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AppealS Nos. 101 , 102 and 103 of 1951.
Civil Appeal No. 101 of 1951 was an appeal from the Judgment and decree dated the 13th March, 1946, of the Chief Court of Avadh at Lucknow in First Civil Appeal No. 132 of 1943 arising out of the Judgment dated the 25th September, 1943, of the Court of Special Judge, 1st Grade, Sitapur in E. E. Act Suit No. 27/1 of 1938.
Civil Appeals Nos. 102 and 103 of 1951 were appeals from the Judgment and Decree dated the 13th March, 1946, of the Chief Court of Avadh at Lucknow in Execution of Decree Appeals Nos. 103 of 1944 and 23 of 1945 arising out of the Judgment dated the 16th November, 1944, of the Court of Additional Civil Judge, Lucknow, in Miscellaneous Case No. 70 of 1944.
B. I. Bishan Singh for the appellant.
M. C. Setalvad (Nazimuddin Siddique, with him) for the respondent.
January 21.
The Judgment of the Court was delivered by MAHAJAN J, 561 MAHAJAN J.
Shortly stated, the factS giving rise to these three appeals are these On the 4th July, 1933, Rai Bahadtir Lala Hari Kishen Das obtained from the court of The civil judge, Sitapur, a final compromise decree in the sum Of Rs. 3,88,300 2 6 with pendente lite and future interests ' and costs, on the foot of two simple mortgages executed in his favour in 1928 and 1931 by Thakur Raghuraj Singh.
The Judgment of the Court was delivered by MAHAJAN J.
561 MAHAJAN J. Shortly stated, the factS giving rise to these three appeals are these On the 4th July, 1933, Rai Bahadtir Lala Hari Kishen Das obtained from the court of The civil judge, Sitapur, a final compromise decree in the sum Of Rs. 3,88,300 2 6 with pendente lite and future interests ' and costs, on the foot of two simple mortgages executed in his favour in 1928 and 1931 by Thakur Raghuraj Singh.
It was provided in the compromise that Raghtiraj Singh mould within a week sell to Hari Kishen Das at agreed prices some villages out of the mortgaged property selected by him and sufficient to satisfy the decree.
He reserved to himself the right to get back the sold villages after five years and before the expiry of fifteen years on payment of the stipulated prices.
The computation of the price of the sold lands was to be made in the manner laid down in clause (6).
Hari Kishen Das made a selection of eight villages, and deeds of sale and relinquishment in respect of them were duly prepared and executed on 4th July, 1933 Before they could be presented for registration, the parties received information that a notification for assumption by the Court of Wards of the management of the talukdar 's estate had been issued and that it was likely to render the conveyances ineffectual.
In view of the impending notification the sale transaction felt through and a refund was obtained of the amount spent on the stamp papers, On the 20th January, 1934, the Court of Wards decided that it would not take the estate under its supervision.
Hari Kishen Das then revived his demand against the judgment debtor for the completion of the sale deeds but the judgment debtor did not pay any heed to his request with the result that on 26th May, 1934, he made an application for execution of the compromise decree.
To the execution of this decree a number of objections were raised by Raghuraj Singh.
Before the disposal of these objections the U.P. Agriculturists ' Relief Act (XXVII of 1934) and the U.P.
Encumbered Estates Act (XXV 562 of 1934) came into operation.
Under the provisions of Act XXVII of 1934, the judgment debtor became entitled to the amendment, of the decree by reduction of interest, and for payment of the decretal sum in instalments.
Under the other Act, a landlord debtor whose property was encumbered could apply to the court for the administration of his estate for liquidation of his debts.
Raghuraj Singh was not slow in seeking the aid of these laws to reduce the amount of his indebtedess and to save his property.
He made applications under both the Acts.
In the application under the Relief Act he prayed for the scaring down of the amount of the decree and for instalments.
In the application under section 4 of the Encumbered Estates Act he asked for liquidation ,of his debts by the civil judge.
On the 11th January, 1936, the civil judge of Sitapur altered the decretal amount of Rs. 3,88,300 2 6 to Rs. 3,76,790 4 3 exclusive of costs and future interest and directed Raghuraj Singh to pay the money in twelve equal annual instalments payable in the month of December of each year, the first instalment being payable in December, 1936, and also provided that in the case of default in payment of three instalments, the whole amount then due would become immediately payable.
Against this order, Hari Kishen Das filed an application in revision to the Chief Court and was successful in having the amended decree set aside on 15th February, 1938.
In the proceedings commenced under the Encumbered Estates Act on 29th October, 1936, Raghuraj Singh obtained an order under section 6 of the Act but this order was eventually quashed by the Board of Revenue on 13th August, 1938, and the debtor 's application under section 4 was dismissed.
Having succeeded in his application in revision in the Chief Court, Hari Kishen Das revived the proceedings in execution of the compromise decree and called upon Raghuraj Singh to execute a sale deed in respect of the selected villages in his favour.
On his failure to comply with this demand, the court 563 executed a deed of sale in his favour on 24th February, 1939, and in due course delivered to him possession of the property covered by the deed.
Thakur Raghuraj Singh died in the year 1941, leaving him surviving the present appellant as his successor in interest.
An appeal had been taken by him against the decision of the Chief Court dated 15th February, 1938, setting aside the amended decree to His Majesty in Council.
By an order of His Majesty in Council passed on 20th January, 1944, the decision of the Chief Court dated 15th February, 1938, was reversed and the amended decree passed by the Civil Judge of Sitapur on 11th January, 1936, was restored.
Liberty was given to the appellant to apply to the court of the civil judge, Sitapur, for such relief as he might be entitled to with reference to the recovery of possession of the property.
In view of the decision of the Privy Council, Bhagwant Singh (appellant) made an application for restoration of possession and for recovery of profit:,, wrongfully realized by Hari Kishen Das and after his death by his adopted son Sri Kishen Das.
This application was strenuously resisted by the creditor and it was pleaded by him that even under the amended decree a sum of Rs. 4,31,148 9 9 including interest and costs had become due to the decreeholder on the date of the sale since three instalments which had till then fallen due had remained unpaid and the default clause had come into operation and the sale in execution could not be set aside, as it has not caused any injury to the judgment debtor and had not in any way caused loss to him in the absence of proof that he had the money to pay the instalments.
The subordinate judge allowed the application for restitution conditional on Bhagwant Singh paying within two months the accumulated sum that had fallen due to the decreeholder under the unpaid instalments up to the date of the order.
He held that the arrears up to December, 1943, came to Rs. 3,58,914 8 9, and deducting from this amount the net profits 73 564 realized during the period of his possession amounting to Rs. 73,294 8 5 and the costs of appeal allowed by the Privy Council, a. sum of Rs. 2,85,620 074 was due and directed that if this amount was not deposited in court within two months, the application would stand dismissed.
Bhagwant Singh applied for extension of time but this application was summarily dismissed.
Rai Sabib Sri Kishen Das and Bhagwant Singh both appealed to the Chief Court against this decision.
The appeal of Sri Kishen Das was numbered as 103 of 1944.
His contention was that the judgment debtor was not entitled to restitution at all.
The appeal of Bhagwant Singh was numbered as 23 of 1945.
His grievance was that he wag entitled to restitution without any condition.
The Chief Court allowed the decreeholder 's appeal (103 of 1944) with costs and dismissed the judgment debtor 's appeal (23 of 1945) but without costs, and dismissed the application of the judgment debtor for restitution on the 13th March, 1946.
Appeals 102 and 103 of 1951 arise out of this decision.
Appeal No. 101 of 1951 arises out of another decision of the Chief Court dated 13 th March, 1946, which confirmed the decree dated 26th September, 1943, of the special judge of Sitapur under the Encumbered Estates Act.
The facts about this matter are these : As already stated, on 28th October, 1936, Thakur Ragburaj Singh applied under section 4 of the U.P.
Encumbered Estates Act (XXV of 1934) for administration of his estate so as to liquidate his debts amounting to about 14 lakhs.
on 13th August, 1938, the Board of Revenue quashed the proceedings under the Encumbered Estates Act initiated by Thakur Raghuraj Singh.
As no order for stay of execution proceedings was obtained by Raghuraj Singh from the Chief Court or the Privy Council, the civil judge to whom the exe cution proceedings had been transferred, on 13th 565 February, 1939, ordered the judgment debtor to execute a sale deed and on his making a default the civil judge on 24th February, 1939, executed a sale deed on behalf of the judgment debtor in, favour of Rai Bahadur Hari Kishen Das.
The U.P.
Encumbered Estates Amendment Act (XI of 1939) came into operation after this sale.
It allowed the applicants to amend their applications, proceedings in respect of which had been quashed previously.
On the 10th October, 1939, Raghuraj Singh applied for amendment of his application.
This application was allowed by the sub divisional officer who passed an order under section 6 of the U.P.
Encumbered Estates Act on 18th October, 1939, and forwarded the amended application to the special judge, first grade, Sitapur.
On 31st July, 1940, the special judge passed an order to the effect that the proceedings would start afresh.
Raghuraj Singh went up in revision to the Chief Court against this order contending that the proceedings should not be deemed as fresh proceedings.
The Chief Court dismissed the revision on 9th December, 1940.
On a notification issued under section 11 of the Encumbered Estates Act, Hari Kishen Das filed objection on 14th August, 1942, under section 11 claiming that the villages sold to him were his property and were not liable to be attached and sold for the debts of Raghuraj Singh.
This objection was contested by the debtor.
The special judge by his decree dated 25th September, 1943, declared Rai Bahadur Hari Kishen Das to be the proprietor of all the eight villages included in the sale deed of 24th February, 1939.
Against the decree of the special judge an appeal was filed in the Chief Court which confirmed that decree on 13th March, 1946.
Appeal No. 101 of 1951 now before us is directed against that decree.
This appeal can be shortly disposed of.
The proceedings under the Encumbered Estates Act having been quashed by the Board of Revenue in August, 1938, the sale held in February, 1939, was unaffected by the bar imposed by section 7 of the Act.
In 566 view of the decision of the Chief Court dated 9th December, 1940, the appellant could not be allowed to agitate the point that the proceedings should have been deemed to be pending in February,.1939, because of the provisions of the amending Act.
This point was stressed before us by the learned counsel for the appellant and he contended that the provisions of the amending Act XI of 1939 should have been given retrospective operation and the date of his original application should have been treated as the date of the start of the proceedings under the Encumbered Estates Act.
This contention, in our opinion, was rightly negatived in the courts below, and it was rightly held that the order made under section 6 on 18th October, 1939, was made on a fresh application under section 4.
of the U.P.
Encumbered Estates Act preferred on 10th October, 1939, and this could not affect the validity of the sale deed executed at a time when no application under section 4 was pending.
It was argued in the courts below that the sale deed was a nullity because it was executed while execution proceedings were pending before the collector under schedule III of the Code of Civil Procedure.
The point was not argued before us in this appeal.
This appeal therefore fails and is dismissed with costs.
As regards appeals Nos. 102 and 103, the main point for decision is whether in the circumstances of this case the appellant was entitled to restitution by way of restoration of possession and grant of mesne profits after the reversal of the compromise decree by the Privy Council and the restoration of the amended decree as passed by the civil judge under the Relief Act.
Having regard to the provisions of section 144 of the Code of Civil Procedure, the Chief Court was of the opinion that the sale in 1939 was inevitable and could not have been avoided if the amended decree had been then in force and that if it was set aside it would confer on the appellant an advantage to which his predecessor was not entitled, he having defaulted 567 in the payment of three instalments before the sale took place.
The following passage from the judgment of the Chief Court expresses the view that it took on this point : "For purposes of section 144 we have in the words of the section 'to place, the parties in the position which they would have occupied but for such decree or such part thereof as has been varied or reversed. ' So placing them the issue which falls for determination is whether the judgment debtor would have paid the accumulated amount of three instalments namely Rs. 1,37,839 1 11 in December, 1939.
On the evidence the lower court has come to the conclusion with which we agree that Thakur Raghuraj Singh owed no less than rupees fourteen lakhs to other creditors, and computing the value of the entire landed property at the rate specified in the compromise of 1133, it was only rupees nine lakhs.
Lal Bhagwant Singh produced no evidence to establish that his father was otherwise in a position to pay the amount of three instalments in December, 1938.
We may mention that no objection has been taken at the bar to the estimate of indebtedness or to the evaluation of the estate.
Taking them, therefore, to be correct it is impossible to believe that the judgment debtor could have prevented the sale on 24th February, 1939, if the parties were then governed by the decree of 1936.
The result which followed was inevitable and cannot be attributed solely to the erroneous order passed by this court in February, 1938.
" In our opinion, no exception can be taken to the judgment of the Chief Court in the facts and circumstances of this case and both these appeals would therefore have to be dismissed.
On account of the order of His Majesty in Council the amended decree passed by the civil judge, Sitapur, on 11th January, 1936, must be deemed to have been subsisting all along.
All the terms of the compromise were embodied in the amended decree and there was no difference in the two decrees except for the reduction of 568 the sum due from Rs. 3,88,300 2 6 to Rs. 3,76,790 4 3 and the reduction of pendente lite and future interest and for provision for instalments.
The compromise decree with the necessary adaptations and amendments became the amended decree and was enforceable as such.
It gave the judgment debtor, an opportunity to satisfy the decree by instalments if he committed no default and to save the property from being sold in satisfaction of it but in case the whole amount of the decree became due according to its terms or if any portion of it remained unpaid, it yet had to be satisfied in the same manner as the original compromise decree.
During the pendency of the decreeholder 's, appeal before the Chief Court the judgment debtor did not obtain any order staying the operation of the amended decree.
He was thus bound to carry out the terms of that decree but he failed to pay any of the instalments that fell due in 1936 or 1937.
The third instalment, it is true, fell due in December, 1938, after the amended decree had been set aside by the Chief Court but the judgment debtor had appealed for its restoration to the Privy Council.
He should therefore have taken steps to protect himself against being in default with payment of three instalments.
In order therefore to avoid the default which he would otherwise commit by nonpayment of the third instalment it was obligatory on him to pay or offer to pay to the decree holder an amount equal to the amount of one instalment so that three instalments will not be in arrears, or to obtain an order from the Privy Council absolving him from complying with the terms of the amended decree set aside by the Chief Court, even if it was eventually restored.
Failing that, he should have obtained a fresh order from the Privy Council fixing the instalments and time for the payment.
He, however, did nothing and adopted the attitude that he need make no payment and considered himself absolved from satisfying either the original decree or the amended decree.
The result of this attitude was that the whole of the decretal amount became due on his 569 failure to pay the third instalment provided for under the amended decree in December, 1938, and he thus lost the benefit of paying the decretal amount by instalments.
The amount due from him in February, 1939 under the decree was the same sum for which the property was sold in execution of the original decree.
In this situation it cannot be said that there was any alteration in the position of the parties by thePrivy Council setting aside the compromise decree and restoring the decree passed by the civil judge, Sitapur, in 1936.
The position would have been the same if that decree was a subsisting one and was in execution.
If the judgment debtor could have shown that he was in a position to pay the aggregate amount of the instalments in December, 1938, or at least one instalment so that he could not be said to have defaulted in the payment of three instalments, then the sale made in February, 1939, could not possibly be regarded as one under the amended decree but could only have been made in consequence of the original compromise decree, and that compromise decree having been superseded and the amended decree having been restored, the sale held under the reversed decree would surely have to be set a side.
On the other hand, if the sale could not have been avoided even if the amended decree which was eventually restored had been in operation at the time of the sale by reason of default of payment of three instalments and the sale was also a necessary consequence under the decree of the civil judge and was inevitable, then it cannot be said that the sale held in February, 1939, was the result and consequence of the reversed decree.
It is true that it is one of the first and the highest duty of a court to take care that its acts do not injure any of the suitors and if any injury was caused to the judgmentdebtor by the sale held in February, 1931, it was our duty to undo the wrong caused to him.
It, however, cannot be said that in this case any wrong has been done to the judgment debtor which we are called upon to redress.
It is not possible to hold that he 570 was under no obligation to satisfy either one or the other of the two decrees, and that he was absolved from satisfying the instalment decree because it had been set aside by the Chief Court and he was also absolved from satisfying the original decree because it was later on set aside by the Privy Council.
Having himself appealed to the Privy Council for the restoration of the instalment decree, it was obligatory on him to carry out the terms of that decree if he wanted to take advantage of its provisions.
Having defaulted in this, he must take its consequences, which are now different from the consequences of the original decree.
Indeed, if in this case the prayer of the judgment debtor for restitution was granted, it would result in doing not only an injustice but a wrong to the decreeholder and the court would not be acting fairly and rightly towards him.
As already said, in February 1939 both under the original decree and the amended decree a sum of over rupees four lakhs became due to him and he was entitled to got a sale of the villages selected by him in his favour towards satisfaction of this decretal debt.
If this sale is set aside and possession of eight villages is restored to the judgment debtor and mesne profits are decreed in his favour, the decreeholder would be deprived of the fruits of his decree which is certainly not the purpose of restitution in law or equity; it would place the judgment debtor in a position of advantage to which he is not entitled.
The executing court decreed restoration of possession of the eight villages in favour of the appellant conditional on his paying the amount due to the decreeholder under the amended decree till the date of that order.
This obviously favourable order passed in his favour by the trial judge was not availed of by the judgment debtor as he has no means whatsoever to make any payment.
An order of restitution in the manner asked for in the circumstances of this case would be contrary to the principles of the doctrine of restitution which is that on the reversal of a judgment the law raises an obligation on the party to the record who received the 571 benefit of the erroneous judgment to make restitution to the other party for what he had lost and that it is the duty of the court to enforce that obligation unless it is shown that restitution would be clearly contrary to the real justice of the case.
The decreeholder in the present case has derived no advantage* to which he was not entitled and the judgment debtor has lost nothing.
In either event he had to discharge and satisfy the decretal debt due from him whether under the first decree or under the second and that debt could only be discharged by sale of the villages selected by the decreeholder.
In the words of Rankin C. J. in Dayal.
Sardar vs Tari Deshi(1), the judgmentdebtor is not entitled to recover the properties except upon showing that the sale was in substance and truth a consequence of the error in the reversed decree.
The sale being inevitable under the amended decree the 'judgment debtor was clearly not entitled to restitution.
It was held in, Gansu Ram vs Parvati Kuer (2), that where a judgment debtor could not have paid even the reduced decretal amount and the sum realized at the sale was less than the decretal amount the situation could not have been altered in any way had the decree been modified before, instead of after the sale, and the judgment debtor could not invoke the provisions of section 144, except by showing that the sale was in substance and truth a consequence of the error in the original decree.
, The observations made in this case have apposite application to the facts and circumstances of this case.
For the reasons given above we are of the opinion that there is no merit in either of these appeals and we dismiss both of them with costs.
Appeals dismissed.
(1)(1932) I.L.R. , (2) A.I.R. 1941 Pat.
| Under a compromise decree the amount due to the plaintiff was fixed by mutual consent and it was further agreed that the defendant should within one week of the date of the decree convey to the plaintiff immoveable properties sufficient to satisfy the decree.
The U. P. Agriculturists Relief Act of 1934 having come into force, the decree was subsequently amended by the Civil Judge by reducing the amount and directing that the amount may be paid in 12 annual instalments with the condition that if three instalments were in default the whole amount was to become immediately payable.
The amended decree was set aside by the Chief Court in 1938.
The decree holder applied for execution, and a sale deed was executed by the Civil Judge in 1939 for the entire decree amount.
The Privy Council reversed the decree of the Chief Court and restored the amended decree of the Civil Judge in 1944.
The judgment debtor applied for restoration of the properties with mesne profits by way of restitution: Held, confirming the decree of the Chief Court, that, as the judgment debtor bad not obtained any order staying the operation of the amended decree pending the dereeholder 's appeal to the Chief Court he was bound to carry out the terms of the amended decree, and, as the Privy Council had merely restored the amended decree without altering the provisions as to payment by instalments or extending the time for payment by instalments and its decree did not in any way alter the position of the parties as it stood under the amended decree, and, the sale was not in consequence of any error in a decree which was reversed on appeal by the Privy Council, the judgment debtor was not entitled to restitution.
Dayal Sardar vs Tari Deshi (I.L.R. and Gansu Ram vs Parvati Kuer (A.I.R. 1941 Pat. 130) approved.
560 The judgment debtor in the above mentioned case applied tinder section 4 of the U. P.
Encumbered Estates 'Act, 1934, for administration of his estate in 1936 but the proceedings were quashed by the Board of Revenue in 1938.
As no order for stay of execution was obtained, a sale was effected in execution of the decree in February, 1939.
The U. P. Encumbered Estates (Amendment) Act, 1939, came into force after the date of the sale and the judgment debtor applied on the 10th October, 1939, foe amending his former application, but it was ultimately decided by the Chief Court that the amendment application of 1939 must be treated as fresh proceedings: Held, confirming the decision of the Chief Court, that as the proceedings which were started in 1936 were quashed by the Board of Revenue in 1938, the sale held in February, 1939, was unaffected by the bar imposed by section 11 of the Act.
The order made on the application of the 10th October was an order on a fresh application under section 4 and it had no retrospective effect and could not affect the validity of the sale effected when no application under section 4 was pending.
|
iminal Appeals Nos. 89 and 90 of.
Appeals by Special Leave from the Judgment and Order dated the 23rd November 1953 of the High Court of Judicature 'at Bombay in Criminal Appeal No. 1213 of 1953, and from the Judgment and Order dated the 25th August 1953 of the High Court of Judicature at Bombay in Criminal Appeal No. 1121 of 1953 arising out of the judgment and decree dated the 6th August 1953 of the Court of Sessions Case No. 36 of 1952.
section Narayanaiah and Dr. C. V.L. Narayan, for the appellant in Criminal Appeal No. 89 of 1954.
C. Sanjeevarow Nayadu and R. Ganapathy Ayyar, for the appellant in Criminal Appeal No. 90 of 1954.
M.C. Setalvad, Attorney General of India (G. N. Joshi and Porus A. Mehta, with him) for the respondent.
151 1180 1954.
December 22.
The Judgment of the Court was delivered by BOSE, J.
These two appeals arise out of the same trial.
The two appellants, Shreekantiah (the first accused in the trial Court and the appellant in Appeal No. 89 of 1954) and Parasuram (the second accused and the appellant in Appeal No. 90 of 1954) were tried with a third accused Dawson on a number of different charges centering round section 409 of the Indian Penal Code: criminal breach of trust by a public servant.
The trial was by jury and all three were found guilty of an offence under section 409 read with section 34.
They were convicted and sentenced as under: Accused No. 1.
Shreekantiah to one year and a fine of Rs. 500 with four months in default; Accused No. 2.
Parasuram to two years and a fine of Rs. 500 with six months in default; and Accused No. 3.
Dawson to six months and a fine of Rs. 200 with two months in default.
The appeal of the second accused to the High Court was dismissed summarily on 25 8 1953 with the one word "dismissed".
The first and third accused appealed separately.
Their appeal was heard by another Bench and was admitted, and a reasoned judgment followed on 23 11 1953.
This, to.
say the least, was, in the circumstances of this case, anomalous.
The ap.peals arise out of the same trial and are from one judgment and relate to the same charge to the jury, and what is more they raise substantially the same points.
This Court was constrained to express its disapproval of the summary rejections of appeals which raise issues of substance and importance.
We draw attention to the remarks in Mushtak Hussein vs The State of Bombay(1).
Those observations apply with even greater force in the present case.
The three accused are Government servants.
At all material times, the first was the Officer Commanding, the Military Engineering Stores Depot at Dehu Road near Poona.
He was in over all charge.
The (1) ; , 820. 1181 second was under him as the officer in charge of the Receipts and Issue control section.
The third worked directly under the second as the Assistant Stores Officer.
The depot is maintained by the Central Government and covers an area of some 150 acres.
Government stores worth several lacs of rupees are kept there.
On 11 9 1948 iron stores worth about Rs. 4,000 were illegally passed out of the depot and were handed over to one Ibrahim Fida Hussain, an agent of the approver Mohsinbhai (P.W. 1).
The case for the prosecution is that the three accused, who were in charge of these stores and to whom they had been entrusted in various capacities, entered into a conspiracy to defraud Government of these properties and that in pursuance of this conspiracy they arranged to sell them to the approver (P.W. 1) for a sum of Rs. 4,000.
The money is said to have been paid and then the stores were passed out of the depot.
The money is said to have been pocketed by the three accused and not credited to Government.
On these facts a number of charges were framed.
The first set was drawn up on 9 7 1953.
All three accused were jointly charged with an offence punishable under section 5(2) of the Prevention of Corruption Act, 1947 and all three were further jointly charged with having committed criminal breach of trust in furtherance of the common intention of all under section 409 of the Indian Penal Code read with section 34.
Then followed a number of alternative charges in which each was separately charged with having committed criminal breach of trust personally under section 409.
As a further alternative.
, all three were jointly charged under section 409, Indian Penal Code read with section 109 for having abetted each other in the commission of a criminal breach of trust under section 409.
Objection was at once taken to these charges and the one which concerns us now was couched in the following terms; 1182 "It is further submitted that the trial under section 5(2), Corruption Act, 1947 with Indian Penal Code section 409 is likely to embarrass the accused in their defence as it would be difficult to efface the evidence (if any) of the accused persons given on oath from the minds of the Jurors when considering the charge under section 409, Indian Penal Code.
It is therefore prayed that the charges under sec409, Indian Penal Code and section 5(2) of the Corruption Act may not be tried together in one trial".
The Assistant Public Prosecutor said he had no objection to separating the charges and leaving the one under section 5(2) for another trial.
The Court then made the following order on 10 7 1953: "Thus, though a joint trial for offence under section 5(2) of the Prevention of Corruption Act and the offences under the Indian Penal Code is legal and valid,, I think, in view of the circumstances mentioned above, it would be in the interest of justice and also in the interests of the accused themselves if the trial for the offence under section 5(2) of the Prevention of Corruption Act is separated.
I therefore grant the application to this extent and order that the charge should be amended accordingly".
In view of this the charges were re framed on 11 7 1953.
The only difference of substance is that the charge under section 5(2) was dropped.
The others remained.
Now it will be observed that the accused are all public servants and they contend that as, according to the prosecution, they purported to act in the discharge of their official duties, sanction was necessary under section 197 of the Criminal Procedure Code.
There is sanction so far as the first accused is concerned but the second accused contends that there is none in his case to justify the present trial, so his trial,, conviction and sentence are bad.
The position about this is as follows: On 27 10 1949 the Governor General, acting under section 197 of the Code of Criminal Procedure, sanctioned the prosecution of the first accused for offences tinder sections 1183 120 B, 409, 109 and so forth, for having conspired with the other two to commit criminal breach of trust in respect of the properties with which this case is concerned and thus for having abetted the commission of that offence, and also for having committed it.
Similar sanction could easily have been given against the other two accused but it was not.
The sanction for these offences was limited to the first accused.
On the same date sanction was also given for the prosecution of the first accused under section 5(2) of the Prevention of Corruption Act and a similar sanction was given against the second accused.
The question is whether this sanction against the second accused can be extended to cover his prosecution under section 409 of the Indian Penal Code.
In our opinion, it cannot.
At the date of the sanction the unamended Prevention of Corruption Act (II of 1947) was in force.
Criminal breach of trust under section 409 of the Indian Penal Code was included in the definition of "criminal misconduct" under section 5(1)(c) of the Act of 1947.
Therefore, an offence under section 409 could be tried under the Act of 1947 and the question arose whether it would have to be tried under that Act, or whether it could also be tried in the ordinary way by the ordinary Courts.
The Punjab High Court held in The State vs Gurucharan Sinah(1) that it could not.
Because of this the Act of 1947 was amended in 1952 by Act LIX of 1952 and section 4 of the amending Act makes it clear that the trial can be under either law.
But in the same year the Criminal Law Amendment Act, 1952 (Act XLVI of 1952) was passed and because of this Act trials under section 5(2) of the Prevention of Corruption Act must be before a Special Court and a special procedure must be followed.
Therefore, the position which these various Acts created was this.
First, a choice was conferred on some authority to choose whether any given accused should be tried in a special Court with a special procedure and be subject to a lesser punishment under section 5(2) or whether he should be tried in the ordi (1) A.I.R. 1952 Punjab 89, 1184 nary way under section 409 of the Indian Penal Code with the risk of a higher punishment.
The question then is who is to do the choosing.
Under section 197 of the Code of Criminal Procedure the Governor General was at that date the sanctioning authority though the words "exercising his individual judgment" had by that time been deleted.
Under the Prevention of Corruption Act the sanctioning authority was the "Central Government".
Now it may well be that the two mean the same thing because of section 8(a) of the General Clauses Act but that makes no difference at the moment.
The fact remains that either one, or two, Government authorities were given the right, and invested with the duty, of making an election.
They had the right to say whether a certain class of public servant who had committed criminal breach of trust should be tried for that offence under section 409 of the Indian Penal Code in the ordinary courts of the land according to the normal procedure obtaining there and be subject to a maximum penalty of ten years plus an unlimited fine or be tried for the same offence under another name in a special court by a special procedure and be subject to no more than seven years plus a fine which is also unlimited.
At this stage of the arguments we asked the learned counsel for the appellants whether they intended to challenge the vires of this law under article 14 of the Constitution because, if they did, the matter would have to go to a Constitution Bench as we, being only three Judges, would have no power to decide it.
The learned Attorney General at once objected because the point had not been raised at any stage and was not to be found even in the grounds of appeal to this Court.
The learned counsel for the appellants replied that they did not wish to take the point.
Accordingly, we have to proceed in this case on the assumption that the amending Act of 1952 (Act LIX of 1952) is valid.
That results in the position we have outlined above.
There is a choice, not only of forum, but also of procedure and the extent of the maximum penalty.
If two separate authorities are given the right to 1185 choose and neither can encroach upon the preserve of the other, then the Governor General has not sanctioned the present prosecution against the second accused and no other authority has the power to do so.
Therefore, in that event, the sanction given to prosecute under section 5(2) cannot be used to cover the present trial because it is given by another authority not competent to give it.
On the other hand , if the two authorities are really one, then the election has been made clearly and unequivocally.
The sanction is to proceed in the special courts with the special procedure and the second accused is not to be exposed to the risk of the higher penalty.
In that event, the present trial against the second accused is incompetent.
That a defect of this kind is fatal and cannot be cured is well settled.
See the Privy Council in Gokulchand Dwarkadas vs The King(1), the observations of Varadachariar, J. in Hori Ram Singh vs The Crown(1) and the decision of this Court in Madan Mohan vs The State of Uttar Pradesh(1).
But the learned Attorney General argued that no sanction was necessary because, according to him, despite what the second accused says, by no stretch of imagination can he be said to have been acting, or even purporting to act, in the discharge of his official duty.
The argument ran as follows: The act complained of here is the breach of trust and the prior abetment of it: the breach occurred as soon as the goods were loaded on Mohsinbhai 's lorries: it was no part of this accused 's official duties to permit an unauthorised removal of the goods: therefore.
, when he allowed that he neither acted.
nor purported to act, in the discharge of his official duties.
Reference was made to the decision of the Federal Court in Lieutenant Hector Thomas Huntley vs The King Emperor(1) where Zafrullah Khan, J. held that "it must be established that the act complained of was an official act", and to the observations of Varadachariar, J. in Hori Ram Singh vs The Crown(1) (1) A.I.R. 1948 P.C. 82.
(3) A.I.R. 1954 S.C. 637, 641.
(2) , 184.
(4) , 269.
(5) , 186.
1186 where, dealing with section 409 of the Indian Penal Code, he says "Though a reference to the capacity of the accused as a public servant is involved both in the charge under section 409 and in the charge under section 477 A, there is an important difference between the two cases, when one comes to deal with the act complained of.
In the first, the official capacity is material only in connection with the 'entrustment ' and does not necessarily enter into the later act of misappropriation or conversion, which is the act com plained of".
What this argument overlooks is that the stress in the passage quoted is on the word "necessarily" which we have underlined.
A later passage at page 187 explains this: "I would observe at the outset that the question is substantially one of fact, to be determined with reference to the act complained of and the attendant circumstances; it seems neither useful nor desirable to paraphrase the language of the section in attempting to lay down hard and fast tests".
With that we respectfully agree.
There are cases and cases and each must be decided on its own facts.
Now it is obvious that if section 197 of the Code of Criminal Procedure is construed too narrowly it can never be applied, for of course it is no part of an official 's duty to commit an offence and never can be.
But it is not the duty we have to examine so much as the act, because an official act can be performed in the discharge of official duty as well as in dereliction of it.
The section has content and its language must be given meaning.
What it says is " when any public servant. . is accused of any offence alleged to have been committed by him while acting or purporting to act in the discharge of his official duty.
We have therefore first to concentrate on the word "offence".
Now an offence seldom consists of a single act.
It is usually composed of several elements and, as a rule, a whole series of acts must be proved before it can be 1187 established.
In the present case, the elements alleged against the second accused are, first, that there was an "entrustment" and/or "dominion"; second, that the entrustment and/or dominion was "in his capacity as a public servant"; third, that there was a "disposal"; and fourth, that the disposal was "dishonest".
Now it is evident that the entrustment and/ or dominion here were in an official capacity, and it is equally evident that there could in this case be no disposal, lawful or otherwise, save by an act done or purporting to be done in an official capacity.
Therefore, the act complained of, namely the disposal, could not have been done in any other way.
If it was innocent, it was an official act; if dishonest, it was the dishonest doing of an official act, but in either event the act was official because the second accused could not dispose of the goods save by the doing of an official act, namely officially permitting their disposal; and that he did.
He actually permitted their release and purported to do it in an official capacity, and apart from the fact that he did not pretend to act privately, there was no other way in which he could have done it.
Therefore, whatever the intention or motive behind the act may have been, the physical part of it remained unaltered, so if it was official in the one case it was equally official in the other, and the only difference would lie in the intention with which it was done: in the one event, it would be done in the discharge of an official duty and in the other, in the purported discharge of it.
The act of abetment alleged against him stands on the same footing, for his part in the abetment was to permit the disposal of the goods by the doing of an official act and thus "wilfully suffer" another person to use them dishonestly: section 405 of the Indian Penal Code.
In both cases, the 'offence" in his case would be incomplete without proving the official act.
We therefore hold that section 197 of the Code of Criminal Procedure applies and that sanction was necessary, and as there was none the trial is vitiated from the start.
We therefore quash the proceedings 152 1188 against the second accused as also his conviction and sentence.
We now turn to the appeal of the first accused.
He has been convicted under section 409 of the Indian Penal Code read with section 34.
The main point here concerns a vital misdirection in the charge to the jury about section 34.
The learned Additional Sessions Judge misunderstood the scope and content of this section and so misdirected the jury about the law.
The section was expounded at length in paragraphs 15 and 16 of the charge and though some of the illustrations given are on the right lines, there is much there that is wrong and which, if acted on, would cause a miscarriage of justice.
The essence of the misdirection consists in his direction to the jury that even though a person "may not be present when the offence is actually committed" and even if he remains "behind the screen" he can be convicted under section 34 provided it is proved that the offence was committed in furtherance of the common intention.
This is wrong, for it is the essence of the section that the person must be physically present at the actual commission of the crime.
He need not be present in the actual room; he can, for instance, stand guard by a gate outside ready to warn his companions about any approach of danger or wait in a car on a nearby road ready to facilitate their escape, but he must be physically present at the scene of the occurrence and must actually participate in the commission of the offence in some way or other at the time the crime is actually being committed.
The antithesis is between the preliminary stages, the agreement, the preparation, the planning, which is covered by section 109, and the stage of commission when the plans are put into effect and carried out.
Section 34 is concerned with the latter.
It is true there must be some sort of preliminary planning which may or may not be at the scene of the crime and which may have taken place long beforehand, but there must be added to it the element of physical presence at the scene of occurrence coupled with actual participation which, of 1189 course, can be of a passive character such as standing by a door, provided that is done with the intention of assisting in furtherance of the common intention of them all and there is a readiness to play his part in the pre arranged plan when the time comes for him to act.
The emphasis in section 34 is on the word "done": "When a criminal act is done by several persons. .
It is essential that they join in the actual doing of the act and not merely in planning its perpetration.
The section has been elaborately explained by Lord Sumner in Barendra Kumar Ghosh vs The King Emperor(1).
At page 52, he explains that "participation in action" is the leading feature of section 34.
And at page 53 in explaining section 114 of the Indian Penal Code, he says "Because participation de facto (as this case shows) may sometimes be obscure in detail, it is established by the presumption juris et de jure that actual presence plus prior abetment can mean nothing else, but participation.
The presumption raised by section 114 brings the case within the ambit of section 34".
At page 55 he says about section 34 that "participation and joint action in the actual commission of crime are, in substance, matters which stand in antithesis to abetments or attempts".
The misdirection is plain and it goes to the root of the matter because the jury returned a verdict of guilty under section 409 of the Indian Penal Code read with section 34 alone and not under section 409 read with section 109.
It is part of the defence of the first accused that he was not present when the goods were loaded nor was be present when they were allowed to pass out of the gates, that is to say, that he was not present when the offence was committed.
It is true there is evidence to show that he was there when the lorries left but apart from the fact that there is a small discrepancy on the point, there is nothing to indicate that this evidence was believed.
If he was not present he (1) [1924) L.R. 52 I.A. 40.
1190 cannot be convicted with the aid of section 34.
He could have been convicted of the abetment had the jury returned a verdict to that effect because there is evidence of abetment and the charge about abetment is right in law.
But the jury ignored the abetment part of the charge and we have no means of knowing whether they believed this part of the evidence or not.
There is also non direction on an important point which may have caused a miscarriage of justice.
The case for the prosecution is that the accused disposed of the goods to Mohsinbhai for a sum of Rs. 4,000 which was duly paid to the second accused on the 10th.
The learned trial Judge told the jury that "the evidence led by the prosecution about the payment of the Rs. 4,000 is proved to be utterly useless", and in telling them why he gave them a number of reasons.
But he omitted to follow this up by telling them that if they rejected this part of the prosecution case, as he invited them to do, then the strongest part of the case against the accused collapsed because officers.
in the position of the accused do not commit illegal acts like this and expose themselves to a prosecution and possible disgrace unless they are prompted by some strong motive, usually self interest; and though a conviction can be based on evidence which does not disclose a motive if the facts proved justify such a course, yet it would ordinarily be unsafe to convict in a case like the present in the absence of proof indicating an adequate reason for criminal behavior on the part of the accused.
Had the jury been told this, as they should have been, it is possible they would not have returned a verdict of guilty.
In the circumstances, we have no alternative but to quash this conviction also.
We have now to consider whether there should be a retrial.
As the present trial cannot proceed against the second accused, and as all the accused are said to have acted in concert each playing an appointed part in a common plan, we do not think it would be right 1191 to direct a retrial though this is the normal course when a jury trial is set aside on the grounds of misdirection and non direction.
We therefore discharge (not acquit) both the appellants leaving it to Government either to drop the entire matter or to proceed in such manner as it may be advised.
We do this because the accused expressly asked that the charge under the Prevention of Corruption Act should be left over for a separate trial.
The two convictions are therefore quashed and also the sentences.
We are told that the first accused has already served out his sentence.
The fine if paid, will be refunded.
The bail bond of the second accused will be cancelled.
| The three accused Government servants were jointly charged with an offence punishable under section 5(2) of the Prevention of Corruption Act, 1947 and all three were further jointly charged with having committed breach of trust in furtherance of the common intention of all under section 409 of the Indian Penal Code read with section 34.
Then followed a number of alternative charges in which each was separately charged with having committed criminal breach of trust personally under section 409.
As a further alternative, all three were 1178 jointly charged under section 409 read with section 109 for having abetted each other in the commission of a criminal breach of trust under section 409.
On objection taken to these charges, the trial for the offence under section 5(2) of the Prevention of Corruption Act was separated from the trial under section 409 of the Indian Penal Code.
The charges were reframed.
One under section 5(2) was dropped while others remained.
On 27 10 1949 the Governor General acting under section 197 of the Code of Criminal Procedure sanctioned the prosecution of the first accused (appellant No. 1) for offences under sections 120 B, 409, 109 for having conspired with the other two to commit criminal breach of trust in respect of properties belonging to Government and for having thus abetted the commission of that offence and also for having committed it.
Similar sanction was not given against the other two accused and was limited only to the first accused.
On the same date sanction was given for the prosecution of the first accused under section 5(2) of the Prevention of Corruption Act, 1947 and a similar sanction was given against the second accused.
The question was whether this sanction against the second accused could be extended to cover his prosecution under section 409 and whether his trial was valid.
Held, (answering the question in the negative) that under section 197 of the Code of Criminal Procedure the sanctioning authority was the Governor General.
Under the Prevention of Corruption Act, 1947 the sanctioning authority was the Central Government.
Either one, or two, Government authorities were given the right and invested with the duty of making an election.
If two Government authorities are given the right to choose and neither can encroach upon the preserve of the other, then the Governor General has not sanctioned the present prosecution against the second accused (appellant No. 2) and no other authority has the power to do so.
Therefore the sanction given to prosecute under section 5(2) of Act II of 1947, could not be used to cover the present trial, because it was given by an authority not competent to give it.
If, on the other hand, the two authorities are really one, then the election has been made clearly.
The sanction under section 5(2) of the Prevention of Corruption Act, 1947 as amended by Act LIX of 1952 and Act XLVI of 1952 is to proceed in special courts with a special procedure so the present trial against the second accused was incompetent.
It is well settled that a defect of this nature is fatal and cannot be cured when section 197 applies and, as it did, sanction was necessary so the trial was vitiated from the start.
The proceeding,,; were accordingly quashed.
If section 197 of the Code of Criminal Procedure is construed too narrowly it can never be applied for it is no part of an official 's duty to commit an offence and never can be.
But it is not the duty of an official which has to be examined so much as his act, because an official act can be performed in the discharge of official duty as well as in dereliction of it.
The section has content and its language must be given meaning.
1179 In the case of the first accused there was misdirection in the charge to the Jury under section 34.
The essence of the misdirection consisted in the Sessions Judge 's direction to the jury that even though a person may not be present when the offence is actually committed and even if he remains "behind the screen" he can be convicted under section 34 provided it is proved that the offence was committed in furtherance of the common intention.
This is wrong because the essence of the section is that the person must be physically present at the actual commission of the crime.
The misdirection is plain and goes to the root of the case because the jury returned a verdict of guilty under section 409 read with section 34 alone and not under section 409 read with section 109, I.P.C. Held, that in cases which raise questions of substance and importance the High Courts should not pass summary orders of rejection without giving some indication of their views on the points raised before them.
Mushtak Hussein vs The State of Bombay ([1953] S.C.R. 809), The State vs Gurucharan Singh (A.I.R. [1952] Punjab 89), Gokulchand Dwarkadas vs The King (A.I.R. , Hori Ram Singh vs The Crown ([1939] F.C.R. 159), Madan Mohan vs The State of Uttar Pradesh (A.I.R. , Lieutenant Hector Thomas Huntley vs The King Emperor ([1944] F.C.R. 262), and Barendra Kumar Ghosh vs The King Emperor ([1924] L.R. 52 I A. 40), referred to.
|
Appeals Nos.
109 to 115 of 1952.
Appeals from the Judgment and Decree dated the 9th day of March 1950 of the High Court of Judicature at Calcutta in Appeal from Appellate Decree Nos.
1841 1847 of 1945 arising out of the Decrees dated the 16th day of September 1944 of Munsiff 3rd Court, Burdwan.
P. K. Chatterjee, for the appellant.
section C. Das Gupta, (Sukumar Ghose, with him), for the respondents in Civil Appeals Nos.
109 to 112 of 1952 and respondents 1, 2(a), 3 and 4 in Civil Appeal No. 113 of 1952 and respondents 1 and 3 in Civil Appeals Nos. 114 and 115 of 1952.
December 20.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
The appellant is the Mahant of a religious institution known as Rajgunj Asthal in Burdwan, and the suits out of which the present appeals arise, were instituted by him to recover possession of various plots of land in the occupation of the defendants, or in the alternative, for assessment of fair and equitable rent.
It was alleged in the plaints that the suit lands were comprised in Mouza Nala forming part of the permanently settled estate of Burdwan, and were Mal lands assessed to revenue, and that more than 200 years previously there had been a permanent Mokarrari grant of those lands by the Maharaja of Burdwan to the Rajgunj Asthal; that in the record of rights published during the settlement in 1931 they were erroneously described as rent free, and that on the strength of that entry the defendants were refusing to surrender possession of the lands to the plaintiff.
It was accordingly prayed that a decree might be passed for eject ment of the defendants, or in the alternative, for assessment of a fair and equitable rent.
1170 The defendants contested the suits, and pleaded that the lands were not Mal lands comprised within Mouza Nala, that they did not form part of the zamindari of Burdwan but had been granted as Lakheraj to their predecessors in title long prior to the permanent settlement, that neither the Maharaja of Burdwan nor the plaintiff claiming under him had any title to them, and that the entry in the record of rights in 1931 was correct.
The defendants also pleaded that as they and their predecessors had been in possession of the lands for over 200 years under assertion of an adverse title, the claim of the plaintiff was barred by limitation.
The District Munsif of Burdwan who tried the suits held that the lands were included in Mouza Nala in Thouzi No. 1, which was comprised in the permanently settled estate of Burdwan, that their income was taken into account in fixing the revenue payable by.
the estate., that they had been granted in permanent Mokarrari by the then Maharaja of Burdwan to the Rajgunj Asthal, and that the plea of the defendants that they held them under a Lakheraj grant made prior to the permanent settlement was not true.
He also held that the documents on which the defendants claimed to have dealt with the properties as owners under assertion of an adverse title were not proved to relate to the suit lands, that the relationship subsisting between the parties was one of landlord and tenant, that as there had been no determination of tenancy, no decree in ejectment could be passed but, that the plaintiff was entitled to fair rent, and that the claim was not barred by reason of article 131 of the Limitation Act.
In the result, he granted decrees for rent.
The defendants appealed against this decision to the Court of the District Judge of Burdwan, who agreed with the District Munsif that the suit lands were Mal lands within the zamindari of Burdwan, and that they had been settled on the plaintiff by the Maharaja of Burdwan.
But he held that as the defendants and their predecessors had been in posses sion of the lands for a very long time without 1171 payment of rent, a presumption of a lost grant could be made in their favour.
He accordingly dismissed the suits.
Against this decision, the plaintiff appealed to the High Court, which agreeing with the District Judge on both the points dismissed the appeals, but granted a certificate under article 133(1) (c), as it was of the opinion that the question of lost grant raised an issue of great importance.
The substantial question that arises for our decision is whether on the materials on record the Courts below were right in presuming a lost grant in favour of the defendants.
The grounds on which the District Judge made that presumption are that the defendants, and their predecessors had been in possession of the lands for a long time without payment of rent, that they had been asserting continuously that they were holding under a Lakheraj grant, and that they did so to the knowledge of the plaintiff.
It must be mentioned that in dealing with this question the District Munsif held that the documents put forward by the defendants as containing assertions by them that they held under a Lakheraj grant were not shown to relate to the suit lands.
The District Judge differed from this finding, and observed: ". . . there are some unmistakable names of tanks, etc., by which some of the lands of these documents at least can be connected with the suit lands . .
These documents relating to these holdings cannot, therefore, be discarded as unconnected with the suit lands".
These observations are vague, and do not lead anywhere, and cannot be taken as a finding on the question.
No attempt was made before us on behalf of the respondents to connect any of the documents with the lands held by them.
In the circumstances, the finding of the District Munsif on the point must be accepted.
On the further question whether the plaintiff had knowledge of the assertion of any hostile title by the defendants, the learned District Judge answered it in the affirmative relying on Exhibits A to A 24, 150 1172 which are receipts for realisations of cesses from the defendants.
But the High Court held and its finding has not been attacked before us that there was no proof of the contents of these documents, and that they must therefore be excluded.
The position thus is that there is no proof that the respondents set up any adverse title prior to 1931, much less that the plaintiff bad knowledge of the same.
We are therefore left with a bare finding that the defendants and their predecessors in title had been in possession for a long period without payment of rent; but here again, there is no finding as to the precise length of time during which they held possession.
The question is whether in this situation a presumption of lost grant could be made.
The circumstances and conditions under which a presumption of lost grant could be made are well settled.
When a person was found in possession and enjoyment of land for a considerable period of time under an assertion of title without challenge, Courts in England were inclined to ascribe a legal origin to such possession, and when on the facts a title by prescription could not be sustained, it was held that a presumption could be made that the possession was referable to a grant by the owner entitled to the land, but that such grant had been lost.
It was a presumption made for securing ancient and continued possession, which could not otherwise be reasonably accounted for.
But it was not a presumption juris et de jure, and the Courts were not bound to raise it, if the facts in evidence went against it.
"It cannot be the duty of a Judge to presume a grant of the non existence of which he is convinced" observed Farwell, J. in Attorney General vs Simpson(1).
So also the presumption was not made if there was any legal impediment to the making of it.
Thus, it has been held that it could not be made, if there was no person competent to be the recipient of such a grant, as where the right is claimed by a fluctuating body of persons.
That was held in Raja Braja Sundar Deb vs Moni Behara and others(1).
There will likewise be no scope for this (1) , 698.
(2) ; , 416.
1173 presumption, if there is no person capable of making a grant: (Vide Halsbury 's Laws of England, Vol.
IV, page 574, para 1074); or if the grant would have been illegal and beyond the powers of the grantor.
[Vide Barker vs Richardson(1) and The Rochdale Canal Company vs Radcliffe(1)].
In the light of these principles, it has now to be seen whether on the facts found a lost grant could be presumed in favour of the defendants.
The finding is, as already stated, that they were in possession without payment of rent for a considerable length of time, but it has not been established precisely for how long.
In their written statements they pleaded that they bad been holding under a Lakheraj grant made prior to the permanent settlement, and had been in possession by virtue of that title for over 200 years.
On this plea, the grant to be presumed should have been made 200 years prior to the suit.
There is an obvious difficulty in the way of presuming such a grant on the facts of this case.
There was a permanent settlement of the zamindari of Burdwan in 1793, and it has been found by all the Courts that in that settlement the suit lands were included as part of the Mal or assessed lands of the estate.
Now, the scheme of the settlement of the estates was to fix the revenue payable thereon on the basis of the income which the properties were estimated to yield, and Regulation No. 8 of 1793 contains elaborate provisions as to how the several kinds of property are to be dealt with.
Section 36 of the Regulation provides that "the assessment is also to be fixed exclusive and independent of all existing lakheraje lands, whether exempted from the kheraje (or public revenue) with or without due authority".
Therefore, when it is shown that lands in an estate are assessed, it must follow that they could not have been held on the date of the permanent settlement as Lakberaj.
It would be inconsistent with the scheme of the settlement and section 36 of Regulation No. 8 of 1793 to hold that the assessed or Mal lands in an estate could have been held on an anterior Lakheraj grant.
It was for this (1) (2) [18521 18 Q. B. 287.
1174 reason that the defendants pleaded that the suit lands were not comprised in the Mal lands of the zamindari of Burdwan.
But that plea has been negatived, and it has been found that they are part of the Mal lands within the zamindari assessed to revenue, and in view of that finding there is no scope for the presumption of a lost grant.
Learned counsel for the respondents relied strongly on the record of rights made in 1931 with reference to the suit lands as supporting his contention.
The entry in question describes the lands as "Bhog Dakhal Sutre Niskar", and has been translated as "without rent by virtue of possession and enjoyment".
The plaintiff attacked this entry as made at the instance of the defendants acting in collusion with one of his agents.
The Courts below, however, have held that had not been established, and therefore the entry must be taken as properly made.
The respondents contended that a strong presumption should be made in favour of the correctness of the entry, because it was made in the ordinary course of business, and that it was sufficient to sustain a presumption of lost grant.
Giving the entry its full value, does the word "Niskar" import a rent free grant? Rule 37 of the Technical Rules and Instructions issued by the Settlement Department for observance by the settlement authorities provides that if property is found in the possession of a person who is not actually paying rent for it should be described as "Niskar", and if no sanad or title deed is produced by the occupant showing a rent free title, the words "Bhog Dakhal Sutre" (by virtue of enjoyment and possession) should be added.
In the written statement it was stated that (as the defendants could not produce any 'revenuefree grant ' they (Settlement Officers) recorded Niskar Raiyati right in a general way".
Reading Rule 37 along with the written statement it is clear that the entry in the record of rights in 1931 was made in compliance with that Rule, and that what it imports is not that there was a rent free grant, but that the person in possession was not actually paying rent.
Whatever weight might attach to the word "Niskar" in a 1175 record of rights in other context, where the question is whether a presumption of a lost pre settlement Lakheraj grant could be made, the inference to be drawn from that word cannot outweigh the effect of the non exclusion of the lands from the Mal or the regularly assessed estate.
We are therefore of opinion that a presumption of lost grant cannot be founded on the entry in the record of rights.
There are also other difficulties in the way of presuming a lost grant in favour of the predecessors of the defendants.
The suit properties formed part of Mauza Nala within the zamindari of Burdwan, and if a grant had been made in favour of the predecessors of the defendants, it must have been made by the Maharaja of Burdwan or by the Rajgunj Asthal.
But the defendants have in their written statements denied the title of both the Maharaja and the Asthal, and having failed in that plea, cannot fall back on a presumption of lost grant by the very persons, whose title they have repudiated.
This does not exhaust all the difficulties of the defendants.
According to the District Judge, the suit properties had been settled on the Rajgunj Asthal more than 200 years ago.
Therefore, the grant to be presumed must have been made by the Mahant of Asthal in favour of the predecessors of the defendants.
But before raising such a presumption, it must be established that the grant was one which could have legally been made by him.
It is well settled that it is beyond the powers of a manager of a religious institution to grant perpetual lease binding the institution for all times to a fixed rent, unless there is a compelling necessity or benefit therefor.
Vide Palaniappa Chetty vs Sreenath Devasikamony(1).
And what is pleaded in the present case is not even so much as a permanent lease, because there is neither premium paid nor rent reserved but a Lakheraj grant unsupported by any consideration.
That would clearly be beyond the powers of a Mahant, and no presumption of a lost grant could be made in respect thereto.
In Barker vs Richardson(2) , an easement was claimed (1) [1917] L.R. 44 I.A. 147.
(2) , 1176 both on the ground of prescription and presumption of a lost grant by a rector.
In negativing this claim, Abbot, C. J. observed that a grant could not be presumed, because the rector had no right to bind his successor by it, and it would therefore be invalid.
In The Rochdale Canal Company vs Radcliffe(1) where the Court was asked to presume that a company had made a grant of its surplus waters for use by the Duke of Bridgewater, Lord Campbell, C. J. observed that "if they had made a grant of the water in the terms of this plea, such a grant would have been ultra vires and bad", and on that ground, he refused to raise the presumption.
We are accordingly of opinion that on the facts found, no presumption of a lost grant could be made in favour of the defendants, and that the plaintiff was entitled to assessment of fair and equitable rent on the holdings in their possession.
Learned counsel for the respondents also raised the plea of limitation.
The Courts below have held that the suits were within time under article 131 of the Limitation Act, as the final settlement of records was published on 16 6 1931, and the present suits were filed within 12 years thereof for establishing the right of the institution to assessment of rent.
It was observed by the learned Judges of the High Court who heard the application for leave to appeal to this Court that it was not suggested before them that the decision on the question of limitation was erroneous.
The contention that is now pressed before us is that in the view that there was no rent free grant in favour of the predecessors of the defendants they were all trespassers, and that the title of the Asthal had become extinguished by adverse possession for long over the statutory period.
But the question of adverse possession was not made the subject of an issue, and there is no discussion of it in the judgments of the Courts below.
We have already held that the documents relied on by the defendants as containing assertions that they held under a Lakheraj grant are not shown to relate to the suit lands.
We (1) ; , 1177 have also held that there is no proof that the defendants claimed to hold under a rent free grant to the knowledge of the plaintiff prior to 1931, and that what all has been established by them is non payment of rent for a considerable but unascertained period of time.
That, in itself, is not sufficient to make their possession adverse.
It was only in 1931 that the defendants could be said clearly to have asserted a hostile title, and the suits are within time from that date.
There is no substance in this plea, which is accordingly rejected.
In the result, the appeals are allowed, the decrees ,of the District Court and of the High Court are set aside, and those of the District Munsif restored with costs in this Court and in the two Courts below.
The decrees of the District Munsif will stand as regards costs in that Court.
Appeals allowed.
| A presumption of a lost grant arises in favour of a person who does not claim adversely to the owner but who on the other hand proves ancient and continued possession in assertion of a title derived from the owner without any challenge and such possession and assertion cannot be accounted for except by referring to a legal origin of the grant claimed.
But the presumption of a lost grant is not an irrebuttable presumption of law and the court cannot presume a grant where it is convinced of its non existence by reason of a legal impediment, as where the presumption of a lost grant is claimed by a fluctuating body of persons.
Similarly a presumption of a lost grant cannot arise when there is no person capable of making such a grant or if the grant pleaded is illegal or beyond the powers of the grantor.
A presumption of a lost grant by way of Niskar cannot be im puted to the Mohunt of an Asthal inasmuch as he is legally incompetent to make any Niskar grant.
When a defendant who denies the title of the plaintiff in respect of any land, fails in that plea, he cannot fall back on the presumption of a lost grant from the very person whose title he has denied.
Findings of fact arrived at by courts should not be vague.
Attorney General vs Simpson ([1901] , Raja Braja Sunder Deb vs Moni Behara and others ( [1951] S.C.R. 431), Barker vs Richardson ( , The Rochdale Canal Com 1169 pany vs Radcliffe ([1852] IS Q.B. 287), and Palaniappa Chetty vs Sreenath Devasikamony ( [1917] L.R. 44 I.A. 147), referred to.
|
Appeal No. 118 of 1953.
Appeal from the Judgment and Decree dated the 28th July 1949 of the High Court of Judicature for the State of Punjab at Simla in Civil Regular First Appeal No. 365 of 1946 arising out of the Decree dated the 31st day of October 1946 of the Court of the SubJudge, 1st Class, Pathankot in Suit No. 110 of 1945.
Rajinder Narain, for the appellant.
K. L. Gosain (R. section Narula and Naunit Lal, with him), for the respondent.
January 21.
The Judgment of the Court was delivered by DAS J.
This is an appeal by the plaintiff in a suit for a declaration of his title as collateral within ' four degrees of Gurdial, who was a Sarswat Brahmin, resident of Pathankot in the district of Gurdaspur and the last male holder of the properties in suit.
Gurdial died many years ago leaving certain lands in villages Bhadroya, Kingarian and Pathankot, Tehsil Pathankot in the district of Gurdaspur, and leaving him surviving his widow Musammat Melo and a daughter Musammat Maya Devi, the respondent before us.
Some time in the year 1926, a portion of the land in village Bhadroya was acquired for the Kangra Valley Railway and a sum of Rs. 1,539 7 0 was awarded to Musammat Melo.
On ail objection by the appellant this amount was deposited in the Court of the Senior Subordinate Judge, Gurdaspur, with a direction to pay the interest on this amount to Musammat Melo.
On the 28th September 1944 Musammat Melo died and the Revenue Courts ordered mutations in respect of the lands in the three villages in favour of the respondent as the daughter of Gurdial.
On the 10th March 1945 the appellant filed the suit out of which this appeal arises against the respondent for a declaration that he was entitled to the lands mentioned in the plaint as well as to the sum of 1194 Rs. 1 539 7 0 in preference to the respondent under the custom governing the parties *hereunder the collaterals of the last male holder excluded the daughter.
The respondent contested the suit mainly on the grounds (i) that the suit for a mere declaration was not maintainable (ii)that the parties were governed by Hindu Law and not by custom, (iii)that the appellant was not a collateral of Gurdial at all, (iv)that the properties in suit were not ancestral, and (v) that there was no custom whereunder the collaterals of the father who was the last male holder excluded the daughter from succession to the selfacquired property of her father.
The Subordinate Judge in his judgment pronounced on the 31st October 1946 held (i) that the lands in suit being in possession of tenants, the suit for a declaration of title thereto was maintainable but the suit for a declaration in respect of the sum of Rs. 1,539 7 0 was not maintainable in view of the provisions of the Indian Succession Act relating to succession certificates, (ii)that the parties were governed by custom and not by Hindu Law, (iii)that the appellant was a collateral of Gurdial within four degrees, (iv)that the land in Khata No. 2 of village Kingarian was ancestral while the rest of the lands in suit were non ancestral, and (v) that there was a custom according to which daughter was excluded from inheritance by the collaterals up to the fourth degree with respect to ancestral as well as self acquired property of the last male holder as laid down in the case of Buta Singh vs Mt. Harnamon(1).
In the result, the Subordinate Judge decreed the suit in respect only of the lands in suit and ordered the parties to bear their own costs.
(1) A.I.R. 1946 Lah.
306. 1195 Against this judgment and decree the respondent preferred an appeal to the Lahore High Court.
The appellant preferred cross objections against the order as to costs and against the finding that the lands in the three villages except the land in Khata No. 2 of village Kingarian were non ancestral.
After the partition of India the appeal was transferred to the High Court of East Punjab.
By its judgment dated the 28th July 1949 the East Punjab High Court allowed the appeal and dismissed the cross objections on the following findings: (i) that the suit for declaration of title to the lands was maintainable as all the lands in suit were in the possession of tenants,, (ii) that the lands in suit except the land in Khata No. 2 of village Kingarian were non ancestral, and (iii) that according to the custom prevailing in the Gurdaspur district a daughter was entitled to succeed to non ancestral property in preference to collaterals even though they were within the fourth degree.
The High Court accordingly modified the decree of the Subordinate Judge to the extent that the declaration in the appellant 's favour was made to relate only to the land in Khata No. 2 of village Kingarian which was held to be ancestral.
On an application made by the appellant on the 26th August 1949 the High Court, by its order dated the 5th June 1950, granted him a certificate of fitness to appeal to the Federal Court.
After the commencement of the Con stitution of India the appeal has come before this Court for final disposal.
The first question raised before us but not very seriously pressed is as to whether the lands in suit other than those in Khata No. 2 in village Kingarian were ancestral or self acquired.
Our attention has not been drawn to any material on the record which induces us to take a view different from the view concurrently taken by the Courts below.
We, therefore, see no force or substance in this contention, 153 1196 The main fight before us has been on the question as to whether there is a custom in the Gurdaspur district governing the parties under which a collateral within the fourth degree excludes the daughter of the last male holder from succession to the self acquired property of her father.
The customary rights of succession of daughters as against the collaterals of the father with reference to ancestral and non ancestral lands are stated in paragraph 23 of Rattigan 's Digest of Customary Law.
It is categorically stated in subparagraph (2) of that paragraph that the daughter succeeds to the self acquired property of the father in preference to the collaterals even though they are within the fourth degree.
Rattigan 's 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 vs Ujagar Singh(1).
The general custom of the Punjab being that a daughter excludes the collaterals from succession to the selfacquired property of her father the initial onus, there fore, must, on principle, be on the collaterals to show that the general custom in favour of the daughter 's succession to the self acquired property of her father has been varied by a special local custom excluding the daughter which is binding on the parties.
Indeed, it has been so held by the Judicial Committee in Mst.
Subhani vs Nawab(2) and the matter is now well settled.
The appellant claims to have discharged this initial onus in two ways, namely (1) by producing the Riwaj i am of the Gurdaspur district prepared by Mr. Kennaway in 1913 and (2) by adducing evidence showing that the collaterals of one Harnam Singh, who was also a Sarswat Brahmin of the Gurdaspur district and indeed a member of this very family of Gurdial succeeded in preference to his daughter.
It is pointed out that no instance has been proved on the part of the respondent showing that the daughter ever excluded the collaterals from succession to the self acquired property of the father.
The trial Court (1) ; (2) I.L.R. 1197 as well as the High Court took the view that the evidence as to the succession to the property of Harnam Singh was of no assistance to the appellant for the reason that the evidence was extremely sketchy, that it did not appear whether the properties left by Harnam Singh were ancestral or self acquired or whether the properties left by him were of any substantial value at all as would have made it worth while for the daughter to claim the same in addition to the properties gifted to her by her father during his lifetime.
Further, the fact that the daughter did not contest the succession of the collaterals to the properties left by Harnam Singh, even if they were self acquired, might well have been the result, as held by the High Court, of some family arrangement.
We find ourselves in agreement with the Courts below that the instance relied upon by the appellant is wholly insufficient to discharge the onus that was on him to displace the general custom recorded in paragraph 23(2) of Rattigan 's Digest of Customary Law.
The appellant contends that in any case he has fully discharged the onus that was on him by producing in evidence the Riwaj i am recording the custom of the district of Gurdaspur which was compiled by Mr. Kennaway in 1913.
Reference is also made to the earlier Riwaj i ams of the Gurdaspur District prepared in 1865 and 1893.
Answer to question 16 as recorded in the Riwaj i am of 1913 shows that subject to certain exceptions, which are not material for our purpose, the general rule is that the daughters are excluded by the widow and male kindred of the deceased., however remote.
This answer goes much beyond the answers to the same question as recorded in the Riwaj i ams of 1865 and 1893 for those answers limit the exclusion in favour of the male kindred up to certain specified degrees.
The answer to question 17 of the 1913 Riwai i am like those to question 17 of the 1865 and 1893 Riwaj i ams clearly indicates that except amongst the Gujjars of the Shakargarh tehsil all the remaining tribes consulted by the Revenue authorities recognised no distinction as to the rights of the daughters to inherit (i) the immovable or 1198 ancestral and (ii) the movable or self acquired property of their respective fathers.
It is claimed that these answers quite adequately displace the general custom and shift the onus to the respondent to disprove the presumption arising on these Riwaj i ams by citing instances of succession contrary to these answers.
In support of this contention reference is made to the observations of the Privy Council in Beg vs Allah Ditta(1) that the statements contained in a Riwaj i am form a strong piece of evidence in support of the custom therein entered subject to rebuttal.
Reliance is also placed on the observations of the Privy Council in Mt. Vaishno Ditti vs Mt. Rameshri(2) to the effect that the statements in the Riwaj i am might be accepted even if unsupported by instances.
The contention is that on production by the appellant of the Riwaj i am of the Gurdaspur district the onus shifted to the respondent to prove instances rebutting the statements contained therein.
This, it is urged, the respondent has failed to do.
" There is no doubt or dispute as to the value of the entries in the Riwaj i am.
It is well_settled that though they are entitled to an initial presumption in favour of their correctness irrespective of the question whether or not the custom, as recorded, is in accord with the general custom, the quantum of evidence necessary to rebut that presumption will, however, vary with the facts and.
circumstances of each case.
Where, for instance, the Riwaj i am lays down a custom in consonance with the general agricultural custom of the province, very strong proof would be required to displace that presumption; but where, on the other hand, the custom as recorded in the Riwaj i am is opposed to the custom generally prevalent, the presumption will be considerably weakened.
Likewise, where the Riwaj i am affects adversely the rights of the females who had no opportunity whatever of appearing before the Revenue authorities, the presumption will be weaker still and only a few instances would be sufficient to rebut it.
[See Khan Beg vs Mt. (1) [1916] L.R. 44 I.A. 89.
(2) Lah.
186; L.R. 55 I.A. 407 1199 Fateh Khatun (1), Jagat Singh vs Mst.
Jiwan The principles laid down in these cases were approved of by the Judicial Committee in Mst.
Subhani 's case supra.
Learned counsel appearing for the appellant contends that even if the presumption as to the correctness of the Riwaj i am be weak, the respondent has not cited a single instance of a daughter having excluded the collaterals from succession to the selfacquired property of her father and has, therefore, failed to discharge the onus that was thrown on her as a result of the production by the appellant of the Riwaj i am of 1913 and, consequently, the appellant must succeed.
This argument overlooks the fact that in order to enable the appellant to displace the general custom recorded in Rattigan 's work and to shift the onus to the respondent the appellant must produce a Riwaj i am which is a reliable and trustworthy document.
It has been held in Qamar ud Din vs Mt. Fateh Bano(3) that if the Riwaj i am produced is a reliable and a trustworthy document, has been carefully prepared and does not contain within its four corners contradictory statements of custom and in the opinion of the Settlement Officer is not a record of the wishes of the persons appearing before him as to what the custom should be, it would be a presumptive piece of evidence in proof of the special custom ,set up, which if left unrebutted by the daughters would lead to a result favourable to the collaterals.
If, on the other hand, it is not a document of the kind indicated above then such a Riwaj i am will have no value at all as a presumptive piece of evidence.
This principle has been followed by the East Punjab High Court in the later case of Mohammad Khalil vs Mohammad Bakhsh (4).
This being the position in law, we have to scrutinise and ascertain whether the Riwaj i ams of the Gurdaspur district in so far as they purport to record the local custom as to the right of succession of daughters to the self acquired properties of their respective father are reliable and trustworthy documents.
(1) , Lah.
276, 296, 297.
(2) A.I.R. 1935 Lah.
(3) Lah.
(4) A.I.R. 1949 E.P. 252.
1200 Twenty two tribes including Brahmins were consulted by Mr. Kennaway who prepared the Riwaj i am of 1913.
In paragraph 4 of the Preface Mr. Kennaway himself states that many of the questions related to matters on which there really existed no custom and the people had merely stated what the custom should be and not what it actually was.
In Appendix 'C ' are collected 56 instances of mutuations in which the daughter inherited.
In these there are four instances relating to Brahmins.
Answer to question 16, as recorded in this Riwaj i am, has been discredited and shown to be incorrect in at least three cases, namely, Gurdit Singh vs Mt. Malan(1), Kesar Singh vs Achhar Singh(1) and Buta Singh vs Mt. Harnamon(3).
The answer to question 16 as recorded in the 1913 Riwaj i am, it was pointed out, went much beyond the answer given to the same question in the Riwaj i ams of 1865 and 1893.
The answer to question 17 of the 1913 Riwaj i am that no distinction is to be made between ancestral and self acquired property has not been accepted as correct in not less than six cases, namely, Bawa Singh vs Mt. Partap(4), Jagat Singh vs Mt. Jiwan(5), Kesar Singh vs Gurnam Singh(1), Najju vs Mt. Aimna Bibi (7) Gurdit Singh vs Mt. Man Kaur(8), and Labh vs Mt. Fateh Bibi(9).
The statements in a Riwaj i am the truth of which is doubted by the compiler himself in the preface and which stand contradicted by the instances collected and set out in Appendix 'C ' of the same Riwaj i am and which have been discredited in judicial proceedings and held to be incorrect cannot, in our opinion, be regarded as a reliable or trustworthy document and cannot displace the initial presumption of the general custom recorded in Rattigan 's book so as to shift the onus to the daughter who is the res pondent.
The appellant relies on the cases of Ramzan Shah vs Sohna Shah("), Nanak Chand vs Basheshar Nath(11), Mt. Massan vs Sawan Mal(" ') and Kesar Singh vs (1) Lah.
364.(2) A.I.R. 1936 Lah. 68. (3) A.I.R. 1946 Lah. 306.(4) A.I.R. 1935 Lah.
(5) Ibid, 617.
(6) Ibid, 696.
(7) A.I.R. 1936 Lah.
493.(8) A.I.R. 1937 Lah.
(9) A.I.R. 1940 Lah.
436.(10) [1889] 24 P.R, 191.
(11) [19O8]43 P.R. 15.
(12) A.I.R. 1935 Lah.
453, 1201 Achhar Singh(1).
The first three cases are of no assistance to him although the second and third relate to Brahmins of Gurdaspur, for the properties in dispute ' in those cases were ancestral and the respondent does not now dispute the appellant 's right to succeed to her father 's ancestral propertie 'section These cases, therefore, do not throw any light on the present case which is concerned with the question of succession to selfacquired property.
Further, in the last case, the collaterals were beyond the fourth degree and it was enough for the Court to say that irrespective of whether the properties in dispute were ancestral or selfacquired the collaterals in that case could not succeed.
It is also to be noted that the earlier decisions werenot cited or considered in that case.
In our opinion the appellant has failed to discharge the onus that was initially on him and that being the position no burden was cast on the respondent which she need have discharged by adducing evidence of particular instances.
In these circumstances, the general custom recorded in Rattigan 's book must prevail and the decision of the High Court must be upheld.
We accordingly dismiss this appeal with costs.
Applal dismissed.
| It is now well settled that the general custom of the Punjab being that a daughter excludes the collaterals from succession to the self acquired property of her father the initial onus, therefore, must, on principle, be on the collaterals to show that the general custom in favour of the daughter 's succession to the self acquired property of her father has been varied by a special local custom excluding the daughter which is binding on the parties.
It is also well settled that though the entries in the Riwaj i am are entitled to an initial presumption in favour of their correctness irrespective of the question whether or not the custom, as recorded, is in accord with the general custom, the quantum of evidence necessary to rebut that presumption will, however, vary with the facts and circumstances of each case.
Where, for instance, the Riwaj iam lays down a custom in consonance with the general agricultural custom of the province, very strong proof would be required to displace that presumption; but where, on the other hand, the custom as recorded in the Riwaj i am is opposed to the custom generally prevalent, the presumption will be considerably weakened, Likewise, 1192 where the Riwaj i am affects adversely the rights of the females who had no opportunity whatever of appearing before the Revenue authorities, the presumption will be weaker still and only a few instances would be sufficient to rebut it.
If the Riwaj i am produced is a reliable and a trustworthy document, has been carefully prepared, and does not contain within its four corners contradictory statements of custom, and in the opinion of the Settlement Officer is not a record of the wishes of the persons appearing before him as to what the custom should be, it would be a presumptive piece of evidence in proof of the special custom setup, which if left unrebutted by the daughters would lead to a result favourable to the collaterals.
If, on the other hand, it is not a document of the kind indicated above, then such a Riwaj i am will have no value at all as a presumptive piece of evidence.
The Riwaj i ams of the Gurdaspur district prepared by Mr. Kennaway in 1913 in so far as they purport to record the local custom as to the right of the daughter to succeed to the self acquired property of her father are not reliable and trustworthy documents.
The answer to question 16 and the answer to question 17 re corded therein do not contain the correct record of custom.
Held, that the appellants collateral within fourth degreea Saraswat Brahmin of Pathankot in the district of Gurdaspur had failed to discharge the onus that initially rested on him that the respondent (the daughter) was excluded by him in respect of the nonancestral property of her father and that therefore no burden was cast on her of adducing evidence of particular instances.
The general custom laid down in para 23 of Rattigan 's Digest of Customary Law that "a daughter is preferred to collaterals in regard to the self acquired property of tier father" was approved by the Supreme Court.
Butta Singh vs Mt. Harnamon (A.I.R. 1946 Lab. 306), Gopal Singh vs Ujagar Singh ( ; , Mst.
Subhani vs Nawab (I.L.R. [1940] Lab.
154), Beg vs Allah Ditta ( [1916] L.R. 44 I.A. 89), Mt. Vaishno Ditti vs Mt. Rameshri ( Lab. 186; L.R. 55 I.A. 407), Khan Beg vs Mt. Fateh Khatun ( Lab.
276), Jagat Singh vs Mst.
Jiwan (A.I.R. 1935 Lab.
617), Qamar ud din vs Mt. Fateh Bano ([1943] I.L.R. 26 Lab. 110), Mohammad Khalil vs Mohammad Bakhsh (A.I.R. 1949 E.P. 252), Gurdit Singh vs Mt. Malan ([1924] I.L.R. 5 Lab.
364), Kesar Singh vs Achhar Singh (A.I.R. 1936 Lab.
68), Bawa Singh vs Mt. Partap (A.I.R. 1935 Lab. 288), Kesar Singh vs Gurnam Singh (A.I.R. 1935 Lab.
696), Najju vs Mt. Aimna Bibi (A.I.R. 1936 Lab. 493), Gurdit Singh vs Mt. Man Kaur (A.I.R. 1937 Lab. 90), Labh vs Mt. Fateh Bibi (A.I.R. 1910 Lab. 436), Ramzan Shah vs Sohna Shah ([1889] 24 P.R. 191), Nanak Chand vs Basheshar Nath ( [1908] 43 P.R. 15) and Mt. Massan vs Sawan Mal (A I R. 1935 Lab. 453), referred to, 1193
|
minal Appeal No. 132 of 1954.
Appeal by Special Leave granted by the Supreme Court by its Order dated the 3rd September, 1954 from the Judgment and Order dated the 15th June ' 1954 of the High Court of Judicature for the State of Punjab at Simla in Criminal in Appeal No. 287 of 1954 arising out of the Judgment and Order dated the 14th April 1954 of the Court of Additional Sessions Judge in Session Case No. 4 of 1954.
J.G. Sethi, (Naunit Lal, with him), for the appellant.
1204 Gopal Singh and P. G. Gokhale, for the respondent.
January 25.
The Judgment of the Court was delivered by IMAM J.
This appeal by Nanak Chand comes by special leave against the judgment of the Punjab (1) High Court.
The appellant was convicted by the High Court under section 302 of the Indian Penal Code and the sentence of death passed on him by the Additional Sessions Judge of Jullundur was con firmed.
On the facts alleged by the prosecution there can be no doubt that Sadhu Ram was killed on the 5th of November, 1953, at about 6 45 P.m. at the shop of Vas Dev P. W. 2.
It is alleged that the appellant along with others assaulted Sadhu Ram.
The appellant was armed with a takwa.
Numerous injuries were found on the person of Sadhu Ram.
According to the doctor, who held the postmortem examination, injuries 1, 3 and 4 were due to a heavy sharp edged weapon and could be caused by a takwa.
It was denied by the prosecution that the deceased was assaulted by any other person with a takwa.
According to the Medical evidence, injuries 1, 3 and 4 individually, as well as collectively, were enough to cause: death in the ordinary course of nature.
In the Court of Sessions the appellant along with others was charged under section 148 and section 302, read with section 149 of the Indian Penal Code.
The Additional Sessions Judge, however, held, that the charge of rioting was not proved.
He, accordingly found the appellant and three others guilty under section 302 read with section 34 of the Indian Penal Code.
He acquitted the other three accussed There was an appeal by three convicted persons to the High Court and the high court convicted the appellant alone under section 302 of the Indian Penal Code, confirming the sentence of death but altered the conviction of the other accused 'from section 302/34 to section 323, Indian Penal Code.
it held that the provisions of section 34 of the Indian Penal Code did not apply.
1205 On behalf of the appellant questions of law and questions of fact were urged.
It will be unnecessary to deal with the questions of fact if the argument on points of law is accepted.
The principal question of law to be considered is as to whether the appellant could legally be convicted for murder and sentenced under section 302, Indian Penal Code when he was not charged with that offence.
It was urged that as the appellant had been acquitted of the charge of rioting and the offence under section 302/149 of the Indian Penal Code, he could not be convicted for the substantive offence of murder under section 302, Indian Penal Code, without a charge having been framed against him under that section.
Reliance has been placed on the provisions of the Code of Criminal Procedure relating to the framing of charges, the observations of the Privy Council in Barendra Kumar Ghosh vs Emperor(1) and certain decisions of the Calcutta High Court to which reference will be made later on.
It was urged that for every distinct offence of which a person is accused, there shall be a separate charge and every such charge shall be tried separately except in cases mentioned under sections 234, 235, 236) 237 and 239 of the Code of Criminal Procedure.
Section 149 of the Indian Penal Code creates a specific offence and it is a separate offence from the offence of murder punishable under section 302 of the Indian Penal Code.
The provisions of sections 236, 237 and 238 of the Code of Criminal Procedure did not apply to the facts and circumstances of the present case.
Off behalf of the Prosecution, however, it was urged that section 149 did not create any offence at all and therefore no separate charge was obligatory under section 233 of the Code of Criminal Procedure and that in any event the provisions of sections 236 and 237 of the Code of Criminal Procedure did apply and the appellant could have been convicted and sentenced, under section 302 of the Indian Penal Code, although no charge for the substantive offence of murder had been framed against him.
(1) Cal, 197, 1206 It is necessary, therefore, to examine the provisions of section 149 of the Indian Penal Code and consider as to whether this section creates a specific offence.
Section 149 of the Indian Penal Code is to be found in Chapter VIII of that Code which deals with offences against the public tranquillity.
Section 149 of the Indian Penal Code reads: "If an offence is committed by any member of an unlawful assembly in prosecution of the common object of that assembly, or such as the members of that assembly knew to be likely to be committed in prosecution of that object, every person who, at the time of the committing of that offence, is a member of the same assembly, is guilty of that offence".
This section postulates that an offence is committed by a member of an unlawful assembly in prosecution of the common object of that assembly or such as a member of the assembly knew to be likely to be committed in prosecution of that object and declares that in such circumstances every person, who was a member of the same assembly at the time of the commission of the offence, was guilty of that offence.
Under this section a person, who is a member of an unlawful assembly is made guilty of the offence committed by another member of the same assembly, in the circumstances mentioned in the section, although he had no intention to commit that offence and had done no overt act except his presence in the assembly and sharing the common object of that assembly.
Without the provisions of this section a member of an unlawful assembly could not have been made liable for the offence committed not by him but by another member of that assembly.
Therefore when the accused are acquitted of riot and the charge for being members of an unlawful assembly fails, there can be no conviction of any one of them for an offence which he had not himself committed.
Similarly under section 150 of the Indian Penal Code, a specific offence is created.
Under this section a person need not be a member of an unlawful assembly and yet he would be guilty of being a member of an unlawful assembly and guilty of an offence which may be committed by 1207 a member of the unlawful assembly in the circumstances mentioned in the section.
Sections 149 and 150 of the Indian Penal Code are not the only sections in that Code which create a specific offence.
Section 471 of the Indian Penal Code makes it an offence to fraudulently or dishonestly use as genuine any document which a person knows or has reason to believe to be a forged document and it provides that such a person shall be punished in the same manner as if he had forged such document.
Abetment is an offence under the Indian Penal Code and is a separate crime to the principal offence.
The sentence to be inflicted may be the same as for the principal offence.
In Chapter XI of the Indian Penal Code offences of false evidence and against public justice are mentioned.
Section 193 prescribes the punishment for giving false evidence in any stage of a judicial proceeding or fabricating false evidence for the purpose of being used in any stage of a judicial proceeding.
Section 195 creates an offence and the person convicted of this offence is liable in certain circumstances to be punished in the same manner as a person convicted of the principal offence.
Sections 196 and 197 to 200 of the Indian Penal Code also create offences and a person convicted under any one of them would be liable to be punished in the same manner as if he had given false evidence.
It was, however, urged on behalf of the Prosecution that section 149 merely provides for constructive guilt similar to section 34 of the Indian Penal Code.
Section 34 reads: "When a criminal act is done by several persons, in furtherance of the common intention of all, each of such persons is liable for that act in the same manner as if it were done by him alone".
This section is merely explanatory.
Several persons must be actuated by a common intention and when in furtherance of that common intention a criminal act is done by them, each of them is liable for that act as if the act bad been done by him alone.
This section does not create any specific offence.
As was pointed out by Lord Sumner in Barendra Kumar Ghosh vs Emperor(1) " 'a criminal act ' means that (1) Cal. 197, 1208 unity of criminal behaviour which results in something, for which an individual would be punishable, if it were all done by himself alone, that is, in a criminal offence".
There is a clear distinction between the provisions of sections 34 and 149 of the Indian Penal Code and the two sections are not to be confused.
The principal element in section 34 of the Indian Penal Code is the common intention to commit a crime.
In furtherance of the common intention several acts may be done by several persons resulting in the commission of that crime.
In such a situation section 34 provides that each one of them would be liable for that crime in the same manner as if all the acts resulting in that crime had been done by him alone. ' There is no question of common intention in section 149 of the Indian Penal Code.
An offence may be committed by a member of an unlawful assembly and the other members will be liable for that offence although there was no common intention between that person and other members of the unlawful assembly to commit that offence provided the conditions laid down in the section are fulfilled.
Thus if the offence committed by that person is in prosecution of the common object of the unlawful assembly or such as the members of that assembly knew to be likely to be committed in prosecution of the common object, every member of the unlawful assembly would be guilty of that offence, although there may have been no common intention and no participation by the other members in the actual commission of that offence.
In Barendra Kumar Ghosh vs Emperor(1) Lord Sumner dealt with the argument that if section 34 of the Indian Penal Code bore the meaning adopted by the Calcutta High Court, then sections 114 and 149 of that Code would be otiose.
In the opinion of Lord Sumner, however, section 149 is certainly not otiose,, for in any case it created a specific offence.
It postulated an assembly of five or more persons having a common object, as named in section 141 of the Indian Penal Code and then the commission of an offence by one member of it in prosecution of that object and he referred to Queen vs Sabid Ali and (1) Cal, 197, 1209 Others(1).
He pointed out that there was a difference between object and intention, for although the object may be common, the intentions of the several members of the unlawful assembly may differ and indeed may be similar only in respect that they are all unlawful, while the element of participation in action, which is the leading feature of section 34, was replaced in section 149 by membership of the assembly at the time of the committing of the offence.
It was argued, however, that these observations of Lord Sumner were obiter dicta.
Assuming though not conceding that may be so, the observations of a Judge of such eminence must carry weight particularly if the observations are in keeping with the provisions of the Indian Penal Code.
It is, however, to be remembered that the observations of Lord Sumner did directly arise on the argument made before the Privy Council, the Privy Council reviewing as a whole the provisions of sections 34, 114 and 149 of the Indian Penal Code.
On behalf of the appellant certain decisions of the Calcutta High Court were relied upon in support of the submission made, viz. Panchu Das vs Emperor(2), Reazuddi and Others vs King Emperor(3) and Emperor vs Madan Mandal and Others( ' ).
These decisions support the contention that it will be illegal to convict an accused of the substantive offence under a section without a charge being framed if he was acquitted of the offence under that section read with section 149 of the Indian Penal Code.
, On the other hand, the prosecution relied upon a decision of the.
Full Bench of the Madras High Court in Theetkumalai Gounder and Others vs King Emperor(5) and the case Queen Empress vs Bisheshar and Others(6).
The decision of the Madras High Court was given in April, 1924, and reliance was placed upon the decision of the Allahabad High Court.
The decision of the Privy Council in Barendra Kumar Ghosh 's case was in October, 1924.
The Madras High Court, therefore, did not have before it the decision of the Privy Council.
It is impossible to, say what view might have been expressed (1) [1873] 20 W.R. (Cr.) 5.(2) Cal.
(3) [1961] 6 O.W.N 98.(4) ,Cal.
(5) Mad. 746.(6) All.
1210 by that court if the Privy Council 's judgment in the aforesaid case had been available to the court.
The view of the Calcutta High Court had been noticed and it appears that a decision of the Madras High Court in Taikkottathil Kunheen(1) was to the effect that section 149 of the Indian Penal Code is a distinct offence from section 325 of the Indian Penal Code.
Because of this it was thought advisable to refer the matter.
to a Full Bench.
Two questions were referred to the Full Bench: (1) When a charge omits section 149, Indian Penal Code, and the conviction is based on the provisions of that section, is that conviction necessarily bad, or does it depend on whether the accused has or has not been materially rejudiced by the omission? (2) When a charge has been framed under sections 326 and 149, Indian Penal Code, is a conviction under section 326, Indian Penal Code, necessarily bad, or does this also depend on whether the accused has or has not been materially prejudiced by the form of the charge? The Full Bench agreed with the view expressed by Sir John Edge in the Allahabad case that section 149 created no offence, but was, like section 34, merely declaratory of a principle of the common law, and its object was to make it clear that an accused who comes within that section cannot put forward as a defence that it was not his hand which inflicted the grievous hurt.
It was observed by Spencer, J. that a person could not be tried and sentenced under section 149 alone, as no punishment is provided by the section.
Therefore the omission of section 149 from a charge does not create an illegality by reason of section 233 of the Code of Criminal Procedure which provides that for every distinct offence of which any person is accused there shall be a separate charge.
They did not agree, with the general statement in Reazuddi 's case(2) that it is, settled law that when a person is charged by implication under section 149, he cannot be convicted of the substantive offence.
A charge for a substantive offence under section 302, or section 325 of the Indian Penal Code, etc.
is for a distinct and separate offence from that under section (1) [1928] 18 L.W. 946.
(2) (1901] 1211 302, read with section 149 or section 325, read with section 149, etc.
and to that extent the Madras view is incorrect.
It was urged by reference to section 40 of the Indian Penal Code that section 149 cannot be regarded as creating an 'offence ' because it does not itself provide for a punishment.
Section 149 creates an offence but the punishment must depend on the offence of which the offender is by that section made guilty.
Therefore the appropriate punishment section must be read with it.
It was neither desirable nor possible to prescribe one uniform punishment for all cases which may fall within it.
The finding that all the members of an unlawful assembly are guilty of the offence committed by one of them in the prosecution of the common object at once subjects all the members to the punishment prescribed for that offence and the relative sentence.
Reliance was also placed upon the decision of the Patna High Court in Ramasray Ahir vs King Emperor(1) as well as the decision of the Allahabad High Court in Sheo Ram and Others vs Emperor(1).
In the former case the decision of the Privy Council in Barendra Kumar Ghosh 's case was not considered and the decision followed the Full Bench of the Madras High Court and the opinion of Sir John Edge.
In the latter case the Allahabad High Court definitely declined to answer the question as to whether the accused charged with an offence read with section 149, Indian Penal Code, or with an offence read with section 34, Indian Penal Code, could be convicted of the substantive offence only.
After an examination of the cases referred to on behalf of the appellant and the prosecution we are of the opinion that the view taken by the Calcutta High Court is the correct view namely, that a person charged with an offence read with section 149 cannot be convicted of the substantive offence without a specific charge being framed 'as required by section 233 of the Code of Criminal Procedure.
It was urged that in view of the decision of this Court in Karnail Singh and another vs State of Punjab(1) a conviction under section 302, read with see (1) Patna 484.
(2) A.I.R. 1948 All. 162, (3) , 155 1212 tion 149, could be converted into a conviction under section 302/34 which the trial Court did.
There could be no valid objection, therefore, to converting a conviction under section 302/34 into one under section 302 which the High Court did. ' This argument is unacceptable.
The High Court clearly found that section 34 was not applicable to the facts of the case and acquitted the other accused under section 302/34, that is to say the other accused were wrongly convicted by the trial court in that way but the appellant should have been convicted under section 302.
The High Court could not do what the trial court itself could not do, namely, convict under section 302, as no separate charge had been framed under that section.
It was urged by the Prosecution that under the provisions of section 236 and section 237 of the Code of Criminal Procedure a person could be convicted of an offence which he is shown to have committed although he was not charged with it.
Section 237 of the Code of Criminal Procedure is entirely dependent on the provisions of section 236 of that Code.
The provisions of section 236 can apply only in cases where there is no doubt about the facts which can be proved but a doubt arises as to which of several offences have been committed on the proved facts in which case any number of charges can be framed and tried or alternative charges can be framed.
In these circumstances if there had been an omission to frame a charge, then under section 237, a conviction could be arrived at on the evidence although no charge had been framed.
In the present case there is no doubt about the facts and if the allegations against the ap pellant that he bad caused the injuries to the deceased with takwa was established by evidence, then there could be no doubt that the offence of murder bad been committed.
There was no room for the application of section 236 of the Code of Criminal Procedure.
It had been argued on behalf of the prosecution that no finding or sentence pronounced shall be deemed invalid merely on the ground that no charge was framed.
Reliance was placed on the provisions of section 535 of the code of criminal procedure 1213 Reference was also made to the provisions of section 537 of that Code.
Section 535 does permit.
a court of appeal or revision to set aside the finding or sentence if in its opinion the non framing of a charge has resulted in a failure of justice.
Section 537 also permits a court of appeal or revision to set aside a finding or sentence if any error, omission or irregularity in the charge has, in fact, occasioned a failure of justice.
The explanation to the section no doubt directs that the court shall have regard to the fact that the objection could and should have been raised at an earlier stage in the proceedings.
In the present case, however, there is no question of any error, omission or irregularity in the charge because no charge under section 302 of the Indian Penal Code was in fact framed.
Section 232 of the Code of Criminal Proce.
dure permits an appellate court or a court of revision, if satisfied that any person convicted of an offence was misled in his defence in the absence of a charge or by an error in the charge, to direct a new trial to be had upon a charge framed in whatever manner it thinks fit.
In the present case we are of the opinion that there was an illegality and not an irregularity curable by the provisions of sections 535 and 537 of the Code of Criminal Procedure.
Assuming, however, for a moment that there was merely an irregularity which was curable we are satisfied that, in the circum stances of the present case, the irregularity is not curable because the appellant was misled in his defence by the absence of a charge under section 302 of the Indian Penal Code.
By framing a charge under section 302, read with section 149 of the Indian Penal Code against the appellant, the Court indicated that it was not charging the appellant with the offence of murder and to convict him for murder and sentence him under section 302 of the Indian Penal Code was to convict him of an offence with which he had not been charged.
In defending himself the appellant was not called upon to meet such a charge and in his defence he may well have considered it unnecessary to concentrate on that part of the prosecution ease, Attention has been 1214 drawn to the Medical evidence.
With reference to injury No. I the doctor stated that the wounds were not very clean cut.
It is further pointed out that the other incised injuries on the head were bone deep.
The bone, however, had not been out.
Injuries on the head although inflicted by a blunt weapon may sometimes assume the characteristics of an incised wound.
Reference was made to Glasgow on Medical Jurisprudence, 9th Ed., at page 241, where it is stated that under certain circumstances, and in certain situations on the body, wounds produced by a blunt instrument may stimulate the appearance of an incised wound.
These wounds are usually found over the bone which is thinly covered with tissue, in the regions of the head, forehead, eyebrow, cheek, and lower jaw, among others.
It is also pointed that Vas Dev P.W. 2 bad admitted that Mitu took away the takwa from the appellant after Sadhu Ram had been dragged out of the shop but no takwa blow was given outside the shop.
Prakash Chand P.W. 4, another eye witness, also admitted that Mitu had taken the takwa from the appellant when they had come out of the shop.
It was urged that if a specific charge for murder had been framed against the appellant, he would have questioned the doctor more closely about the incised injuries on the head of the deceased, as well as the prosecution witnesses.
It is difficult to hold in the circumstances of the present case that the appellant was not prejudiced by the non framing of a charge under section 302, Indian Penal Code.
Having regard to the view expressed on the question of law, it is unnecessary to refer to the arguments on the facts.
The appeal is accordingly allowed and the conviction and the sentence of the appellant is set aside and the case of the appellant is remanded to the court of Sessions at Jullundur for retrial after framing a charge under section 302 of the Indian Penal Code and in accordance with law.
Appeal allowed.
| Section 34 of the Indian Penal Code is merely explanatory.
It does not create any specific offence.
Under this section several persons must be actuated by a common intention and when in further (1) A.I.R. 1936 Lah.
1202 ance of that common intention a criminal act is done by them, each of them is liable for that act as if the act had been done by him alone.
There is a clear distinction between the provisions of section 34 and section 149 of the Indian Penal Code and the two sections are not to be confused.
The principal element in section 34 of the Indian Penal Code is the common intention to commit a crime.
In furtherance of the common intention several acts may be done by several persons resulting in the commission of that crime.
In such a situation section 34 provides that each one of them would be liable for that crime in the same manner as if all the acts resulting in that crime had been done by him alone.
There is no question of common intention in section 149 of the Indian Penal Code.
An offence may be committed by a member of an unlawful assembly and the other members will be liable for that offence although there was no common intention between that person and the other members of the unlawful assembly to commit that offence provided the conditions laid down in the section are fulfilled.
Thus if the offence committed by that person is in prosecution of the common object of the unlawful assembly or such as the members of that assembly knew to be likely to be committed in prosecution of the common object, every member of the unlawful assembly would be guilty of that offence, although there may have been no common intention and no participation by the other members in the actual commission of that offence.
There is a difference between object and intention, for although the object may be common, the intentions of the several members of the unlawful assembly may differ and indeed may be similar only in one respect namely that they are all unlawful, while the element of participation in action, which is the leading feature of section 34, is replaced in section 149 by membership of the assembly at the time of the committing of the offence.
A charge for a substantive offence under section 302, or section 325 of the Indian Penal Code, etc.
is for a distinct and separate offence from that under section 302, read with section 149 or section 325, read with section 149, etc.
A person charged with an offence read with section 149 cannot be convicted of the substantive offence without a specific charge being framed as required by section 233 of the Code of Criminal Procedure.
There was no room for the application of section 236 of the Code of Criminal Procedure to the facts of the present case.
The provisions of section 236 of the Code of Criminal Procedure can apply only in cases where there is no doubt about the facts which can be proved but a doubt arises as to which of several offences have been committed on the proved facts in which case any number of charges can be framed and tried or alternative charges can be framed.
In the present case there was no doubt about the facts and if the allegation against the appellant that he had caused the injuries to the deceeased with takwa was established by evidence, then there could be no doubt that the offence of murder had been committed, 1203 In the present case there was no question of any error, omission or irregularity, in the charge within the meaning of section 537 of the Code of Criminal Procedure because no charge under section 302 of the Indian Penal Code was in fact framed.
There was an illegality in the present case and not an irregularity which was curable by the provisions of sections 535 and 537 of the Code of Criminal Procedure.
Assuming however that there was merely an irregularity which was curable, the irregularity in the circumstances of the case was not curable because the appellant was misled in his defence by the absence of a charge under section 302 of the Indian Penal Code.
By framing a charge under section 302, read with section 149, Indian Penal Code against the appellant, the Court indicated that it was not charging the appellant with the offence of murder and to convict him for murder and sentence him under section 302 of the Indian Penal Code was to convict him of an offence with which he had not been charged.
In defending himself the appellant was not called upon to meet such a charge and in his defence he may well have considered it unnecessary to concentrate on that part of the prosecution ease.
Barendra Kumar Ghosh vs Emperor ( (1925] I.L.R. 52 Cal. 197), Queen vs Sabid Ali and others ( [1873] 20 W.R. (Cr.) 5), Panchu Das vs Emperor ( Cal.
698), Beazuddi and Others vs King Emperor ([1901] , Emperor vs Madan Mandal and Others ( Cal. 662), Theethumalai Gounder and Others vs King Emperor ([1924] I.L.R. , Queen Empress vs Bisheshar and Others ( All. 645), Taikkottathil Kunheen ( [1923] 18 L.W. 946), Bamasray Ahir vs King Emperor ( Patna 484), Sheo Ram and Others vs Emperor (A.I.R. 1948 All. 162), and Karnail Singh and another vs State of Punjab ( , referred to.
|
Appeals Nos. 2 and 4 of 1955.
Appeal by Special Leave from the Order dated the 18th day of November 1954 of the Labour Appel 1243 late Tribunal of India, Bombay in Application (Misc.) Bombay No. 773 of 1954.
H. M. Seervai, J. B. Dadachanji and Rajinder Narain, for the appellant in Civil Appeal No. 2 of 1955 and respondent in Civil Appeal No. 4 of 1955.
D. H. Buch and I. N. Shroff, for the respondents in Civil Appeal No. 2 of 1955 and appellants in Civil Appeal No. 4 of 1955.
M. C. Setalvad, Attorney General for India (G. N. Joshi and P. C. Gokhale with him), for the Intervener (Union of India).
February 3.
The Judgment of the Court was delivered by DAS J.
This is an appeal by special leave from the order of the Labour Appellate Tribunal, Bombay Bench, dated the 18th November 1954 which was made on an application made by the appellant company on the 6th September 1954 under section 22 of the Industrial Disputes (Appellate Tribunal) Act, 1950 (Act XLVIII of 1950) which is hereinafter referred to as the 1950 Act.
The appellant company carries on business as assemblers of motor vehicles from "completely knocked down" assemblies imported into India.
There was some appeal pending before the Labour Appellate Tribunal arising out of disputes between the appellant company and its workmen.
It is alleged that the name of the appellant company had been removed by the Government of India from the list of approved manufacturers maintained by them and that, in the result, it had been unable to secure further import licenses for the import of completely knocked down assemblies of motor vehicles and that consequently on and from the 1st November 1953 the company had to lay off a number of its workmen, for it had to operate the various departments of its factory at greatly reduced strength.
As the appellant company saw no prospect of any increase in the scope of its present operation which would provide employment for the workmen who had been laid off, it had become necess 1244 sary to retrench the workmen named in Annexure A to the application.
As those workmen were concerned with the appeal pending before the Labour Appellate Tribunal the company applied to the Appellate Tribunal under section 22 of the 1950 Act for permission to retrench them.
The respondents through their Union, the Automobile Manufacturers ' Employees ' Association, Bombay, filed a written statement on the 1st November 1954 making diverse allegations against the company and contending that the company bad itself to blame for having brought about the lay off.
It was contended that there was no immediate cause for making the application, that the company was motivated by ulterior motives to deprive the workmen of their dues which even according to the company would become due and payable to the workmen on the expiry of the one year of the said lay off period.
It was further alleged that in or about April 1954 the company recalled some of the workmen out of those who had been laid off since November 1953 violating all principles on which a recall should have been made and that by such arbitrary and unscientific recall the company had imposed disproportionate work loads on the recalled workmen, thereby altering their conditions of service to their prejudice.
The respondents maintained that the application was not maintainable in law, was mala fide and should be dismissed.
In the penultimate paragraph of the written statement it was submitted that in the event of the Labour Appellate Tribunal granting the permission in whole or in part such permission should be granted subject to the following conditions: (1) Payment of full wages with dearness allowance for the entire period of lay off; (2) Payment of one month 's notice pay and retrenchment compensation at the rate of one month 's wages including dearness allowance for every completed year of service and part thereof in addition to the gratuity as per the scheme in force in the company; (3) Alternatively to (2) above and in cage the Labour Appellate Tribunal took the view that the 1245 lay off was governed by section 25 C of the , payment of compensation at 50 per cent.
of their wages plus dearness allowance for the entire period of lay off to the date of discharge in addition to the notice pay and gratuity as claimed in (2) above; and (4)Payment of leave wages as per existing rules, taking the entire period of lay off as service.
A number of documents were filed in support of the respective contentions.
The Labour Appellate Tribunal at the very outset of its judgment under appeal states its finding on the merits of the action proposed to be taken by the company as follows: "There can be little doubt that the retrenchment has been occasioned by the failure of the concern to secure sufficient work owing to absence of licenses from Government and, therefore, retrenchment must be regarded as inevitable and the application before us bona fide.
Permission to retrench cannot be refused but for the reasons that we shall state hereafter we make that permission conditional upon the fulfilment of certain terms by the concern".
The company contended before the Labour Appellate Tribunal that its function, while dealing with an application under section 22 of the 1950 Act, was only to give or withhold permission.
This contention was rejected by the Appellate Tribunal with the following observation: "That view is quite untenable as has been repeatedly held by this Tribunal.
We are the authority to whom an application has to be made for permission to retrench, and when such an application is made we must of necessity exercise our judgment and discretion and satisfy ourselves that when the company retrenches it does justice by its employees".
The Labour Appellate Tribunal was clearly influenced by the consideration which, stated in its own words, was as follows: "We do not think that we will be advancing the interest of the employees or of the concern by refusing 1246 retrenchment because the case for retrenchment has been established, and the sooner the workmen are allowed to leave and find for themselves other employment the better for them.
But in order to assure ourselves that on retrenchment the employees receive what in justice they should have, we have decided to give permission to retrench subject to cer tain conditions which in our view are inherent under the Act.
, and which apart from the Act we consider to be just and equitable in the particular circumstances of this case".
In this view of the matter the Labour Appellate Tribunal definitely declined "to leave over the question of compensation for lay off as a legacy of the present troubles; the employees to be retrenched have enough to worry them without having to make claims and have them decided after contest before a Tribunal".
In the result, the Labour Appellate Tribunal gave the appellant company permission to retrench "subject to the terms and conditions of Act XLIII of 1953, provided that each workman is paid at the rate of half basic wages and dearness allowance for the whole period from the date of lay off up to the date of retrenchment (less sums already received as lay off compensation)".
Liberty was given to the company to set off the lay off compensation protanto against the retrenchment relief given by the Act.
Aggrieved by this decision the appellant company applied for and obtained from this Court special leave to appeal against this order.
The respondents subsequently filed an application for special leave to appeal against this decision in so far as the Labour Appellate Tribunal had not allowed their full claim as surmmarised above and in so far as the names of 17 persons had been struck off on the allegation of the company that they were not workmen.
This application of the respondents was also acceded to and the two appeals have been heard together.
The Union of India asked for leave to intervene as important questions of construction of the provisions of the (hereinafter referred to as the 1947 Act) and the 1950 Act were involved.
Such 1247 leave was granted.
and we have heard learned counsel for the Union of India along with learned counsel for the parties.
The question as to the propriety of permitting the names of 17 workmen to be struck off from the application has not been seriously pressed before us.
Only two questions have been canvassed at some length before us, namely . (1)Whether under section 22 of the 1950 Act the Tribunal has jurisdiction to impose conditions when granting the permission asked for; and (2)Whether the conditions imposed in this case are in conformity with law.
It is plain, however, that in case the first question is answered in the negative, the second question will not call for any decision on the present occasion.
In order to correctly answer the questions it will be necessary to bear in mind the general scheme of the two Acts.
The purpose of the 1947 Act is, inter alia, to make provision for the investigation and settlement of industrial disputes.
In order to achieve this avowed object different authorities have been constituted under this Act.
Thus section 3 provides for the constitution of Works Committee whose duty is to promote measures for securing and preserving amity and good relations between the employers and workmen.
The appropriate Government is authorised by section 4 to appoint conciliation officers charged with the duty of mediating in and promoting the settlement of industrial disputes and by section 5 to constitute a Board of Conciliation for promoting the settlement of industrial disputes.
Section 6 empowers the appropriate Government to constitute a Court of Inquiry for enquiring into any matter appearing to be connected with or relevant to an industrial dispute.
Finally, section 7 provides for the constitution of Industrial Tribunals for the adjudication of industrial disputes in accordance with the provisions of the Act.
Section 10 of this Act provides for reference of disputes to a Board, Court or Tribunal.
It will be noticed that under this section it is the appropriate 160 1248 Government which alone can make the reference and set the authority in motion.
The procedure, powers and duties of conciliation officers, Boards, Courts and Tribunals are elaborately prescribed and defined in sections I 1 to 15.
It is to be noted that the conciliation officer, Board, and Court are required to make a report to the appropriate Government while the Tribunal is enjoined to submit its award to the appropriate Government.
The report of a Board or Court and the award of a Tribunal are under section 17 to be published by the appropriate Government within a month from the date of their receipt.
Section 17 A provides that the award of a Tribunal shall become enforceable on the expiry of 30 days from the date of its publication and, subject to the provisions of sub section (1) shall come into operation from such date as may be specified therein and if no date is so specified from the date when the award becomes enforceable as aforesaid.
Section 19 prescribes the period of operation of settlements and awards.
Chapter deals with strikes and lock outs.
Sections 26 to 31 which are grouped together under the heading "Penalties" prescribe punishments.
Section 31 (I) provides that any employer who contravenes the provisions of section 33 shall be punishable with imprisonment for a term which may extend to 6 months or with fine which may extend to Rs. 1,000 or with both.
Section 33, a contravention of which is made punishable by section 31, as it stood before 1950, forbade an employer, during the pendency of any conciliation proceedings or proceedings before a Tribunal, to alter, to the prejudice of the workmen concerned in the dispute, the conditions of service applicable to them immediately before such proceedings, nor, save with the express permission of the conciliation officer, Board or Tribunal, as the case may be, to discharge, dismiss or otherwise punish during the pendency of the proceedings any workman, except for misconduct not connected with the dispute.
It may be noted that under this section the ban on the alteration of the conditions of service was absolute and that permission was necessary only in case of discharge or dismissal or 1249 punishment and even in such case no permission was necessary when the workman was guilty of misconduct not concerned with the pending dispute.
The Only deterrent against a contravention by an employer of the provisions of section 33 was the prosecution of the employer under section 31.
This was hardly any consolation for the workmen, for if an employer took the risk of a prosecution and acted in contra vention of section 33 the workmen could only raise an industrial dispute and ask the appropriate Government to refer the same to a Tribunal but if the Government declined to accede to their prayer the workmen were without any remedy.
This was the position under the 1947 Act before it was amended in 1950.
The 1950 Act was enacted for establishing an Appellate Tribunal in relation to industrial disputes.
Chapter II of the Act deals with the constitution, composition and functions of the appellate tribunal.
Section 7 formulates the jurisdiction of the appellate tribunal.
Section 9 confers on the appellate tribunal all the powers which are vested in a Civil Court when hearing an appeal under the Code of Civil Procedure, 1908.
Section 10 prescribes the period of limitation within which appeals are to be brought before the appellate tribunal.
Under section 15 the decision of the appellate tribunal becomes enforceable on the expiry of 30 days from the date of its pronouncement, provided that where the appropriate Government is of opinion that it would be inexpedient, on public grounds, to give effect to the whole or any part of the decision the appropriate Government may, before the expiry of the said period of 30 days, by order in the Official Gazette either reject the decision or modify it.
Section 22 of this Act provides: "22.
During the period of thirty days allowed for the filing of an appeal under section 10 or during the pendency of any appeal under this Act, no employer sball (a) alter, to the prejudice of the workmen concerned in such appeal, the conditions of service applicable to them immediately before the filing of such appeal, or 1250 (b)discharge or punish, whether by dismissal or otherwise, any workmen concerned in such appeal, save with the express permission in writing of the Appellate Tribunal".
Section 23 on which reliance is placed by learned counsel for the respondents and for the intervener, reads as follows: "23.
Where an employer contravenes the provisions of section 22 during the pendency of proceedings before the Appellate Tribunal, any employee aggrieved by such contravention, may make a complaint in writing, in the prescribed manner to such Appellate Tribunal and on receipt of such complaint, the Appellate Tribunal shall decide the complaint as if it were an appeal pending before it, in accordance with the provisions of this Act and shall pronounce its decision thereon and the provisions of this Act shall apply accordingly". ' Section 29 of this Act provides for penalty for con travention of the provisions of section 22, namely, imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.
From what has been stated so far four things are to be noted, namely, (i) that the ordinary and primary jurisdiction of the appellate tribunal is appellate, (ii) that section 22 of this Act confers on the appellate tribunal a special jurisdiction which is in the nature of original jurisdiction, (iii) that section 23 also vests in the tribunal an additional jurisdiction to decide the complaint as if it were an appeal pending before it; and (iv) that section 23 confers on the workmen an additional remedy which they did not have under the 1947 Act.
To fill up the lacuna in the 1947 Act section 34 of the 1950 Act provided for certain amendments of the 1947 Act.
Amongst other things, it substituted a new section for the old section 33 of the 1947 Act.
The new section 33 runs as follows "33.
During the pendency of any conciliation proceedings or proceedings before a Tribunal in respect of any industrial dispute, no employer shall 1251 (a)alter, to the prejudice of the workmen concerned in such dispute, the conditions of service applicable to them immediately before the commencement of such proceedings; or (b)discharge or punish, whether by dismissal or otherwise, any workman concerned in such dispute, save with the express permission in writing of the conciliation officer, Board or Tribunal, as the case may be".
It will be noticed that this section has made several changes.
Thus under this section provision is made for obtaining permission as a condition precedent both for altering the conditions of service and for discharging or punishing the workmen and no exception is made for a case of misconduct unconnected with the pending dispute.
Besides this, the following new section was added to the 1947 Act as section 33 A: "33 A. Where an employer contravenes the provisions of section 33 during the pendency of proceedings before a Tribunal, any employee aggrieved by such contravention, may make a complaint in writing, in the prescribed manner to such Tribunal and on receipt of such complaint that Tribunal shall adjudicate upon the complaint as if it were a dispute referred to or pending before it, in accordance with the provisions of this Act and shall submit its award to the appropriate Government and the provisions of this Act shall apply accordingly".
It may be pointed out that the new sections 33 and 33 A thus inserted into the 1947 Act confer distinct benefits on the workmen and give some additional jurisdiction and power to the authorities mentioned therein.
Section 33 A enjoins the Tribunal to decide the complaint "as if it were a dispute referred to or pending before it" and to submit its award to the appropriate Government and provides that the provisions of the Act shall apply to the award.
It is quite clear that the provisions of these two new sections 33 and 33 A of the 1947 Act correspond to and are in pari materia with the provisions of sections 22 and 23 of the 1950 Act and are more or less in similar terms.
The question for our conside 1252 ration is: What are the meaning, scope and effect of these sections.
A cursory perusal of section 33 A of the 1947 Act as well as section 23 of the 1950 Act will at once show that it is the contravention by the employer of the provisions of section 33 in the first case and of section 22 in the second case that gives rise to a cause of action in favour of the workmen to approach and move the respective authority named in the section and this contravention is the condition precedent to the exercise by the authority concerned of the additional jurisdiction and powers conferred on it by the sections.
The authority referred to in the sections is, as we have seen, a Court of limited jurisdiction and must accordingly be strictly confined to the exercise of the functions and powers actually conferred on it by the Act which constituted it.
What, then, are the scope and ambit of the functions and powers with which it has been vested by these sections? When an employer contravenes the provisions of section 33 of the 1947 Act or of section 22 of the 1950 Act the workmen affected thereby obviously have a grievance.
That grievance is two fold.
In the first place it is that the employer has taken a prejudicial action against them without the express permission in writing of the authority concerned and thereby deprived them of the salutary safeguard which the legislature has provided for their protection against victimisation.
In the second place, and apart from the first grievance which may be called the statutory grievance, the workmen may also have a grievance on merits which may be of much more seriousness and gravity for them, namely, that in point of fact they have been unfairly dealt with in that their interest has actually been prejudicially affected by the highhanded act of the employer.
These sections give the workmen the right to move the authority by lodging a complaint before it.
This is a distinct benefit given to them, for, as we have seen, apart from these sections, the workmen have no right to refer any dispute for adjudication.
This complaint is required to be made in the prescribed manner.
Form DD prescribed by rule 51 A of the Industrial 1253 Disputes (Central) Rules, 1947, framed under section 38 of the 1947 Act, like Form E prescribed under section 35 of the 1950 Act, requires the complaining workmen to show in their petition of complaint not only the manner in which the alleged contravention has taken place but also the grounds on which the order or the act of the management is challenged.
This clearly indicates that the authority to whom the complaint is made is to decide both the issues, namely (1) the fact of contravention and (2) the merits of the act or order of the employer.
It is also clear that under section 33 A of the 1947 Act the authority is to adjudicate upon the complaint "as if it were a dispute referred to or pending before it" and under section 23 of the 1950 Act the authority is to decide the complaint "as if it were an appeal pending before it".
These provisions quite clearly indicate that the jurisdiction of the authority is not only to decide whether there has been a failure on the part of the employer to obtain the permission of the authority before taking action but also to go into the merits of the complaint and grant appropriate reliefs.
The extreme contention that under section 33 A of the 1947 Act, on a finding that there has been a contravention of the provisions of section 33, the Tribunal 's duty is only to make a declaration to that effect, leaving the workmen to take such steps under the Act as they may be advised to do, has been negatived by the Labour Appellate Tribunal in Serampore Belting Mazdoor Union vs Serampore Belting Co., Ltd.(1) and by the Bombay High Court in Batuk K. Vyas vs Surat Borough Municipality(1).
The same principle has been accepted and applied by a Full Bench of the Labour Appellate Tribunal to a case under section 23 of the 1950 Act in Raj Narain vs Employers ' Association of Northern India(1).
We find ourselves in agreement with the construction placed upon section 33 A of the 1947 Act and section 23 of the 1950 Act by these decisions.
In our view the scope and ambit of the jurisdiction conferred on the authority named in those (1) (2) (3) , 1254 sections is wider than that conferred on the Criminal Court by section 31 of the 1947 Act and section 29 of the 1950 Act.
The Criminal Court under the two last mentioned sections is only concerned with the first issue herein before mentioned, namely, yea or nay whether there has been a contravention of the respective provisions of the sections mentioned therein, but the authority exercising jurisdiction under section 33 A of the 1947 Act and section 23 of the 1950 Act is to adjudicate upon or decide the complaint "as if it were a dispute referred to or pending before it" in the first case or "as if it were an appeal pending before it" in the second case.
The authority is, therefore, enjoined to go into the merits of the act complained of under section 33 A of the 1947 Act and section 23 of the 1950 Act.
In this sense the jurisdiction of the authority named in these two sections is certainly wider than that of the Criminal Court exercising jurisdiction under the penal sections referred to above.
Having regard to the scope of the enquiry under section 33 A of the 1947 Act and section 23 of the 1950 Act it must follow that the power of the authority to grant relief must be co extensive with its power to grant relief on a reference made to it or on an appeal brought before it, as the case may be.
The provision that the authority concerned must submit its award to the appropriate Government and that the provisions of the respective Acts would be applicable thereto also support the view that the decision of the authority is to partake of the nature of a decision on the merits of an industrial dispute which when published by the appropriate Government will become enforceable under the respective Acts.
It follows, therefore, that the authority referred to in these sections must have jurisdiction to do complete justice between the parties relating to the matters in dispute and must have power to give such relief as the nature of the case may require and as is also indicated by the prayer clause mentioned in the two Forms DD and E referred to above.
In short, these two sections give to the workmen a direct right to approach the Tribunal or Appellate Tribunal for the 1255 redress of their grievance without the intervention of the appropriate Government which they did not possess before 1950 and they provide for speedy determination of disputes and avoid multiplicity of proceedings by giving complete relief to the workmen in relation to their grievances arising out of the action taken by the employer in contravention of the provisions of the relevant sections.
It is significant that this jurisdiction or power has been vested in the Tribunal or Appellate Tribunal whose normal duty is to decide or adjudicate upon industrial disputes and not on any conciliation officer or Board who are normally charged with the duty of bringing about settlement of dis putes.
it is submitted by learned counsel for the Respondents and of the intervener that the scope of section 33 of the 1947 Act and of section 22 of the 1950 Act is precisely the same as that of section 33 A of the 1947 Act and section 23 of the 1950 Act.
The argument is that the two last mentioned sections were enacted only in order to afford an opportunity to the workmen to do what they had been prevented from doing at the earlier stage by reason of the employer taking the law into his own hands and taking action against them without previously obtaining the sanction of the appropriate authority to do so.
If the law permits the workmen to ventilate their grievances at a later stage under section 33 A of the 1947 Act and section 23 of the 1950 Act there can be no logical reason why the law should not permit them to do so at the earlier stage under section 33 of the 1947 Act and section 22 of the 1950 Act.
It is submitted that the purpose of labour legislation being to maintain industrial peace and restore amity and goodwill between the employer and his workmen, it should be the attempt of the Tribunal or the Appellate Tribunal at every stage to try to resolve all disputes which are connected with the matter which is brought before it.
Finally, it is urged that whenever an authority is vested with the power to do or not to do an act it must be regarded as having a discretion and 161 1256 that in exercise of such discretion the authority must be presumed to be vested with power to impose suitable conditions.
Reliance is placed on the decision in The Queen vs County Council of West Riding of Yorkshire(1).
The argument is that the authority concerned may under section 33 of the 1947 Act and section 22 of the 1950 Act grant by way of imposing conditions the same relief which it can grant to the workmen under section 33 A of the 1947 Act and section 23 of the 1950 Act.
We are unable to accept this contention as correct for reasons which we now proceed to state.
The object of section 22 of the 1950 Act like that of section 33 of the 1947 Act as amended is to protect the workmen concerned in disputes which form the subject matter of pending proceedings against victimisation by the employer on account of their having raised industrial disputes or their continuing the pending proceedings.
It is further the object of the two sections to ensure that proceedings in connection with industrial disputes already pending should be brought to a termination in a peaceful atmosphere and that no employer should during the pendency of those pro ceedings take any action of the kind mentioned in the sections which may give rise to fresh disputes likely to further exacerbate the already strained relation between the employer and the workmen.
To achieve this object a ban has been imposed upon the ordinary right which the employer has under the ordinary law governing a contract of employment.
Section 22 of the 1950 Act and section 33 of the 1947 Act which impose the ban also provide for the removal of that ban by the granting of express permission in writing in appropriate cases by the authority mentioned therein.
The purpose of these two sections being to determine whether the ban should be removed or not, all that is required of the authority exercising jurisdiction under these sections is to accord or withhold permission.
And so it has been held we think rightly by the Labour Appellate Tribunal in Carlsbad Mineral Works Co. Ltd. vs Their (1) [1S96] 2, Q.B. 386. 1257 Workmen(1) which was a case under section 33 of the 1947 Act.
Even a cursory persual of section 33 of the 1947 Act will make it clear that the purpose of that section was not to confer any general power of adjudication of disputes.
It will be noticed that under section 33 of the 1947 Act the authority invested with the power of granting or withholding permission is the conciliation officer, Board or Tribunal.
The conciliation officer or the Board normally has no power, under the 1947 Act, to decide any industrial dispute but is only charged with the duty of bringing about a settlement of dispute.
It is only the Tribunal which can by its award decide a dispute referred to it. 'Section 33 by the same language confers jurisdiction and power on all the three authorities.
Power being thus conferred by one and the same section, it cannot mean one thing in relation to the conciliation officer or the Board and a different and larger thing in relation to the Tribunal.
There is no reason to think that the legislature, by a side wind as it were, vested in the conciliation officer and the Board the jurisdiction and power of adjudicating upon disputes which they normally do not possess and which they may not be competent or qualified to exercise.
Further, if the purpose of the section was to invest all the authorities named therein with power to decide industrial disputes one would have expected some provision enabling them to make and submit an award to which the provisions of the Act would apply such as is provided in section 33 A of the 1947 Act or section 23 of the 1950 Act.
There is no machinery provided in section 33 of the 1947 Act or section 23 of the 1950 Act for enforcing the decision of the authority named in those sections.
This also indicates that those sections only impose a ban on the right of the employer and the only thing that the authority is called upon to do is to grant or withhold the permission, i.e. to lift or maintain the ban.
And so it has been held by this Court in Atherton West & Co., Ltd. vs Suti Mill Mazdoor Union(1) which was a case under clause 23 of the U. P. Government Notification quoted on p. 785.
(1) (2) ; , 786 7, 1258 Section 22 of the 1950 Act is in pari materia with section 33 of the 1947 Act and the above clause 23 of the U. P. Government Notification and most of the considerations noted above in connection with these provisions apply mutatis mutandis to section 22 of the 1950 Act.
Imposition of conditions is wholly collateral to this purpose and the authority cannot impose any condition.
And it has been so held we think correctly in G. C. Bhattacharji vs Parry & Co., Ltd., Calcutta(1).
In view of the scheme of these Act summarised above and the language of these sections the general principle laid down in the case of The Queen vs
The County Council of West Riding supra can have no application to a case governed by these sections.
In our judgment the Labour Appellate Tribunal was in error in holding that it had jurisdiction to impose conditions as a prerequisite for granting permission to the company to retrench its workmen and the first question must be answered in the negative.
In the view we have taken on the first question we do not consider it necessary on this occasion to express any opinion on the other question canvassed before us.
The result, therefore, is that this appeal is allowed and the decision of the Labour Appellate Tribunal is set aside and the matter is remanded to the Labour Appellate Tribunal to deal with the application of the company and make the appropriate order according to law.
In the circumstances of this case we make no order as to costs.
Appeal No. 4 of 1955 is dismissed also without costs.
| Held, (i) that the ordinary and primary jurisdiction of the Labour Appellate Tribunal constituted under the Industrial Disputes (Appellate Tribunal) Act, 1950 is appellate; (ii) that section 22 of the Act confers on the appellate tribunal a special jurisdiction which is in the nature of original jurisdiction; (iii) that section 23 also vests in the tribunal an additional jurisdiction to decide the complaint as if it were an appeal pending before it; and (iv) that section 23 confers on the 1242 workmen an additional remedy which they did not have under the .
The two now sections 33 and 33 A inserted in the Industrial Di putes Act 1947 (XIV of 1947) by Act XLVIII of 1950 confer distinct benefits on the workmen and give some additional jurisdiction and power to the authorities mentioned therein.
Section 33 A enjoins the Tribunal to decide the complaint "as if it were a dispute referred to or pending before it" and to submit its award to the appropriate Government and provides that the provisions of the Act shall apply to the award.
The provisions of these two new sections 33 and 33 A of the 1947 Act correspond to and are in pari materia with the provisions of sections 22 and 23 of the 1950 Act and are more or less in similar terms.
A ban has been put by section 22 of 1950 Act and section 33 of the 1947 Act upon the ordinary right, which the employer has under the ordinary law governing a contract of employment with a view to protect the workmen against victimisation by the employer and to ensure the termination.of the proceedings in connection with industrial disputes in a peaceful atmosphere and the only thing that the authority is called upon to do is to grant or withhold the permission i.e. to lift or maintain the ban.
These sections do not confer any power on the authorities to adjudicate upon any other dispute.
Under section 22 of the Industrial Disputes (Appellate Tribunal) Act, 1950 (XLVIII of 1950) the Labour Appellate Tribunal has no jurisdiction to impose conditions as a pre requisite for granting permission to the employer to retrench its workmen.
Under section 33 A of the and section 23 of the 1950 Act the jurisdiction of the authority is not only to decide whether there has been a failure on the part of the employer to obtain the permission of the authority before taking action but also to give a decision on the merits of an industrial dispute and grant appropriate relief which when published by the appropriate Government will become enforceable under the respective Acts.
Serampore Belting Mazdoor Union vs Serampore Belting Co., Ltd. ([1951] , Batuk K. Vyas vs Surat Borough Municipality ([1952] , Raj Narain vs Employer s ' Association of Northern India ([1952] 1 Lab.
L.J. 381), The Queen vs County Council of West Riding of Yorkshire ([1896] 1 Q.B. 386), Carlsbad Mineral Works Co., Ltd. vs Their Workmen ([1953] , Atherton West & Co., Ltd. vs Suti Mill Mazdoor Union ([1953] S.C.R. 780) and Bhattacharji vs Parry & Co., Ltd., Calcutta ([1954] , referred to.
|
Appeals Nos. 97 and 98 of 1952.
Appeals under Articles 132(1) and 133(1)(c) of the Constitution of India from the Judgment and Decree dated the 13th October 1950 of the High Court of Judicature at Patna in Miscellaneous Judicial Cases Nos. 140 and 107 of 1950.
M. C. Setalvad, Attorney General for India (G. N. Joshi, Lal Narain Sinha and P. G. Gokhale with him), for the appellant in C.A. Nos. 97 and 98 of 1952.
B. Sen and I. N. Shroff, for the respondents Nos.
I to 4. 1955.
February 10.
The Judgment of the Court was delivered by JAGANNADHADAS J.
These are two connected appeals arising out of a. common judgment of the High Court of Patna on two applications to it dated the 5th July, 1950 and 28th July, 1950, under article 226 of the Constitution.
The State of Bihar is the appellant in both the appeals.
The first three respondents in Appeal No. 97 are the sons of the fourth respondent therein, viz. Kumar Rani Sayeeda Khatoon (hereinafter referred to as Kumar Rani).
The said Kumar Rani is also the first respondent in Appeal No. 98.
The other respondents in both the appeals are Government Officers under the appellant, the State of Bihar.
The applications before the High Court arose with reference to action taken against (1) the property, and (2) the person, of Kumar Rani by the Officers of the Government of Bihar, under the following circumstances.
Kumar Rani was admittedly born in the territory of India and claims to be the lawfully wedded wife of Captain Maharaj Kumar Gopal Saran Narayan Singh of Gaya by virtue of an alleged marriage between them in 1920 according to Arya Samaj rites and subsequently according to Muslim rites, She owned and 1261 possessed considerable properties.
In 1946 she created a wakf of her properties consisting of 427 villages for the maintenance and support of herself, her sons and their descendants, by executing a deed of Wakf ulalAulad dated the 4th May, 1946, by which she divested herself of all her interest in the said properties and vested them in Almighty God.
She appointed, herself as the sole mutwalli for her life time or until relinquishment, and her three sons to succeed her as joint mutwallis.
The deed also provided that the net income was to be spent for the maintenance of herself and her three sons with the direction that not more than half should be spent by the wakifa for her own use.
In July, 1948, Kumar Rani went to Karachi.
In December, 1948, she returned to India from Pakistan on a temporary permit and went back to Pakistan in April, 1949.
On the 21st June, 1949, the Bihar Administration of Evacuee Property Ordinance, 1949 (Bihar Ordinance No. III of 1949) came into force.
The Deputy Custodian of Evacuee Property issued a notification on the 2nd September, 1949, under section 5 of this Ordinance, declaring all the properties comprised in the abovementioned wakf estate to have vested in the Custodian as being evacuee property.
He took possession thereof between the 20th September and 2nd October, 1949.
On the 14th May, 1950, Kumar Rani again came back to India under a permanent permit obtained from the High Commissioner for India in Pakistan.
This permit was, however, cancelled on the 12th July, 1950, by the Deputy High Cominissioner,on the ground that this was wrongly issued, without the concurrence of the Government, a. , required by the rules made under the Influx from Pakistan (Control) Act, 1949.
In view of this cancellation, the Sub Inspector of Police, Gaya, issued notice to Kumar Rani directing her that since her permanent permit had been cancelled, she should leave lndia by the 31st July, 1950.
In view of these happenings two applications were filed before the High Court of Patna, one dated the 5th July, 1950, challenging the validity of the action taken by the Deputy Custodian declaring the wakf estate as evacuee property and taking posses 1262 sion thereof on the basis of that declaration, and another application dated the 28th July, 1950, challenging the validity of the order of the Sub Inspector of Police, Gaya, directing Kumar Rani to leave India.
The first of these applications was filed by Kumar Rani along with her three sons as petitioners and the second by Kumar Rani alone.
Both these applications were allowed by the High Court and hence these appeals by the State on leave granted by the High Court.
These two connected appeals came up for hearing be fore this Court on the 26th and 27th October, 1953.
This Court after hearing counsel on both sides was of the opinion that one of the essential facts (to be mentioned in detail herein below when dealing with Appeal No. 97) requisite for a proper decision of Appeal No. 97 had been assumed without investigation and that it was necessary to have a finding thereupon after taking evidence.
This Court accordingly re manded Appeal No. 97 to the High Court to submit a finding and directed that on the receipt of the finding both the appeals (Appeals Nos. 97 and 98) should be heard together.
The finding has now been received and the appeals have been re heard.
It is necessary at this stage to mention that the advocate who appeared for the respondents in both the appeals at the prior hearing appeared before us at this hearing and stated that he had been instructed to withdraw his appearance in these appeals and to allow the hearing to proceed ex parte.
The preliminary facts having been stated as above, it will now be convenient to deal with these two appeals separately.
Appeal No. 98 which raises the fundamental question as to the continuing citizenship of Kumar Rani will be taken up first.
Civil Appeal No. 98 of 1952.
This appeal arises out of the application to the High Court dated the 28th July, 1950, challenging the validity of the order dated the 23rd July, 1950, issued by the Sub Inspector of Police, Gaya.
This order is challenged on the ground that Kumar Rani was, and throughout continued to be, a citizen of India and 1263 that the order dated the 23rd July, 1950, which, in substance, amounted to an order of her externment from India, was in violation of Kumar Rani 's fundamental right under article 19 of the Constitution as a citizen of India.
The question that arises is whether, in the circumstances, Kumar Rani was a citizen of India at the date of the order.
The contention of Kumar Rani is that though it is a fact that she did go to Pakistan in the year 1948, she went there only for a temporary purpose, viz. for securing the medical treatment of a reputed Hakim and that she was always and continued to be a citizen of India and that, therefore, the High Commissioner for India in Pakistan had no power to cancel the permit issued to her.
As regards her allegation that when she first went to Karachi in July, 1948, she did so temporarily for the purpose of medical treatment, the learned Judges of the High Court were not inclined to accept her story.
But, all the same, they held that she was and continued to be a citizen of India, on the ground that she was born in India and that her domicile continued to be that of her husband, Captain Maharaj Kumar Gopal Saran Narayan Singh, who, it is not disputed, throughout continued to be in India.
The learned Judges of the High Court apparently had article 5 of the Constitution in mind and acted on the view of the English law that the wife 's domicile continues throughout to be that of her husband during the continuance of marriage.
It appears to us, with respect, that the learned Judges of the High Court completely overlooked article 7 of the Constitution.
The relevant portion of article 5 of the Constitution says as follows: "At the commencement of this Constitution, every person who has his domicile in the territory of India and who was born in the territory of India shall be a citizen of India".
In the view of the High Court since Kumar Rani was born in India and bad the Indian domicile of her husband, she was a citizen of India.
But article 7 says: "Notwithstanding anything in article 5, a person 162 1264 who has after the first day of March, 1947, migrated from the territory of India to the territory now included in Pakistan shall not be deemed to be a citizen of India".
There is a proviso to this article which will be noticed presently.
But before noticing the proviso and its effect, it is necessary to mention the following facts which may be taken to have been made out on the record.
(1) Kumar Rani went to Karachi in July, 1948.
(2) Her story that she went there temporarily for medical treatment has been doubted by the High Court and appears to us to be unfounded.
(3) When she came to India in December, 1948, she did so on a temporary permit stating in her application for the said permit that she was domiciled in Pakistan and accordingly representing herself to be a Pakistani national.
(4) She went back to Pakistan in April, 1949, on the expiry of that temporary permit.
(5) She made an attempt to obtain a permit for permanent return to India only after steps had been taken to vest the property in the Custodian and after the same was taken possession of.
There can be no doubt on these facts that she must be held to have migrated from the territory of India after the 1st March, 1947.
Even if therefore article 5 can be said to be applicable to her on the assumption that Captain Narayan Singh was her husband and that her domicile was that of her husband, the facts bring her case under article 7.
Article 7 clearly overrides article 5.
It is peremptory in its scope and makes no exception for such a case, i.e., of the wife migrating to Pakistan leaving her husband in India.
Even such a wife must be deemed not to be a citizen of India unless the particular facts bring her case within the proviso to article 7.
This proviso is as follows: "Provided that nothing in this article shall apply to a person who, after having so migrated to the territory now included in Pakistan, has returned to the territory of India under a permit for resettlement or permanent return issued by or under the authority of any law".
It is contended with reference to this proviso that 1265 since she in fact returned under a permanent permit, she is entitled to the benefit there of and that the subsequent cancellation of the said permit is both illegal and irrelevant.
Rule 10 of the Permit System Rules, 1949, framed by the Central Government under section 4 of the Influx from Pakistan (Control) Act, 1949, provides that a permit for permanent resettlement in India may be granted by the High Commissioner or Deputy High Commissioner only after securing the agreement of the State or the Province where the applicant intends to settle.
Rule 29 provides that every permit issued under the rules shall be liable to cancellation at any time, without any reason being assigned by the issuing authority.
In the present case, the permit has been cancelled in a reasoned order on the ground that, on the facts of the case, the consent of the State Government concerned should have been obtained before the permit could be issued.
This is a case, therefore, not of a valid permanent permit having been issued and the permit holder returning to India on the strength thereof and the same having been arbitrarily cancelled.
It is a case of an unauthorised issue of an invalid permit which has been properly cancelled.
Hence the proviso to article 7 can have no possible application.
The applicant, is, therefore, not a citizen of India and the order passed by the Sub Inspector of Police, Gaya, dated the 23rd July, 1950, directing Kumar Rani to leave India was accordingly valid.
This appeal must therefore succeed.
Civil Appeal No. 97 of 1952.
This appeal arises out of the application to the High Court dated the 5th July, 1950, challenging the validity of the notification dated the 2nd September 1949, issued by the Deputy Custodian under the Bihar Administration of Evacuee Property Ordinance, 1949, declaring the wakf estate as evacuee property and taking possession thereof.
Three main grounds on which this has been contested are as follows: (1) Kumar Rani was not an evacuee.
(2) She had written a letter dated the 2nd June, 1949, addressed to her ,second son, Kumar Fateh Singh, whereby she relin 1266 quished the office of mutwalli in the wakf estate, and therefore by virtue of the said letter and in pursuance of the terms of the original deed of wakf, her three sons, respondents I to 3, had become the joint mutwallis as well as the owners of the beneficial interest in the wakf estate.
It being undisputed that these three remained in India throughout, it is contended that the property at the date of the notification was the property of these three sons and not of Kumar Rani and that, therefore, the Bihar Administration of Evacuee Property Ordinance, 1949, has no application to the facts.
(3) The Bihar Administration of Evacuee Property Ordinance, 1949, is not applicable to wakf property and to the beneficial interest of the applicants therein.
So far as the first point is concerned an "evacuee" is defined as follows in the Bihar Administration of Evacuee Property Ordinance, 1949: "A person who, on account of the setting up of the Dominions of India and Pakistan or on account of civil disturbances or the fear of such disturbances, leaves or has, on or after the 1st day of November, 1946, left, any place in the Province of Bihar for any place outside the territories now forming part of India".
It is clear that, as already found above, Kumar Rani migrated to Pakistan from India after the 1st March, 1947.
In view of the fact that her plea as to the reason for such migration has not been accepted, she can well be taken to have left India for Pakistan in the circumstances set out in this definition, and after the prescribed date.
She has, therefore, been rightly taken to be ' an "evacuee" by the Custodian.
As regards the second point, the alleged relinquishment of the office of mutwalli by Kumar Rani and the vesting of the interest in the wakf property in her three sons, respondents 1 to 3, as joint mutwallis thereof, by virtue of the terms of the ' deed of wakf, is based on a letter addressed to the second respondent, her second son Kumar Fateh Singh, purporting to have been written by her and dated the 2nd June, 1949.
The genuineness of this letter has been challenged and it is the issue as to it 1267 genuineness that was remanded to the High Court for a finding by the previous order of this Court.
The 7 High Court having taken evidence on the matters at the hearing after remand and having considered the same, has clearly found that the letter was not genuine.
We have gone through the finding and the material relevant thereto, and can find no reason not to accept it.
There is, therefore, no substance in this second contention.
As regards the third point, the contention is based on the definition of the phrase "evacuee property" in the Bihar Administration of Evacuee Property Ordinance, 1949, which is as follows: "Evacuee property means any property in which an evacuee has any right or interest or which is held by him under any deed of trust or other instrument".
It is contended that this definition does not apply either to the wakf property or to the beneficial interest of the mutwalli therein and that, therefore, the property in question did not vest in the Custodian.
Now, as already stated, the original notification vesting the wakf property in the Custodian was made under section 5 of the Bihar Administration of Evacuee Property Ordinance, 1949.
This Ordinance was repealed by section 55(2) of Central Ordinance No. XXVII of 1949.
The Central Ordinance defined "evacuee property" as "any property in which an evacuee has any right or interest, whether personal or as a trustee or as beneficiary or in any other capacity".
The Central Ordinance was in turn repealed by Cenral Act No. XXXI of 1950 and "evacuee property" has been defined therein as meaning "any property of an evacuee whether held by him as owner or as a trustee or as a beneficiary or as a tenant or in any other capacity".
The word "property" is defined as meaning " property of any kind and includes any right or interest in such property".
The Central Ordinance which repealed the Bihar Ordinance as well as the Central Act which repealed the Central Ordinance, each contain section 8(2) providing that 1268 " where immediately before the commencement of this Ordinance (Act) any evacuee property in a Province has vested in any person exercising the power of Custodian under any law repealed hereby, the evacuee property shall on the commencement of the Ordinance (Act) be deemed to have been vested in the Custodian appointed or deemed to have been appointed for the Province under the Ordinance (Act) and shall continue to so vest".
The definitions of the phrase "evacuee property" in the Central Ordinance and by the Central Act are clear and unambiguous so as to include the interest of an evacuee in any property held as a trustee or beneficiary.
There is no reason to think that "evacuee property" as defined in the Bihar Ordinance was meant to be anything different.
The words used in this definition are of sufficient amplitude and we are of the opinion that the Bihar definition comprised also wak property and interest therein.
We are also of the opinion that the successive repeals of the Bihar Ordinance by the Central Ordinance and the Central Act and the continuance of the vesting in the Custodian, places the matter beyond any doubt.
This contention must, therefore, fail.
This appeal also must accordingly succeed.
In the result both the appeals are allowed.
The appellant in the circumstances will get only the costs incurred before the High Court on remand in Civil Appeal No. 97 of 1952.
Appeals allowed.
| The relevant portion of article 5 of the Constitution reads: "At the commencement of this Constitution every person who has his domicile in the territory of India and who was born in the territory of India shall be a citizen of India".
Article 7 of the Constitution lays down: "Notwithstanding anything in article 5, a person who has after the first day of March 1947, migrated from the territory of India to the territory now included in Pakistan shall not be deemed to be a citizen of India".
It was contended on behalf of the respondent Kumar Rani who had migrated from India to Pakistan in 1948 that she was, and continued to be, a citizen of India on the ground that she was born in India and her domicile continued to be that of her husband, who throughout continued to be in India and that her case was covered by article 5 of the Constitution.
Held (repelling the contention) that article 7 of the Constitution clearly overrides article 5.
As the respondent had migrated from India to Pakistan after the 1st March, 1947, her case fell under article 7 of the Constitution and that inasmuch as it was a case of an unauthorised issue of an invalid permit which had been properly cancelled the proviso to article 7 did not apply and that therefore the respondent could not be deemed to be a citizen of India.
Held also, that the definitions of the phrase "evacuee property" in the Administration of Evacuee Property Ordinance 1949 and the (XXXI of 1950) clearly include the interest of an evacuee in any property held as a trustee or beneficiary.
The definition of evacuee property in Evacuee Property Ordinance 1949 (Bihar Ordinance No. III of 1949) is not 1260 different and the words used therein comprise also wakf property and any interest therein.
|
Appeal No. 215 of 1954.
Appeal by Special Leave from the Judgment and Order dated the 23rd day of August 1954 of the High Court of Judicature at Bombay in Special Civil Application No. 1665 of 1954 under Article 226 of the Constitution of India.
R. B. Kotwal, J. B. Dadachanji and Rajinder Narain, for the appellant.
Naunit Lal, for respondents Nos. 1 to 3. 1955.
February 22.
The Judgment of the Court was delivered by SINHA J.
This is an appeal by special leave against the judgment and order dated the 23rd August 1954 of the High Court of Judicature at Bombay, dismissing the appellant 's petition for a writ of quo warranto or any other appropriate writ directed against the election of the 2nd and 3rd respondents as President and Vice President respectively of the Gadag Betgeri 1271 The facts of this case are not in dispute and may shortly be stated as follows: The 1st respondent is a municipality governed by the provisions of the Municipal Boroughs Act (Bombay Act XVIII of 1925) which 7 hereinafter shall be referred to as the Act for the sake of brevity.
The appellant is one of the 32 councillors constituting the municipality.
The last general election to the municipality took place on the 7th May 1951.
The term of the councillors was three years computed from the date of the first general meetinog held after the general election aforesaid in this case the 10th July 1951.
In that meeting the 4th and 5th respondents were elected President and Vice President respectively of the municipality for a term of three years.
The Act was amended by Bombay Act XXXV of 1954, under which the term of office of the councillors was extended from 3 to 4 years ending on the 9th July 1955.
As the term of respondents 4 and 5 aforesaid was to expire at the end of three years from the 10th July 1951 and as the term of the municipality was extended by one year under the amending Act aforesaid, the vacancies thus occurring bad to be filled up by a fresh election of President and Vice President.
The Collector therefore called a special general meeting of the municipality to be held on the 30th July 1954 to elect a President and Vice President for the remaining period of the quadrennium.
The Collector had nominated the Prant Officer (the District Deputy Collector) to preside over that special general meeting.
On the 30th July 1954 the Prant Officer under instructions from the Collector adjourned the meeting to the 3rd August 1954 without transacting any business, the only item on the agenda being the election of the President and Vice President.
The 3rd respondent raised a point of order against the adjournment but the presiding officer aforesaid overruled that objection.
Hence the special general meeting was held on the 3rd August 1954.
At that meeting the appellant raised a point of order that under the provisions of the " Act a President could not be elected for 163 1272 a term less than a year and that therefore the proposed election would be in the teeth of those provisions.
The presiding officer who was the same person who had adjourned the meeting on the 30th July 1954 overruled that objection too.
Thereupon 13 out of the 32 councillors who were present walked out on the ground that they did not propose to participate in a meeting in which the proposal was to elect a President for less than a year contrary to the provisions of the Act.
The appellant was one of those 13 councillors who walked out.
It may be added that the full strength of the municipality is 32 councillors all of whom were present both on the 30th July 1954 and the 3rd August 1954.
The remaining 19 councillors proceeded to transact business and elected the 2nd respondent as the President, the proposal being that he "should be President of the municipality for the remaining period of the quadrennium" and that was the proposal which was carried.
Immediately after the election of the President another meeting was held for the election of the Vice President under the presidency of the newly elected President (the 2nd respondent).
The appellant raised the same point of order as he had done in the case of the election of the President and that was also overruled.
Thereupon six of the councillors present including the appellant walked out and the remaining councillors elected the 3rd respondent as the Vice President.
The appellant moved the High Court of Bombay under article 226 of the Constitution for a writ of quo warranto or any other appropriate writ or order or direction against the 2nd and 3rd respondents "restraining them from usurping the office of the President and Vice President respectively of the opponent No. I Municipality and restraining them from performing any duties and from exercising any powers as President and Vice President respectively".
The High Court held that the election of the 2nd and 3rd respondents was not illegal and dismissed the application.
It held that on a proper construction of the relevant provisions of the Act it was not correct to say that the term of office of the councillors or of the newly 1273 elected President and Vice President shall end with the 9th July 1955; that the intention was to elect the President and the Vice President for the remaining term of the municipality which was not only a period of four years certain but an additional period up to 7 the date when new President and Vice President A would be elected and take over after a fresh general election; that the adjournment of the meeting of the 30th July was not beyond the powers of the presiding officer; and that consequently the meeting of the 3rd August was not vitiated by any illegality.
It was also pointed out by the High Court that all the councillors constituting the municipality had notice of the adjourned meeting and did as a matter of fact attend that meeting and that even if there was any irregularity in the adjournment on the 30th July 1954 that did not affect the illegality of the adjourned meeting and the business transacted therein.
The appellant moved the High Court for leave to appeal to this court but that application was rejected.
The appellant then applied to this court for special leave to appeal which was granted on the 3rd September 1954.
It has been argued on behalf of the appellant that the meeting held on 3rd August 1954 as aforesaid was invalid for the reasons: 1. that it was not an adjourned meeting inasmuch as the meeting of the 30th July 1954 had not been validly adjourned, 2.
that it had not been called by the Collector, and 3.
that the written notice required by section 35(3) had not been given and in any event, had not been served and published as required by law.
Secondly it was urged that the meeting of the 3rd August being thus invalid.
, the business transacted at that meeting, namely, the election of the President was equally invalid.
Thirdly it was urged that the election of the President being invalid, the meeting held that very day under the presidency of the President thus elected was also invalid and the election of the Vice President consequently was illegal.
It was 1274 further argued that the election of the President and the Vice President being in violation of section 19 of the Act was invalid on that ground also; and finally, that the amendment of section 19 by the amending Act LIV of 1954 after leave to appeal had been granted by this court could not affect the present proceedings which were then pending even though the amending Act purported to make it retrospective.
On behalf of respondents 1, 2 and 3 who only have appeared in this court, it has been urged that a President and Vice President could be elected for a term of less than one year as section 19 of the Act was subject to section 23 (1) (A); that in any view of the matter, section 19 as amended by the amending Act LIV of 1954 rendered the election beyond question as the Act in terms was meant to validate all elections held between the passing of the amending Act XXXV of 1954 and the amending Act LIV of 1954; that the presiding officer had inherent, if not statutory power to adjourn the meeting of the 30th July 1954 and that in any event the meeting held on the 3rd August 1954 could be treated as a fresh meeting called by the Collector and that any irregularity in serving the notice or in the appointment of the presiding officer was cured by the provisions of section 57 of the Act.
It was also argued that the appellant was not the councillor who had objected to the adjournment of the meeting of the 30th July and could not therefore object to it at a later stage.
Finally it was argued that the appellant had no right to a writ or order prayed for as he had not been injured in any sense.
It would thus appear that there are two main questions in controversy between the parties, namely, (1) whether the meeting of the 3rd August, 1954 had been validly held; and (2) whether the president and the vice president having been elected "for the remaining period of the quadrennium" had been validly elected.
There are a number of subsidiary questions bearing upon these two main questions which have been canvassed before us, 1275 A good deal of argument was addressed to us contending that the presiding officer had no power to adjourn the meeting of the 30th July 1954 in view of the provisions of section 35(11) of the Act.
In this connection reference was also made to the proviso to section 19 A(2).
Those provisions, it was argued,, point to the conclusion that the powers of the presiding officer are the same as those of the president of a municipality when presiding over an ordinary meeting of the municipality except that section 35(11) relating to adjournments had been qualified only to this extent by the proviso aforesaid, that the Collector or the officer presiding over the meeting for the purpose of holding an election of the president or vice president may refuse to adjourn such a meeting in spite of the wishes of the majority of the members present to the contrary.
It was also argued that the High Court had wrongly taken the view that the presiding officer had the inherent right to adjourn the meeting.
Reference was made to certain passages in "The Law of Meetings" by Head, "The Law on the Practice of Meetings" by Shackleton, and "Company Meetings" by Talbot.
In our opinion, it is unnecessary for the purpose of this case to pronounce upon the merits of that controversy in the view we take of the meeting of the 3rd August, 1954, assuming that the meeting of the 30th July, 1954 had been adjourned without authority.
It is common ground that it was the Collector who called the meeting of the 30th July 1954 and that it was under instructions from the Collector that meeting was adjourned.
Under the provisions of section 23(1) (A), on the expiry of the term of office of the president or vice president as determined by the municipality under section 19(1) of the Act, a new president or vice president shall be elected within 25 days from the date of such expiry.
The provisions of section 19 A which relate to the procedure for calling a meeting of a newly constituted municipality for the election of a president and vice president have been made applicable to the calling of a meeting and the procedure to be followed at such meeting for the 1276 election of a president.
Section 19 A requires the Collector to call a meeting for holding such an election.
Such a meeting shall be presided over by the Collector or such officer as the Collector may by order in writing appoint in this behalf.
The Collector or his nominee, when presiding over such a meeting, shall have the same powers as the president of a municipalit by when presiding over a meeting of the municipality has, but shall not have the right to vote.
On the 30th July, 1954 a special general meeting had been called by the Collector for the election of the President.
In the proceedings of that meeting it has been recorded that "Under instructions from the Collector of Dharwar the presiding authority adjourns the meeting to 3rd August 1954 at 3 P.m.".
At that meeting all the 32 councillors were present and admittedly in their presence the presiding officer declared openly that the meeting will be held on the 3rd August 1954 under instructions from the Collector concerned.
When the meeting was held on the 3rd August 1954 at 3 P.m.
as previously notified, again the 32 councillors were present.
The proceedings show that the same Prant Officer "occupied the chair as authorised by the Collector".
The presiding authority read out and explained to the members present the following telegraphic message from the Collector: "Government have directed to bold election of President of Gadag Municipality on 3rd August as already arranged.
Hold election accordingly today without fail".
At this meeting the appellant raised two points of order, (1) that the election of the president for the remaining period of the quadrennium as mentioned in the agenda was illegal, and (2) that the meeting was not an adjourned meeting of the municipality and was also illegal because it was under the instructions of the Collector that the adjourned meeting was being held and that the Collector had no such power.
The minutes of the proceedings further show that "the presiding authority ruled out the points of order on the ground that this was a special meeting called by the Collector for the election of the President and 1277 the election has to be held as already fixed".
After the ruling given by the presiding authority, 13 members including the appellant expressed a desire to walk out and walked out with the permission of the presiding authority.
The remaining members, as already indicated, continued the business of the meeting and the proposal that the 2nd respondent should be elected president of the municipality for the remaining period of the quadrennium after having been duly made and seconded was carried unanimously and the meeting terminated.
It would thus appear that the meeting of the 3rd August 1954 for the election of the president had been called by the Collector who had authorized the Prant Officer to preside over that meeting and that the 2nd respondent was duly elected president.
Under section 35(3) of the Act, for such a special general meeting three clear days ' notice has to be given "specifying the time and place at which such meeting is to be held and the business to be transacted thereat shall be served upon the councillors, and posted up at the municipal office or the kacheri or some other public building in the municipal borough and also published in a local vernacular newspaper having a large circulation if such exists".
It has been contended on behalf of the appellant that the notice required by section 35 (3) contemplates a written notice to be served and published in the manner specified, and that the meeting of the 3rd August 1954 could not be said to have been held after complying with the terms of sub section (3) of section 35.
It was also contended that the requirements of section 19 A(1) and (2) have also not been complied with because there is no evidence that the Collector had called that meeting or that he had made an order in writing that the presiding authority had been authorized to preside over that meeting.
In our opinion, there is no substance in any one of these contentions.
From the record of the proceedings of the proposed meeting of the 30th July 1954 and the actual meeting on the 3rd August 1954 it is clear that whatever had been done had been done under the orders of 1278 the Collector.
He had called the meeting of the 30th July as also of the 3rd August 1954.
It was he who had appointed the Prant Officer as the presiding officer for both those meetings.
It is true that the notice of the meeting of the 3rd August 1954 had not been given in writing but had only been intimated to all the councillors who were present at the meeting of the 30th July 1954.
The notice amply satisfies the requirement of three days ' clear notice, though it was not in writing.
It had indicated the time of the meeting and the business to be transacted.
Under section 35(4) the ordinary venue of a meeting is the municipal office unless otherwise indicated in the notice.
It is also true that the notice was not served in the manner indicated in sub section (3) of section 35 of the Act.
There is no evidence that there existed a local vernacular newspaper with large circulation, in which the notice of the meeting could be published.
The question is, do those omissions render the notice ineffective in law.
That could only be so if those provisions were held to be mandatory.
The following provisions (omitting the words not material to this case) would show that those provisions of section 35(3) are directory and not mandatory and that any omissions in the manner of service of the notice are mere irregularities which would not vitiate the proceedings unless it was shown that those irregularities bad prejudicially affected the proceedings: "No resolution of a municipality deemed invalid on account of any irregularity in the service of notice upon any councillor or member provided that the proceedings of the municipality . . . were not prejudicially affected by such irregularity".
Fortunately for the respondents, all the councillors constituting the municipality were present on both the occasions, namely, 30th July and 3rd August, 1954.
Hence they had ample notice of the meeting to be held on the 3rd August, 1954, the time and place of the meeting and the business to be transacted.
It has not been either alleged or proved that the irregularities in the service of the notice or the omissions com 1279 plained of had prejudicially affected the proceedings.
But it was contended that as the notice had not been posted up at the municipal office or the local kacheri or some other public building and had also not been published in a local vernacular newspaper, if there were one, though all the councillors were present on 3rd August, 1954, the members of the public had no such notice and naturally therefore could not be present at that meeting.
In this connection it was pointed out that sub section (6) of section 35 provides that every such meeting shall be open to the public, unless the presiding authority directs to the contrary.
It is evident from the provisions of that sub section that though the presence of the public at such meetings may be desirable, it is not obligatory.
The presence at or the absence from such a meeting of the members of the public has no legal consequence so far as the validity of the election is concerned.
It must therefore be held that the meeting of the 3rd August, 1954 in substance, though not in form, complied with the requirements of the law for holding a valid special general meeting and that therefore that meeting was not invalid, assuming, as already said, that the order of the presiding authority adjourning the meeting of the 30th July, 1954 was not authorized.
It has to be remembered in this connection that such a special general meeting can be presided over only by the Collector or the person authorized by him and if either the Collector or his nominee does not hold the meeting, it is not competent for councillors present to elect their own chairman for presiding over such a meeting.
Therefore if the presiding authority admittedly under instructions from the Collector refused to proceed with the elections on the 30th July 1954, the councillors present could not hold a meeting of their own with a president of their own choice and transact the only business on the agenda, namely, the election of president.
Hence, rightly or wrongly, if the meeting called for the 30th July was not held, another meeting had to be held for the purpose within 25 days of the occurrence of the vacancy.
In this case, as a 164 1280 result of the expiry of the original term of office of the president and vice president, another meeting giving the required three days statutory notice had to be held.
The meeting held on the 3rd August 1954 was such a meeting.
Indeed, there were some omissions in the manner of publication or service of the notice but those in law were mere irregularities which do not have the effect of vitiating the election held at that meeting.
The election of the president therefore, if not otherwise invalid, could not be assailed on the ground of the irregularity in the service or publication of the notice, in the special circum stances of this case.
If all the councillors had not been present on the 30th July or had not been informed of the proposed meeting of the 3rd August 1954, other considerations may have arisen but in this case it is clear that there was absolutely no prejudice to any party or individual or the municipality as a whole.
But it was further contended that the walking out of the 13 councillors rendered the meeting infructuous.
In our opinion, such a result does not follow from the voluntary act of the 13 councillors who chose to walk out.
It was not even suggested that there was no quorum for the special general meeting after the 13 councillors walked out.
The next question is whether the provisions of section 19 (1) as they stood on the 3rd August 1954 render the election of the president and the vice president on the 3rd August 1954 invalid as it was "for the remaining period of the quadrennium".
The High Court has taken the view that the remaining period of the quadrennium would not necessarily end on the 9th July 1955, in view of the proviso to section 19(1) "that the term of office of such president or vice president shall be deemed to extend to and expire with the date on which his successor is elected".
In view of the events that have happened it is not necessary for us to pronounce on the correctness or otherwise of that decision.
After the judgment of the High Court and after the grant of special leave by this court, the Bombay Legislature enacted Act LIV of 1954 which was published in the Bombay Gazette on the 14th 1281 October 1954.
Sections 2 and 3 of the amending Act are in these terms: "2.
In section 19 of the Bombay Municipal Boroughs Act, 1925, in sub section (I), (1)after the words 'not less than one year ' the words 'or not less than the residue of the term of office of the municipality, whichever is less ' shall be inserted; (2)for the words 'three years ' the words 'four years ' shall be substituted.
3.(1) The amendments made by this Act shall be deemed to have come into force on the date on which the Bombay District Muncipal and Municipal Boroughs (Amendment) Act, 1954, came into force (hereinafter in this section referred to as 'the said date ') and all elections to the office of the president or vice president, held on or after the said date and before the coming into force of this Act, shall be deemed to be valid as if this Act bad been in force on the said date; and any person elected to the office of the president or vice president at any of such elections shall not be deemed to have been illegally elected merely on the ground that the residue of the term of office of the municipality being less than one year at the time of such election, he would hold his office for a term less than one year in contravention of section 19 of the Bombay Municipal Boroughs Act, 1925, as it was in operation before the coming into force of this Act.
(2)Nothing contained in this section shall affect the judgment, decree or order of any competent court, passed before the coming into force of this Act, holding any of such elections invalid on the ground specified in sub section (1)".
It has not been contended that section 19 as amended by Act LIV of 1954 does not in terms cover the elections now impugned, nor that section 3 of the amending Act quoted above is not retrospective; but it has been urged on behalf of the appellant that it is not retrospective to the extent of affecting pending proceedings.
In terms the amendment in question is deemed to have come into force on the II the May 1954 1282 on which date the amending Act XXXV of 1954 had come into force.
Section 3 in terms also declares that all elections to the office of president and vice president held on or after the 11th May 1954 and before the coming into force of the amending Act shall be deemed to have been valid.
The section also declares in unequivocal terms that such an election shall not be questioned simply on the ground of contravention of section 19 on which the election of the 2nd and 3rd respondents bad been questioned before the High Court.
The legislature apparently thought fit to declare beyond all controversy that an election of president or vice president for the unexpired portion of the term of a municipality could not be questioned on the ground that the provisions of section 19 as it stood before the amendment had been contravened.
But it was argued on behalf of the appellant that in terms the amendment had not been made applicable to pending litigation and that therefore this court should hold that the amendment did not have the effect of validating the elections which were already under challenge in a court.
No authority has been cited before us in support of the contention that unless there are express words in the amending statute to the effect that the amendment shall apply to pending proceedings also, it cannot affect such proceedings.
There is clear authority to the contrary in the following dictum of Lord Reading, C.J. in the case of The King vs The General Commissioners of Income tax for Southampton; Ex parte W. M. Singer (1), "I cannot accept the contention of the applicant that an enactment can only take away vested rights of action for which legal proceedings have been commenced if there are in the enactment express words to that effect.
There is no authority for this proposition, and I do not see why in principle it should be the law.
But it is necessary that clear language should be used to make the retrospective effect applicable to proceedings commenced before the passing of the statute".
That was a case in which the Act in question had (1) , 259, 1283 validated assessments made by commissioners for wrong parishes.
It was held by the court that the retrospective effect of the relevant section extended to proceedings for a prohibition commenced before the Act came into force and the rule nisi for a prohibition was therefore discharged.
In every case the language of the amending statute has to be examined to find out whether the legislature clearly intended even pending proceedings to be affected by such statute.
A number of authorities were cited before us but it is only necessary to refer to the decision of their Lord ships of the Judicial Committee in Mukerjee, Official Receiver vs Ramratan Kuer(1), which is clearly in point.
In that case while an appeal had been pending before the Judicial Committee the amending Act had been passed clearly showing that the Act was retrospective in the sense that it applied to all cases of a particular description, without reference to pending litigation.
In those circumstances their Lordships pointed out that if any saving were to be implied in favour of pending proceedings, then the provisions of the statute would largely be rendered nugatory.
Those observations apply with full force to the present case, inasmuch as if any saving were to be implied in favour of cases pending on the date of the amendment, the words "all elections to the office of the president or vice president, held on or after the said date and before the coming into force of this Act, shall be deemed to be valid" could not be given their full effect.
As there are no such saving clauses in express or implied terms, it must be held that the amendment was clearly intended by the legislature to apply to all cases of election of president or vice president, whether or not the matter had been taken to court.
it is the duty of courts to give full effect to the intentions of the legislature as expressed in a statute.
That being so, it must be held that the amending Act had the effect of curing any illegality or irregularity in the elections in question with reference to the provisions of section 19 of the Act.
For the reasons aforesaid it must be held that the (1) [1935] L.R. 63 I.A. 47.
1284 meeting of the 3rd August 1954 had been validly held and that there is no illegality in the election of the 2nd and 3rd respondents as president and vice president respectively.
We accordingly affirm the orders of the High Court, though not for the same reasons.
The appeal fails and is dismissed with costs.
Appeal dismissed.
| The first respondent Municipality governed by the Municipal Boroughs Act, 1925 (Bombay Act XVIII of 1925) consists of 32 councillors, S, (the appellant) being one of them.
The last general election to the Municipality took place on the 7th May 1951.
The term of the councillors was three years computed from the first meeting held on 10th July 1951 after the general election.
In that meeting the 4th and 5th respondents were elected President and Vice President respectively for a term of three years.
Act XVIII of 1925 was amended by Bombay Act XXXV of 1954 under which the term of office of the councillors was extended from 3 to 4 years ending on 9th July 1955.
As the term of respondents 4 and 5 was to expire at the end of three years from the 10th July 1951 and as the term of the Municipality was extended by one year under the Amending Act XXXV of 1954 a fresh election of President and VicePresident was necessary to fill up the vacancies thus occurring.
The Collector called a special general meeting for the 30th July 1954 to elect a President and Vice President for the remaining period of the quadrennium and nominated the Prant Official (the District Deputy Collector) to preside over that meeting.
On the 30th July 1954 the Prant Officer adjourned the meeting to the 3rd August 1954 under instructions from the Collector without transacting any business.
The objection raised by respondent No. 3 against the adjournment was overruled by the presiding Officer.
The special general meeting was held on the 3rd August 1954.
An objection raised by S (the appellant) that under the provisions of the Act a President could not be elected for a term less than a year was overruled by the presiding Officer.
On this 13 councillors (including S) out of the 32 who were present walked out on the ground that the President was to be elected for a term less than a year contrary to the provisions of the Act.
The remaining 19 councillors elected the 2nd respondent as the President for the remaining period of the quadrennium.
Immediately after that another meeting presided over by the newly elected President elected respondent No. 3 as Vice President.
The same point of order raised by S as in the case of the President was overruled, on which 6 councillors walked out and the meeting was held by the remaining councillors.
All the 32 councillors were present both on the 30th July 1954 and the 3rd August 1954.
An application under article 226 of the Constitution presented by S questioning the validity of the meeting of the 3rd August, 1954, and consequently the validity of the election of respondents Nos. 2 and 3 as President and Vice President for the remaining period of the quadrennium was dismissed by the High Court.
Held, (1) that the meeting of the 3rd August 1954, in substance though not in form, complied with the requirements of the law for holding a valid special meeting and therefore the meeting was not invalid because the record of proceedings would show that whatever had been done on the 30th July 1954 and the 3rd August 1954 had been done under the orders of the Collector.
The notice to the councillors required under section 35(3) of the Act satisfied the requirements of three clear days, that the provisions of section 35(3) regarding the ser 1270 vice of notice are directory and not mandatory; and that any omissions in the manner of service of the notice are more irregularities which would not vitiate the proceedings unless it is shown that those irregularities had prejudicially affected the proceedings which had not been alleged or proved in the present case.
All the councillors constituting the Municipality were present on both the occasions namely the 30th July 1954 and the 3rd August 1954 and thus had ample notice of the meeting to be held on the 3rd August 1954, the time and place of the meeting and the business to be transacted.
That under the provisions of section 35(3) of the Act the presence at or the absence from the meeting of the members of the public has no legal consequence so far as the validity of the election is concerned; (2) that as section 19 of the Bombay Boroughs Act, (Bombay Act XVIII of 1925) had been amended by the Bombay Municipal Boroughs Act, 1954 (Bombay Act LIV of 1954) and was retrospective in its operation, it had the effect of curing any illegality or irregularity in the election with reference to the provisions of section 19 of the Act and therefore respondents Nos. 2 and 3 had been validly elected as President and, Vice President respectively.
King vs The General Commissioners of Income tax for South ampton, Ex parte W.M. Singer ([1916] 2 K.B. 249) and Mukerjee, Offcial Receiver vs Ramratan Kuer ([1935] L. R. 63 I. A. 47), referred to.
|
minal Appeals Nos.
95 to 97 and 106 of 1954.
1151 Appeal by Special Leave from the Judgment and Order dated the 24th August 1953 of the High Court of Judicature for the State of Punjab (Circuit Bench, Delhi) in Criminal Revision Nos.
109 D, 122 D and 123 D of 1953 arising out of the Judgment and Order dated the 25th May 1953 of the Court of Special Judge,Delhi, in Corruption Case No. 14 of 1954; from the Judgment and Order dated the 27th August 1954 of the High Court of Judicature for the State of Punjab (Circuit Bench, Delhi) in Criminal Miscellaneous No. 131 D of 1954.
H. J. Umrigar and Rajinder Narain, for appellant No. 1.
C. K. Daphtary, Solicitor General of India (G. N. Joshi, P. A. Mehta and P. G. Gokhale, with him), for the respondent.
December 14.
The Judgment of the Court was delivered by JAGANNADHADAS J.
These are appeals by special leave against the orders of the Punjab High Court made in exercise of revisional jurisdiction, reversing the orders of the Special Judge, Delhi, quashing certain criminal proceedings pending before himself against these appellants for alleged offences under the Penal Code and the Prevention of Corruption Act, 1947.
The Special Judge quashed the proceedings on the ground that the investigations on the basis of which the appellants were being prosecuted were in contravention of the provisions of sub section (4) of section 5 of the Prevention of Corruption Act, 1947, and hence illegal.
In Appeal No. 95 of 1954 the appellants are two persons by name H.N. Risbud and Indar Singh.
In Appeals No. 96 and 97 of 1954 H.N. Risbud above mentioned is the sole appellant.
These appeals raise a common question of law and are dealt with together.
The appellant Risbud was the Assistant Development Officer (Steel) in the office of the Directorate General, Ministry of Industry and Supply, Government of India and the appellant Indar Singh was the Assistant Project Section Officer (Steel) in the office of the Direc 1152 torate General, Ministry of Industry and Supply, Government of India.
There appear to be a number of prosecutions pending against them before the Special Judge, Delhi, appointed under the Criminal Law Amendment Act., 1952 (Act XLVI of 1952).
We are concerned in these appeals with Cases Nos.
12,13 and 14 of 1953.
Appeals Nos. 95, 96 and 97 arise respectively out of them.
The cases against these appellants are that they along with some others entered into criminal conspiracies to obtain for themselves or for others iron and steel materials in the name of certain bogus firms and that they actually obtained quota certificates, on the strength of which some of the members of the conspiracy took delivery of quantities of iron and steel from the stock holders of these articles.
The charges, therefore, under which the various accused, including the appellants, are being prosecuted are under section 120 B of the Indian Penal Code, section 420 of the Indian Penal Code and section 7 of the Essential Supplies (Temporary Powers) Act, 1946.
In respect of such of these accused as are public servants, there are also charges under section 5(2) of the Prevention of Corruption Act, 1947.
Under section 5(4) of the Prevention of Corruption Act, 1947, a police officer below the rank of a Deputy Superintendent of Police shall not investigate any offence punishable under sub section (2) of section 5 without the order of a Magistrate of the First Class.
The first information reports in these cases were laid in April and June, 1949, but permission of the Magistrate, for investigation as against the public servants concerned, by a police officer of a rank lower than a Deputy Superintendent of Police, was given in March and April, 1951.
The charge sheets in all these cases were filed by such officers in August and November, 1951, i.e. subsequent to.
the date on which permission as above was given.
But admittedly the investigation was entirely or mostly completed in between the dates when the first information was laid and the permission to investigate by an officer of a lower rank was accorded.
It appears from the evidence taken in this behalf that such investigation was con 1153 ducted not by any Deputy Superintendent of Police but by officers of lower rank and that after the permission was accorded little or no further investigation was made.
The question, therefore, that has been raised is, that the proceedings by way of trial initiated on such charge sheets are illegal and require to be quashed.
To appreciate the argument it is necessary to notice the relevant sections of the Prevention of Corruption Act, 1947 (Act II of 1947) (hereinafter referred to as the Act.
Section 3 of the Act provides that offences punishable under section 161 or 165 of the Indian Penal Code shall be deemed to be cognizable offences.
Section 4 enacts a special rule of evidence against persons accused of offences under section 161 or 165 of the Indian Penal Code, throwing the burden of proof on the accused.
Broadly stated, this section provides that if it is proved against an accused that lie has accepted or obtained gratification other than legal remuneration, it shall be presumed against him that this was so accepted or obtained as a motive or reward.
, such as is mentioned in section 161 of the Indian Penal Code.
Sub sections (1) and (2) of section 5 create a new offence of "criminal misconduct in discharge of official duty" by a public servant punishable with imprisonment for a term of seven years or fine or both.
Sub section (3) thereof enacts a new rule of evidence as against a person accused of the commission of offences under section 5(1) and (2).
That rule, broadly stated,.
is that when a person so accused, or any other person on his behalf, is in possession of pecuniary resources or property disproportionate to the known sources of his income and for which he cannot satisfactorily account, the Court shall presume him to be guilty of criminal misconduct unless he can displace that presumption by evidence.
The offence of criminal misconduct which has been created by the Act, it will be seen, is in itself a cognizable offence, having regard to item 2 of the last portion of Schedule 11 of the Code of Criminal Procedure under the bead "offences against the other laws".
In the normal course, therefore, an investi 1154 gation into the offence of criminal misconduct under section 5(2) of the Act and an investigation into the offence under sections 161 and 165 of the Indian Penal Code which have been made cognizable by section 3 of the Act would have to be made by an officer incharge of a police station and no order of any Magistrate in this behalf would be required.
But the proviso to section 3 as well as sub section (4) of section 5 of the Act specifically provide that "a police officer below the rank of a Deputy Superintendent of Police shall not investigate any such offence without the order of a Magistrate of the First Class or make any arrest there for without a warrant".
It may be mentioned that this Act was amended by Act LIX of 1952.
The above mentioned proviso to section 3 as well as sub section (4) of section 5 have been thereby omitted and substituted by section 5 A, the relevant portion of which may be taken to be as follows: "Notwithstanding anything contained in the Code of Criminal Procedure, no police officer below the rank of a Deputy Superintendent of Police (elsewhere than in the presidency towns of Calcutta, Madras and Bombay) shall investigate any offence punishable under sections 161, 165 or 165 A of the Indian Penal Code or under section 5(2) of this Act without the order of a Magistrate of the First Class".
This amendment makes no difference.
In any case the investigation in these cases having taken place prior to the amendment, what is relevant is section 5(4) as it stood before the amendment.
It may also be mentioned that in 1952 there was enacted the Criminal Law Amendment Act, 1952 (Act XLVI of 1952) which provided for the appointment of Special Judges to try offences under sections 161, 165 and 165 A of the Indian Penal Code and under sub section (2) of section 5 of the Act such offences were made triable only by such Special Judges.
Provision was also made that all pending cases relating to such offences shall be forwarded for trial to the Special Judge.
That is how the present cases are all now before the Special Judge of Delhi appointed under this Act.
On the arguments urged before us two points arise 1155 for consideration.
(1) Is the provision of the Prevention of Corruption Act, 1947, enacting that the investigation into the offences specified therein shall not be ' conducted by any police officer of a rank lower than a Deputy Superintendent of Police without the specific order of a Magistrate, directory or mandatory.
(2) Is the trial following upon an investigation in contravention of this provision illegal.
To determine the first question it is necessary to consider carefully both the language and scope of the section and the policy underlying it.
As has been pointed out by Lord Campbell in Liverpool Borough Bank vs Turner(1), "there is no universal rule to aid in determining whether mandatory enactments shall be considered directory only or obligatory with an implied nullification for disobedience.
It is the duty of the Court to try to get at the real intention of the Legislature by carefully attending to the whole scope of the statute to be construed".
(See Craies on Statute Law, page 242, Fifth Edition).
The Code of Criminal Procedure provides not merely for judicial enquiry into or trial of alleged offences but also for prior investigation thereof.
Section 5 of the Code shows that all offences "shall be investigated, inquired into, tried and otherwise dealt with in accordance with the Code" (except in so far as any special enactment may provide otherwise).
For the purposes of investigation offences are divided into two categories 'cognizable ' and 'non cognizable '.
When information of the commission of a cognizable offence is received or such commission is suspected, the appropriate police officer has the authority to enter on the investigation of the same (unless it appears to him that there is no sufficient ground).
But where the information relates to a non cognizable offence, he shall not investigate it without the order of a competent Magistrate.
Thus it may be seen that according to the scheme of the Code, investigation is a normal preliminary to an accused being put up for trial for a cognizable offence (except when the Magistrate takes cognizance other (1) 148 1156 wise than on a police report in which case he has the power under section 202 of the Code to order investigation if he thinks fit).
Therefore, it is clear that when the Legislature made the offences in the Act cognizable, prior investigation by the appropriate police officer was contemplated as the normal preliminary to the trial in respect of such offences under the Act.
In order to ascertain the scope of and the reason for requiring such investigation to be conducted by an officer of high rank (except when otherwise permitted by a Magistrate), it is useful to consider what "investigation" under the Code comprises.
Investigation usually starts on information relating to the commission of an offence given to an officer in charge of a police station and recorded under section 154 of the Code.
If from information so received or otherwise, the officer in charge of the police station has reason to suspect the commission of an offence, he or some other subordinate officer deputed by him, has to proceed to the spot to investigate the facts and circumstances of the case and if necessary to take measures for the discovery and arrest of the offender.
Thus investigation primarily consists in the ascertainment of the facts and circumstances of the case.
By definition, it includes "all the proceedings under the Code for the collection of evidence conducted by a police officer".
For the above purposes, the investigating officer is given the power to require before himself the attendance of any person appearing to be acquainted with the circumstances of the case.
He has also the authority to examine such person orally either by himself or by a duly authorised deputy.
The officer examining any person in the course of investigation may reduce his statement into writing and such writing is available, in the trial that may follow, for use in the manner provided in this behalf in section 162.
Under section 155 the officer in charge of a police station has the power of making a search in any place for the seizure of anything believed to be necessary for the purpose of the investigation.
The search has to be conducted by such officer in person.
A subordinate officer may be deputed by him for the 1157 purpose only for reasons to be recorded in writing if he is unable to conduct the search in person and there is no other competent officer available.
The investigating officer has also the power to arrest the person or persons suspected of the commission of the offence under section 54 of the Code.
A police officer making an investigation is enjoined to enter his proceedings in a diary from day to day.
Where such investigation cannot be completed within the period of 24 hours and the accused is in custody he is enjoined also to send a copy of the entries in the diary to the Magistrate concerned.
It is important to notice that where the investigation is conducted not by the officer in charge of the police station but by a subordinate officer (by virtue of one or other of the provisions enabling him to depute such subordinate officer for any of the steps in the investigation) such subordinate officer is to report the result of the investigation to the officer in charge of the police station.
If, upon the completion of the investigation it appears to the officer in charge of the police station that there is no sufficient evidence or reasonable ground, he may decide to release the suspected accused, if in custody, on his executing a bond.
If, however, it appears to him that there is sufficient evidence or reasonable ground, to place the accused on trial, he is to take the necessary steps therefore under section 170 of the Code.
In either case, on the completion of the in vestigation he has to submit a report to the Magistrate under section 173 of the Code in the prescribed form furnishing various details.
Thus, under the Code investigation consists generally of the following steps:(1) Proceeding to the spot, (2) Ascertainment of the facts and circumstances of the case, (3) Discovery and arrest of the suspected offender, (4) Collection of evidence relating to the commission of the offence which may consist of (a) the examination of various persons (including the accused) and the reduction of their statements into writing, if the officer thinks fit, (b) the search of places of seizure of things considered necessary for the investigation and to be produced at the trial, and (5) Formation of the opi 1158 nion as to whether on the material collected there is a case to place the accused before a Magistrate for trial and if so taking the necessary steps for the same by the filing of a charge sheet under section 173.
The scheme of the Code also shows that while it is permissible for an officer in charge of a police station to depute some subordinate officer to conduct some of these steps in the investigation, the responsibility for every one of these steps is that of the person in the situation of the officer in charge of the police station, it having been clearly provided in section 168 that when a subordinate officer makes an investigation he should report the result to the officer in charge of the police station.
It is also clear that the final step in the investigation, viz. the formation of the opinion as to whether or not there is a case to place the accused on trial is to be that of the officer in charge of the police station.
There is no provision permitting delegation thereof but only a provision entitling superior officers to supervise or participate under section 551.
It is in the light of this scheme of the Code that the scope of a provision like section 5(4) of the Act has to be judged.
When such a statutory provision enjoins that the investigation shall be made by a police officer of not less than a certain rank, unless specifically empowered by a Magistrate in that behalf, notwithstanding anything to the contrary in the Code of Criminal Procedure, it is clearly implicit therein that the investigation (in the absence of such permission) should be conducted by the officer of the appropriate rank.
This is not to say that every one of the steps in the investigation has to be done by him in person or that he cannot take the assistance of deputies to the extent permitted by the Code to an officer in charge of a police station conducting an investigation or that he is bound to go through each of these steps in every case.
When the Legislature has enacted in emphatic terms such a provision it is clear that it had a definite policy behind it.
To appreciate that policy it is relevant to observe that under the Code of Criminal Procedure most of the offences relating to public 1159 servants as such, are non cognizable.
A cursory perusal of Schedule II of the Code of Criminal Procedure discloses that almost all the offences which may be alleged to have been committed by a public servant, fall within two chapters, Chapter IX "Offences by, or relating to, public servants", and Chapter XI "Offences against public justice" and that each one of them is non cognizable.
(Vide entries in Schedule II under sections 161 to 169, 217 to 233, 225 A as also 128 and 129).
The underlying policy in making these offences by public servants non cognizable appears to be that public servants who have to discharge their functions often enough in difficult circumstancesshould not be exposed to the harassment of investigation against them on information levelled, possibly, by persons affected by their official acts, unless a Magistrate is satisfied that an investigation is called for, and on such satisfaction authorises the same.
This is meant to ensure the diligent discharge of their official functions by public servants, without fear or favour.
When, therefore, the Legislature thought fit to remove the protection from the public servants, in so far as it relates to the investigation of the offences of corruption comprised in the Act, by making them cognizance, it may be presumed that it was considered necessary to provide a substituted safeguard from undue harassment by requiring that the investigation is to be conducted normally by a police officer of a designated high rank.
Having regard therefore to the peremptory language of sub section (4) of section 5 of the Act as well as to the policy apparently underlying it is reasonably clear that the said provision must be taken to be mandatory.
It has been suggested by the learned SolicitorGeneral in his arguments that the consideration as to the policy would indicate, if at all, only the necessity for the charge sheets in such a case having to be filed by the authorised officer, after coming to his own conclusion as to whether or not there is a case to place the accused on trial before the Court, on a. perusal of the material previously collected, and that at best this might extend also to the requirement of arrest of the 1160 concerned public servant by an officer of the appropriate rank.
There is, however, no reason to think that the policy comprehends within its scope only some and not all the steps involved in the process of investigation which, according to the scheme of the Act, have to be conducted by the appropriate investigating officer either directly or when permissible through deputies, but on his responsibility.
It is to be borne in mind that the Act creates two new rules of evidence one under section 4 and the other under section 5(3), of an exceptional nature and contrary to the accepted canons of criminal jurisprudence.
It may be of considerable importance to the accused that the evidence in this behalf is collected under the responsibility of the authorised and competent investigating officer or is at least such for which such officer is prepared to take responsibility.
It is true that the result of a trial in Court depends on the actual evidence in the case but it cannot be posited that the higher rank and the consequent greater responsibility and experience of a police officer has absolutely no relation to the nature and quality of evidence collected during investigation and to be subsequently given in Court.
A number of decisions of the various High Courts have been cited before us bearing on the questions under consideration.
We have also perused the recent unreported Full Bench judgment of the Punjab High Court(1).
These disclose a conflict of opinion.
It is sufficient to notice one argument based on section 156(2) of the Code on which reliance has been placed in some of these decisions in support of the view that section 5(4) of the Act is directory and not mandatory.
Section 156 of the Code of Criminal Procedure is in the following terms: "156(1).
Any officer in charge of a police station may, without the order of a Magistrate, investigate any cognizable case which a Court having jurisdiction over the local area within the limits of such station would have power to inquire into or try under the provisions of Chapter XV relating to the place of inquiry or trial.
(1) Criminal Appeals Nos.
25 D and 434 of 1953 disposed of on 3rd May,1954.
1161 (2).
No proceeding of a police officer in any such case shall at any stage be called in question on the ground that the case was one which such officer was not empowered under this section to investigate.
Any Magistrate empowered under section 190 may order such an investigation as above mentioned".
The argument advanced is that section 5(4) and proviso to section 3 of the Act are in substance and in effect in the nature of an amendment of or proviso to section 156(1) of the Code of Criminal Procedure.
In this view, it was suggested that section 156(2) which cures the irregularity of an investigation by a person not empowered is attracted to section 5(4) and proviso to section 3 of the 1947 Act and section 5 A of the 1952 Act.
With respect, the learned Judges appear to have overlooked the phrase "under this sec tion" which is to be found in sub section (2) of section 156 of the Code of Criminal Procedure.
What that sub section cures is investigation by an officer not empowered under that section, i.e. with reference to sub sections (1) and (3) thereof.
Sub section (1) of section 156 is a provision empowering an officer in charge of a police station to investigate a cognizable case without the order of a Magistrate and delimiting his power to the investigation of such cases within a certain local jurisdiction.
It is the violation of this provision that is cured under sub section (2).
Obviously sub section (2) of section 156 cannot cure the violation of any other specific statutory provision prohibiting investigation by an officer of a lower rank than a Deputy Superintendent of Police unless specifically authorised.
But apart from the implication of the language of section 156(2), it is not permissible to read the emphatic negative language of sub section (4) of section 5 of the Act or of the proviso to section 3 of the Act, as being merely in the nature of an amendment of or a proviso to sub section (1) of section 156 of the Code of Criminal Procedure.
Some of the learned Judges of the High Courts have called in aid sub section (2) of section 561 of the Code of Criminal Procedure by way of analogy.
It 1162 is difficult to see how this analogy helps unless the said sub section is also to be assumed as directory and not mandatory which certainly is not obvious on the wording thereof We are, therefore, clear in our opinion that section 5(4) and proviso to section 3 of the Act and the corresponding section 5 A of Act LIX of 1952 are mandatory and not directory and that the investigation conducted in violation thereof bears the stamp of illegality.
The question then requires to be considered whether and to what extent the trial which follows such investigation is.
vitiated.
Now, trial follows cognizance and cognizance is preceded by investigation.
This is undoubtedly the basic scheme of the Code in respect of cognizable cases.
But it does not necessarily follow that an invalid investigation nullifies the cognizance or trial based thereon.
Here we are not concerned with the effect of the breach of a mandatory provision regulating the competence or procedure of the Court as regards cognizance or trial.
It is only with reference to such a breach that the question as to whether it constitutes an illegality vitiating the proceedings or a mere irregularity arises.
A defect or illegality in investigation, however serious, has no direct bearing on the competence or the procedure relating to cognizance or trial.
No doubt a police report which results from an investigation is provided in section 190 of the Code of Criminal Procedure as the material on which cognizance is taken.
But it cannot be maintained that a valid and legal police report is the foundation of the jurisdiction of the Court to take cognizance.
Section 190 of the Code of Criminal Procedure is one out of a group of sections under the beading "Conditions requisite for initiation of proceedings.
The language of this section is in marked contrast with that of the other sections of the group under the same heading, i.e. sections 193 and 195 to 199.
These latter sections regulate the competence of the Court and bar its jurisdiction in certain cases excepting in compliance therewith.
But section 190 does not.
While no doubt, in one sense, clauses (a), (b) and (c) of section 190(1) are conditions requisite for taking of cogni 1163 zance, it is not possible to say that cognizance on an invalid police report is prohibited and is therefore a nullity.
Such an invalid report may still fall either under clause (a) or (b) of section 190(1), (whether it is the one or the other we need not pause to consider) and in any case cognizance so taken is only in the nature of error in a proceeding antecedent to the trial.
To such a situation section 537 of the Code of Criminal Procedure which is in the following terms is attracted: "Subject to the provisions herein before contained, no finding, sentence or order passed by a Court of competent jurisdiction shall be reversed or altered on appeal or revision on account of any error, omission or irregularity in the complaint, summons, warrant, charge, proclamation, order, judgment or other proceedings before or during trial or in any enquiry or other proceedings under this Code, unless such error, omission or irregularity, has in fact occasioned a failure of justice".
If, therefore, cognizance is in fact taken, on a police report vitiated by the breach of a mandatory provision relating to investigation, there can be no doubt that the result of the trial which follows it cannot be set aside unless the illegality in the investigation can be shown to have brought about a miscarriage of justice.
That an illegality committed in the course of investigation does not affect the competence and the jurisdiction of the Court for trial is well settled as appears from the cases in Prabhu vs Emperor(1) and Lumbhardar Zutshi vs The King(2).
These no doubt relate to the illegality of arrest in the course of investigation while we are concerned in the present cases with the illegality with reference to the machinery for the collection of the evidence.
This distinction may have a bearing on the question of prejudice or miscarriage of justice, but both the cases clearly show that invalidity of the investigation has no relation to the competence of the Court.
We are, therefore, clearly, also, of the opinion that where the cognizance of the case has in fact been taken and the case has proceeded to termi (1) A.I.R. 1944 P.C. 73.
149 (2) A.I.R. 1950 P C. 26, 1164 nation.
, the invalidity of the precedent investigation does not vitiate the result, unless miscarriage of justice has been caused thereby.
It does not follow, however, that the invalidity of the investigation is to be completely ignored by the Court during trial.
When the breach of such a mandatory provision is brought to the knowledge of the Court at a sufficiently early stage, the Court, while not declining cognizance, will have to take the necessary steps to get the illegality cured and the defect rectified, by ordering such reinvestigation as the circumstances of an individual case may call for.
Such a course is not altogether outside the contemplation of the scheme of the Code as appears from section 202 under which a Magistrate taking cognizance on a complaint can order investigation by the police.
Nor can it be said that the adoption of such a course is outside the scope of the inherent powers of the Special Judge, who for purposes of procedure at the trial is virtually in the position of a Magistrate trying a warrant case.
When the attention of the Court is called to such an illegality at a very early stage it would not be fair to the accused not to obviate the prejudice that may have been caused thereby, by appropriate orders, at that stage but to leave him to the ultimate remedy of waiting till the conclusion of the trial and of discharging the somewhat difficult burden under section 537 of the Code of Criminal Procedure of making out that such an error has in fact occasioned a failure of justice.
It is relevant in this context to observe that even if the trial had proceeded to conclusion and the accused had to make out that there was in fact a failure of justice as the result of such an error, explanation to section 537 of the Code of Criminal Procedure indicates that the fact of the objection having been raised at an early stage of the proceeding is a pertinent factor.
To ignore the breach in such a situation when brought to the notice of the Court would be virtually to make a dead letter of the peremptory provision which has been enacted on grounds of public policy for the benefit of such an accused.
It is true that the peremptory pro 1165 vision itself allows an officer of a lower rank to make the investigation if permitted by the Magistrate.
But this is not any indication by the Legislature that an investigation by an officer of a lower rank without such permission cannot be said to cause prejudice.
When a Magistrate is approached for granting such permission he is expected to satisfy himself that there are good and sufficient reasons for authorising an officer of a lower rank to conduct the investigation.
The granting of such permission is not to be treated by a Magistrate as a mere matter of routine but it is an exercise of his judicial discretion having regard to the policy underlying it.
In our opinion, therefore, when such a breach is brought to the notice of the Court at an early stage of the trial the Court have to consider the nature and extent of the violation and pass appropriate orders for such reinvestigation as may be called for, wholly or partly, and by such officer as it considers appropriate with reference to the requirements of section 5 A of the Act.
It is in the light of the above considerations that the validity or otherwise of the objection as to the viola tion of section 5(4) of the Act has to be decided and the course to be adopted in these proceedings, determined.
The learned Special Judge before whom the objection as to the violation of section 5(4) of the Act was taken took evidence as to the actual course of the investigation in these cases.
In the cases out of which Criminal Appeals Nos. 96 and 97 of 1954 arise, the first information report which in each case was filed on 29 6 1949 was in terms on the basis of a complaint filed by the Director of Administration and Co ordination,, Directorate of Industry and Supply.
This disclosed information constituting offences including that under section 5(2) of the Act.
The cases were hence registered under various sections including section 5(2), of the Act.
The investigation that was called for on the basis of such a first information report was to be by an officer contemplated under section 5(4) of the Act.
The charge sheets in these two cases were filed on 11 8 1951 by a Sub Inspector 1166 of Police, R. G. Gulabani and it appears that he applied to the Magistrate for permission to investigate into these cases on 26 3 1951.
His evidence shows that so far as the case relating to Criminal Appeal No. 97 of 1954 is concerned, he did not make any investigation at all excepting to put up the chargesheet.
All the prior stages of the investigation were conducted by a number of other officers of the rank of Inspector of Police or Sub Inspector of Police and none of them had taken the requisite permission of the Magistrate.
In the case out of which Criminal Appeal No. 96 of 1954 arises the evidence of R. G. Gulabani shows that he took up the investigation after he obtained permission and partly investigated it thereafter but that the major part of the investigation was done by a number of other officers who were all below the rank of Deputy Superintendent of Police without having obtained from the Magistrate the requisite sanction therefor.
Both these are cases of clear violation of the mandatory provisions of section 5(4) of the Act.
In the view we have taken of the effect of such violation it becomes necessary for the Special Judge to reconsider the course to be adopted in these two cases.
As regards the case out of which Criminal Appeal No. 95 of 1954 arises it is to be noticed that the first information report which was filed on 30 4 1949 disclosed offences only against Messrs Patiala Oil Mills, Dev Nagar, Delhi, and others, and not as against any public servant.
The case that was registered was accordingly in respect of offences punishable under section 420 of the Indian Penal Code and section 6 of the Essential Supplies (Temporary) Powers Act, 1946, and not under any offence comprised within the Pre Vention of Corruption Act.
The investigation proceeded, therefore, in the normal course.
The evidence shows that the investigation in this case was started on 2 5 1949 by Inspector Harbans Singh and that on 11 7 1949 he handed over the investigation to Inspector Balbir Singh.
Since then it was only Balbir Singh that made all the investigation and it appears from his evidence that he examined as many 1167 as 25 witnesses in the case.
It appears further that in the course of this investigation it was found that, the two appellants and another public servant were liable to be prosecuted under section 5(2) of the Act.
Application was then made to the Magistrate by Balbir Singh for sanction being accorded to him under section 5(4) of the Act and the same was given on 20 3 1951.
The charge sheet was filed by Balbir Singh on 15 11 1951.
He admits that all the investi gation by him excepting the filing of charge sheet was prior to the obtaining the sanction of the Magistrate for investigation.
But since the investigation prior to the sanction was with reference to a case registered under section 420 of the Indian Penal Code and section 6 of the Essential Supplies (Temporary) Powers Act, 1946, that was perfectly valid.
It is only when the material so collected disclosed the commission of an offence under section 5(2) of the Act by public servants, that any question of taking the sanction of the Magistrate for the investigation arose.
In such a situation the continuance of such portion of the investigation as remained, as against the public servants concerned by the same officer after obtaining the permission of the Magistrate was reasonable and legitimate.
We are, therefore, of the opinion that there has been no such defect in the investigation in this case as to call for interference.
In the result, therefore, Criminal Appeal No. 95 of 1954 is dismissed.
Criminal Appeals Nos.96 and 97 of 1954 are allowed with the direction that the Special Judge will take back the two cases out of which these appeals arose on to his file and pass appropriate orders after reconsideration in the light of this judgment.
Criminal Appeal No. 106 of 1954.
This is an appeal by special leave against a common order of the High Court of Punjab relating to Cases Nos. 19 to 25 of 1953 before the Special Judge, Delhi.
It raises the same questions which have been disposed of by our judgment in Criminal Appeals Nos. 95 to 97 of 1954.
Since the appeal is, in form, one 1168 against the order of the High Court refusing to grant stay of the proceedings then pending, it is sufficient to dismiss this appeal with the observation that it will be open to the appellants to raise , the objections before the Special Judge.
| Held, that section 5(4) and proviso to section 3 of the Prevention of Corruption Act, 1947 (II of 1947) and the corresponding section 5 A of the Prevention of Corruption (Second Amendment) Act, 1952 (LIX of 1952) are mandatory and not directory and that an investigation conducted in violation thereof is illegal.
If cognizance is in fact taken on a police report in breach of a mandatory provision relating to investigation, the results which follow cannot be set aside unless the illegality in the investigation can be shown to have brought about a miscarriage of justice.
It is well settled that an illegality committed in the course of an investigation does not affect the competence and the jurisdiction of the court for trial and where cognizance of the case has in fact been taken and the case has proceeded to termination the invalidity of the preceding investigation does not vitiate the result unless miscarriage of justice has been caused thereby When any breach of the mandatory provisions relating to investigation is brought to the notice of the Court at an early stage of the trial the Court will have to consider the nature and extent of the violation and pass appropriate orders for such reinvestigation as may be called for, wholly or partly, and by such officer as it considers appropriate with reference to the requirements of section 5 A of the Prevention of Corruption (Second Amendment) Act, 1952.
Liverpool Borough Bank vs Turner ([1861] ; , Prabhu vs Emperor (A.I.R. and Lumbhardar Zutshi vs The King (A.I.R. , referred to.
|
22 of 1955.
Under Article 32 of the Constitution for a Writ in the nature of habeas corpus.
Sadhan Chandra Gupta (The Petitioner also present) for the petitioner.
M. C. Setalvad, Attorney General of India (B. Sen, and I. N. Shroff, for P. K. Bose, with him) for the respondents.
February 23.
The Judgment of the Court was delivered by BOSE J.
The petitioner, Hans Muller, who is not a citizen of India, and who is said to be a West German subject, was arrested by the Calcutta Police on the 18th September, 1954 and was placed under preventive detention.
The order was made by the West Bengal Government under section 3(1) of the of 1950 (Act IV of 1950) on the ground that his detention was "with a view to making arrangements for his explusion from India".
The grounds were served on the 22nd of September, 1954.
The second ground runs "That you are a foreigner within the meaning of the (Act XXXI of 1946) and that it has become necessary to make arrangements for your expulsion from India and for this purpose you are required to be detained under section 3 (1) (b) of the until the issue of an appropriate order of expulsion from the Central Government".
On the day after his arrest, namely on the 19th September, 1954 he wrote to the Consul General of West Germany at Calcutta saying that be had been arrested and asking for an early interview.
This was granted.
On the 21st of September 1954, the petitioner wrote to the West Bengal Government asking it "to be kind enough to pass an order for our immediate repatriation from India" 1287 and "to do the necessary arrangement for our transmission out of India".
On the 9th of October 1954 the Calcutta Police handed the petitioner 's passport over to the West German Consul at the Consul 's request.
This passport was issued to the petitioner by the West German Government at Nurenburg in West Germany on the 27th of November 1953.
When the passport was handed over to the West German Consul it had on it a number of visas, including an Indian, all of which had on them the condition "while the passport is valid".
When the West German Consul got the passport he made the following entry on it: "Valid only for the return voyage to the Federal Republic of Germany until the 8th January 1955".
The petitioner complains that this invalidated all the other visas and as, according to this fresh entry, the passport ceased to be valid after the 8th of January 1955, he now has no passport.
On the same day, the 9th of October 1954, the West German Government wrote to the West Bengal Government saying that a warrant of arrest was issued against the petitioner in West Germany in connection with a number of frauds and that legal proceedings in connection with those warrants are still pending.
The Consul also said that he had received information that similar charges had been made against the petitioner in Lebanon and in Egypt and be concluded "The Government of the Federal Republic of Germany will apply for Muller 's extradition through diplomatic channels whilst at the same time submitting the supporting documents.
As this will require a certain amount of time, I am directed to give you advance information of this step and hereby request the Government of West Bengal to issue a provisional warrant of arrest which ensures Muller 's detention up to the date of his extradition to Germany.
This Consulate has already arranged for Muller 's repatriation by the German boat 'KANDELFELS ' due to arrive in Calcutta on the 19th instant.
All 165 1288 expenses in connection with Muller 's repatriation will be borne by the Government of the Federal Republic of Germany".
On receipt of this letter the Secretary to the Government of West Bengal recorded the following note: "I suppose there would be no objection to our keeping Muller in detention till the 19th instant.
We must issue order of his release as soon as his boat is ready to sail".
The West Bengal Government had no power to deport the petitioner.
Only the Central Government could do that, and up till the 20th of October the Central Government had not passed any orders.
On that date the petitioner applied to the High Court of Calcutta for a writ in the nature of habeas corpus under section 491 of the Criminal Procedure Code.
Because of that, and because this matter has been pending in the courts ever since, no orders have yet been issued for his expulsion from India though we are told by the learned Attorney General that they have been made and signed but are being held in abeyance pending the decision of this petition.
The petitioner contended that his detention was invalid for the following, among other, reasons: (1) Because section 3(1)(b) of the , the section under which the order was.
made, is ultra vires the Constitution on three grounds (a) that it contravenes articles 21 and 22; (b) that it contravenes article 14, and (c) that it was beyond the legislative competence of Parliament to enact such a law; (2) Because section 3(1) (b) is not a law of preventive detention within the meaning of article 22(3) and therefore it contravenes article 22 (1) and (2); and (3) Because, in any event, the order was made in bad faith.
The High Court decided against the petitioner on all points and dismissed the petition on 10 12 1954.
He thereupon made the present petition to this Court on the same grounds, presumably under article 32 of the Constitution.
It was filed oil 10 1 1955.
1289 We will first consider the vires of section 3(1) (b).
It is in these terms: "The Central Government or the State Government may . . . (b) if satisfied with respect to any person who is a foreigner within the meaning of the (XXXI of 1946), that with a view to regulating his continued presence in India or with a view to making arrangements for his expulsion from India, it is necessary so to do, make an order directing that such person be detained".
The detention order is by a State Government and not by the Centre.
The portion of the section on which the order is based is the part that gives a State Government power to make an order of detention against a foreigner, on satisfaction, "with a view to making arrangements for his expulsion from India".
The competence of the Central Legislature to enact a law dealing with this aspect of preventive detention is derived from Entry 9 of the Union List read with Entry 10, The portion of Entry 9 which concerns us is as follows: "Preventive detention for reasons connected with Foreign Affairs The scope of the expression "Foreign Affairs" is indicated in Entry 10: "Foreign Affairs; all matters which bring the Union into relation with any foreign country".
It is well settled that the language of these Entries must be given the widest scope of which their meaning is fairly capable because they set up a machinery of Government and are not mere Acts of a legislature subordinate to the Constitution.
Giving Entry 9 its widest range we find it impossible to hold that legislation that deals with the right of a State to keep foreigners under preventive detention without trial does not bring the Union into relation with a foreign country.
Every country claims the right to the allegiance of its subjects wherever they may be and in return guarantees to them the right of diplomatic 1290 protection when abroad.
It is therefore the privilege, and the anxiety, of every civilised nation to keep vigilant watch over its subjects abroad and to ensure for them, as far as that is possible through diplomatic channels, fair play and justice administered along lines of what is called, broadly for want of a better term, natural justice.
A foreign State has a very direct interest in what is done to its subjects in a foreign land.
Therefore, legislation that confers jurisdiction upon Governments in this country to deprive foreigners of their liberty cannot but be a matter that will bring the Union into relation with foreign States, particularly when there is no public hearing and no trial in the ordinary courts of the land.
But in this particular case, the relation is even more direct, for the provision here is for detention with a view to making arrangements for a foreigner 's expulsion from India.
A foreign State has a very deep interest in knowing where and how its subjects can be forcibly expelled against their will.
The legislative competence of Parliament to deal with this question is, we think, clear; and this covers not only section 3(1) (b) of the but also the (Act XXXI of 1946) in so far as it deals with the powers of expulsion and the right of the Central Government to restrict the movements of foreigners in India and prescribe the place of their residence and the ambit of their movements in the land.
The learned Attorney General sought to base the legislative competence upon other Entries as well and claimed that Parliament is not confined to Entry 9 in List I and Entry 3 in List III (the only Entries that touch directly on preventive detention).
He claimed, for example, that laws for the preventive detention of foreigners can also be based upon Entry 17 in List I which relates to aliens and Entry 19 which relates to expulsion from India; and also upon the portions of Entries 9 in List I and 3 in List III that deal with the "security of India" and the "security of the State" and the "maintenance of public order", provided always that they comply with articles 21 and 22 of the Constitution, We express no opinion 1291 about this as we can uphold the portion of the Statute that is impugned here on the narrower ground we have set out above.
The next question is whether the limitations imposed on this power by articles 21 and 22 have been observed.
Article 21 guarantees the protection of personal liberty to citizen and foreigner alike.
No person can be deprived of his personal liberty "except according to procedure established by law", and article 22 prescribes the minimum that the procedure established by law must provide.
There can be no arrest or detention without the person being produced before the nearest magistrate within twenty four hours, excluding the time necessary for the journey, etc., nor can he be detained beyond that period without the authority of a magistrate.
The only exceptions are (1) enemy aliens and (2) "any person who is arrested or detained under any law providing for preventive detention".
There are further limitations, but they were not invoked except that the learned Attorney General explained that the unrestricted power given by section 4(1) of the (a pre constitution measure) to confine and detain foreigners became invalid on the passing of the Constitution because of articles 21 and 22.
Therefore, to bring this part of the law into line with the Constitution, section 3 (1) (b) of the was enacted.
It was more convenient to insert new provisions about the confinement and detention of foreigners in the rather than amend the because the was a comprehensive Act dealing with preventive detention and was framed with the limitations of articles 21 and 22 in view.
It was urged on behalf of the petitioner that section 3(1)(b) of the is ' not reasonably related to the purpose of the Act, namely, "preventive detention".
It was argued that preventive detention can only be for the purpose of prevent 1292 ing something and when you seek to make arrangements for a man 's expulsion from the country you are not preventing anything, or trying to, but are facilitating the performance of a positive act by the State, namely the act of expulsion.
We do not agree and will first examine the position where an order of expulsion is made before any steps to enforce it are taken.
The right to expel is conferred by section 3(2)(c) of the on the Central Government and the right to enforce an order of expulsion and also to prevent any breach of it, and the right to use such force as may be reasonably necessary "for the effective exercise of such power" is conferred by section 11(1), also on the Central Government.
There is, therefore, implicit in the right of expulsion a number of ancillary rights, among them, the right to prevent any breach of the order and the right to use force and to take effective measures to carry out those purposes.
Now the most effective method of preventing a breach of the order and ensuring that it is duly obeyed is by arresting and detaining the person ordered to be expelled until proper arrangements for the expulsion can be made.
Therefore, the right to make arrangements for an expulsion includes the right to make arrangements for preventing any evasion or breach of the order, and the confers the power to use the means of preventive detention as one of the methods of achieving this end.
How far it is necessary to take this step in a given case is a matter that must be left to the discretion of the Government concerned, but, in any event, when criminal charges for offences said to have been committed in this country and abroad are levelled against a person, an apprehension that he is likely to disappear and evade an order of expulsion cannot be called either unfounded or unreasonable.
Detention in such circumstances is rightly termed preventive and falls within the ambit of the and is reasonably related to the purpose of the Act.
The next question is whether any steps can be 1293 taken under the law in anticipation of an order that is about to be made, or which may be made, by the competent authority on the recommendation of another authority seized with certain powers of Government and yet not competent to make an order of this kind.
The confers the right of expulsion on the Central Government.
Therefore, a State Government has no right either to make an order of expulsion or to expel.
It was argued that if a State Government cannot expel or make an order of expulsion, then it cannot be permitted to detain "with a view to making arrangements for the expulsion".
It was contended that the only authority that can make such arrangements, or direct that they should be made, is the Central Government.
It was also argued that until an order of expulsion is made by the proper authority, no one can start making arrangements for its due execution; the arrangements contemplated by section 3(1)(b) must follow and not precede the order, especially as they involve curtail ment of a man 's personal liberty, for the order may never be made and it would be wrong to permit an authority not authorised to decide the question to detain a man of its own motion till somebody else has time and leisure to consider the matter.
That would be inconsistent with the fundamental right to liberty guaranteed by the Constitution to citizen and foreigner alike.
Again, we do not agree.
The expressly confers the right to detain ' with a view to making, arrangements" for the expulsion upon both the State and the Central Government and the "satisfaction" required by section 3(1)(b) can be of either Government.
The right to satisfy itself that the drastic method of preventive detention is necessary to enable suitable arrangements for expulsion to be made is therefore expressly conferred on the State Government and as a State Government cannot expel, the conferral of the right can only mean that the State Government is given the power to decide and to satisfy itself whether expulsion is desirable or neces 1294 sary, and if it thinks it is, then to detain until proper arrangements for the expulsion are made, one of them, and an essential one, being reference to the Central Government for final orders.
It is evident that the authorities must be vested with wide discretion in the present field where international complications might easily follow in a given case.
Unless a State Government has authority to act in anticipation of orders from the Centre, it might be too late to act at all.
We now turn to the argument that section 3 (1) (b) is ultra vires because it offends article 14 of the Constitution.
Actually, the attack here is on section 3 (2) (c) of the but as section (3) (1) (b) of the is consequential on that it is also involved.
Section 3(1)(b) permits detention of a "foreigner" with in the meaning of the .
The definition of "foreigner" is given in section 2(a) of that Act and is as follows: " `foreigner ' means a person who (i)is not a natural born British subject as defined in sub sections (1) and (2) of section (1) of the British Nationality and Status of Aliens Act, 1914, or (ii) has not been granted a certificate of naturalization as a British subject under any law for the time being in force in India".
The rest of the definition is not material.
The argument is that this differentiates between foreigner and foreigner.
It takes two classes of British subjects who are now as much foreigners as anyone else not an Indian citizen, out of the class of foreigners for the purposes of preventive detention and for the purposes of expulsion under the .
This, it was contended, offends article 14 which provides that "The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India".
This argument is easily answered by the classification rule which has been repeatedly applied in this Court.
The classification of foreigners into those who are British subjects of the kind set out in the definition, and others, so as to make the former not 1295 foreigners for the purposes of the and the , is a reasonable and rational classification and so does not, on the authority of our previous decisions, offend article 14.
There is no individual discrimination and it is easily understandable that reasons of State may make it desirable to classify foreigners into different groups.
We repel this argument.
It was then said that at any rate there is differentiation in the same group because the definition discriminates between classes of British subjects inter se.
It was pointed out that the British Nationality and Status of Aliens Act, 1914 was repealed in 1948 and re enacted in another form but as our Act has retained the 1914 definition that is the one we must consider.
We do not intend to examine this contention because, even if it be true that there is the discrimination alleged, namely between one class of British subject and another, that will not give the petitioner a right of challenge on this ground.
He is not a British subject and so is not a member of the only class that could claim to be aggrieved on this score.
This Court has decided in earlier cases that the only persons who can impugn any given piece of legislation under article 32 are those who are aggrieved thereby.
As the petitioner is not a person aggrieved, so far as this point is concerned, he not being a British subject, he cannot attack the section on this ground.
We hold that the impugned portions of section 3(1)(b) of the and section 3(2)(c) of the are intra vires.
We now turn to a wider question that brings us to the fringe of International law.
It arises in this way.
The good faith of the Government of the State of West Bengal in making the order of detention was challenged on the following, among other, grounds.
It was argued that the real object of Government in continuing the detention was to keep the petitioner in custody so that it would be in a position to hand him over to the West German authorities as soon as a suitable German boat arrived.
It will be remembered 166 1296 that the West German Government wants the petitioner for offences which he is alleged to have committed in West Germany and that the West German Consul at Calcutta wrote to the West Bengal Government on 9 10 1954 asking that Government to issue a provisional warrant of arrest against the petitioner and to keep him in custody until the West German Government could initiate extradition proceedings against him, and added that the West German Consulate at Calcutta had already arranged for his repatriation on a German boat that was to arrive on the 19th of October 1954.
On receipt of this letter, the Secretary of the West Bengal Government recorded a note saying that he supposed there would be no objection to the West Bengal Government keeping the petitioner in detention till the 19th.
It was said that the connection between the letter, the expected arrival of the boat on the 19th and the Secretary 's proposal to keep the petitioner till that date, was obvious.
The attack on the good faith of the West Bengal Government at this point was two fold.
First, it was said that whatever the original intention of the West Bengal Government may have been, when the West German Consul 's letter was received, the object of the detention was no longer for the purpose of making arrangements for the petitioner 's expulsion but for keeping him in custody till the West German Government was in a position to commence extradition proceedings; that, it was said, was an abuse of the and was not justified by any of its provisions.
The second ground of attack was that, if that was not the object, then, very clearly, the idea was to hand the petitioner over to the German authorities on a German boat without the formality of extradition proceedings and without giving the petitioner a chance to defend himself and show that be could not be extradited.
That, it was said, made the matter worse than ever.
It was denied that the petitioner had committed any offence in West Germany or any where else.
He claimed to be a communist and said that the real object of the West German Government 1297 was to subject him to political persecution the moment they could lay bands on him.
The contention was that once an order of extradition is asked for, a foreigner cannot be handed over to the Government seeking his extradition except under the Extradition Act.
The learned Attorney General contended very Cc strongly that this question was academic and should not be considered because no order of expulsion had yet been served on the petitioner and no one knows the terms of the order.
We do not think it is in view of what the learned Attorney General told us, namely that an order of expulsion has actually been made and signed but is kept in abeyance pending our deci sion.
We see no force in the first part of the petitioner 's argument.
We are at bottom considering the question of the West Bengal Government 's good faith.
The order of detention was made before the West German Consul wrote his letter, so there was no connection between that letter and the order.
After that there is no material to indicate that the West Bengal Government changed its mind and continued the deten tion for another purpose.
The note referred to is the note of a Secretary to Government and embodies his suggestion about what should be done.
It cannot be used either as an order of Government itself or as an indication of its mind.
The second point raises a question of wider import touching the status and rights of foreigners in India, and the question we have to determine is whether there is any law in India vesting the executive government with power to expel a foreigner from this land as opposed to extraditing him.
Article 19 of the Constitution confers certain fundamental rights of freedom on the citizens of India, among them, the right "to move freely throughout the territory of India" and "to reside and settle in any part of India", subject only to laws that impose reasonable restrictions on the exercise of those rights in the interests of the general public or for the protection of the interests of any Scheduled Tribe.
No cor 1298 responding rights are given to foreigners.
All that is guaranteed to them is protection to life and liberty in accordance with the laws of the land.
This is conferred by article 21 which is in the following terms: "No person shall be deprived of his life or personal liberty except according to procedure established by law".
Entries 9, 10) 17, 18 and 19 in the Union List confer wide powers on the Centre to make laws about among other things, admission into and expulsion from India, about extradition and aliens and about preventive detention connected with foreign affairs.
Therefore, the right to make laws about the extradition of aliens and about their expulsion from the land is expressly conferred; also, it is to be observed that extradition and expulsion are contained in separate, entries indicating that though they may overlap in certain aspects, they are different and distinct subjects.
And that brings us to the which deals, among other things, with expulsion, and the Extradition Act which regulates extradition.
The confers the power to expel foreigners from India.
It vests the Central Government with absolute and unfettered discretion and, as there is no provision fettering this discretion in the Constitution, an unrestricted right to expel remains.
The law of extradition is quite different.
Because of treaty obligations it confers a right on certain countries (not all) to ask that persons who are alleged to have committed certain specified offences in their territories, or who have already been convicted of those offences by their courts, be handed over to them in custody for prosecution or punishment.
But despite that the Government of India is not bound to comply with the request and has an absolute and unfettered discretion to refuse.
There are important differences between the two Acts.
In the first place, the Extradition Act applies to everybody, citizen and foreigner alike, and to every class of foreigner, that is to say, even to foreigners who are not nationals of the country asking for 1299 extradition.
But, as has been seen, because of article 19 no citizen can be expelled (as opposed to extradition) in the absence of a specific law to that effect; and there is none; also, the kind of law touching expulsion (as opposed to extradition) that could be made in the case of a citizen would have to be restricted in scope.
That is not the case where a foreigner is concerned because article 19 does not apply.
But a citizen who has committed certain kinds of offences abroad can be extradited if the formalities prescribed by the Extradition Act are observed.
A foreigner has no such right and he can be expelled without any formality beyond the making of an order by the Central Government.
But if he is extradited instead of being expelled, then the formalities of the Extradition Act must be complied with.
The importance of the distinction will be realised from what follows; and that applies to citizen and foreigner alike.
The Extradition Act is really a special branch of the law of Criminal Procedure.
It deals with criminals and those accused of certain crimes.
The is not directly concerned with criminals or crime though the fact that a foreigner has committed offences, or is suspected of that, may be a good ground for regarding him as undesirable.
Therefore, under the Extradition Act warrants or a summons must be issued; there must be a magisterial enquiry and when there is an arrest it is penal in character; and and this is the most important distinction of all when the person to be extradited leaves India he does not leave the country a free man.
The police in India hand him over to the police of the requisitioning State and he remains in custody throughout.
In the case of expulsion, no idea of punishment is involved, at any rate, in theory, and if a man is prepared to leave voluntarily he can ordinarily go as and when he pleases.
But the right is not his.
Under the Indian law, the matter is left to the unfettered discretion of the Union Government and that Government can prescribe the route and the port or place of departure and can place him on a particular ship or plane.
(See sections 3(2) (b) and 6 of the Foreigners 1300 Act).
Whether the Captain of a foreign ship or plane can be compelled to take a passenger he does not want or to follow a particular route is a matter that does not arise and we express no opinion on it.
But assuming that he is willing to do so, the right of the Government to make the order vis a vis the man expelled is absolute.
This may not be the law in all countries.
Oppenheim, for example, says that in England, until December 1919, the British Government bad "no power to expel even the most dangerous alien without the recommendation of a court, or without an Act of Parliament making provision for 'such expulsion, except during war or on an occasion of imminent national danger or great emergency".
(Oppenheim 's International Law, Vol. 1, 7th edition, page 631).
But that is immaterial, for the law in each country is different and we are concerned with the law as it obtains in our land.
Here the matter of expulsion has to be viewed from three points of view: (1) does the Constitution permit the making of such a law? (2) does it place any limits on such laws? and (3) is there in fact any law on this topic in India and if so, what does it enact? We have already examined the law making power in this behalf and its scope, and as to the third question the law on this matter in India is embodied in the which gives an unfettered right to the Union Government to expel.
But there is this distinction.
If the order is one of expulsion, as opposed to extradition, then the person expelled leaves India a free man.
It is true he may be apprehended the moment he leaves, by some other power and consequently, in some cases this would be small consolation to him, but in most cases the distinction is substantial, for the right of a foreign power to arrest except in its own territory and on its own boats is not unlimited.
But however that may be, so far as India is concerned, there must be an order of release if he is in preventive custody and though he may be conducted to the frontier under detention he must be permitted to leave a free man 1301 and cannot be handed over under arrest.
In a case of extradition, he does not leave a free man.
He remains under arrest throughout and is merely handed over by one set of police to the next.
But in that event, the formalities of the Extradition Act must be complied with.
There must be a magisterial enquiry with a regular hearing and the person C sought to be extradited must be afforded the right to submit a written statement to the Central Government and to ask, if he so chooses, for political asy lum; also be has the right to defend himself and the right to consult, and to be defended by, a legal practitioner of his choice.
(Article 22(1) Of course, he can also make a representation against an order of expulsion and ask for political asylum apart from any Act but those are not matters of right as under the Extradition Act.
Our conclusion is that the is not governed by the provisions of the Extradition Act.
The two are distinct and neither impinges on the other.
Even if there is a requisition and a good case for extradition, Government is not bound to accede to the request.
It is given an unfettered right to refuse.
Section 3(1) of the Extradition Act says "the Central Government may, if it thinks fit".
Therefore, if it chooses not to comply with the request, the person against whom the request is made cannot insist that it should.
The right is not his; and the fact that a request has been made does not fetter the discretion of Government to choose the less cumbrous procedure of the when a foreigner is concerned, provided always, that in that event the person concerned leaves India a free man.
If no choice had been left to the Government, the position would have been different but as Government is given the right to choose, no question of want of good faith can arise merely because it exercises the right of choice which the law confers.
This line of attack oil the good faith of Government falls to the ground.
The remaining grounds about want of good faith 1302 that were raised in the petition were not seriously pressed and as they are of no substance we need not discuss them.
The petition fails and is dismissed.
Petition dismissed.
| The petitioner, a West German subject, was placed under pre ventive detention by an order of the West Bengal Government under section 3(1)(b) of the on the ground that he was a foreigner within the meaning of the and that it had become necessary to make arrangements for his expulsion from India and therefore he was required to be detained until the issue of an appropriate order from the Central Government.
The questions for determination in the case were: (i) whether section 3(1)(b) of the was ultravires the Constitution inasmuch as it contravenes articles 14, 21 and 22 of the Constitution and whether it was beyond the legislative competence of Parliament to enact such a law; (ii)whether, in any event, the detention was invalid as it was made in bad faith.
Held that the impugned portion of the and section 3(2)(c) of the on which it is based are not ultra vires the Constitution inasmuch as; (i)in view of Entry 9 and Entry 10 of the Union list of the Seventh Schedule to the Constitution, the language of which must be given the widest meaning, the legislative competence of Parliament to deal with the question of preventive detention of foreigners 1285 is clear and this covers not only section 3(1)(b) of the but also the , in so far as it deals with the powers of expulsion and the right of the Central Government to restrict the movements of foreigners in India and prescribe the place of their residence and the ambit of their movements in the land; (ii)the was a comprehensive Act dealing with preventive detention and was framed with the Limitations of articles 21 and 22 in view.
Section 3(1)(b) of the was enacted to bring the unrestrained power given by section 4(1) of the into line with the provisions of the Constitution; (iii)section 3 (1) (b) of the is reasonably related to the purpose of the Act, namely preventive detention, inasmuch as the right to expel a foreigner conferred by section 3(2) of the on the Central Government and the right to make arrangements for expulsion include the right to make arrangements for preventing any breach or evasion of the order; and the confers the power to use the means of preventive detention as one of the methods of achieving this end; (iv)the State Government is competent to make an order of detention under the law in anticipation of an order of expulsion that is about to be made, or which may be made by the Central Government on the recommendation of the State Government which, though seized with certain powers of Government is not competent to make an order of expulsion itself.
Unless a State Government has authority to act in anticipation of orders from the Centre it might be too late to act at all; (v)the impugned section does not offend article 14 of the Con stitution inasmuch as differentiation between foreigner and foreigner as envisaged in section 2(a) and section 3(2)(c) of the and section 3(1)(b) of the is based on a reasonable and rational classification.
There is no individual discrimination, and reasons of State may make it desirable to classify foreigners into different groups On the question of good faith, held, that the circumstance of the case did not show bad faith on the part of the West Bengal Government.
The is not governed by the provisions of the Extradition Act 1870.
The two are distinct and neither impinges on the other.
Even if there is a requisition and a good case for extradition, Government is not bound to accede to the request.
It is given an unfettered right to refuse, vide section 3(1) of the Extradition Act, and has got an absolute discretion to choose the less cumbrous procedure of the when a foreigner is concerned.
As the Government is given the right to choose, no question of want of good faith can arise merely because it exercises the right of choice which the law confers.
|
minal Appeal No. 139 of 1954.
1333 Appeal by Special Leave from the Judgment and Order dated the 29th April 1954 of the Allahabad High Court in Criminal Appeal No. 1101 of 1953 and Referred No. III of 1953 arising out of the Judgment and Order dated the 3rd September 1953 of the Court of the Sessions Judge at Fatehpur in Sessions Trial No. 50 of 1953.
Sadhan Chandra Gupta and Janardhan Sharma, for the appellant.
K. B. Asthana and C. P. Lal, for the respondent.
March 1.
The Judgment of the Court was delivered by JAGANNADHADAS J.
This is an appeal by special leave from the judginent of the High Court at Allababad.
The sole appellant before us has been convicted by the Sessions Court under sections 148, 307 and 302 of the Indian Penal Code, and sentenced to rigorous imprisonment for two and a half years under section 148, to transportation for life under section 307, and to death under section 302.
These convictions and sentences have been confirmed by the High Court.
At the trial there were 19 other accused along with this appellant.
All of them were convicted and sentenced by the trial court under various sections of the Indian Penal Code.
On appeal ten out of them were acquitted by the High Court.
In respect of the remaining nine besides this appellant, the convictions and sentences were partially modified.
But this appeal is not concerned with them.
The incident in the course of which these offences are said to have been committed took place in the evening of the 4th January, 1953, shortly before sun set in a village called Sonari in the district Fatehpur, Uttar Pradesh.
During that incident two persons, Bisheshwar and Surajdin, are alleged to have received gun shot wounds.
Bisheshwar survived but Surajdin died on the spot.
The back ground for this incident was as follows: In the village of Sonari there were two factions between whom there was prior history of enmity resulting in criminal prosecutions by each against the other.
It 1334 may be broadly stated that the accused persons in the present case belong to one party and the prosecution witnesses as well as the deceased person belong to the other party.
In the year 1946 there was rioting between them in which two of the present prosecution witnesses were assaulted.
This led to a criminal case against some of the present accused and others, in which they were convicted and sentenced, the members of the other party figuring there in as prosecution witnesses.
Again, just five months prior to the present incident, there was another rioting in the village between these two groups.
In that, one Rain Bharosey a member of the party of the present accused was killed.
As a result 15 persons of the opposite party (i. e. the party of the present prosecution witnesses) were prosecuted.
By the date of this incident that case had been committed to the sessions but the sessions trial had not started.
According to the prosecution case, the occasion for the incident, which concerns us, was that some of the present accused wanted to persuade or prevent a member of the opposite party by name, Bisheshwar P.W. 2 in this case from doing what is called pairavi on behalf of the accused in that case.
(Pairavi is said to be the active assistance in relation to Court proceedings which a friend or agent renders to a litigant).
While, Bisheshwar, P.W. 2, and two others Bhurey Lal, P.W. 1, and Ram Saran, P.W. 3, were sitting in front of the house of Ram Saran on the evening of the 4th January, 1953, the present appellant and the other accused are said to have turned up before them, ' lathies in hand.
The appellant is said to have asked Bisheshwar to give up doing pairavis in the then pending case on behalf of the accused therein.
Bisheshwar having declined to do so, the appellant is said to have pulled out a pistol from his inner pocket and fired at him, as a result of which he fell down on the ground.
P.Ws. 2 and 3 are said to have dragged him inside the house and chained the door from inside, run up the roof and raised an alarm, whereupon a number of persons of the other party are said to have come running up.
One of the persons who so came running up was 1335 Surajdin who was cutting fodder at the house of Bhurey Lal, P.W. 1.
The appellant is said to have fired at him with the pistol.
He fell down and died on the spot.
Another person named Gaya Prasad is said to have received some minor lathi injuries.
Accused party thereafter is said to have run away.
First information of the report was lodged by Bhurey Lal, P.W. 1, near about 12 that very night at the police station which was about nine miles from the scene of the occurrence.
The police came on the scene the next morning and the usual investigation followed.
The police filed on the 22nd February, 1953, a charge sheet for offences under sections 147, 148, 323/149 and 307/149.
The charge sheet in so far as it was under section 323/149 related presumably to some minor injuries said to have been received by Gaya Prasad, and in so far as it was under section 307/149 related presumably to the gun shot wounds received by Bisheshwar, P.W. 2.
It may be noticed that the charge sheet did not concern itself with any offence or offences alleged to have been committed, in bringing about the death of Surajdin by the firing of a pistol at him.
It is on this charge sheet that cognizance of the case was taken by the Magistrate and committal proceedings were started.
It appears, however, that the complainant party finding that the police challan did not relate to the offence under sec tion 302, Indian Penal Code filed, on the 2nd May, 1953, a private complaint, before the very Magistrate in whose court the committal proceedings were by then pending.
That complaint was filed by the same Bisheshwar, P.W. 1, who lodged the first information in this case on the 5th January, 1953.
It sets out substantially the same facts.
This complaint also was taken on the file of the Magistrate.
The enquiry thereon was merged into the enquiry relating to the police challan case.
The Magistrate eventually committed all the 20 accused to take their trial before the Sessions Judge by framing charges, under sections 147, 323/149, 307/149 and 302/149.
There was a specific charge under section 148, Indian Penal Code against Suraj Pal and 1336 Dharm Raj, the former for being armed with a pistol and the latter for being armed with a pharsa, at the time of the commission of the rioting.
It is in respect of charges so framed by the committing Magistrate without any amendment or alteration that the accused were tried in the Sessions Court.
It may be mentioned at this stage that the defence of the accused, apart from the general denial of their hav ing anything to do with the incident and denials as to their having been present at the occurrence, was to the effect that it was the complainant 's party including the deceased Surajdin who formed the unlawful assembly, with the common object of beating one Ram Pal of the village.
This Ram Pal had appeared as a prosecution witness at the committal stage in the criminal proceedings by then pending against the present prosecution witnesses as accused.
It was also their defence that it was one Ram Bhawan of that party who, in the course of the incident, fired pistol shots in the air and also shot, later, Surajdin and brought about his death.
The learned Sessions Judge found all the accused guilty of the various offences as charged and sentenced them.
On appeal the High Court considered the prosecution evidence with reference to three aspects.
(1) How far the manner in which the prosecution alleged the incident to have taken place can be accepted; (2) How far the prosecution case regarding the presence and participation of the various per sons can be accepted; and (3) What offence can be said to have been made out as against each of them.
On the first question the High Court accepted the view that the incident took place as alleged by the prosecution.
With reference to the second, the High Court set out elaborately various reasons why the prosecution evidence in so far as it implicates particular individuals, could not be accepted at its face value and required to be carefully scrutinized.
With reference to certain criteria which it was considered necessary and right to adopt for purposes of scrutiny, the High Court held that the convictions of ten out of the 20 persons before it should be set aside and that 1337 the other ten persons including the present appellant were participants in the rioting.
Accordingly, the Court confirmed the conviction as against these ten under section 147, Indian Penal Code.
As regards the charge under section 148, Indian Penal Code, Dharm Raj was acquitted but the conviction of Suraj Pal was maintained on the ground of his having a pistol in his hand at the time of the rioting.
There remained the three charges against the ten persons under sections 323/149 for injuries on Gaya Prasad, 307/149 in respect of the gun shot wounds received by Bisheshwar, and 302/149 in respect of the murder of Surajdin.
It was held that the assault on Gaya Prasad wasn 't proved beyond doubt and hence, all the accused were acquitted in respect of this charge.
As regards the other two charges, i.e., under sections 307/149 and 302/149, the High Court came to the conclusion that neither the attempt on the life of Bisheshwar by pistol fire nor the actual death of Surajdin by pistol fire can be said to have been in prosecution of the common object of the unlawful assembly nor to have been within the knowledge of the accused as being so likely.
It was, therefore, held that none of the accused could be found guilty under section 149, with reference to, the attempt on the life of Bisheshwar, or the death of Surajdin.
All the same, in view of the fact that the evidence showed that the person who inflicted the pistol fire as against both was the appellant Suraj Pal, it was held that he was guilty of the offences under sections 307 and 302, Indian Penal Code.
On this ground, therefore, the High Court, while it set aside the convictions and sentences of all the accused under sections 307/149 and 302/149, maintained the 'convictions of the appellant under these two sections and maintained the sentences of transportation for life under section 307 and of death under section 302, Indian Penal Code.
The High Court convicted the other nine persons under section 323/149 in respect of the injuries received by P.W. 2 and sentenced them therefor.
On the above statement of the course of these proceedings, one important fact which emerges is that 1338 there have been no direct and individual charges against the appellant for the specific offences under sections 307 and 302, Indian Penal Code.
The question that arises is whether ', without such direct charges the convictions and sentences for those offences can be maintained.
It appears to us quite clear that a charge against a person as a member of an unlawful assembly in respect of an offence committed by one or other of the members of that assembly in prosecu tion of its common object is a substantially different one from a charge against any individual for an offence directly committed by him while being a member of such assembly.
The liability of a person in respect of the latter is only for acts directly committed by him, while in respect of the former, the liability is for acts which may have been done by any one of the other members of the unlawful assembly, provided that it was in prosecution of the common object of the assembly or was such as the members knew to be likely to be so committed.
A charge under section 149, Indian Penal Code puts the person on notice only of two alleged facts, viz. (1) that the offence was committed by one or other of the members of the unlawful assembly of which he is one, and (2) that the offence was committed in prosecution of the common object or is such that was known to be likely to be so committed.
Whether or not section 149, Indian Penal Code creates a distinct offence (as regards which there has been conflict of views in the High Courts), there can be no doubt that it creates a distinct head of criminal liability which has come to be known as "constructive liability" a convenient phrase not used in the Indian Penal Code.
There can, therefore, be no doubt that the direct individual liability of a person can only be fixed upon him with reference to a specific charge in respect of the particular offence.
Such a case is not covered by sections 236 and 237 of the Code of Criminal Procedure.
The framing of a specific and distinct charge in respect of every distinct bead of criminal liability constituting an offence, is the foundation for a conviction and sentence therefore The absence, therefore, of specific 1339 charges against the appellant under sections 307 and 302, Indian Penal Code in respect of which he has been sentenced to transportation for life And to death respectively, is a very serious lacuna in the proceedings in so far as it concerns him.
The question then which arises for consideration is whether or not this lacuna has prejudiced him in his trial.
It is perfectly true that the initial accusation as disclosed by the first information lodged by the com plainant, P.W. 1, on the 5th January, 1953, specifically, was to the effect that it was this appellant who with a pistol fired both as against Bisheshwar, P.W. 2, as also against the deceased, Surajdin.
It is also true that this allegation was repeated in the private complaint filed by this same P.W. I in May, 1953, directly before the Magistrate.
It is also undeniable that the evidence in court, both in the committal proceedings as well as at the sessions trial, given by the prosecution witnesses was in support of that allegation.
But curiously enough, apart from the absence of any individual charges against the appellant for these specific offences, even the charges against him and others relating to the injuries inflicted on P.W. 2 and the deceased Surajdin are somewhat vague as to the authorship thereof The relevant charges run as follows (after specifying the members alleged to constitute the unlawful assembly): "Firstly: That you, on the 4th day of January 1953 at about half an hour before sunset in village Sonari, formed an unlawful assembly with the common object of committing the murders of Bisheshwar and Suraj Din and committed rioting.
And thereby committed an offence punishable under section 147 of the Indian Penal Code.
Secondly: That you on the same date, time and place, in prosecution of the common object of the said unlawful assembly of which you were members at that time committed the murder of Suraj Din who was shot dead by a pistol fire.
And thereby committed an offence punishable under section 302/149 of the Indian Penal Code, 1340 Thirdly: That you on the same date, time and place, in prosecution of the common object of the said unlawful assembly of which you were members at that time attempted to commit the murder of Bisheshwar Singh by means of a pistol fire.
And thereby committed an offence punishable under section 307/149 of the Indian Penal Code".
The portions underlined (for the purposes of this judgment) in the charge under heads 2 and 3 above are curiously vague.
They appear to indicate a definite non committal attitude on the part of the Public Prosecutor and the Court, which has the ultimate responsibility for the framing of the charge, (vide section 226, Code of Criminal Procedure) as to who is the active author of the pistol fire referred to under these two heads of charge.
When the charge was so pointedly vague, no accused was bound to direct his attention in his defence to the question as to whether he or somebody else was the person who fired the pistol which brought about the gun shot wounds.
It has been brought to our notice that the appellant has been specifically questioned in the Court of Sessions under section 342, Code of Criminal Procedure on the footing that he was the person who fired at P.W. 2 and the deceased, Surajdin, and that the accused denied it.
But this cannot be said to remove any prejudice that would arise by virtue of the vagueness in the charge at the sessions trial, as to who was the author of the pistol fire.
Normally in a sessions trial the accused has no right of cross examination after the questioning under section 342, Code of Criminal Procedure.
It has been suggested that since such a question was put also in the questioning by the committing Magistrate under section 342, Code of Criminal Procedure, the accused had ample notice of this specific case before the commencement of the sessions trial.
But it does not follow that there could be no prejudice.
On the other hand, the very fact that in spite of such questioning the charges framed in the Magistrate 's Court, with their vagueness, in so far as this feature therein is concerned, has been 1341 maintained, before the Sessions Court without any amendment, is likely to have been misleading.
The appellant might well have relied on the absence of any such amendment as being an indication that he was not called upon to defend himself on the footing of his being the author of the pistol fire.
In a case so serious as that which involves the sentences of transportation for life, and of death, and particularly in a case like the present one, where the death sentence has been awarded in the trial court by distinguishing this appellant from all the other accused in respect of his individual act by way of pistol fire, it is difficult to say that the accused has not been prejudiced by the absence of specific charges under sections 307 and 302, Indian Penal Code.
Further, the medical evidence indicates that P.W. 2 as well as the deceased Surajdin had gun shot wounds on their person.
The evidence of the Doctor is to the effect that these wounds may have been caused by a country pistol which, it is alleged, the appellant had in his hand.
It has been suggested on behalf of the defence that the Medical Officer was not competent to speak about it and that if the prosecution wanted to rely thereupon, they should have called an arms expert to speak to the same.
Whether or not this comment is legitimate, it is clear that if the appellant is to be found directly responsible for inflicting the wounds, noted as gun shot wounds by the Medical Officer, he might well have availed himself of the opportunity to elucidate, by cross examination or positive defence, the nature of the fire arm which would have caused the actual injuries found on the bodies of P. W. 2 and of deceased Surajdin.
In all the circumstances above noticed, we are satisfied that the absence of specific charges against the appellant under sections 307 and 302, Indian Penal Code has materially prejudiced him.
We must accordingly set aside the convictions and sentences of the appellant under sections 307 and 302 of the Indian Penal Code.
The further question that arises is whether or not we are to direct a retrial of the appellant in respect of these offences.
We have given our best considera 1342 tion to all the circumstances of this case and have for this purpose looked into the evidence and the material on the record.
The case discloses certain outstanding features.
At the very outset and simultaneously with the first information filed by P.W. 1 in this case, there was another report filed by one Ram Pal at the same police station, almost exactly at the same time, relating to the same incident.
This is exhibit P 16 on the record.
This report is said to have been lodged at the police station at 12 15 in the night, while the other report is said to have been lodged at 12 10 that night.
The report, exhibit P 16, alleged the present prosecution party to be the aggressors and put forward, as the occasion for the incident, an attempt on the part of the prosecution party to beat Ram Pal, the com plainant of that complaint, for having given evidence in support of the prosecution in the committal proceedings of the rioting case then pending against the present prosecution witnesses (as accused therein)obviously with a view to prevent him from giving evidence in the Sessions Court against them.
That complaint specifically refers to one Ram Bhawan who is P.W. 4 in the present case as the person who had a pistol in hand and fired with it.
That report makes no mention of any injuries having been by then received from pistol fire, in the course of that incident.
Of course, there is no proof, in this case, of any of the allegations in that report.
But it appears from the order of commitment in this case (which forms part of the present printed record) that with reference to that report there was pending, at the date of the committal, a cross case against some of the prosecution witnesses in the present case for the same incident.
The police constable mohair of the police station where the counter complaint, exhibit P 16 was lodged and who accepted both the complaints (1) from Bhurey Lal, and (2) from Ram Pal, has stated in his evidence that when the complaint, exhibit P 16, was filed by Ram Pal the present appellant Suraj Pal had also accompanied Ram Pal, the complainant therein.
This may well be claimed to be the conduct of an innocent person.
It is also not without some significance 1343 that admittedly and as a matter of fact, the police did not file any charge sheet in the present case against any one for the actual offence of murder under section 302, Indian Penal Code and that even in the charge sheet which they did file they confined the case to section 307, Indian Penal Code but did not commit themselves as to who out of the members of the unlawful assembly was the author of the pistol fire.
So far as it appears from the police charge sheet dated the 22nd February, 1953, as printed in the record before us, there is a statement therein to the effect "Suraj Pal Singh and Ram Manohar were armed with pistols".
Ram Manohar is also one of the accused who was put up for trial.
The statements of some of the prosecution witnesses furnish indication of more than one fire arm having been used at the incident.
Thus, for instance.
, Bisheshwar, P.W. 2, said "I heard 3 or 4 guns being fired outside and also heard a noise".
P.W. 4., Ram Bhawan, said "We four persons threw lumps of earth from the well at the accused persons, the accused retired and fired their gun twice. . . .
The accused had fired a gun from the door of Mabadeo when going away, then, bad fired two or three guns from his door".
P.W. 5, Gaya Prasad, said "Two or three guns afterwards had been fired from the door of Mahadeo Pandit.
Those guns had been fired from the lane.
The guns had been fired at the door of Ram Saran and had bit it".
All these witnesses no doubt assert that so far as the particular injuries with which this case is concerned the firing was by the appellant Suraj Pal.
But the above state ments by these witnesses in the cross examination may well indicate that there may have been other persons in the unlawful assembly at that time with arms in their hands, who made use of them by firing.
Apart from the use of pistols in the course of that incident, by one party or the other, there are clear indications that there was a mutual fight between both the parties.
Two of the persons on the side of the accused, viz. Lal Pratap and Chedi Lal have received some injuries and their injury certificates have 172 1344 been marked as Exs.
D 1 and D 2.
The prosecution witnesses themselves admit that there was mutual fighting to this extent, viz. that there was also throwing of brickbats by the complainant 's party against the rioters.
As already stated there is in fact a counter case against some of the present prosecution witnesses in respect of the same incident.
In such a situation any further trial is likely to result only in very doubtful and unreliable evidence being adduced after a considerable lapse of time.
Even as it is, the evidence recorded in the present case has been found by the High Court in its judgment as not acceptable at its face value.
The learned Judges have dealt with this aspect at length and they wound up their consideration of this part of the case as follows: "For the above reasons, I am of opinion that there is a good deal of substance in this part of the arguments of the appellants ' counsel.
The question that would arise is as to which of the particular accused is guilty and what should be the criterion for deciding this matter.
In view of the biassed and interested nature of the prosecution evidence, I am of opinion that the presence of only those accused should be held to have been proved who have been assigned any definite part by the prosecution witnesses or ,whose presence is corroborated by some other circumstantial evidence.
In view of the highly interested nature of the prosecution evidence, dealing with the first aspect of the case also, viz. the question as to how far the prosecution have succeeded in proving the manner in which the incident occurred, 1 have not accepted the prosecution case unless it found corroboration from some other factor of a circumstantial nature or from probabilities of the case".
It is by reference to these standards that they have rejected the evidence of the prosecution witnesses in so far as they implicated ten other accused whom the High Court acquitted.
But it appears to us, that judged by the very same standards there is no adequate reason for accepting the evidence as being reliable in respect of this appellant also.
In fact there is good reason to feel that on the same standards this appel 1345 lant also should have got the benefit of the doubt.
At this stage, it is not out of place to mention one fact.
It appears from the evidence of the Investigating Officer, P.W. 14, that in the course of the investigation the prosecuting authorities were of the opinion that the murder in this case was to be attributed to the prosecution witness, Ram Bhawan, P.W. 4, and not to the appellant, and that in their view even the evidence as against Ram Bhawan was not sufficient to put him on trial for the murder.
Doubtless such an opinion of the prosecuting authorities has no relevancy in the case and should not have been placed on the record in this case.
But when we have to consider the desirability or otherwise of retrial, we need not shut our eyes to these features of the case which have been brought on the record.
In the circumstances mentioned above we do not consider that the interests of justice require that any retrial should be ordered.
We accordingly direct that there shall be no retrial.
In the result, the convictions of the appellant under sections 307 and 302 of the Indian Penal Code and the sentences therefor are hereby set aside.
But his conviction under section 148 of the Indian Penal Code is maintained as also the sentence of two years and a half in respect thereof.
This appeal is accordingly allowed partially to the extent indicated above.
Appeal partially allowed.
| Where a person has been charged along with others under sections 302 and 307 of the Indian Penal Code each, only as read with section 149 of the Code, his convictions and sentences for the substantial offences under sections 302 and 307 of the Code are erroneous.
The absence of specific charges in this behalf is a serious lacunas in the proceedings, inasmuch as the framing of a specific and distinct charge in respect of every distinct head of criminal liability constituting an offence is the foundation for a conviction and sentence therefore The conviction in these circumstances under Bs.
302 and 307 of the Code and sentences of death and transportation for life cannot be maintained unless the Court is satisfied, on the facts of the case, that the accused has not been prejudiced in his trial.
Whether or not in such a situation the questioning of the accused during the course of his examination under section 342 of the Code of Criminal Procedure in relation to the offences under sections 302 and 307 of the Indian Penal Code can be relied upon as obviating the likelihood of prejudice has to be determined with reference to the facts and circumstances of each case.
All the circumstances of the case and the evidence and materials on the record should be looked into on the question arising in such a situation as to whether a retrial should be ordered or not.
|
Appeal No. 208 of 1952.
Appeal by Special Leave from the Judgment and Order dated the 28th day of September 1951 of the Authority under the , Bombay in Application No. 500 of 1951.
M. C. Setalvad, Attorney General for India (G. N. Joshi, PorUs A. Mehta and P. G. Gokhale, with him), for the appellant.
J. B. Dadachanji, M. V. Jayakar and Rajinder Narain, for respondent No. 1. 1955.
March 2.
The Judgment of the Court was delivered by 1347 SINHA J.
This is an appeal by special leave from the orders dated the 28th September 1951 passed by the 2nd respondent, the Authority appointed under section 15(1) of the (IV of 1936), (which hereinafter will be referred to as the Act) allowing the 1st respondent 's claim for house rent allowance as part of his wages.
In this case the facts are not in dispute and may shortly be stated as follows: The 1st respondent is a gangman in the employ of the Central Railway (which previously used to be known as the G.I.P. Rly.), since April 1945.
At that time his wages were Rs. 18 per month plus dearness allowance.
With effect from the 1st November 1947 the Railway Board under the Ministry of Railways of the Government of India introduced a scheme of grant of compensatory (city) allowance and house rent allowance at rates specified in their memorandum No. E47 CPC/14.
This scheme was modified by the Railway Board 's letter No. E47 CPC/14 dated 1st December 1947.
As a result of this scheme certain railway employees stationed at specified headquarters were eligible for the allowance aforesaid at certain specified rates.
The 1st respondent thus became entitled to the allowance of Rs. 10 per month.
This allowance the 1st respondent drew along with his salary until the 18th August 1948 when he was offered by the Government, quarters suitable to his post, but he refused to occupy the same.
On his refusal to occupy the quarters offered by the Government, the house rent allowance was stopped with effect from the 19th August 1948.
On the 8th June 1951 the 1st respondent put in his claim before the Authority for Rs. 290 on the ground that the appellant, the Divisional Engineer, G.I.P. Ry., who was the authority responsible under section 4 of the Act for payment of wages, had stopped payment of house rent allowance to him from the 19th August 1948.
The claim covered the period the 19th August 1948 to the 18th January 1951 at the rate of Rs. 10 per month.
The appellant appeared before the Authority and by his written statement contested the claim on the ground that the house rent allowance which was 1348 the subject matter of the claim was not "wages" within the meaning of section 2(vi) of the Act.
It was, therefore, submitted by the appellant who was the opposite party before the Authority that it had no jurisdiction to entertain the claim which should be dismissed in limine.
It was further pleaded that the claim was inadmissible on the ground that there had been no illegal deduction from the respondent 's wages inasmuch as the respondent had been allotted railway quarters of a suitable type and as he had refused to occupy those quarters he was not entitled under the rules to any house rent allowance.
Alternatively, it was further pleaded by the appellant that so much of the claim as, related to a period preceding six months immediately before the date of the application was time barred under the first proviso to section 15(2) of the Act. ' The Authority condoned the delay and that part of the order condoning the delay is not in controversy before us.
On the issues thus joined between the parties the Authority came to the conclusion that the house rent allowance was "wages" as defined in the Act that as a matter of fact, accommodation was offered to the 1st respondent and he refused it; but that even so, the appellant was not entitled to withhold the house rent allowance.
Accordingly the claim for Rs. 290 was allowed by the Authority.
The short point to be decided in this case is whether the house rent allowance claimed by the 1st respondent came within the purview of the definition of "wages" contained in the Act.
There being no difference on questions of fact between the parties, the answer to the question raised must depend upon the construction to be placed upon the following material portion of the definition of "wages" in section 2(vi) of the Act: 'Wages ' means all remuneration, capable of being expressed in terms of money, which would, if the terms of the contract of employment, express or implied, were fulfilled, be payable, whether conditionally upon the regular attendance, good work or conduct or other behaviour of the person employed or other 1349 wise, to a person employed in respect of his employment or of work done in such employment, and includes any bonus or other additional remuneration of the nature aforesaid which would be so payable and any sum payable to such person by reason of the termination of his employment, but does not include (a)the value of any house accommodation, supply of light, water, medical Attendance or other amenity, or of any service excluded by general or special order of the State Government. . .
Shorn of all verbiage, "wages" are remuneration payable by an employer to his employee for services rendered according to the terms of the contract between them.
The question then arises, what are the terms of the contract between the parties.
When the 1st respondent 's employment under the railway administration represented by the appellant began, admittedly be was not entitled to any such house rent allowance.
As already indicated, the scheme for payment of house rent allowance was introduced with effect from the 1st November 1947 when the rules were framed, admittedly under sub section (2) of section 241 of the Government of India Act, 1935, by the Governor General.
Those rules were amended subsequently.
We are here concerned with the amendment made by the Railway Board by its letter No. E47CPC/ 14 dated the 1st December 1947, particularly rule 3(i) which is in these terms: "The house rent allowance will not be admissible to those who occupy accommodation provided by Government or those to whom accommodation has been offered by Government but who have refused it".
It has been argued on behalf of the appellant that the terms of the contract between the parties include the rule quoted above and that therefore the position in law is that there is no absolute right in the 1st respondent to claim the house rent allowance; in other words, it is contended that there is a condition precedent to the claim for house rent allowance being admissible, namely, that the employee should be posted at one of those places, like Bombay, Calcutta, 1350 Madras ' etc., before the claim for house rent allowance could arise and that there is a condition subsequent, namely, that the employee posted at any one of those places will cease to be entitled to the allowance if either the Government provides accommodation to the employee in question or the employee refuses to occupy the accommodation so offered to him.
On the other hand, it has been argued on behalf of the 1st respondent that the employee 's right to the allowance accrues as soon as he has fulfilled the terms of the contract of employment including regular attendance, good work or conduct and his other behaviour in terms of the definition of "wages" as contained in the Act.
It was also argued on behalf of the 1st respondent that the terms of the definition have to be construed consistently with the provisions of sections 7 and 11 of the Act; that rule 3(i) quoted above is inconsistent with some of the terms of the definition of "wages" and the provisions of sections 7 and 11 and that in any event, if rule 3(i) aforesaid were to be considered as a part of the terms of the contract between the parties, section 23 of the Act prohibits an employee from entering into such a contract as has the effect of depriving him of his vested rights.
It should be noted at the outset that the learned Attorney General appearing on behalf of the appellant has not pressed the argument which appears to have been raised in the written statement of the appellant and also before the Authority as would appear from the orders passed by him, that clause (a) excluding "the value of any house accommodation" clearly showed that house rent allowance was not included in "wages" as defined in section 2(vi) of the Act.
As will presently appear, this argument proceeds on the unwarranted assumption that house rent allowance is synonymous with the value of any house accommodation referred to in the definition of "wages" and in section 7(2)(b) and section 11 of the Act.
The answer to the question whether house rent allowance is "wages" may be in the affirmative if the rules framed by the department relating to the grant of house rent allowance make it compulsory for the 1351 employer to grant house rent allowance without anything more: in other words, if the house rent allowed had been granted without any conditions or with conditions, if any, which were unenforceable in law.
But the statutory rules framed by the Government governing the grant of house rent allowance do not make it unconditional and absolute in terms.
The house rent allowance in the first instance is not admissible to all the employees of a particular class.
It is admissible only to such railway employees as are posted at specified places in order "to compensate railway servants in certain costlier cities for excessive rents paid by them over and above what they might normally be expected to pay"; nor is such an allowance "intended to be a source of profit" or to be "an allowance in lieu of free quarters", as specifically stated in the preamble to the letter No. E47CPC/14, dated 1st December 1947, issued by the Railway Board.
The argument on behalf of the 1st respondent would have been valid if the rules in terms contemplated the grant of house rent allowance to every employee of a particular category but the rules do not make the grant in such absolute terms.
The house rent allowance is admissible only so long as an employee is stationed at one of the specified places and has not been offered Government quarters.
The rules distinctly provide that the allowance will not be ad raissible to those who occupy Government quarters or to those to whom such quarters have been offered but who have refused to take advantage of the offer.
Once an employee of the description given above has been offered suitable house accommodation and he has refused it, he ceases to be entitled to the house rent allowance and that allowance thus ceases to be "wages" within the meaning of the definition in the Act, because it is no more payable under the terms of the contract.
In our opinion, it is clear beyond all reasonable doubt that the rules which must be included in the terms of contract between the employer and the employee contemplate that an employee posted at one 173 1352 of the specified places would be entitled to house rent allowance; but that as soon as he is offered Government quarters for his accommodation, he ceases ' to be so entitled., whether he actually occupies or does not occupy the quarters offered to him.
Hence the grant of house rent allowance does not create an indefeasible right in the employee at all places wherever he may be posted and in all circumstances, irrespective of whether or not he has been offered Government quarters.
But it has been argued on behalf of the respondent that such a conclusion would be inconsistent with the provisions of sections 7 and 1 1 of the Act.
We do not see any such inconsistency.
Section 7 of the Act deals with such deductions as may be made from the wages as defined in the Act, of an employee.
Subsection (2) of section 7 categorically specifies the heads under which deductions may lawfully be made from wages.
Clause (d) of this sub section has reference to "deductions for house accommodation sup plied by the employer", and section 11 provides that such a deduction shall not be made unless the house accommodation has been accepted by the employee and shall not exceed the amount equivalent to the value of such accommodation.
The definition of "wages" in the Act also excludes from its operation the value of house accommodation referred to in sections 7 and II as aforesaid.
The legislature has used the expression "value of any house accommodation" in the definition of "wages" as denoting something which can be deducted from "wages".
The one excludes the other.
It is thus clear that the definition of "wages" under the Act cannot include the value of any house accommodation supplied by the employer to the employee; otherwise it would not be a legally permissible deduction from wages.
It Is equally clear that house rent allowance which may in certain circumstances as aforesaid be included in "wages" is not the same thing as the value of any house accommodation referred to in the Act.
That being so, there is no validity in the argument advanced on behalf of the 1st respondent that rule 3(i) aforesaid is 1353 inconsistent with the provisions of sections 7 and 11 of the Act.
It remains to consider the last argument advanced on behalf of the 1st respondent that section 23 of the Act prohibits an employee from relinquishing such a right as is the subject matter of rule 3(i) quoted above.
This argument proceeds on the assumption that house rent allowance which is a right conferred on the employee is an absolute right.
It has already been held above that the Act read along with the rules which constitute the terms of the contract between the employer and the employee does not create any absolute right in the employee to the house rent allowance.
That being so, there is no question of the employee relinquishing any such right as is contemplated by section 23.
For the reasons aforesaid, the appeal succeeds.
The orders passed by the Authority are set aside.
In the special circumstances of this case there will be no order as to costs.
Appeal allowed.
| The Railway Board under the Ministry of Railways of the Gov ernment of India introduced a scheme with effect from the 1st 1346 November 1947 granting compensatory (city) allowance and house rent allowances at certain rates to certain Railway employees (including the 1st respondent who was a railway employee since 1945) stationed at specified head quarters.
The first respondent drew this ' allowance along with his salary up to the 18th August 1948, when he was offered by the Government, quarters 'suitable to his post, but he refused to occupy the same and the house rent allowance was stopped from the date of his refusal to occupy the quarter offered to him.
Rule 3(i) of the Statutory Rules framed by the Government and put into effect on 1st November 1947 runs as follows: "The house rent allowance will not be admissible to those who occupy accommodation provided by Government or those to whom accommodation has been offered by Government but who have refused".
Held, that the house rent allowance is admissible only so long as an employee is stationed at one of the specified places and has not been offered Government quarters.
The rules distinctly provide that the allowance will not be admissible to those who occupy Government quarters or those to whom such quarters have been offered but who have refused to take advantage of the offer.
Once an employee of the description given above has been offered suitable house accommodation and he has refused it, he ceases to be entitled to the house rent allowance and that allowance ceases to be "wages" within the meaning of the definition in section 2(vi) of the Act because it is no more payable under the terms of the contract.
The grant of house rent allowance does not create an indefeasible right in the employee at all places wherever he may be posted and in all circumstances, irrespective of whether or not he has been offered Government quarters.
|
Appeal No. 146 of 1954.
Appeal by Special Leave from the Judgment and Order dated the 17th day of December, 1952, of the High Court of Judicature at Madras in Referred Case No. 45 of 1952 arising out of the Report dated the 27th day of March, 1951, of the Court of District Judge, Krishna in C.M.P. No. 123 of 1951.
section P. Sinha, (K. R. Chaudhary and Sardar Bahadur, with him), for the appellant.
R. Ganapathy Iyer and P, G. Gokhale, for respondent No. 1.
1056 T. Satyanarayana and P. G. Gokhale, for respondent No. 3. 1954.
December 3.
The Judgment of the Court was delivered by DAS J.
This is an appeal by special leave from an order made by a Special Bench of the High Court of Judicature at Madras under section 12 of the (Act XXXVIII of 1926) debarring the appellant from practising as an advocate for a period of five years.
The material facts are these.
The appellant before us is an advocate ordinarily practising at Masaulipatam.
In Calendar Case No. I of 1949 on the file of the Additional First Class Magistrate 's Court at Masaulipatam nine persons were charged with the offence of conveying rice from the village to other villages without permits.
Accused Nos. 2 and 4 were not represented by any advocate.
Accused Nos. 1, 3, 5, 6 and 8, all cart men, were defended by the appellant.
Accused No. 7, who initiated the proceedings out of which the present appeal arises and who is hereinafter referred to as "the petitioner", was defended by another advocate.
The case was disposed of on the 30th September, 1949.
Accused Nos. 1, 3, 5 and 6 were acquitted.
Accused No. 2 was convicted and sentenced to a fine of Rs. 20 and in default of payment of fine to undergo simple imprisonment for one month.
Accused No. 4 and the petitioner, accused No. 7, were also convicted and sentenced to pay a fine of Rs. 300/ each and in default of payment of fine to undergo simple imprisonment for six months.
Accused No. 8 was sentenced to pay a fine of Rs. 100/ and in default of payment of the fine, to simple imprisonment for three months.
Accused No. 2 paid the fine but the other three convicted persons did not.
The four convicted persons including the petitioner thereafter engaged the appellant to prefer an appeal to the Sessions Court.
The appeal was presented before the Sessions Court on the 8th October, 1949 and on the same day a petition was filed on behalf of accused Nos. 4, 7 (petitioner) and 8 for an order staying the 1057 realisation of the fine.
That application for stay came up before the learned Sessions Judge on the 10th October, 1949 when notice was directed to issue to the Public Prosecutor.
On the 11th October, 1949 the learned Judge passed the following order: "Suspended pending disposal of this petition.
Call on 14. 10".
On the 14th October, 1949 the following further order was passed: "Execution of sentences suspended till disposal of appeal".
The appeal was posted for hearing on the 25th November, 1949 and was adjourned from time to time.
Eventually, it was finally heard on the 13th July, 1950 when the appeal was allowed and the conviction and sentences of all the appellants were set aside.
On the 25th January, 1951 the petitioner caused a registered notice (exhibit A/2) to be sent to the appellant alleging that on the 11th October, 1949 the appellant had represented to him that the Court had refused to suspend the sentences and that unless the amount of fine was deposited the petitioner would be sent to jail.
It was further alleged that on such representation the petitioner had on that day paid to the appellant a sum of Rs. 300 for which the appellant had passed to the petitioner a chit (exhibit A/1) under his own signature acknowledging receipt of the said sum.
The chit (exhibit A/1) which is addressed to the petitioner runs as follows: "This day, you have paid to me a sum of Rs. 300 (three hundred rupees only)".
It is signed by the appellant and below his signature appears the date 11th October 1949 and the time 5 15 P.m. is also mentioned below the signature.
The allegation in the registered notice further was that the appellant had concealed from the petitioner the fact that the order for payment of fine had been suspended until the hearing of the appeal and also that the appeal had eventually been allowed.
The notice ended with a threat that if the appellant failed to return the sum of Rs. 300 together with interest at 12 per cent.
per annum from the 11th October 1949 up to date of 1058 payment the petitioner would be constrained, in addition to such other proceedings as he may be advised to take for recovery of the said amount, to complain against the appellant and his unprofessional conduct to the High Court and the Bar Council.
This notice was received by the appellant on the 12th February 1951 and on the next day, 13th February 1951, the appellant issued three registered notices Exs.
A/3, A/4 and A/5 to the petitioner.
In exhibit A/5 the appellant complained that the petitioner had been evading payment of the agreed fee of Rs. 150 and on firm demand having been made by the appellant on the 21st January 1951 for payment of such fee before the 25th January 1951 the petitioner had issued the registered notice exhibit A/2.
In exhibit A/4 the appellant alleged that the petitioner instructed the appellant to file a stay petition as the petitioner was unable to pay the fine and that the appellant filed the petition accordingly and obtained a stay order about which the petitioner was fully aware.
In those circumstances the allegations contained in the petitioner 's notice exhibit A/2 were false and highly defamatory.
He further alleged that the petitioner was also present in Court on the 13th July 1950 when the appeal was allowed.
In the circumstances, there was no need for the petitioner to pay any money to the appellant for the purpose of paying the fine.
The appellant called upon the petitioner to withdraw the allegations and tender an unqualified apology immediately.
In exhibit A/3 the appellant stated that the petitioner had come to him on the 6th October 1949 to engage him as his advocate for filing an appeal.
Seeing that the appellant was then pressed for money for payment of an installment of a loan No. 616 to the Land Mortgage Bank, Pedana, the petitioner volunteered to arrange for a loan of Rs. 300 for the appellant at Pedana and asked him to give a chit in his favour and to send the appellant 's clerk with the petitioner.
The petitioner did not, however, succeed in arranging for any money but the chit exhibit A/I remained with him.
There was a denial that there was any consideration for the chit exhibit A/I. On the 7th March 1951 the petitioner sent a reply generally 1059 denying the allegations contained in the three several notices sent by the appellant to the petitioner.
That reply was received by the appellant on the 13th March 1951 and on the 14th March 1951 the appellant issued a further rejoinder exhibit A/7 denying the allegations in the petitioner 's reply and stating that the statements in his three notices were true.
It was further alleged that when the petitioner failed to sup ply the amount mentioned in the chit exhibit A/I the appellant asked him to return the chit but the petitioner said that the chit was missing and that he would search for it and return it subsequently and so saving the petitioner gave the appellant on the 16th October 1949.a hand letter (exhibit D/8) admitting that the petitioner was unable to supply the amount of Rs. 300 mentioned in the said chit as promised.
The petitioner did not send any reply to this letter in spite of the fact that the appellant had therein referred to a hand letter (exhibit D/8) dated the 16th October 1949 which totally nullified the value of the chit exhibit A/I. The petitioner then on the 27th March 1951 sent a petition to the High Court making a complaint against the appellant of professional misconduct and praying that the Hon 'ble High Court might be pleased to order an enquiry into the allegations made in his complaint and to take such action against the appellant as was necessary and expedient in the circumstances of the case.
Along with the petition were submitted a photograph of the chit exhibit A/I and copies of the registered correspondence that passed between the petitioner and the appellant.
Even in this petition the petitioner did not refer to the band letter (exhibit D/8) of the 16th October 1949 and did not specifically deny having written the same.
Upon the presentation of the petition the appellant submitted a written explanation before the High Court.
The High Court,, under section 10 of the , referred the matter to the District Judge to enquire into the allegations made in the petition and to submit A report.
The District Judge issued a notice to the appellant setting forth the following charges: 136 1060 "1.
That you have suppressed fraudulently the order of the Additional Sessions Judge, Krishna at Masaulipatam, suspending payment of fine of Rs. 300 and made in Crl.
M. P. No. 180 of 1949 in C. A. No. 82 of 1949 preferred against the conviction and sentence passed by the Additional First Class Magistrate, Bandar, in C.C. No. 1 of 1949, on his file, against the petitioner, who is the seventh accused therein; 2.
That you, having fraudulently suppressed the above stated fact, have represented to the petitioner that the amount of fine of Rs. 300 had to be deposited into Court on pain of the petitioner being sent to jail and received the said sum of Rs. 300 from him and passed a receipt in his favour for the same; 3.
That you, even though the above said C.A. No. 82 of 1949 on the file of the Additional Sessions Judge, Krishna at Masaulipatam was allowed by the judgment dated 13 7 1950, having all knowledge about it did not inform the petitioner that the said C.A. No. 82 of 1949 was disposed of, and later on informed him that it was dismissed, and the conviction and sentence were confirmed; 4.
That you, therefore, wrongfully withheld the amount of Rs. 300 belonging to the petitioner without depositing into Court as represented by you and also without refunding it to the petitioner even after the said appeal was allowed in spite of repeated requests and demands made by him, and 5.
That you have falsely set up a plea of not having received the said sum of Rs.300 from the petitioner, for which you have passed a receipt in his favour, and later on set up that you wanted to borrow the said amount from him during the subsistence of the relationship of advocate and client, which (borrowing from a client) itself is prohibited by law".
The petitioner examined himself (P.W.1) and his brother Potharaju (P.W.2) as his witnesses in support of the allegations in the petition.
The appellant examined himself (R. W. 1) and his clerk D. Venkatarangam (R.W.2), Kameswararao, the secretary of the Vadlamannadu Co operative Land Mortgage Bank at 1061 Pedana (R.W.3) and Venktadri, clerk of an advocate (R.W.4) in support of his defence.
On a consideration of the entire evidence the learned District Judge found that the testimony of the petitioner and his brother was not credible and acceptable and that there was no reason to reject the testimony of the appellant and his clerk and other witnesses and he came to the conclusion that it bad not been satisfactorily proved that the appellant was guilty of any of the charges framed against him.
The District Judge sent a report accordingly.
The matter was placed before a Special Bench of the Madras High Court.
The Special Bench had no hesitation in agreeing with the findings of the learned District Judge on charges 1, 2 and 3.
In their opinion much reliance could not be placed on the veracity of the complainant himself The High Court, in agreement with the learned District Judge, held that the appellant was not guilty of the first three charges.
Coming to the last two charges the learned Judges were struck by several facts, namely, (i) the passing of two receipts for two sums of money each of Rs. 300 which were identical with the amount of fine imposed on each of the accused Nos. 4 and 7 (petitioner) and (ii) the date of payment, namely, the 11th October 1949 on which date the petitioner and the fourth accused had to deposit the fine.
The learned Judges were strongly impressed with the fact that the chit exhibit A/I had been allowed to remain with the petitioner.
The High Court also noted that if the arrange ment was that the appellants clerk would pass a formal stamped receipt after getting the money there was no necessity to issue an informal receipt in favour of the petitioner in advance.
The learned Judges further pointed out that in none of the three notices dated the 13th February 1951 any reference had been made by the appellant to the hand letter (exhibit D/8) 'dated the 16th October 1949.
The High Court concluded that the failure to mention this hand letter in the earliest reply by the appellant cast considerable doubt on the genuineness of the document and consequently the Court could not act on the basis that it 1062 contained a true statement of facts admitted by the petitioner.
The High Court also referred to several other minor points suggesting the improbability of the appellant 's story.
The High Court held that the appellant had received a sum of Rs. 300 from the petitioner on the 11th October 1949 as acknowledged by the appellant in the chit exhibit A/ 1.
The High Court accordingly held that charges Nos. 4 and 5 had been proved against the appellant and passed orders against the appellant debarring him from practicing as an advocate for five years.
The appellant has now preferred this appeal after having obtained special leave from this Court.
We have been taken through the evidence by learned advocates appearing on both sides.
It appears to us that while there are some facts which cast some doubt on the version of the appellant there are other material facts completely overlooked by the High Court which nevertheless have a material bearing on the truthfulness or falsity of the complainant 's story.
It is true that the appellant did not refer to the hand letter (exhibit D/8) in his replies Exs.
A/3, A/4 and A/5 to the petitioner 's letter exhibit A/2, but the appellant did refer to it in his rejoinder exhibit A/7 of the 14th March 1951.
It is significant that the petitioner did not send any reply to this last rejoinder and deny the allegations definitely made by the appellant.
It is further significant that the petitioner did not deny the genuineness of the band letter exhibit D/8 even in his petition.
In his evidence the petitioner admits the signature on the hand letter to be his own but states that it must have been made out by the appellant on a blank paper on which he had induced the petitioner to put his signature on the representation that the same would be used as a Vakalatnama.
It is very difficult to accept this story because the petitioner knew from his experience as an accused in the trial Court that no Vakalatnama was required in a criminal case.
Nor has any of the other appellants been produced as a witness to say that any such signature was taken from any of them on blank paper.
Further, the petitioner was present in Court on the 11th October when 1063 the interim stay order was made.
exhibit A/1 bears the hour 5 15 P.m. below the signature of the appellant which shows that chit came into existence after court hours.
It is utterly impossible to believe that the petitioner would deposit Rs. 300 with his new advocate in spite of the fact that in the earlier part of the day the interim order for stay had been made.
It is also significant that accused No. 4 who is also alleged to have paid Rs. 300 to the appellant for a similar purpose has not been called as a witness to corroborate the evidence of the petitioner and his brother.
The question of the ability of the petitioner to advance Rs. 300 is one of great importance in this case.
The petitioner is not a man of means.
He alleged that he had raised the sum of Rs. 300 by selling some miscellaneous gold.
No goldsmith or shrove was called to produce his books and give evidence in corroboration of the petitioner and his brother.
Indeed, the petitioner could not even mention the name of any shroff to whom he is supposed to have sold his gold.
The High Court completely overlooked this aspect of the matter and in the absence of satisfactory evidence showing that the petitioner was in a position to pay the sum of Rs. 300 it will be extremely risky to hold that the fact of payment of Rs. 300 by the petitioner to the appellant has been proved only because there are some weaknesses in the appellant 's story.
The appellant 's story that he required Rs. 600 to be paid to the Land Mortgage Bank is supported by the secretary of the Land Mortgage Bank (R.W. 3) who stated that the appellant bad informed him that he had raised Rs. 300 only and that a person who had promised to arrange for a loan of Rs. 300 had failed to do so and that the appellant had asked his advice as to what he was to do.
The secretary then told the appellant that as he had made an excess payment in 1948 towards and on account of the principal it would be enough if he paid the amount of Rs. 377/9/ which the appellant bad.
It is significant that the Bank 's records show that the appellant had paid only Rs. 377/9/ into the Bank on the 4th November, 1949.
If the petitioner had paid 1064 Rs. 300 to the appellant there would have been no reason why the appellant should not have paid the entire Rs. 600 towards his liability to the Bank.
The learned District Judge who had the advantage of seeing the witnesses and hearing the evidence disbelieved the evidence of the petitioner and his brother and we see no compelling reason to take a different view of it.
On the facts and circumstances of this case we think that charges 4 and 5 have not been brought home to the appellant or, at any rate, the appellant is entitled to the benefit of the doubt.
In the circumstances, we hold that the order passed by the High Court should be reversed and we direct that the complaint against the appellant do stand dismissed as not proved.
Before parting with this appeal we desire to say that it appears to us that it was wholly wrong and inappropriate for the appellant to have made the Honourable Judges of the Madras High Court respondents to this appeal.
It appears that in some cases involving contempt of Court the Honourable Judges have been made parties.
It is not necessary for us to express any opinion on this occasion as to the propriety of that procedure in contempt cases but we are clearly of the opinion that in an appeal arising out of a proceeding under the Bar Councils Act the appropriate parties should be the advocate concerned, the complainant, if any, the Bar Council or the secretary thereof and the Advocate General of the State concerned to whom notices have to be issued under section 12(3) of the .
Appeal allowed.
| It is wrong and inappropriate to implead the Judges of the High Court as respondents in an appeal preferred to the Supreme Court by an Advocate against whom an order of suspension was passed by the High Court under section 12 of the .
In such appeal the proper respondents are the complainant if any, the Bar Council or Secretary thereof and the Advocato General of the State concerned
|
Appeal No, 147 of 1953, 1355 Appeal by Special Leave from the Judgment and Order dated the 24th day of August 1951 of the High Court of Judicature at Bombay in Appeal No. 50 of 1951 arising out of the Order dated the 19th day of June 1951 of the said Court exercising Original Jurisdiction in Misc.
No. 143 of 1951.
M. C. Setalvad, Attorney General.for India (Porus A. Mehta and P. G. Gokhale, with him), for the appellant.
J. B. Dadachanji, M. V. Jayakar and Rajinder Narain for respondent No. 2. 1955.
March 4.
The Judgment of Vivian Bose, Venkatarama Ayyar and Sinha JJ.
was delivered by Sinha J. Jagannadhadas J. delivered a separate judgment.
SINHA J. This is an appeal by special leave from the order of the High Court of Judicature at Bombay dated the 24th August 1951 upholding that of a single Judge of that court sitting on the Original Side, dismissing the appellant 's petition under article 226 of the Constitution for a writ of certiorari quashing the order dated the 23rd January 1951 passed by the 1st respondent, the Authority under the (hereinafter referred to as the Act).
The facts leading up to this appeal may shortly be stated as follows: The 2nd respondent is and has been at all material times an employee of the Central Railway (formerly called the G.I.P. Rly.) represented by the appellant who has been nominated by the Railway Administration as responsible for payment of wages under section 3 of the Act.
Ever since 1941, the 2nd respondent has been employed by the Railway Administration as a carpenter on daily wages, and has been treated as a daily rated casual labourer and has been paid his wages at the rate of Rs. 3 4 0 per day.
He continued receiving his wages at that rate until October,, 1949 without any demur, and granting receipts for the wages thus received.
On the 2nd December, 1949 an application was made by one K. N. Pitkar " an official of Registered Trade Union, a person 1356 permitted by the Authority" under sub section (2) of section 15 of the , against the G.I.P. Ry.
administration through its Divisional Engineer, Parel, Bombay.
It was alleged on behalf of the 2nd respondent that his wages due in respect of six months from May to October 1949 amounting to Rs. 245 had not been paid or had been subjected to illegal deductions as shown in the schedule.
The schedule will be set out hereinafter.
A claim for Rs. 245 plus Rs. 15 by way of compensation was made.
The appellant, as the opposite party before the Authority, resisted the claim, inter alia, on the grounds (1) that Rs. 245 had not been illegally deducted from the wages of the 2nd respondent; and (2) that the claim of the 2nd respondent who was employed as a daily rated casual labourer on specified daily wages, to be placed on a permanent cadre on the scale of monthly rates of pay was unfounded.
It was further alleged that the 2nd respondent did not come within the purview of the Railway Services (Revision of Pay) Rules as he was a daily rated casual labourer charged to works and that no rules had been laid down governing the rates of pay and the conditions of service of daily rated casual laborers like the 2nd respondent.
Hence his terms of service were the daily wages paid to him all along.
It was thus contended that there had been no deduction from his wages.
In this connection reference was made to the award of the Railway Workers Classification Tribunal, dated the 28th May 1948.
The Authority by its orders dated the 23rd January 1951 decided that the position of the 2nd respondent was not that of a casual labourer but that of a "temporary employee" and that therefore he was entitled to be on the scale of Rs. 55 150 plus the allowances admissible.
In coming to this conclusion the Authority observed that the work done by the 2nd respondent is of the same nature as that of a member of the permanent staff.
Hence the 2nd respondent could not be called a casual labourer.
It also made reference to 1357 article 39 (d) of the Constitution containing the direction that there should be equal pay for equal work.
The Authority also negatived the contention raised on behalf of the appellant that the question of classification of an employee was outside its jurisdiction.
In pursuance of the said order the Authority allowed the 2nd respondent 's application by its further orders dated the 2nd March 1951.
Against the said orders of the Authority the appellant moved the High Court of Judicature at Bombay by an application under article 226 of the Constitution for quashing the aforesaid orders.
The matter was heard in the first instance by a learned single Judge of that court who by his orders dated the 19th June 1951 dismissed the application.
The appellant preferred an appeal under the Letters Patent which was heard by a Division Bench of that court.
The Division Bench by its order dated the 24th August 1951 dismissed the appeal and agreed with the conclusions of the Judge on the Original Side that the Authority had not acted without jurisdiction or had not exceeded its jurisdiction in entertaining the 2nd respondent 's application.
On the appellant 's application for leave to appeal to this court being rejected by the High Court, the appellant moved this court and obtained special leave to appeal on the 2nd February 1953.
The main controversy between the parties in this court is whether, having regard to the relevant provisions of the Act, the 1st respondent was competent to pass the orders it did, which orders had been upheld by the High Court of Bombay.
The Authority set up under section 15 of the statute in question is undisputably a tribunal of limited jurisdiction.
Its power to hear and determine disputes must necessarily be found in the provisions of the Act.
Such a tribunal, it is undoubted,, cannot determine any controversy which is not within the ambit of those provisions.
On examining the relevant provisions of the Act it will be noticed that it aims at regulating the payment of wages to certain classes of persons employed in industry.
It applies 1358 in the first instance to the payment of wages to persons employed in any factory or employed by a railway administration; but the State Government has the power after giving three months notice to extend the provisions of the Act or any of them to the payment of wages to any class of persons employed in any class or group of industrial establishments.
"Wages" means "all remuneration, capable of being expressed in terms of money, which would, if the terms of the contract of employment, express or implied, were fulfilled, be payable. . to a person employed in respect of his employment or of work done in such employment. " (omitting words not necessary for our present purpose).
Section 3 lays down that every employer or his re presentative or nominee shall be responsible for the payment to persons employed by him of all wages Section 's provides for fixation of "wage periods ' which shall not exceed one month in any case.
Section 5 indicates the last date within which, with reference to the particular wage period, wages shall be paid.
Section 7 lays down that the wages of an em ployed person shall be paid to him without deductions of any kind except those authorized by or under the Act.
Section 7(2) in clauses (a) to (k) specifies the heads under which deductions from wages may be made, namely, fines; deductions for absence from duty; deductions for damage to or loss of goods of the employer; deductions for house accommodation supplied by the employer; deductions for amenities and services supplied by the employer; deductions for recovery of advances or for adjustment of overpayments of wages; deductions of income tax payable by the employee; deductions to be made under orders of a court or other competent authority; deductions for subscriptions to, and for repayment of advances from any provident fund; deductions for payments to cooperative societies, etc.; and finally, deductions made with the concurrence of the employed person in furtherance of certain schemes approved by Government.
No other deductions are permissible.
It is also laid 1359 down that every payment made by the employed person to the employer or his 'agent shall be deemed to be deduction from wages.
Each of the several heads of deductions aforesaid is dealt with in detail in sections 8 to 13.
Section 8 lays down the conditions and limits subject to which fines may be imposed and the procedure for imposing such fines.
It also requires a register of such fines to be maintained by the person responsible for the payment of wages.
Section 9 deals with deductions on account of absence from duty and prescribes the limits and the proportion thereof to wages.
Section 10 similarly deals with deductions for damage or loss to the employer and the procedure for determining the same.
Like section 8, this section also requires a register of such deductions and realizations to be maintained by the person responsible for the payment of wages.
Section 11 lays down the limits of deductions for house accommodation and other amenities or services which may have been accepted by the employee, subject to such conditions as the State Government may impose.
Section 12 lays down the conditions subject to which deductions for recovery of advances may be made from wages.
Finally section 13 provides that the deductions for payment to co operative societies and insurance schemes shall be subject to such conditions as the State Government may prescribe.
Section 14 makes provision for the appointment of Inspectors for carrying out the purpose of the Act, with power to enter on any premises and to examine any registers or documents relating to the calculation or payment of wages and to take evidence on the spot.
His function is to see that the registers or documents prescribed by the Act containing the necessary entries as regards deductions and other matters have been properly kept by the employers or their agents in order to be able to ascertain whether any deductions from wages in excess of the provisions of sections 7 to 13 aforesaid have been made.
We then come to section 15 which makes provision for the appointment of the Authority "to hear and decide for any specified area all claims arising out of deductions from the wages, or delay in payment of 174 1360 the wages of persons employed or paid in that area".
Where the Authority finds that any deduction has been made from the wages of an employed person or the payment of any wages had been delayed, he may at the instance of the wage earner himself or any legal practitioner or any official of a registered trade union authorized in writing to act on his behalf, or any Inspector under the Act or any other person acting with the permission of the Authority, after making such enquiry as he thinks fit and after giving an opportunity to the person responsible for the payment of wages under section 3 to show cause, direct the refund to the employed person of the amount deducted or the payment of delayed wages together with such compensation as he may determine.
The section also lays down the limits and conditions of his power to direct payment of compensation to the employed person or of penalty to the employer, if he is satisfied that the application made on behalf of an employee was either malicious or vexatious.
His determination is final subject to a very limited right of appeal under section 17.
Section 18 vests the Authority with all the powers of a civil court under the Code of Civil Procedure, for the purpose of taking evidence, of enforcing the attendance of witnesses and of compelling the production of documents.
Section 22 lays down that no court shall entertain any suit in respect of wages or of deduction from wages in so far as the claim forms the subject matter of a pending proceeding under the Act or has formed the subject of a direction in favour of or against the plaintiff under section 15, or which could have been recovered by the application under that section.
Section 26 empowers the State Government to make rules to regulate the procedure to be followed by the authorities and courts referred to in sections 15 and 17 and provides that rules may be made inter alia, requiring the maintenance of records, registers, returns and notices necessary under the Act and the display in a conspicuous place of notices specifying the rates of wages payable to persons employed on such premises; and prescribing the authority for making a list of 1361 acts and omissions in respect of which fines may be imposed and the procedure for imposing such fines.
We have set out above in some detail the relevant provisions of the Act in order to point out that those provisions are not applicable to the complaint made in the present case.
In this connection it is necessary to set out in extenso the "particulars of claim" in the schedule appended to his application which are as follows: "The applicant is working as a carpenter mason with the opposite party under I.O.W., Byculla.
According to the orders on introduction of the prescribed scales, the Railway Administration has to make the staff working under I.O.W. on permanent monthly wages scheme under the rules of the prescribed scales.
The applicant along with others was up till now under daily wages scheme.
About 20 posts under I.O.W. where the applicant is working were to be made per manent.
The opposite party in supersession of claim of the applicant has confirmed his juniors on the permanent scales as a skilled workman in the scale of 55 3 85 4 125 5 130, whereas the opposite party continued to pay the applicant on daily wages scheme thus depriving him of his legitimate wages under the prescribed scale, which resulted in the monetary loss to the applicant of Rs. 40 13 4 per month.
Notice on behalf of the applicant was served on this count on the opposite party but of no avail and hence this application.
The juniors have been paid under the prescribed scales from April, 1949, from which date the applicant was also entitled to the prescribed scale 55 130 (scale for skilled workman).".
There is no allegation of delay in payment of wages inasmuch as it is not the respondent 's case that his wages were not paid within the time limit laid down in section 5; nor are there allegations to show that any payments have been made by the employed person to the employer or his agent which could be deemed to be a deduction from his wages within the meaning of section 7.
None of the categories of deductions as laid down in section 7 have been referred to.
In other words, it is not alleged that his Wages 1362 were so much and that so much had been deducted under any of the heads set out under section 7(2).
The allegations made by the respondent only amount to saying that he had been paid his actual wages as fixed by the railway administration but that after the introduction of the scheme of upgrading of persons employed under the daily wages scheme, others who were junior to him had been placed on the monthly wages scheme whereas his claim to be so placed had been ignored.
The respondent 's main grievance, therefore, appears to be that he had not been paid wages on the scale to which he would have been entitled if he had been placed on the monthly wages scheme.
In our opinion, the scheme of the Act as set forth above shows that if an employee were to state that his wages were, say Rs. 100 per month and that Rs. 10 had been wrongly deducted by authority responsible for the payment of wages that is to say, that the deductions could not come under any one of the categories laid down in section 7 (2), that a would be a straight case within the purview of the Act and the authority appointed under section 15 could entertain the dispute.
But it is said on behalf of the respondent that the authority has the jurisdiction not only to make directions contemplated by sub section (3) of section 15 to refund to the employed person any amount unlawfully deducted but also to find out what the terms of the contract were so as to determine what the wages of the employed person were.
There is no difficulty in accepting that proposition.
If the parties entered into the contract of service, say by correspondence and the contract is to be determined with reference to the letters that passed between them, it may be open to the authority to decide the controversy and find out what the terms of the contract with reference to those letters were.
But if an employee were to say that his wages were Rs. 100 per month which he actually received as and when they fell due but that he would be entitled to higher wages if his claims to be placed on the higher wages scheme had been recognized and given effect to, 1363 that would not in our opinion, be a matter within the ambit of his jurisdiction.
The authority has the jurisdiction to decide what actually the terms of the contract between the parties were, that is to say, to determine the actual wages; but the authority has no jurisdiction to determine the question of potential wages.
The respondent 's complaint in the present case comes within the latter illustration.
If the respondent 's claim to be placed on the scheme of higher wages had been.
unduly passed over by the appellant, if indeed he had the power to do so, the obvious remedy of the respondent was to approach the higher authorities of the railway administration by way of departmental appeal or revision; but instead of doing that, he has sought his redress by making his claim before the authority under the Act.
The question is, has the authority the power to direct the appellant or his superior officers who may have been responsible for the classification, to revise the classification so as to upgrade him from the category of a daily wageearner to that of an employee on the monthly wages scheme.
If the respondent had been on the cadre of monthly wages and if the appellant had withheld his rise in wages to which he was automatically entitled, without any orders of his superior officers, be might justly have claimed the redress of his grievance from the authority under the Act, as it would have amounted to an underpayment.
But in the present case, on the case as made on behalf of the respondent, orders of the superior officers were necessary to upgrade him from a daily wage earner to a higher care.
The authority under the Act has not been empowered under section 15 to make any such direction to those superior officers.
The appellant is responsible to pay the respondent only such wages as are shown in the relevant register of wages presumably maintained by the department under the provisions of the Act, but he cannot be directed to pay the respondent higher wages on the determination by the authority that he should have been placed on the monthly wages scheme.
In that view of the matter it is not necessary to go 1364 into the merits of the controversy as to what classification as adumbrated by the Railway Workers ' Classification Tribunal, and adopted by the Railway administration, the second respondent should have been brought under.
If that question were open to determination by the Authority, we would have had to remit the case to the Authority to give a fresh opportunity to the parties to adduce all the relevant evidence and then to come to its final conclusions, as it appeared to us during the hearing of the case that all relevant information had not been placed before the Authority.
But, as, in our opinion, that is not a matter within its limited jurisdiction, that contingency does not arise.
For the reasons given above we allow this appeal, quash the orders of the Authority and of the High Court, but in the special circumstances of this case we make no order as to costs.
JAGANNADHADAS J. I regret that I find myself unable to agree.
The second respondent before us, employed as a carpenter in the Railway since 1941, has been working as a daily rated casual labourer.
He claimed that he should have been absorbed as a monthly rated permanent employee and that he has been wrongly superseded.
His claim to be treated as a permanent employee was apparently not accepted by the Tribu nal (the Authority under section 15 of the for Bombay).
But it was held that the position of the applicant is not that of a daily rated casual labourer but that of a monthly rated temporary employee.
His claim was treated and upheld by the Tribunal as one substantially based on the ground that the Award of the Railway Workers ' Classification Tribunal in relation to the recommendations of the Central Pay Commission was approved by the Railway Board and directed to be implemented, and that by virtue thereof he was no longer a mere casual labourer but was entitled to higher wages on the footing of a monthly rated labourer.
No question arises that the order of the Tribunal is bad owing to the 1365 variation between the claim made and the relief granted.
As held by the High Court, pleadings in these cases have to be liberally construed.
That his claim was understood as having been based on the Award of Railway Workers ' Classification Tribunal, by the Railway Authorities themselves, is clear from the statement filed on their behalf in answer to the J. employee 's claim.
Apart from the question of jurisdiction, the defence was two fold.
(1) The applicant being a daily rated casual labourer, charged to works, the directive of the Railway Board did not apply to him.
(2) Even if it applied to a person in the situation of the applicant, he was not entitled to be brought on to the monthly rates of pay in the skilled grade, without his previously passing a trade test to establish himself as skilled in his trade and he did not pass the test.
The Tribunal.
on the material referred to by it in its order, came to the conclusion (1) that the applicant did not fall within the category of workcharged staff, (2) that under the Award of the Railway Workers ' Classification Tribunal, no trade test was necessary for the applicant who was a carpenter, and (3) that as per certain instructions of the concerned authority, the period of casual labour was to be limited to six months, and that since this applicant was admittedly a casual labourer under the Railway for a much larger period, i.e. since 1941, he became entitled to be treated as a temporary employee and not as a casual labourer and to receive wages as such.
Whether these conclusions are right or wrong is not the question before us.
The only question is whether or not the Tribunal had the jurisdiction to find that the applicant was entitled to the emoluments of a monthly rated temporary employee and not to that of a daily rated casual labourer, as the result of the order of the Railway Board directing implementation of the Award of the Classification Tribunal.
The jurisdiction of the Tribunal arises under section 15 of the (Act IV of 1936) (hereinafter referred to as the Act).
The Tribunal is set up to decide "all claims arising out of deductions from the wages or delay in payment of 1366 wages".
The relief which it is authorised to award,is to direct "the refund of the amount deducted, or the payment of the wages delayed".
Such a direction made by the Tribunal is final, under section 17 of the Act, subject to the right of appeal provided therein.
Under section 22, no suit lies in any court for the recovery of wages or of any deduction therefrom which could have been recovered by an application under section 15.
However limited this jurisdiction of the Tribunal, and however elaborate the provisions in the Act for the preparation and display by the employer of the table of wages payable to the employees, and for the inspection thereof by the Factory Inspectors, it cannot be supposed that the jurisdiction of the Tribunal is only to enforce the wages so displayed or otherwise admitted.
Such a narrow construction would rob the machinery of the Act of a great deal of its utility and would confine its application to cases which are not likely to arise often, in a wellordered administration like the Railways.
Indeed, I do not gather that such a construction was pressed for, before us, in the arguments.
Even a Tribunal of limited jurisdiction, like the one under consideration, must necessarily have the jurisdiction to decide, for itself, the preliminary facts on which the claim or dispute before it depends.
In the instant case, it must have jurisdiction to decide what the wages payable are and, for that purpose, what the contract of employment and the terms thereof are.
The judgment of my learned brothers in this case apparently recognizes the jurisdiction of the Tribunal as above stated, when it said that the Tribunal has the power "to find out what the terms of the contract were to determine what the wages of the employed person were".
Whether the Tribunal 's decision in this behalf is conclusive or not is a matter that does not arise for decision in this case.
But, it is said that the Tribunal has no authority to determine the question of "potential wages".
Undoubtedly a claim to a higher potential wage cannot be brought in under the category of "claim arising out of deduction from the wages or delay in pay 1367 ment of the wages" if that wage depended on the determination by a superior departmental or other authority as to whether or not a particular employee is entitled to the higher wage a determination which involves the exercise of administrative judgment or discretion or certification, and which would, in such a situation., be a condition of the payability of the wage.
But where the higher wage does not depend upon such determination but depends on the applica tion of, and giving effect to, certain rules and orders which, for this purpose, must be deemed to be incorporated in the contract of employment, such a wage is, in my view, not a prospective wage, merely because the paying authority concerned makes default or commits error in working out the application of the rules.
In this context it is relevant to notice that the definition of "wages" in the Act is "all remuneration which would if the terms of the contract, express or implied, were fulfilled, be payable".
The word "were" in this definition which I have underlined, seems to indicate that even a "prospective wage" which would be payable on the proper application of the rules in the sense which I have explained above may well fall within its scope.
he wage under the Act is not, necessarily, the immediately pre existing wage but the presently payable wage.
In the case before us, the order of the Tribunal proceeded on the view that the applicant was presently entitled to be treated as a monthly rated temporary employee and not as a daily rated casual labourer, by virtue of the directions of the Railway Board for the implementation of the scheme of classification and that therefore he was entitled to the appropriate higher wage.
We have not been shown any material to indicate that this higher classification of the applicant depended not on the mere application, of the classification scheme and the rules thereunder, to him but upon any determination by a departmental higher authority.
If it was the latter, undoubtedly the Tribunal cannot claim to sit in judgment over that determination, whether it was right or wrong.
Such 175 1368 determination, if wrong, could be corrected only by a further departmental appeal, if any, available.
But the Tribunal had, to my mind, the authority to find whether the applicant 's case falls within the scope of determination by the departmental authority or is one of mere application of the rules to the facts of this case.
If the decision of the Tribunal in this behalf was wrong, the appropriate remedy for the Railway Authority was by way of an appeal under section 17 of the Act.
Since the finding of the Tribunal in this case involved the case of as many as six persons and the net additional amount ordered was a sum of Rs. 1,341, its finding was appealable under section 17 of the Act.
Whether or not an employee was entitled to wages of a higher category than what he was till then drawing would depend entirely on the scope of the rules with reference to which he is entitled to become one in the higher category and it cannot be assumed a priori that such a claim is a claim to "prospective wages".
In my view, therefore, there is no sufficient reason to reverse the judgment of the learned Judges of the Bombay High Court and this appeal should be dismissed with costs.
BY THE COURT.
In accordance with the decision of the majority, the appeal is allowed and the orders of the Authority and of the High Court are quashed.
There will be no order as to costs throughout.
Appeal allowed.
| The second respondent had been an employee of the Central Railway as a daily rated casual labourer on specified daily wages since 1941.
He continued to receive his wages at the specified rate until October 1949.
In October 1949 he made an application through an official of the Registered Trade Union a person permitted by the authority under sub section (2) of section 15 of the Payment of Wages Act, 1936 claiming his wages due in respect of six months from May to October 1949.
The respondent did not allege delay in the 1354 payment of his wages or deduction of his wages in contravention of the provisions of section 5 or section 7 of Act IV of 1936 respectively.
The respondent alleged that he had been paid his actual wages as fixed by the railway administration but that after the introduction of the scheme of upgrading of persons employed under the daily wages scheme, others who were junior to him had been placed on the monthly wages scheme whereas his claim to be so placed, had been ignored and that he had not been paid wages on the scale to which he would have been entitled if he had been placed on the monthly wages scheme.
Held, per SINHA J. (VIVIAN BosE and VENYATARAMA AYYAR JJ.
concurring, JAGANNADHADAS J. dissenting), that the respondent 's complaint fell under the category of potential wages and the authority appointed under the Act had no jurisdiction to decide the question of potential wages.
It had the jurisdiction to decide what actually the terms of the contract between the parties were, that is to say, to determine the actual wages.
On the case as made on behalf of the respondent, orders of the superior officers were necessary to upgrade him from a daily wageearner to a higher cadre.
The authority under the Act has not been empowered under section 15 to make any such direction to the superior officers.
Per JAGANNADHADAS J. Undoubtedly a claim to a higher potential wage cannot be brought in under the category of "claim arising out of deduction from the wages or delay in payment of the wages" if that wage depended on the determination by a superior departmental or other authority as to whether or not a particular employee is entitled to the higher wage a determination which involves the exercise of administrative judgment or discretion or certification, and which would, in such a situation, be a condition of the payability of the wage.
But where the higher wage does not depend upon such determination but depends on the application of and giving effect to certain rules and orders which, for this purpose, must be deemed to be incorporated in the contract of employment, such a wage is not a prospective wage merely because the paying authority concerned makes default or commits error in working out the application of the rules.
The wage under the Act is not necessarily the immediately pre existing wage but the presently payable wage.
Whether or not an employee was entitled to wages of a higher category than what he was till then drawing would depend entirely on the scope of the rules with reference to which he is entitled to become one in the higher category and it cannot be assumed a priori that such a claim is a claim to "prospective wages".
On the facts of the case as found the dispute as to the wage was one that fell within the jurisdiction of the "authority" concerned.
|
iminal Appeal No. 22 of 1954.
1446 Appeal under Article 134(1) (c) of the Constitution from the Judgment and Order dated the 27th October 1953 of the Allahabad High Court in Criminal Reference No. 121 of 1953.
K. P. Gupta and A. D. Mathur, for the appellant.
K. B. Asthana and C. P. Lal, for the respondent.
March 15.
The Judgment of the Court was delivered by JAGANNADHADAS J.
This is an appeal by leave granted by the High Court of Allahabad presumably under article 134(1)(c) of the Constitution.
The facts are simple.
Three persons including the appellant were, at the material time, parcel porters at the railway station Manikpur in the district Banda of Uttar Pradesh.
On the night of the 18th June, 1952, they were found by two watchmen of the Watch and Ward staff attached to the railway station, committing theft of certain packets of biscuits by breaking open a railway parcel containing those packets, which as parcel porters, they had occasion to handle.
First information of the same was lodged, before the Sub Inspector, Railway Police, by one Ram Prasad, Head Watchman.
The Railway Police filed the charge sheet under section 379 of the Indian Penal Code on the 20th June, 1952.
The case was taken cognizance of by the Railway Magistrate, Manikpur.
All the three accused pleaded guilty.
They were convicted by the Magistrate on the 15th July, 1952, and sentenced to a fine of Rs. 25 each.
Against this conviction the present appellant filed a revision to the Sessions Judge of Banda.
It is necessary at this stage to mention that under the U. P. Panchayat Raj Act, 1947, the Panchayati Adalats in U. P. have criminal jurisdiction in certain matters.
The point taken before the Sessions Judge was that by virtue of the said Act, the present case should have been tried by the Panchayati Adalat and that the Railway Magistrate had no jurisdiction.
This contention was accepted by the 'learned Sessions Judge.
He accordingly made a reference to the High Court for quashing the conviction 1447 and sentence.
It came before a Single Judge of the High Court who did not feel quite satisfied that the Railway Magistrate had jurisdiction.
But without deciding the question one way or the other, he declined to accept the reference on the ground that the revisional jurisdiction of the High.
Court was J. discretionary.
Somewhat 'curiously however, the learned Judge granted a certificate against his own judgment that the case is a fit one for appeal to the Supreme Court.
If the learned Judge thought fit to grant leave to appeal, he might well have himself decided the question involved so that we should have had the benefit of his consideration of the same.
To decide the question of jurisdiction thus raised it is necessary to notice the scheme of the U. P. Panchayat Raj Act, 1947 (U.P. Act XXVI of 1947) (here in after referred to as the Act) and a few relevant sections of the same.
It may be mentioned that the Act appears to have undergone some amendments in the year 1952 and recently in 1955.
These amendments have no application to the present case.
Under the Act, as it stood at the time of the commission of the offence and the conviction there for, the scheme thereunder is as follows: Under section 3, the State Government shall, by notification in the official Gazette, establish a Gaon Sabha for every village or group of villages.
Under section 42, the State Government or the prescribed authority shall divide a district into circles, each circle comprising as many areas subject to the jurisdiction of Gaon Sabhas as may be expedient.
The State Government shall also establish Panchayati Adalats for each, such circle, provided that the areas of Gaon Sabhas within each circle shall, as far as possible, be contiguous.
Under section 43, every Gaon Sabha in a circle shall elect five adults of prescribed qualification permanently residing within its jurisdiction to act as Panches in the Panchayati Adalat of that circle.
The Panches so elected by all the Gaon Sabhas in a circle shall form a panel.
Under section 44 all the Panches elected under section 43 shall elect from among themselves a person who is able to record proceedings and to act, 185 1448 as Sarpanch of the Panchayati Adalat.
As will be seen from the subsequent sections the Panchayati Adalat has jurisdiction to deal with all disputes and cases, both civil and criminal, arising within its area but it is enough for the present case to notice only those portions which relate to criminal jurisdiction Section 52(1) provides that certain specified ;Offences if committed within the jurisdiction of a Panchayati Adalat (which in this context must be taken to refer to local jurisdiction) shall be cognizable by such Panchayati Adalat.
The clauses of sub section (1) of section 52 specify the various classes of offences under the Indian Penal Code and under some other special and local Acts which are within the cognizance of the Panchayati Adalat.
Section 379, Indian Penal, Code, is one of the; sections, so enumerated and it is specifically provided that the jurisdiction of the Adalat in respect of this offence is only where the theft of the stolen property does not exceed Rs. 50. 'Section 51(1) provides that not with stand anything contained in the Code of Criminal Pro cedure, 1898, every case instituted under the Act shall be instituted before the Sarpanch of the Panchayati Adalat of the circle in which the offence is committed.
It is also provided under section 55 that no court shall take cognizance of any case which is cognizable under the Act by the Panchayati Adalat unless an 'Order has been passed by a Sub Divisional Magistrate under section.
Section 851 authorises a Sub Divisional Magistrate, on an application of a party or on his own motion, to cancel the jurisdiction of the Panchayati Adalat with regard to any pending case if there is an apprehension of miscarriage of justice.
Section 49 provides the machinery for the trial of 'Cases by the formation of benches to deal with the same.
It is necessary to set out the whole of that section in so far as it relates to criminal cases and it is as follows: "49.
(1) The Sarpanch shall, for the trial of every case, form a bench of five Panches from the panel (the panel referred to: in section 43 above noticed).
provided that at least one of the Panches in the bench 1449 shall be a person who is able to record evidence and proceedings.
(2) Every such bench shall include one Panch who resides in the area of the Gaon Sabha in which the complainant of a case resides and likewise one Panch in the area in which the accused resides and J. three Panches residing in the area of the Gaon Sabha in which neither party resides, provided that in police cases one Panch shall be such as may be residing in the Gaon Sabha in which the offence was committed, one Panch residing in the area of Gaon Sabha in which the accused resides and three Panches residing in the areas other than those mentioned above.
(3). . . . . . . . . . . . (4) Notwithstanding anything contained in this section, the State Government may, by rules, prescribe the constitution of special benches for ' determining any dispute arising between any parties or Gaon Sabhas or different circles 'or for any other purpose".
One of the rules framed with reference to this subsection which is relevant for the present purpose is rule 84 and is as follows: "For the purposes of trial or decision of any case or proceeding parties of which are residents of different circles or different districts or any one of the parties is a resident of a place not governed by the Act, the prescribed authority having jurisdiction over the Panchayati Adalat in which a case or proceeding is instituted or transferred for disposal shall constitute a special bench consisting of Panches of the said Panchayati Adalat and if convenient and possible may include a Panch of the other circle and shall appoint one of them as Chairman of the bench unless the Sarpanch is a member of it".
The question of jurisdiction arises with reference to ' the above provisions of the Act.
The charge sheet filed by the police shows that the theft of the property involved in the case is Rs. 3.
There can also be no doubt that the offence has been committed within the limits of Manikpur.
It would appear, therefore, prima 1450 facie that by virtue of sections 51 and 52, the Panchayati Adalat of Manikpur had jurisdiction to try the case.
If so, the jurisdiction of the regular Magistrate would appear to be barred under section 55 of the Act, since it is,not suggested that there has been any order under section 85.
But there is a serious difficulty in the way of the exercise of this jurisdiction by the Adalat.
The jurisdiction of the Adalat to try any criminal case has to be exercised by a bench of the Panches to be formed by the Sarpanch under section 49 of the Act.
The bench has to consist of five Panches of whom one is to be of the Gaon Sabha of Manikpur (since the offence was committed in that place and this is a police case) and another belonging to the Gaon Sabha of the accused and the other three from Gaon Sabhas outside the above two.
Where there is only one accused and that accused belongs to an area within Uttar Pradesh for which a Gaon Sabha has been formed under the Act or where there are more than one accused all belonging to the area of the same Gaon Sabha, the constitution of a bench of the Panchayati Adalat for the trial of such a case presents no difficulty.
But in the present case it is on the record that one out of the three accused by name Tulsi belongs to Jubbalpore in Madhya Pradesh.
It was, therefore, not possible to constitute a bench in strict compliance with section 49(2) of the Act to try his case.
Recourse had, therefore, to be had to section 49(4) and the rules framed thereunder.
The relevant rule 84 (which has been quoted above) no doubt provides for the constitution of special benches to try cases where there are more than one accused who are residents of different areas.
Now this rule in so far as it provides for cases wherein all the parties concerned are residents.of Uttar Pradesh may be unexception able.
But whether it is valid in so far as it provides 'for the exercise of jurisdiction in respect of a resident outside the State may be open to argument on more grounds than one.
In the present case, it is sufficient to consider whether this portion of the rule is valid, with reference to section 49(4) under which it is 1451 framed.
Section 49(4) authorises the Government to frame rules for the constitution of special benches "for determining disputes between parties of different circles or Gaon Sabhas or for any other purpose".
"Circles or Gaon Sabhas" mentioned herein has reference only to circles and Gaon Sabhas constituted. ' under the Act.
This does not authorise the framing of a rule in so far as it relates to a person belonging to a place outside the State.
Nor can the phrase "for any other purpose" in sub section (4) of section 49 whatever that may mean be construed so widely as to authorise a rule affecting such an outsider, assuming without deciding, that a statutory provision by a State Legislature can, directly or by delegation and in terms, validly provide for the exercise of such jurisdiction by a Panchayati Adalat.
We are clearly of the opinion that rule 84 in so far as it relates to the constitution of a special bench where one of the parties belongs to a place outside the State is ultra vires.
Hence no competent bench could be constituted under section 49 of the Act for the trial of the present case in which there are three accused of whom one is a person belonging to a different State.
Now, in these circumstances, it has to be considered whether the trial of this case by the ordinary criminal Court is barred.
The bar of the jurisdiction of the ordinary criminal Court is brought about by section 55 of the Act.
But it requires to be noticed that the bar which is brought about by the section, is a bar which relates to the case as a whole.
Because, in, terms, what it says is "no court shall take cognizance of any case which is cognizable under the Act by a Panchayati Adalat".
Under section 2(a) of the Act a "case" is defined as meaning "criminal proceeding in respect of an offence triable by a Panchayati Adalat" and "Panchayati Adalat" is defined as "including a bench thereof".
It is clear, therefore, that this bar has reference to the entire proceeding, i.e., as involving all the accused together.
Such a bar in.
respect of the entire case can be operative only where there is a valid machinery for the trial thereof.
In the present case in which at 'least one of the accused 1452 (though not this very.
appellant) is a person coming from an area outside the local extent of the Act, any bench of the Adalat that can be validly formed there .
under cannot try the three accused together and hence can have no Jurisdiction over the whole case.
The jurisdiction of the regular criminal court in respect of such a case cannot be taken away by the operation of section 55 of the Act.
It is to be remembered that the jurisdiction of the criminal courts under section 5 of the Code of Criminal Procedure is comprehensive.
That section enjoins, that all offences under the Indian Penal Code shall be investigated, enquired into, tried and otherwise dealt with "according 'to the provisions hereinafter contained".
To the extent that no valid machinery is set up under the U.P. Panchayat Raj ' Act for the trial of any Particular case, the jurisdiction of the ordinary criminal court under section 5 Code of Criminal Procedure cannot be held to have been excluded.
Exclusion of jurisdiction of a court of general jurisdiction, can be brought about by the setting no of a court of limited jurisdiction, in respect of the limited field, only if the vesting and the exercise of that limited jurisdiction is clear and operative.
Where, as in this case, there is no adequate machinery for the exercise of this jurisdiction in a specific case, we cannot hold that the exercise of jurisdiction in respect of such a case by the Court of general jurisdiction is illegal.
We are, therefore, of the opinion that the Railway Magistrate had the jurisdiction to try the case.
The appeal is accordingly dismissed.
Appeal dismissed.
| Three accused were convicted by a Magistrate under section 379 of the Indian Penal Code of the offence of theft of the value of Rs. 3 and sentenced to a fine of Rs. 25/ each.
The question for determination was whether the case should have been tried by a Panchayat Adalat constituted under the U. P. Panchayat Raj Act, 1947 and the Magistrate had no jurisdiction to try it.
Two of the accused belonged to U. P. State and the third belonged to Madhya Pradesh State.
Section 52(1) of the Act provides that certain specified offences (including the offence of theft when the value of stolen property does 1445 not exceed Rs. 50/ ) shall be cognizable by a Panchayat Adalat.
Section 55 provides that no court shall take cognizance of any case which is cognizable under the Act by the Panchayat Adalat.
Section 49 provides: " 49(1) The Sarpanch shall, for the trial of every case, form a bench of five Panches from the panel referred to in section 43.
(2) Every such bench shall include one Panch who resides in the area of the Gaon Sabha in which the complainant of a case resides and likewise one Panch in the area in which the accused resides and three Panches residing in the area of the Gaon Sabha in which neither party resides, provided that in police cases one Panch shall be such as may be residing in the Gaon Sabha in which the offence was committed, one Panch residing in the area of Gaon Sabha in which the accused resides and three Panches residing in the areas other than those mentioned above".
Rule 84 framed by the State Government under section 49(4) of the Act reads as follows: " For the purposes of trial or decision of any case or proceeding parties of which are residents of different circles or different districts or any one of the parties is a resident of a place not governed by the Act, the prescribed authority having jurisdiction over the Panchayati Adalat in which a case or proceeding is instituted or transferred for disposal shall constitute a special bench consisting of Panches of the said Panchayati Adalat and if convenient and possible may include a Panch of the other circle and shall appoint one of them as Chairman of the bench unless the Sarpanch is a member of it".
Held that inasmuch as in the present case one out of the accused belonged to Madhya Pradesh it was not possible to constitute a bench in strict compliance with section 49(2) of the Act to try his case.
Section 84 in so far as it relates to the constitution of a special bench where one of the parties belongs to a place outside the State of U. P. is ultra vires.
Hence no competent bench could be constituted under section 49 of the Act for the trial of the present case in which there were three accused one of whom was a person belonging to a different State.
Under the circumstances the jurisdiction of the ordinary courts was not excluded.
Exclusion of jurisdiction of a court of general jurisdiction, can be brought about by the setting up of a court of limited jurisdiction, in respect of the limited field, only if the vesting and the exercise of that limited jurisdiction is clear and operative.
The bar under section 55 of the Act relates to the case as a whole and has reference to the entire proceeding in respect of all the accused together.
|
minal Appeal No. 62 of 1953.
Appeal under.
Article 134(1)(c) of the Constitution from the Judgment and Order dated the 27th March 1953 of the High Court of Judicature at Patna in Criminal Revision No. 1290 of 1951 arising out of 79 the Judgment and Order dated the 12th November 1951 of the Court of Sessions Judge, Singhbhum in Criminal Revision No. 16 of 1951.
Mahabir Prasad, Advocate General for the State of Bihar (Shyam Nandan Prasad and M. V. Sinha, with him), for the appellant.
section N. Mukherji, for the respondent.
March 24.
The Judgment of the Court was delivered by SINHA J.
In this appeal we did not think it necessary to hear the counsel for the respondents on the merits of the decision appealed from in the view we have taken, as will presently appear, of the terms of the surety bond which was being sought to be enforced against the sureties, the respondents in this Court.
The surety bond in question was taken in circumstances which clearly appear from the follow ing resolution of the Government of Bihar dated the 17th October 1946: "Whereas one Maulavi A. Ali Khan, who was convicted under section 120 B read with section 420, Indian Penal Code by the First Special Tribunal, Calcutta and sentenced to four years ' rigorous imprisonment and a fine of rupees one lac which conviction and sentence have been subsequently upheld by the Patna High Court, has submitted to the Provincial Government a petition praying for suspension of his sentence in order to enable him to prefer an appeal against the said conviction and sentence to the judicial Committee of the Privy Council And Whereas the Provincial Government have granted the prayer of the petitioner subject to the conditions hereinafter specified which the petitioner has accepted: Now, therefore, the Governor of Bihar hereby orders that the execution of the aforesaid sentence of Maulavi A. Ali Khan be suspended pending the hearing of the proposed appeal to the Judicial Committee of the Privy Council on his furnishing security worth Rs. 50,000 with two sureties of Rs. 25,000 each to the 80 satisfaction of either the Sub Divisional Officer, Jamshedpur or the Deputy Commissioner of Singhbhum and undertaking (1) to furnish proof by the 1st December, 1946 of his having taken all necessary steps for the filing of the appeal and also (2) to surrender to the Deputy Commissioner of Singhbhum within three days of the receipt of the notice of the order or judgment of the Judicial Committee if by the said order or judgment the sentence is upheld either partly or wholly.
The petitioner, if in custody, may be released if he complies with the above conditions.
By order of the Governor of Bihar, (sd.) T.G.N. Ayyar, Secretary to Government".
In pursuance of that resolution the surety bond in question was taken from the respondents.
The material portion of the bond (exhibit 2) is in these terms: "We, section T. Karim, son of Abdul Wahab, by caste Mohammedan, by occupation Contractor and Proprietor Jamshedpur and Star Talkies, Jamshedpur, residing at Sakchi, police station Sakchi in Town Jamshedpur, district Singhbhum, (2) Manik Homi, son of late Homi Engineer, by caste Parsee, by occupation zamindar of Mango, residing at Mango, police station Sakchi, district Singhbhum, Stand surety for the amount of Rs. 25,000 only each and bind ourselves to the Government of Bihar of which we bind ourselves, our heirs, executors and successors firmly for payment of Rs. 50,000 only in case Mr. Ali Khan fails to furnish proof by the 1st December 1946 of his having taken all necessary steps for the filing of the appeal and to surrender to the Deputy Commissioner of Singhbhum within three days of the receipt of the notice of the order or judgment of the Judicial Committee if by the said order or judgment the sentence is upheld either partly or wholly".
It is dated the 19th October, 1946.
As a result of the constitutional changes the jurisdiction of the Privy Council came to be transferred to the Federal Court by virtue of the Abolition of the Privy Council Juris 81 diction Act (Constituent Assembly Act V of 1949) which came into force on the 10th October, 1949.
As, from that date ("the appointed day") all appeals ' pending before the Judicial Committee of the Privy Council by virtue of section 6 stood transferred to the Federal Court.
Ali Khan 's appeal to the Privy Council thus got transferred to the Federal Court and in due course was heard by this Court.
This Court dismissed the appeal in November 1950.
In the meantime Ali Khan, the convicted person, who had gone to London to look after his appeal there, migrated to Pakistan and thus placed himself beyond the jurisdiction of the courts in India.
In December 1950 the Deputy Commissioner of Singhbhum issued notice to the sureties, the respondents, to produce Ali Khan within three days.
On their failure to do so, the Deputy Commissioner called upon the sureties to show cause why their bond should not be forfeited.
The sureties raised certain legal objections to the proceedings taken by the Deputy Commissioner.
They contended that he had no jurisdiction to initiate the proceedings.
The Deputy Commissioner postponed the decision of the preliminary objections and directed that all the points in controversy shall be heard and determined at the final hearing.
Against that order the respondents moved the Sessions Judge of Singhbhum who by his orders dated the 12th November, 1951 overruled their objections and held that the Deputy Commissioner had jurisdiction to initiate the proceedings.
It is not necessary to set out his reasons.
The respondents moved the High Court in revision against the orders aforesaid of the Sessions Judge.
A Division Bench of the High Court allowed the application holding that the Deputy Commissioner had no such jurisdiction as he purported to exercise in the matter of enforcing the terms of the surety bond against them.
Accordingly, the High Court quashed the proceedings before the Deputy Commissioner.
Hence this appeal by the State of Bihar.
From the terms of the surety bond quoted above it would appear that the sureties bound themselves for 11 82 payment of Rs. 50,000 "only in case Mr. Ali Khan fails. . . . . to surrender to the Deputy Commissioner of Singhbhum within three days of the receipt of the notice of the order or judgment of the Judicial Committee if by the said order or judgment the sentence is upheld either partly or wholly".
In view of this clear provision in the bond the terms of which being penal in nature must be very strictly construed, it cannot be said that the contingencies contemplated by the parties has occurred.
There was no judgment or order of the Judicial Committee upholding either in part or in whole the sentence against Ali Khan.
As the terms of the bond so construed cannot be said to have been fulfilled, the penalty stipulated has not been incurred.
It must therefore be held that the proceedings taken against the respondents were entirely misconceived.
It was in these circumstances that we did not think it necessary to hear the appeal on its merits, that is to say, on the point of jurisdiction on which the case had been decided by the High Court.
It was contended by the Advocate General of Bihar who appeared in support of the appeal that in the events which had happened there could be no judgment or order of the Judicial Committee and that therefore the judgment of this Court, which by virtue of the constitutional changes had come by the jurisdiction vested in the Privy Council, should be deemed to be the judgment or order contemplated by the parties to the surety bond.
In our opinion, there is no substance in this contention, firstly, because there is no term in the bond to the effect that the surety would be bound by any judgment or order given by such other court as may succeed to the jurisdiction then vested in the Judicial Committee of the Privy Council to hear the appeal preferred by Ali Khan against his conviction by the courts in India: and secondly, because there is no room, while construing the penal clause of a surety bond, for the application of a legal fiction as suggested on behalf of the appellant.
The Government through their legal advisers were not 83 circumspect enough to insert any such alternative clause as would have given the judgment or order of, this Court the same effect as is contemplated by the terms of the surety bond quoted above.
The appeal must therefore be dismissed in limine.
Appeal dismissed.
| In a surety bond the sureties bound themselves for payment of Rs. 50,000 "only in case Mr. Ali Khan fails. . to surrender to the Deputy Commissioner of Singhbhum within three, days of the receipt of the notice of the order or judgment of the Judicial Committee if by the said order or judgment the sentence is upheld either partly or wholly".
As a result of the constitutional changes the jurisdiction of the Privy Council came to be transferred to the Federal Court, and eventually Ali Khan 's appeal to the Privy Council was heard and dismissed by the Federal Court.
Thereupon the Deputy Commissioner issued notice to the sureties to produce Ali Khan within three days.
Held, that the proceedings taken against the sureties were entirely misconceived as the penalty stipulated had not been incurred, in view of the terms of the bond set out above.
Provisions in a surety bond which are penal in nature must be very strictly construed and there is no room for the application of a legal fiction that the judgment of the Federal Court must be deemed to be the judgment or order contemplated by the parties to the surety bond.
|
Appeal No. 207 of 1954.
Appeal by special leave from the Judgment and Order dated the 31st day of August 1953 of the Labour Appellate Tribunal of India, Lucknow, in Appeal No. III 57 of 1953.
A. section R. Chari (Bawa Shiv Charan ' Singh and M. R. Krishna pillai, with him), for the appellant.
Achhru Ram (Naunit Lal, with him), for the respondent.
March 15.
The Judgment of the Court was delivered by SINHA J.
This is an appeal by special leave against the orders of the Lucknow Bench of the Labour Appellate Tribunal of India (hereinafter to be referred to as "The Appellate Tribunal") dated the 31st August 1953, setting aside the award dated the 13th October 1952 made by the Chairman, Central Government Industrial Tribunal, Calcutta (herein after to be referred to as "The Tribunal") reinstating the appellant as the head cashier with back salary under the Punjab National Bank (hereinafter called "The Bank").
The facts leading up to this appeal may shortly be stated.
The appellant started his service as the head cashier in the Una Branch of the Bank on the 18th June 1949.
The Cash Department of the Bank is in charge of Treasurers.
The relation between the Bank and the Treasurers is evidenced by an agreement dated the 1st May 1944 (exhibit 1) which will be noticed in detail hereinafter.
That was an agreement between the Bank and "Messrs Rai Bahadur Karam Chand Puri & Bros".
That firm was appointed the Treasurers at the head office of the Bank and other places in and outside the Punjab.
On the 28th September 1951 the District Manager of the Northern Circle of the.
Bank wrote a letter (exhibit 4) to the Treasurers informing 1420 them that it had been decided to close the Una office of the Bank with effect from the close of business on the 3rd November 1951.
In pursuance of that letter the Treasurers intimated by a letter dated 2nd October 1951 enclosing a copy of exhibit 4 to the appellant that the Una Branch of the Bank will cease to function from the close of business on the 3rd November 1951 and that his services will not be required after that date.
The Punjab National Bank Em ployees ' Union (Punjab) took up the cause of the appellant as also that of other employees and made representations to the Government of India.
The Government of India by a notification No. SRO 432 dated the 8th March 1952 published in the Gazette of India, Part II Sec. 3, in exercise of its powers under section 10 of the Industrial Disputes Act XIV of 1947 (hereinafter called the Act) referred the industrial dispute between the Bank and its workmen named in schedule 2 (concerning workers dismissed) and schedule 3 (relating to workers transferred) for adjudication to the Industrial Tribunal at Calcutta constituted under section 7 of the Act.
Schedule 1 in so far as it is necessary for purposes of this case contains the following points of dispute between the employer and the workmen: "1.
Wrongful dismissal of the workmen mentioned in schedule II and their reinstatement.
In the event of any order for reinstatement payment of wages and other allowances from the date of dismissal to the date of reinstatement".
The appellant is No. 5 in schedule 2 aforesaid.
The 'Tribunal gave its award on the 13th October 1952 in respect of a number of employees whose cases were actually in controversy before it.
It is only necessary to refer to the award in so far as it concerned the appellant.
After overruling the preliminary objection of the Bank that the Union bad no locus standi to represent the appellant the Tribunal formulated the following point for its decision: "On merits the main point involved is as to whether the services of an employee of the Cash 1430 Department can be terminated on a change made in the services of the Contractor Cashier".
It answered this point in these words: "This point has been agitated in more than one case and I have also held in Reference No. 3 of 1951 as Chairman of Industrial Tribunal (P. N. Bank dispute) relating to 5 cashiers that the employees of the Cash Department are the employees of the Bank and not the nominees of the Contractor Cashiers so far service conditions are concerned, and I think it will serve no useful purpose to discuss all the legal precedents cited, more especially when the point has been set at rest by their Lordships of the Supreme Court in Civil Appeal No. 66 of 1952 in the matter of United Commercial Bank Ltd. vs Secretary, U. P. Bank EmPloyees ' Union and Others.
I am of the opinion that the dismissal of Shri Sharma was wrongful and liable to be set aside.
Now the normal remedy is reinstatement and I have no hesitation in allowing the same.
He will also be paid his back salary an allowance from the date of dismissal to the date of reinstatement".
Whatever may be the merits of the answer given to the question propounded by the Tribunal, there is no doubt that the question posed had been wrongly framed.
The discharge or dismissal of the appellant had nothing to do with the change in the personnel of the Treasurers.
The appellant 's services were dispensed with on the ground that the Una Branch where he was employed as head cashier being an un economic unit had to be closed and that therefore the appellant 's services were no more required.
The res pondent 's case appears to have been that the firm.
known as Messrs R. B. Karam Chand Puri & Bros. have been contractors for the Cash Department of the Bank at the head office and some of the other offices in the Punjab and beyond; that from time to time agreements were executed between the Bank and the aforesaid firm; that the last agreement was executed on the 1st May 1954 (exhibit 1); that the appellant according to the respondent Bank was the nominee of the said firm, and that his services had been dispensed 1431 with by the said firm whose employee he was and not by the Bank which had nothing directly to do with the employment of cashiers and other workers in the Cash Department which was in charge of the Treasurers described as "Contractor Treasurers".
Hence the main question in controversy between the parties was whether the appellant was an employee of the Bank or of the said "Contractor Treasurers", whom we shall call the "Treasurers" for the sake of brevity.
The Tribunal did not address itself to the determination of that question.
This Court also did not discuss and decide the matter in Civil Appeal No. 66 of 1952, but assumed that cashiers of the Bank were its employees.
If that question had been decided by this Court, as the Tribunal erroneously thought this Court had, in Civil Appeal No. 66 of 1952, the controversy would have been at an end.
Therefore when the respondent preferred an appeal to the Appellate Tribunal, the Bank at the forefront of its attack against the award of the Tribunal raised the ground that the Tribunal had not determined the basic question which could have given jurisdiction to the Tribunal to decide the dispute whether the head cashier was an employee of the Bank or was a nominee of the "Treasurer" as contended on behalf of the Bank.
The Bank relied very strongly before the Appellate Tribunal on the memorandum of agreement (exhibit 1) and the correspondence that passed between the Bank and the "Treasurers" on the one hand and the latter and the appellant before us on the other (Exs. 2, 3, 4 and 5).
The Appellate Tribunal rightly remarked that the Tribunal had recorded no finding on that basic question and had assumed that the respondent before it was an employee of the Bank.
The Appellate Tribunal took the view that the agreement (exhibit 1) was decisive of that question.
After referring in great detail to the terms of the agreement the Appellate Tribunal came to the conclusion that the cashier was not an employee of the Bank but of the Treasurers and that therefore the Tribunal had no jurisdiction to give any relief to the complainant before it.
The 183 1432 award by the Tribunal was, in the result, set aside and the Bank 's appeal allowed.
The appellant in this Court through his counsel Shri Chari, argued that the Appellate Tribunal had misinterpreted the provisions of the Industrial Disputes Act in coming to the conclusion that the Tribunal had no jurisdiction to entertain the dispute simply on the ground that one of the parties to the dispute bad successfully denied the relationship of employer and employee; that the Appellate Tribunal misconceived its functions by basing its findings on the interpretation of the written agreement between the Bank and its Treasurers when it should have gone into all the relevant facts to determine the substance of the matter; and finally, that the Appellate Tribunal misdirected itself on the question of the interpretation of the agreement for coming to the conclusion that the appellant was not an employee of the Bank but was a nominee of the "Treasurers".
It was further argued on behalf of the appellant that the Tribunal having based its decision on its previous award dated the 16th September 1952 in Reference No. 3 of 1951 between persons more or less in the same position as the appellant and the respondent Bank, in the background.
of the decision of the previous Tribunals, e.g., the award of the Conciliation Board presided over by Mr. Justice Bind Basni Prasad of the Allahabad High Court, the award by the Tribunal presided over by Mr ' K. C. Sen, and the award of the All India Industrial Tribunal '(Bank Disputes), presided over by Sri section Panchapagesa Sastri and the award dated the 24th March 1951 in Reference No. 20, the award of the Tribunal was really final.
The argument was that the award of the Tribunal was based on considerations of facts and circumstances disclosed in those earlier awards to which the Bank and its cashiers and other employees employed in the Cash Department were parties.
It was thus a final finding of fact which was not open to appeal before the Appellate Tribunal.
It was therefore contended that the Appellate Tribunal bad no jurisdiction to entertain the appeal and to reverse the award of the Tribunal.
1433 On behalf of the respondent Bank it was contended that no specific grounds had been taken either before the Appellate Tribunal or in the memorandum of appeal to this Court that the Appellate Tribunal had no jurisdiction on the ground now taken by the appellant in this Court, nor was that ground taken in the statement of case.
On merits it was contended by the respondent 's counsel that the Tribunal is as much bound by the rules of evidence and procedure as any other Tribunal and as the Tribunal had not addressed itself to the question whether the cashier appellant was an employee of the Bank, the question was open before the Appellate Tribunal which was competent to pronounce on that basic question.
Finally it was argued that on a true construction of the provisions of the agreement (exhibit 1) this Court should accept the finding of the Appellate Tribunal that the appellant was not an employee of the Bank and that on that account the Tribunal had no jurisdiction to grant any relief to the appellant.
On behalf of the respondent the case was practically rested on the construction of the agreement (exhibit 1).
With reference to the terms of the agreement the learned counsel for the respondent argued that the Treasurers were not servants or employees of the Bank but were "independent contractors" and that the appellant and other employees in the Cash Department having been nominees of the "independent contractors" there could not be any relation of employer and employee between the Bank and the appellant.
It is therefore necessary to examine in some detail the terms of the agreement aforesaid.
We set out below, underlining important words, the terms of the agreement in so far as they are relevant for the determination of the true relation between the Bank and the Treasurers.
Though this agreement is dated the 1st May 1944, cl.
(1) provides that it will be deemed to have commenced and come into force from the 15th March 1942, the date of the death of R. B. Karam Chand Puri and will take the place of the previous agreement dated the 26th July 1941, thus maintaining the continuity of the relationship between the 1434 Bank and the Treasurers '.
The agreement provides that the Treasurers shall diligently and faithfully serve the Bank at the Head Office and its various offices mentioned in schedule A attached to and forming part of the agreement and at other offices where they may hereafter be appointed treasurers and shall in all respects diligently and faithfully obey and observe all lawful orders and instructions of the Bank or the person placed by the Bank in authority over them in relation to the due discharge of their duties as Treasurers.
The Treasurers in addition to the duties, liabilities and responsibilities devolving upon them by virtue of the provisions of the agreement shall also be liable to perform such duties and discharge such responsibilities as by custom usually devolve on treasurers in the employ of a bank.
The Treasurers shall be paid for their services a remuneration as mentioned in schedule A aforesaid or such remuneration as the General Board of Directors of the Bank may determine from time to time.
Out of the remuneration paid to them by 'the Bank the Treasurers shall pay salaries to their nominees employed by them for performing the duties of a cashier in the Bank on their behalf or other functionaries of a similar nature.
The salaries of such nominees employed by them will be fixed by the Treasurers themselves but the same will be subject to the approval of the Bank.
The remuneration of the Treasurers will be the net amount which will be left to them after paying salaries to their nominees employed by them for working as cashiers, etc.
The Treasurers themselves will not be entitled to any kind of allowances besides the net remuneration as aforesaid but their nominees or working cashiers will be entitled to allowances which ,the authorities of the Bank may sanction for members of the staff from time to time.
The Treasurers shall employ the number of men at each office as mentioned in schedule A aforesaid.
The Board of Directors shall have the power to increase or decrease the number of their nominees for any particular office and the amount of remuneration fixed for that office.
The Treasurers shall be responsible for the due safety, both within and outside the premises of the Bank at any 1435 office placed under their charge, of all money, specie, ornaments, bullion, cash, etc.
and of other valuable documents received by them for and on behalf of the Bank or from the Bank and shall be answerable to the Bank for all losses occurring either inadvertently or by or through the negligence or misconduct of the Treasurers or any of their nominees.
The Treasurers shall be entitled to resign the services of the Bank by giving three calendar months ' notice to the Bank.
The Bank shall also be entitled to dispense with the Treasurers ' services on giving three months ' notice In case of gross negligence or misconduct or of any fraud, misappropriation or embezzlement by the Treasurers or any of the nominees in the discharge of ,their duties as such Treasurers, no notice shall be necessary and the Bank shall have the right to dispense with their services forthwith.
The Bank shall have the right to take the Treasurers into the service of the Bank after settlement of remuneration with the Treasurers at any other office or offices of the Bank.
The Treasurers and their nominees shall obey all the orders, rules and regulations prescribed by the Bank with regard to the discharge of their duties by the cashiers as well as with regard to the amount of balance they are allowed to keep with them.
It shall be the duty of the cashiers to inform the manager of the Bank as soon as the balance in hand exceeds the prescribed limit and to ask for orders on the point.
The Treasurers shall not engage any person as their assistant or peon about whose character, conduct or reliability the manager of the Board of Directors of the Bank may have any objection.
The Treasurers shall also arrange that no person under employment absents himself from duty without the written permission of the manager for the time being.
If any such employee is absent without leave, or he is turned out on the objection of the Board or the Manager, the Treasurers shall forthwith appoint a substitute in his place.
The Treasurers shall be responsible for the acts and defaults of all their nominees.
The Treasurers and their nominees shall be entitled to traveling allowance according to rates sanctioned by the Board 1436 of Directors of the Bank.
The Treasurers have deposited security of the value of Rs. 15,000/ on which they shall be entitled to receive interest at the rate of 31 per cent.
per annum.
As a further security for the due performance of the terms and conditions of the agreement as a cover for loss that may be caused to the Bank by any act or omission of themselves or any one of their nominees, the Treasurers hypothecated properties as per schedule C attached to and forming part of the agreement.
Schedule A aforesaid contains the names of the offices, the monthly remuneration of the Treasurers in respect of each one of those offices separately, net savings of the Treasurers after paying the salaries of the total number of men including cashiers, etc., as stated against each one of the offices.
Apart from the terms set out above bearing on the relation between the Bank and the Treasurers, some of which apply equally to their nominees, the following terms of the agreement bear directly on the relation between the nominees of the Treasurers, like the appellant, and the Bank.
In this connection the agreement provides that the Board of Directors shall have the power to increase or decrease the number of the Treasurers ' nominees for any particular office and the amount of remuneration fixed for that office.
Such nominees shall be entitled as servants of the Bank to any bonus which may from time to time be declared for the members of the staff.
The bonus of the Treasurers shall be limited to the amount of their own net remuneration and no further.
They shall not be entitled to any bonus to which their cashiers are not eligible under the rules of the Bank.
The nominees of the Treasurers shall be entitled to participate as ordinary members of the staff in the provident fund constituted by the Bank.
Such nominees shall also be entitled to traveling allowance according to rates sanctioned by the Board of Directors of the Bank whenever they are required to go to out stations on bank business.
From the terms of the agreement aforesaid set out above almost verbatim omitting such clauses and words as are not relevant to this case, it will appear 1437 that the Treasurers are under the employment of the Bank on a monthly basis for an indefinite term, that is to say, until such time as either party to the agreement terminated it in accordance with the terms quoted above.
They are under the complete control and direction of the Bank through its manager or other functionaries.
The Treasurers have to take their orders from day to day as regards the cash balance or other cognate matters relating to the safe custody of cash, valuable documents, etc.
belonging to the Bank or its constituents.
The Treasurers receive in respect of each office under the incharge a certain name sum out of which they have to pay the salary of a stated number of their assistants who may be head cashiers or cashiers or assistant cashiers and other such functionaries.
They are entitled to receive bonus on the net amount secured to them as their remuneration, being the lump sum fixed in respect of each office, minus the salary of the assistants.
It is true that these Treasurers are not and cannot be expected to be personally present to discharge their onerous duties at each one of the large number of offices spread over the Punjab and outside.
Naturally they had to be authorized to engage head cashiers, or assistant cashiers in respect of each of the offices placed in their charge.
They had to guarantee the fidelity of the persons so employed as their assistants.
Those assistants had to be persons in whose reliability, 'honesty and efficiency both the Bank and the Treasurers had confidence.
The Treasurers have the right to nominate those assistants but the Bank had the final words in the choice.
The Bank Manager has complete control over such nominees in the matter of leave of absence, discipline and conduct in the discharge of their duties as assistants managing the cash and other valuables in the custody of the Bank.
From the very nature of things it bad to be a dual control in the sense that the Treasurers had to nominate the assistants who are to discharge those responsible functions in connection with cash and other valuables of the Bank and the Bank could not abdicate its powers of full control over the day to day working of 1438 the Cash Department.
The nominees of the Treasurers are treated on the same footing as the other servants of the Bank in the matter of bonus ' travelling allowance and provident fund, etc.
It is true those nominees are to be paid by the, Treasurers but it is out of the money provided by the Bank.
It is not always easy to determine whether the relation between two parties, in the present case of the Treasurers vis a vis the Bank, is that of servants to a master or of independent contractors who have undertaken to do a particular job for their employer.
The question has generally arisen in connection with the determination of vicarious liability of an employer in respect of acts done by his agent (using a neutral word which includes an independent contractor as also a servant).
The distinction between a servant and an independent contractor has been the subject matter of a large volume of case law from which the text book writers on torts have attempted to lay down some general tests.
For example, in Pollock 's Law of Torts,* the distinction has thus been brought out: "A master is one who not only prescribes to the workman the end of his work, but directs or at any moment may direct the means also, or, as it has been put, 'retains the power of controlling the work ', a servant is a person subject to the command of his master as to the manner in which he shall do his work. .
An independent contractor is one who undertakes to produce a given result but so that in the actual execution of the work he is not under the order or ,control of the person for whom be does it, and may use his own discretion in things not specified before hand. . . . ." Clerk & Lindsell on Torts (11th Edn.) at p. 135 have adopted the description of an independent contractor given by Pollock as quoted above.
In the 11th Edn. of Salmond 's Treatise on the Law of Torts, the same distinction has been clearly indicated in the following passage at p. 98 *Pages 62 & 63 of Pollock on Torts, 15th Edn.
1439 "what then, is the test of this distinction between a servant and an independent contractor? The test is the existence of a right of control over the agent in respect of the manner in which his work is to be done.
A servant is an agent who works under the supervision and direction of his employer; an in dependent contractor is one who is his own master.
A servant is a person engaged to obey his em ployer 's orders from time to time; an independent contractor is a person engaged to do certain work, but to exercise his own discretion as to the mode and time of doing it he is bound by his contract, but not by his employer 's orders".
Those learned authors have discussed in great detail cases illustrative of those distinctions, indicating the circumstances in which the general rule has been applied to individual cases with such modifications as the facts and circumstances of a particular case required.
We are here not concerned with those nice distinctions which have been drawn in connection with the rule of vicarious liability in torts.
We are here concerned only with the question how far the test laid down by the standard authors as quoted above can be applied to determine the present controversy whether the Treasurers of the Bank were its servants as contended on behalf of the appellant or independent contractors as claimed on behalf of the respondent Bank.
The agreement between the parties, as summarised above, is a composite transaction constituting the Treasurers agents of the Bank, the former agreeing to indemnify the latter against any loss occasioned to the Bank due to the lack of fidelity and efficiency of the ministerial staff entrusted with the charge of the Bank 's cash and valuable documents.
The Treasurers have been charged with the duty of nominating their assistants who are to be responsible in their day to day work to the Bank which all the time has full control over them in the matter of their leave of absence, as to how they shall keep the cash and other valuables and as to how they shall be under the general direction of the Bank 's manager or, some 184 1440 other functionary who may be nominated by the Bank to supervise the work of the Cash Department.
The Bank makes itself answerable to the employees thus appointed by the Treasurers with the concurrence of the Bank for their bonus, provident fund and travelling allowance.
For those purposes these assistants are to be on the same footing as the other employees of the Bank.
It was contended on behalf of the respondent Bank that its agreement with the Treasurers shows that the latter bad the fullest responsibility for the appointment and dismissal and payment of salary of the employees in charge of the, Cash Department of the Bank and that therefore the Treasurers could not but be independent contractors.
It has already been noticed that the appointment of such assistants as are entrusted with the work of the Cash Department is not under the absolute power of the Treasurers.
The appointment has to be approved by the Bank and the Treasurers cannot continue to employ those workmen in whose fidelity and efficiency the Bank has no confidence.
Hence both in the matter of appointment and dismissal of the employees the Bank reserves to itself the power to ' give direction to the Treasurers.
Similarly in the matter of the payment of salary the money comes out of the coffers of the Bank, though it may be paid by the hand of the Treasurers.
In this connection it was contended on behalf of the appellant that payment of salary of the employees in the Cash Department is made through the Ban].
,, itself but we have no tangible evidence in this case beyond the bare assertion at the Bar.
But, in our opinion, the situation in respect of the appointment, dismissal and payment of salary of the employees of the Cash Department is analogous to that of the employees of a particular department of Government, in which appointment and dismissal of ministerial staff may rest with an authority so empowered by the head of the department.
Payment of salary may also be made by the appointing authority but the money comes out of the Government treasury.
In those circumstances, can it be rightly asserted that 1441 those employees are not the servants of Government? The analogy may not be perfect, because, in the present case, the appointment and dismissal of the employees of the Cash Department is the joint responsibility of the Bank and its Treasurers.
It has got to be so because the Treasurers are the guarantors of the fidelity and efficiency of the employees and the Bank has to exercise complete control over the day to day discharge of their functions because it is the Bank which is vitally and immediately concerned with the efficient and honest discharge of the duties of the assistants in the Cash Department, the efficient running of which is the most important of a bank 's functions.
It will further be noticed with reference to the terms of the agreement set out above that whereas the Treasurers and their nominees have to take their orders from the Bank Manager or other such functionary, there is no specific provision that those nominees shall discharge their day to day functions under the direct control of the Treasurers or that they will be subject to the immediate control of the Treasurers in the discharge of their daily duties and in the matter of the grant of leave of absence.
There could not be such a provision, as a dual control of that kind in the daily work of the employees would lead to a great deal of confusion and lack of discipline amongst the ministerial staff.
The employees of the Cash Department have of necessity to be under the direct control of the Bank Manager or of some other functionary appointed by the Bank.
It is the Bank which has undertaken the responsibility in the matter of their pay and prospects in the service and naturally therefore, such employees, even as other employees of the Bank, have to take their orders from the Bank.
It must therefore be held that the Treasurers are the servants of the Bank and that their nominees must equally be so.
The Appellate Tribunal held that on a reading as a whole of the clauses of the agreement aforesaid the appellant was an employee of the Treasurers and not of the Bank, It did not address itself pointedly 1442 to the question as to what was the exact relation between the Bank and the Treasurers.
It did not also consider the question as to what would be the position of the employees of the Cash Department vis a Vis the Bank if it were held that the Treasurers Id. themselves were the servants of the Bank and not independent contractors.
Before the Appellate Tribunal both parties appear to have concentrated their attention on the question as to whether the employees of the Cash Department were servants of the Bank or of the Treasurers.
In our opinion, that was not a correct approach to the determination of the controversy between the parties.
If the Treasurers ' relation to the Bank was that of servants to a master, simply because the servants were authorized to appoint and dismiss the ministerial staff of the Cash Department would not make the employees in the Cash Department independent of the Bank.
In that situation the ultimate employer would be the Bank through the agency of the Treasurers.
It was argued on behalf of the respondent that even if it were held that the Treasurers were the servants of the Bank and not independent contractors, the legal position of the employees of the Cash Department vis a vis the Bank would be the same, namely, that they will be in law the servants of the Treasurers.
In our opinion, there is no substance in that contention.
If a master employs a servant and authorizes him to employ a number of persons to do a particular job and to guarantee their fidelity and efficiency for a cash consideration.
, the employees thus appointed by the servant would be equally with the employer, servants of the master.
It is not always correct to say that persons appointed and liable to be dismissed by an independent contractor can in.
no circumstances be the employees of the third party.
This would be clear from the following observations of Lord Esher, M.R., in the case of Donovan vs Laing, Wharton & Down Construction,Syndicate(1): "It is true that the ' defendants selected the man and paid his wages, and these are circumstances which, if nothing else intervened, would be strong to show (1) (1893] at 632, 1443 that he was the servant of the defendants.
So, indeed, he was as to a great many things but as to the working of the crane he was no longer their servant, but bound to work under the orders of Jones & Co., and, if they saw the man misconducting himself in working the crane or disobeying their orders, they would have a right to discharge him from that employment".
Those observations have been approved in the latest decision of the House of Lords in the case of Mersey Docks & Harbour Board vs Coggins & Griffith (Liverpool) Ltd.(1).
The House of Lords distinguished that ruling on facts but did not depart from the general rule laid down in the earlier decision that the determinative factor is as to which party had control over the workers as to how they would do their job from day to day.
Lord Macmillan in his speech at p. 14 has observed as follows: "Many reported cases were cited to your Lordships but where,, as all agree, the question in each case turns on its own circumstances, decisions in other cases are rather illustrative than determinative.
So far as attempts have been made to formulate a criterion of general application, it cannot be said that these attempts have been very successful".
It would thus appear that the question as to whose employee a particular person was has to be determined with reference to the facts and circumstances of each individual case.
Lord Porter in the course of his speech in the reported case (supra) at p. 17 has observed as follows: "Many factors have a bearing on the result.
Who is paymaster, who can dismiss, how long the alternative service lasts, what machinery is employed, have all to be kept in mind.
The expressions used in any individual case must always be considered in regard to the subject matter under discussion but amongst the many tests suggested I think that the most satisfactory, by which to ascertain who is the employer at any particular time is to ask who is entitled to tell the employee the way in which he is to do the work upon which he is engaged".
(1) ; , 1444 As indicated above, in the present case the direction and control of the appellant and of the ministerial staff in charge of the Cash Department of the Bank was entirely vested in the Bank through its manager or other superior officer.
We have therefore no hesitation in differing from the conclusion arrived at by the Appellate Tribunal and in holding that the appellant was an employee of the Bank.
That being so, the Tribunal had the jurisdiction to make the directions it did in respect of the appellant.
The respondent did not at any stage of the proceedings challenge the orders of the Tribunal on its merits.
That conclusion being reached, there is no difficulty in upholding the orders of the Tribunal in respect of the appellant.
It is therefore not necessary to pronounce upon the other points raised by the parties.
The appeal is accordingly allowed wit costs throughout.
Appeal allowed.
| The appellant was appointed head cashier in one of the branches of the respondent Bank by the Treasurers who were in charge of the Cash Department of the Bank by virtue of an agreement between them.
The question arose as to whether the appellant was an employee of the Bank.
(i) that the terms of the agreement clearly showed that the Treasurers were servants of the Bank and not independent contractors; and that (ii)as the direction and control of the appellant and of the ministerial staff in charge of the Cash Department of the Bank was entirely vested in the Bank, the appellant was an employee of the Bank.
If a master employs a servant and authorizes him to employ a number of persons to do a particular job and to guarantee their fidelity and efficiency for a cash consideration, the employees thus appointed by the servant would be, equally with the employer, servants of the master.
The question as to whose employee a particular person is has to be determined with reference to the facts and circumstances of each individual case, and among the many tests by which to ascertain who is the employer, the most satisfactory one is to ask who is entitled to tell the employee the way in which he is to do the work upon which he is engaged.
(1) (1924] I.L.R. (2) Cal.
297, 1428 Donovan vs Laing, Wharton & Down Construction Syndicate ([1893] and Mersey Docks & Harbour Board vs Coggins & Griffith (Liverpool) Ltd. ([1947] A.C.1), referred to.
|
Appeal No. 74 of 1952.
Appeal by Special Leave from the Judgment and Decree dated the 10th November 1948 of the High Court of Judicature at Bombay in Appeal from Original Decree No. 274 of 1945 arising out of the decree dated the 17th March 1945 of the Court of Revenue Judge, Bombay in Suits Nos. 7 and 23 of 1943.
C. K. Daphtary, Solicitor General for India (Porus A. Mehta, with him), for the appellant.
M. C. Setalvad, Attorney General for India and Jamshedji Kanga,, (R. J. Kolah and Rajinder Narain, with them), for the respondents.
February 28.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
The point for decision in this appeal is as to the liability of certain lands situated within the City of Bombay to be assessed to revenue under the Bombay City Land Revenue Act No. II of 1876.
These lands were originally known as Foras lands, and the rights of the occupants of 1313 those lands were settled by Bombay Act No. VI of 1851, called the Foras Act.
What these rights are, is a matter in controversy between the parties, and will be presently considered.
Between 1864 and 1867 the Government acquired these lands for the purpose of the B.B. C.I. Railway under the provisions of Land Acquisition Act No. VI of 1857.
On 22 11 1938 these lands, being no longer required for the purpose of the Railway, were sold by the Governor General to Lady Pochkhanawalla and others as joint tenants under a deed, Exhibit A.
On 28 3 1939 the survivor of the purchasers under Exhibit A conveyed the lands in trust under Exhibit B, and the respondents are the trustees appointed under that deed.
In April 1942 the appellant acting under the provisions of Bombay Act No. II of 1876, issued notices to the respondents proposing to levy assessment on the lands at the rates mentioned therein, and calling for their representation.
In their reply, the respondents denied the right of the appellant to assess the lands to revenue, and followed it up by instituting two suits before the Revenue Judge for establishing their rights.
In their plaints, they alleged that under the provisions of the Foras Act the maximum assessment leviable on the lands was 9 reas per burga, and that the Government had no right to enhance it; that the effect of the land acquisition proceedings between 1864 and 1867 was to extinguish the right of the State to levy even this assessment, and that further, having purchased the properties absolutely from the Governor General under Exhibit A. they were entitled to bold them without any liability to pay revenue thereon.
They accordingly prayed for a declaration that the Government had no right to levy any assessment on these lands, or, in the alternative, that such assessment should not exceed what was payable under Bombay Act No. VI of 1851.
The appellant contested the suit.
The Revenue Judge held that as a result of the land acquisition proceedings between 1864 and 1867, the lands vested in the Government freed from any liability to pay assessment, and that when the Governor General transferred them under 1314 Exhibit A without reserving the right to assess them, the purchasers had the right to hold them without any liability to pay revenue.
He accordingly granted a declaration that the appellant had no right to levy assessment, and that the notices issued by him under Act No. II of 1876 were illegal.
On appeal by the defendants to the High Court of Bombay, it was held by Chagla, C.J., Bhagwati, J. concurring, that Act No. VI of 1851 imposed a specific limit on the right of the Government to levy assessments on the lands in question, that, further, by reason of the land acquisition proceedings the right of the Provincial Government to levy assessment even within the limits prescribed by Act No. VI of 1851 was extinguished, and that when the lands were transferred by the Central Government to Lady Pochkhanawalla and others, they got them as revenue free lands.
In the result, the appeal was dismissed.
This appeal by special leave is directed against this decision.
The statutory authority under which the appellant seeks to levy assessment on the lands is section 8 of Bombay Act No. 11 of 1876, and it is as follows: "It shall be the duty of the Collector, subject to the orders of Government, to fix and to levy the assessment for land revenue.
When there is no right on the part of the superior holder in limitation of the right of Government to assess, the assessment shall be fixed at the discretion of the Collector subject to the control of Government.
When there is a right on the part of the superior bolder in limitation of the right of Government, in consequence of a specific limit to assessment having been established and preserved, the assessment shall not exceed such specific limit".
It was on the footing that the respondents were 'superior holders ' as defined in the Act, that the appellant issued notices to them in April 1942.
In their reply notices and in the plaints, the respondents did not dispute that position, but only contended in terms of section 8 that they had a specific right in limitation of the right of the Government to assess the 1315 lands; and the entire controversy in the Courts below was whether they had established that right.
No contention was raised that they were not superior holders as defined in the Act, and that, in consequence, no assessment could be imposed on the lands under section 8 of the Act.
In the argument before us, the contention was sought to be raised for the first time by the learned Attorney General that the proceedings taken by the Collector under section 8 were incompetent, as that section would apply only to lands held by superior holders, that the definition of 'superior ' holier ' in section 3 (4) as meaning "the person having the highest title under the Provincial Government to any land in the City of Bombay" would take in only persons who held on a derivative tenure from the Government, that persons who acquired lands from the Government under an outright sale could not be described as 'superior holders ' within section 3 (4), and that the lands held by the respondents were therefore outside the operation of section 8.
On behalf of the appellant, the learned Solicitor General objected to this question being allowed to be raised at this stage of the proceedings, as that would involve investigation of questions of fact and of law, such as whether under the tenures in the City of Bombay, owners held the lands as superior holders, whether under Indian jurisprudence what was paid by the occupier of land was rent or revenue, whether the prerogative right of the Crown to assess lands subsisted in the Presidency Towns of Calcutta, Bombay and Madras and several other questions, for the decision of which there were not sufficient materials.
This objection must be upheld.
In view of the fact that the respondents have, at all stages, claimed immunity from assessment on the basis of section 8, we do not consider that it would be proper to allow them now to change their front, and take up a stand wholly inconsistent with what they had taken, when that involves an investigation into facts which has not been made.
We must, therefore, proceed on the footing that the respondents are `superior holders ' as defined 1316 in section 3 (4) of Act No. 11 of 1876, and that their rights are to be determined in accordance with sec tion 8 of the Act.
Construing that section, the Privy Council laid down in Goswamini ' Shri Kamala Vahooji vs Collector of Bombay(1) two propositions: that though the language of the section would more appropriately apply when the dispute was as to the quantum of assessment ', the right to levy it not being itself controverted, it was open to the superior holder under this section to plead and prove that the State had no right to levy any assessment; and that the burden was on the person who pleaded a limitation on the right of the State to assess, to clearly and unequivocally establish it.
It is, therefore, open to the respondents to plead that the lands are wholly exempt from revenue; but the onus of making it jut lies heavily on them.
The learned Attorney General has sought to establish a right in the respondents in limitation of the right of the appellant to assess the lands on three grounds: (1) the Foras Act No. VI of 1851, (2) the land acquisition proceedings under Act No. VI of 1857, and (3) the sale deed, Exhibit A. Taking first the Foras Act: For a correct appreciation of its provisions, it is necessary to refer Co the history of the lands, which are dealt with therein.
The Island of Bombay once formed part of the Portuguese Domi nions in India.
In 1661 when Princess Infant Catherine was married to King Charles 11 of England, it was ceded by the King of Portugal to the British Crown as dowry, and by a Royal Charter dated 27th March 1668 King Charles 11 granted it to the East India Company.
At that time the Island consisted only of the Fort and the town, and "outside the walls of the town it was scarcely more than rock and marsh which became a group of islands every day on high tide".
Vide Shapurji Jivanji vs The Collector of Bombay(1).
It appears from Warden 's Report on the Landed Tenures in Bombay and Le Mesurier 's Report on the Foras lands, that during the 18th Century the East India Company started (1) (1937) L.R. 64 I.A. 334.
(2) Bom.
483, 488, 1317 reclaiming these lands, and invited the inhabitants to cultivate them, at first without payment of any assessment and subsequently on favourable rates.
These payments were called "Foras".
The meaning of this word is thus explained by Westropp, J. in his note at page 40 in Naoroji Beramji vs Rogers(1): " foras ' is derived from the Portuguese word fora (Latine foras, from foris a door), signifying outside.
It here indicates the rent or revenue derived from outlying lands.
The whole island of Bombay fell under that denomination when under Portuguese rule, being then a mere outlying dependency of Bassein.
Subsequently the term foras was, for the most part, though perhaps not quite exclusively, limited to the new salt batty ground reclaimed from the sea, or other waste ground lying outside the Fort, Native Town, and other the more ancient settled and cultivated grounds in the island, or to the quitrent arising from that new salt batty ground and outlying ground".
Thus, the salt batty lands reclaimed from the sea came to be known as Foras lands by association with the assessments payable thereon called "Foras".
The nature of the interest which the occupants had in the Foras lands was the subject of considerable debate in the beginning of the 19th Century.
In 1804, the Company resumed some of the Foras lands for settling persons displaced in the Town area, and that resulted in a suit by one Sheik Abdul Ambly, wherein the right of the Company to resume the lands was challenged.
The action failed, the Court upholding the claim of the Company to resume them, but at the same time, it observed that its action in dispossessing the occupants would "appear and be felt as a grievous hardship, if not an open and downright injury".
Vide Warden 's Report on the Landed Tenures of Bombay, pages 60 and 61.
Thereafter, the Company had the matter further investigated, and there were reports on the subject by Warden in 1814 and Le Mesurier in 1843.
And finally the Company decided to recognise (1) 4 Boni.
H.C.R. 1. 1318 the rights of the 'Occupants, and that resulted in the enactment of Act VI of 1851.
The relevant provisions of the Act may now be noticed.
The preamble to the Act states that, "Whereas the East India Company are legally entitled to the freehold reversion of the several lands heretofore paying a render called foras, the outline whereof is delineated in a plan and numbered 1, subject to certain tenancies therein at will, or from year to year; whereas it is considered expedient as of grace and favour that the rights of the said East India Company in all of the lands included in the said plan should be extinguished, save as hereinafter mentioned.
It is enacted as follows:" Section 2 enacts that: "From and after the said 1st day of July, the rights of the said Company in all of the said lands mentioned in the said plan No. 1, except those mentioned in the said plan No. 2, shall be extinguished in favour of the persons who shall then hold the same respectively as the immediate rent payers to the said Company, saving the rents now severally payable in respect of such lands, which shall continue payable and recoverable by distress, or by any means by which land revenue in Bombay is or shall be recoverable, under any Act or Regulation Section 4 provides: "Nothing herein contained shall exempt such lands from being liable to any further general taxes on land in Bombay " According to the appellant, the effect of these provisions was to grant the lands to the occupants on a permanent tenure, heritable and alienable, but not further to grant them on a permanent assessment.
Reliance was also placed on the decision in Shapurji Jivanji vs The Collector of Bombay(1), where it was held generally that the Government had the right under section 8 of the Act to enhance the assessments on Foras lands.
There is some support for this contention in the provisions of the Act.
The preamble (1) Bom.
483, 488.
1319 expressly recites that the occupants were tenants at will or from year to year, and that the reversion was with the East India Company.
One consequence of that was that the Company had the right to eject the occupants.
Now, what the Company did under the Act was to give up that right as a matter of grace, because, as already mentioned, it would appear to have invited them to settle on the lands and cultivate them, and it did that by extinguishing its reversion as landlord.
In other words, it agreed to confer on the tenants the status of owners of lands.
If that was all the scope of Act No. VI of 1851, it could not be doubted that the rights of the State to enhance the assessments would not be affected, because ownership of land does not per se carry with it an immunity from enhancement of assessment in exercise of sovereign rights, and occupants of Foras lands cannot claim to be in a better position by reason of the Act than owners of lands in ryotwari tracts, the assessments on which are liable to periodic revision.
But what is against the appellant is that section 2 does not stop with merely extinguishing the reversionary rights of the Company.
It goes further, and saves expressly "the rents now severally payable in respect of such lands", rent being used here in the sense of assessment, and adds "which shall continue to be payable".
Now, the contention of the respondents is that those words conferred on the Government a right to recover only the assessment which was then payable, and that there was thus a limitation on its right to enhance it.
It is common ground that the assessment payable on these lands at that time was 9 reas per burga, and Exhibit N shows that it was at that rate that the assessment was collected from 1858 until the lands were acquired by the Government in land acquisition proceedings.
It is accordingly contended for the respondents that under the Act, the Government could not claim anything more than 9 reas per burga as assessment on the lands.
It is urged for the appellant that the words "now severally payable" could not be construed as impos 169 1320 ing a limitation on the right of the Government to enhance the assessment, as they occur in a saving clause, the scope of which was to reserve the rights of the Company and not to confer on the occupants rights in addition to what the body of the section had granted to them.
It is true that the setting in which these words occur is more appropriate for reserving rights in favour of the Company than for declaring any in favour of the occupants.
But to adopt the construction contended for by the appellant would be to render the words "now severally payable" and "which shall continue to be payable" wholly meaningless.
Notwithstanding that the drafting is inartistic, the true import of the clause unmistakably is that while, on the one hand, the right of the Government to recover the assessment is saved, it is, on the other hand, limited to the amount then payable by the occupants.
The contention of the respondents that under the Foras Act they acquired a specific right to hold the lands on payment of assessment not exceeding what was then payable, must, therefore, be accepted We have next to decide what effect the proceedings taken by the Government under the Land Acquisition Act No. VI of 1857 during the years 1864 to 1867 have on the rights of the parties.
Section VIII of the Act is as follows: "When the Collector or other officer has made an award or directed a reference to arbitration, be may take immediate possession of the land which shall thenceforward be vested absolutely in the Government, free from all other estates, rights, titles and interests".
The contention of the respondents which has found favour with the Courts below is that under that section the effect of the vesting of the lands in the Government was to extinguish whatever interests were previously held over them, that the right of the Government to levy assessment was such an interest, and that it was also extinguished.
It is argued that when lands are acquired under the Act, the valuation that is made is of all the interests subsisting thereon, including the 1321 rights of the Crown to assess the lands, as well as the interests of the claimants therein, that what is paid to the owners is not the full value of the lands but the value of their interests therein, deduction being made of the value of the right of the Government to assess from out of the full value, and that, in effect, there was an award of compensation for the right to assess, and that, therefore, that right equally with the rights of the claimants over the lands would be extinguished.
One of the awards has been marked as Exhibit P, and the respondents rely on the recitals therein that the compensation to the claimants was "for their interest in the said lands".
The award, it must be mentioned, directs the Government to pay the claimants the amounts specified therein, but contains no provision for payment of any sum as compensation to the Government for its right to assess the lands; nor does it even value that right.
But the respondents contended that the Government being the authority to pay must be deemed to have paid itself, and that, in any event, if they were entitled to compensation, their failure to claim it could not affect the result, which was that the right to levy assessment would be extinguished.
We are unable to accept this contention.
When the Government acquires lands under the provisions of the Land Acquisition Act, it must be for a public purpose, and with a view to put them to that purpose, the Government acquires the sum total of all private interests subsisting in them.
If the Government has itself an interest in the land, it has only to acquire the other interests outstanding therein, so that it might be in a position to pass it on absolutely for public user.
In the Matter of the Land Acquisition Act: The Government of Bombay vs Esupali Salebhai(1) Batchelor, J. observed: "In other words Government, as it seems to me, are not debarred from acquiring and paying for the only outstanding interests merely because the Act, which primarily contemplates all interests as held outside Government, directs that the entire compen (1) Bom. 618, 686.
1322 sation based upon the market value of the whole of land, must be distributed among the claimants".
There, the Government claimed ownership of the land on which there stood buildings belonging to the claimants, and it was held that the Government was bound to acquire and pay only for the superstructure, as it was already the owner of the site.
Similarly in Deputy Collector, Calicut Division vs Aiyavu Pillay(1), Wallis, J. (as he then was) observed: 'It is, in my opinion, clear that the Act does not contemplate or provide for the acquisition of any interest which already belongs to Government in land which is being acquired under the Act, but only for the acquisition of such interests in the land as do not already belong to the Government".
With these observations, we are in entire agreement.
When Government possesses an interest in land which is the subject of acquisition under the Act, that interest is itself outside such acquisition, because there can be no question of Government acquiring what is its own.
An investigation into the nature and value of that interest will no doubt be necessary for determining the compensation payable for the interest outstanding in the claimants, but that would not make it the subject of acquisition.
The language of section VIII of Act No. VI of 1857 also supports this construction.
Under that section, the lands vest in the Government "free from all other estates, rights, titles and interests", which must clearly mean other than those possessed by the Government.
It is on this understanding of the section that the award, Exhibit p, is framed.
The scheme of it is that the interests of the occupants are ascertained and valued, and the Government is directed to pay the compensation fixed for them.
There is no valuation of the right of the Government to levy assessment on the lands, and there is no award of compensation therefor.
We have so far assumed with the respondents that the right of the Government to levy assessment is an interest in land within the meaning of section VIII (1) [1911] 9 I C 341. 1323 of Act VI of 1857.
But is this assumption wellfounded? We think not.
In its normal acceptation, "interest" means one or more of those rights which go to make up "ownership".
It will include for example, mortgage, lease, charge, easement and the like.
but the right to impose a tax on land is a prerogative right of the Crown, paramount to the ownership over the land and outside it.
Under the scheme of the Land Acquisition Act, what is acquired is only the ownership over the lands, or the inferior rights comprised therein.
Section 3(b) of the Land Acquisition Act No. I of 1894 defines a "person interested" as including "all persons claiming an interest in compensation to be made on account of the acquisition of land under this Act, and a person shall be deemed to be interested in land if he is interested in an easement affecting the land".
Section 9 requires that notices should be given to all persons who are interested in the land.
Under section 11, the Collector has to value the land, and apportion the compensation among the claimants according to their interest in the land.
Under section 16, when the Collector make an award "he may take possession of the land which shall thereupon vest absolutely in the Government free from all encumbrance".
The word "en cumbrance" in this section can only mean interests in respect of which a compensation was made under section 11, or could have been claimed.
It cannot include the right of the Government to levy assessment on the lands.
The Government is not a "person interested" within the definition in section 3 (b), and, as already stated, the Act does not contemplate its interest being valued or compensation being awarded therefor.
It is true that there is in Act No. VI of 1857 nothing corresponding to section 3(b) of Act No. I of 1984, but an examination of the provisions of Act No. VI of 1857 clearly shows that the subject matter of acquisition under that Act was only ownership over the lands or its constituent rights and not the right of the Government to levy assessment.
The provisions relating to the issue of notices to persons interested 1324 and the apportionment of compensation among them are substantially the same.
Moreover, under section VIII the Government is to take the lands free from all other "estates, rights, title and interest", and "interest" must, in the context, be construed ejusdem generis with "estates" etc., as meaning right over lands, of the character of, but not amounting to an estate, and cannot include the prerogative right to assess the lands.
It must accordingly be held that the effect of the land acquisition proceedings was only to extinguish the rights of the occupants in the lands and to vest them absolutely in the Government, that the right of the latter to levy assessment was not the subject matter of those proceedings, and that if after the award the lands were not assessed to revenue, it was because there could be no question of the Government levying assessment on its own lands.
Then there remains the question whether the sale deed, Exhibit A, imposes any limitation on the right of the Crown to assess the lands.
The deed conveys the lands to the purchasers absolutely "with all rights, easements and appurtenances whatsoever" to be held "for ever".
It does not, however, recite that they are to be held revenue free.
But it is argued for the respondents that where there is an absolute sale by the Crown as here, that necessarily imports that the land is conveyed revenue free; and section 3 of the Crown Grants Act No. XV of 1895 and certain observations in Dadoba vs Collector of Bombay(1) were relied on as supporting this contention.
Section 3 of Act No. XV of 1895 is as follows: "All provisions restrictions, conditions and limitations over contained in any such grant or transfer as aforesaid shall be valid and take effect according to their tenor any rule of law, statute or enactment of the Legislature to the contrary notwithstanding".
The contention is that as the grant is of a freehold estate without any reservation it must, to take effect according to its tenor, be construed as granting exemption from assessment to revenue.
But that will be extending the bounds of section 3 beyond its con (1) (1901] I.L.R. , 1325 tents.
The object of the Act as declared in the preamble is to remove certain doubts "as to the extent and operation of the , and, as to the power of the Crown to impose limitations and restrictions upon grants and other transfers of land made by it or under its authority".
Section 2 enacts that the provisions of the do not apply to Crown grants.
Then follows section 3 with a positive declaration that "all provisions, restrictions, conditions and limitations over" shall take effect according to their tenor.
Reading the enactment as a whole, the scope of section 3 is that it saves "provisions, restrictions, conditions and limitations over" which would be bad under the provisions of the , such as conditions in restraint of alienations or enjoyment repugnant to the nature of the estate, limitations offending the rule against perpetuities and the like.
But no question arises here as to the validity of any provision, restriction, condition, or limitation over, contained in Exhibit A on the ground that it is in contravention of any of the provisions of the , and there is accordingly nothing on which section 3 could take effect.
It is argued by the learned Attorney General that this limitation on the scope of the Act applies in terms only to section 2, and that section 3 goes much further, and is general and unqualified in its operation.
The scope of section 3 came up for consideration before the Privy Council in Thakur Jagannath Baksh Singh vs The United Provinces(1).
After setting out that section, Lord Wright observed: "These general words cannot be read in their apparent generality.
The whole Act was intended to settle doubts which had arisen as to the effect of the , and must be read with reference to the general context. . .
In this view, section 3 must also be construed in the light of the preamble, and so construed, it cannot, for the reasons already given, have any bearing on (1) 1326 the rights of the parties.
Moreover, that section only enacts that "all provisions, restrictions, conditions and limitations over" shall take effect according to their tenor, and what is relied on is not any provision, restriction, condition or limitation over, in Exhibit A which according to its tenor entitles the respondents to hold the lands rent free, but the absolute character of the interest conveyed under Exhibit A.
Therefore, section 3 does not in terms apply.
The respondents also relied on certain observations in Dadoba vs Collector of Bombay(1) as supporting their contention.
There, the facts were that the Government had granted one parcel of land to the Free Church Mission of Scotland revenue free under a deed dated 1 10 1884.
By another deed dated 20 12 1887 they released their right of reversion on two other parcels of land held by the Mission as tenants but "subject to the payment of taxes, rates, charges, assessments leviable or chargeable in respect of the said premises or anything for the time being thereon".
On 16 1 1888 the Mission sold all the three parcels to one Janardan Gopal, and the Secretary of State joined in the conveyance for effectually releasing the reversion of the Government.
Before Janardan Gopal purchased the lands, there had been correspondence between his solicitors and the Government as to the assessment payable on the lands, and the Government had intimated that it would be 9 pies per square yard per annum.
Subsequent to the purchase, the Collector raised the assessment payable on the lands, and the point for decision was whether he could lawfully do so.
In deciding that he could not, Sir Lawrence Jenkins stated that the purchaser had paid full value for the lands in the belief induced by the Government that the assessment of 9 pies per sq.
yard would be permanent, and that on the facts, the case fell within section 115 of the Evidence Act, and that the Government was estopped from enhancing the assessment.
He was also prepared to hold that the correspondence between the purchaser and the Government prior to (1) Bom.
1327 the sale amounted to a collateral contract not to raise the assessment.
Chandavarkar, J., concurred in the decision, and in the course of his judgment observed: ". when we have regard to the nature of the transaction, viz., that Government was selling the property out and out as any private proprietor when we look to the whole of the language used . the intention of the parties must be taken to have been that the purchaser was to be liable to pay the amount of 9 pies per square yard per annum then levied as assessment and no more".
These observations have been relied on as supporting the contention that when there is an absolute sale by the Government, it amounts to an agreement not to levy more assessment than was payable at that time.
But the remarks of the learned Judge have reference to the recitals in the deed dated 20 12 1887 and the negotiations between the purchaser and the Government which are referred to in the passage, and not to the character of the transfer as an absolute sale; and the decision is based on a finding of estoppel or collateral contract deducible from the correspondence between the purchaser and the Government.
Neither section 3 of the Crown Grants Act, nor the observa tions in Dadoba vs Collector of Bombay(1) lend any support to the contention that an absolute sale of lands by the Government ipso facto confers on the purchasers a right to hold the lands free of revenue.
The question then is whether on the, terms of Exhibit A such a right could be held to have been granted.
There was some discussion at the Bar as to the correct rule of construction applicable to the deed, Exhibit A.
It was argued by the learned Solicitor.
General for the appellant that being a Crown grant, Exhibit A should be construed in favour of the Crown and against the grantee.
On the other hand, it was argued by the learned Attorney General that it should make no difference in the construction of the grant, whether the grantor was the Crown or a subject, as (1) Bom.
170 1328 the question in either case was what had been granted; and that must be determined on the language of the deed.
When closely examined, it will be seen that there is no real conflict between the two propositions.
The former is in the nature of a rule of substantive law; and its scope is that where as the transferee from a subject acquires, unless the contrary appears, all the rights which the transferor has in the property as enacted in section 8 of the , a grantee from the Crown gets only what is granted by the deed, and nothing passes by implication.
But when the grant is embodied in a deed, the question ultimately reduces itself to a determination of what was granted thereunder.
What the Court has to do is to ascertain the intention of the grantor from the words of the document, and as the same words cannot be susceptible of two different meanings, it makes no differenbe whether they occur in a grant by the Crown or by the subject.
If the words used in a grant by a subject would be effective to pass an interest, then those words must equally be effective to pass the same interest when they occur in a Crown grant.
Dealing with this question, Sir John Coleridge observed in Lord vs Sydney(1): "But it is unnecessary for their Lordships to say more on this point, because they are clearly of opinion, that upon the true construction of this grant, the creek where it bounds the land is ad medium film, included within it.
In so holding they do not intend to differ from old authorities in respect to Crown grants; but upon a question of the meaning of the words, the same rules of common sense and justice must apply, whether the subject matter of construc tion be a grant from the Crown, or from a subject; it is always a question of intention, to be collected from the language used with reference to the surrounding circumstances 'section Exhibit A has to be construed in the light of these principles.
As already stated, there is no recital in the deed that the purchasers are entitled to, hold the lands free of assessment.
On the other hand, it (1) (1859] ; , 496, 497; ; , 1000.
1329 expressly provides that the properties will be subject "to the payment of all cesses, taxes, rates, assessments, dues and duties whatsoever now or hereafter to become payable in respect thereof", which words would in their natural and ordinary sense cover the present assessment.
In Dadoba vs Collector of Bombay(1), the Court had to consider a clause similar to the above contained in a deed executed by the Government in favour of the Mission on 20 12 1887.
Dis cussing the effect of this clause on the rights of the plaintiff to hold the property permanently on an assessment of 9 pies per sq. yard, Chandavarkar, J. observed: "When that deed says that the property was sold 'subject to the payment of all taxes, rates, charges, assessments leviable or chargeable ', it leaves the question open as to what the taxes etc., are which are `leviable or chargeable '.
Extrinsic evidence of that is admissible, for it neither contradicts nor varies the terms of the deed, but explains the sense in which the parties understood the words of the deed, which, taken by themselves, are capable of explanation: see Bank of New Zealand vs Simpson (2) ".
In that case, the dispute was not as to the liability to pay any assessment but to the quantum of assessment payable, and it was a possible view to take that the clause in question was not decisive on that question, and that it was left open.
But here, the question is whether a right was granted to the purchasers to hold the lands free from liability to be assessed, and the clause in Exhibit A clearly negatives such a right.
Even if we are to regard the question as left open, as observed in Dadoba vs Collector of Bombay(1), it will not assist the respondents, as they have not established aliunde any right to hold the lands free from assessment.
It must, therefore, be held that far from ex empting the lands from liability to be assessed to revenue, Exhibit A expressly subjects them to it.
It was finally contended that even if the land acquisition proceedings between 1864 and 1867 had not the (1) Bom.
(2) 1330 effect of extinguishing the right of the Government to levy assessment, and that even if Exhibit A conferred on the purchasers no right to hold the land revenue free, the assessment which the Government was entitled to levy under section 8 of Act No. II of 1876 was limited to what was payable under the Foras Act No. VI of 1851, and that the appellant had no right to levy assessment at a rate exceeding the same.
The argument in support of the contention was that it was an incident of the Foras tenure under which the lands wore held, that the occupants were bound to pay only a fixed assessment, that the incident was annexed to the lands, and was inseparable therefrom, that between the dates when the lands were acquired under the Land Acquisition at No. VI of 1857 and 22 11 1938 when they were sold under Exhibit A they continued to retain their character as Foras lands, that if no assessment was paid on the lands during that period, it was because the hand to pay and the hand to receive were the same, that when they came to the respondents under Exhibit A, they became impressed with the Foras tenure, and that, in consequence, they were liable to be assessed only at the rate payable under Act No. VI of 1851.
This contention is, in our judgment, wholly untenable.
When the lands were acquired under the Land Acquisition Act No. VI of 1857, the entire "estate, right, title and interest" subsisting thereon became extinguished, and the lands vested in the Government absolutely freed from Foras tenure, and when they were sold by the Government under Exhibit A the purchasers obtained them as freehold and not as Foras lands.
As the tenure under which the lands were originally held had become extinguished as a result of the land acquisition proceedings, it was incapable of coming back to life, when the lands were sold under Exhibit A.
In support of the contention that the incidents of the Foras tenure continued to attach to the lands in the hands of the respondents, the learned Attorney General relied on the following observations of 1331 Das, J. in Collector of Bombay vs Municipal Corporation of the City of Bombay and others(1): "The immunity from the liability to pay rent is just as much an integral part or an inseverable incident of the title so acquired as is the obligation to hold the land for the purposes of a market and for no other purpose".
But the point for decision there was whether the Municipal Corporation of Bombay could acquire by prescription a right to hold the lands rent free, they having entered into possession under a resolution of the Government that no rent would be charged.
And the passage quoted above merely laid down that when title to the land was acquired by the Municipal Corporation by prescription, one of the rights acquired as part of the prescriptive title 'was the right to hold the lands revenue free.
But the question here is whe ther the right to hold the lands under a fixed assessment survived after the acquisition by the Government under the land acquisition proceedings, and that depends on the effect of section VIII of Act VI of 1857.
If, as observed in the above passage, the liability to pay assessment was "an integral part or an inseverable incident of the title", then surely it was also extinguished along with the title of the occupants under section VIII of Act No. VI of 1857.
There is another difficulty in the way of accepting the contention of the respondents.
The Foras Act was repealed in 1870 by Act No. XIV of 1870 long prior to the date of Exhibit A, and therefore, even if we hold that the Foras tenure revived in the hands of the purchasers under Exhibit A, the rights under the Foras Act were no longer available in respect of the lands.
Section I of Act No. XIV of 1870 saves rights "already acquired or accrued", and it is argued that the rights now claimed are within the saving clause.
But as the lands had all been acquired under Act No. VI of 1857 between 1864 and 1867 there were no rights in respect of the lands which could subsist at the date of the repeal, and the rights now claimed (1) ; , 52, 1332 by the respondents are not within the saving clause.
In the result, it must be held that the right of the appellant to levy assessment under section 8 of Act No. II of 1876 is not limited by any right in the respondents.
We accordingly allow the appeal, set aside the judgments of the Courts below, and dismiss both the suits instituted by the respondents with costs throughout.
Appeal allowed.
| In the island of Bombay certain lands were held on a tenure known as "Foras".
Under section 2 of Bombay Act VI of 1851 the occupants were entitled to hold the lands subject only to the payment of revenue then payable.
Between 1864 and 1867 the Government of India acquired these lands under the provisions of the Land Acquisition Act (VI of 1857).
On 22 11 1938 the Governor General sold them to certain persons under whom the present respondents claimed.
In April 1942 the appellant acting under the Bombay City Land Revenue Act (Bombay Act II of 1876) issued notices to the respondents proposing to levy assessment on the lands at the rates mentioned therein.
The respondents thereupon instituted two suits disputing the right of the appellant to assess the lands to revenue.
They contended that under the Foras Land Act the occupants had acquired the right to hold the lands on payment of revenue not exceeding what was then payable, that the right to levy even that assessment was extinguished when the Government acquired the lands under the Land Acquisition Act, that the Governor General having conveyed the lands absolutely under the sale deed dated 22 11 1938 the respondents were entitled to hold them revenue free and that even if revenue was payable it could not exceed what was payable under the Foras Land Act.
Held, (i) that under the Foras Land Act (VI of 1851) the occupants of Foras lands acquired a specific right to hold them on payment of assessment not exceeding what was then payable.
(ii) that the right of the Government to levy assessment was not the subject matter of the land acquisition proceedings and that the effect of those proceedings was only to extinguish the rights of the occupants in the lands and to vest them absolutely in the Government.
(iii) that where there is an absolute sale by the Crown it does not necessarily import that the land is conveyed revenuefree.
The question is one of construction of the grant.
The rule is that a grantee from the Crown gets only what is granted by the 168 1312 deed and nothing passes by implication.
When the grant is embodied in a deed the question ultimately reduces itself to a determination of what was granted thereunder.
Section 3 of the Crown Grants Act (XV of 1895) that "all provisions, restrictions conditions and limitations over shall take effect according to their tenor" does not apply when the question is as to the liability to pay revenue.
(iv)that the Foras tenure became extinguished when the lands were acquired under the Land Acquisition proceedings and it was incapable of coming back to life when the lands were sold on 22 11 1938 and the respondents cannot claim a right to pay assessment only at the rate at which it was payable under the Foras Land Act.
Goswammi Shri Kamala Vahooji vs Collector of Bombay ([1937] L.R. 64 I.A. 334), Shapurji Jivanji vs The Collector of Bombay ([1885] I.L.E. , 488), Naoroji Beramji vs Rogers , Deputy Collector, Calicut Division vs Aiyavu Pillay ([1911] , Dadoba vs Collector of Bombay ([1901] I.L.R. , Thakur Jagannoth Baksh Singh vs The United Provinces ([1946] F.L.J. 88) and Collector of Bombay vs Municipal Corpration of the City of Bombay and others ([1952] S.C.R. 43), referred to.
|
Appeal No. 260 of 1953 and connected appeal (C.A. No. 12 of 1954).
Appeals from the Judgment and Decree dated the 11th day of May 1951 of the High Court of Judicature at Patna in Miscellaneous Appeal No. 253 of 1950 and in appeal from Original Order No. 252 of 1950 arising out of the order dated the 11th day of May 1951 of the Court of Subordinate Judge, Dhanbad in Suit No. 34 of 1949 and in Title Suit No. 27 of 1949 respectively.
Mahabir Prasad, Advocate General for the State of Bihar (section P. Varma and M. Sinha, with him), for the appellant (In Civil Appeal No. 260 of 1953).
Mahabir Prasad, Advocate General for the State of Bihar (M. M. Sinha for R. C. Prasad, with him), for the appellant (In Civil Appeal No. 12 of 1954).
7 50 C. K. Daphtary, Solicitor General for India (Porus A. Mehta and P. G. Gokhale, with him), for the respondent (In both the Appeals).
March 24.
The Judgment of the Court was delivered by BOSE J.
This appeal and Civil Appeal No. 12 of 1954, which will also be governed by this judgment, raise the same points though there are some differences in the facts.
We will deal with Civil Appeal No. 260 of 1953 first.
The suit there related to an arbitration matter.
The appellant before us, whom it will be convenient to call the contractor, entered into a contract with the Dominion of India through an Additional Chief Engineer of the C.P.W.D. on 1 11 1945 for the supply of bricks to the C.P.W.D., a department of the Dominion Government.
Disputes arose about a number of matters.
Clause 14 of the agreement provided that all disputes arising out of or relating to the contract should be referred to the Superintending Engineer of the Circle for the time being.
Accordingly, there was a reference on 21 1 1949 and an award followed on 8 5 1949.
It was filed in the Court of the Subordinate Judge, Dhanbad, and the contractor prayed that it be accepted and that a decree be passed in terms of it.
The Dominion of India filed objections under section 30 of the and prayed that the award be set aside and alternatively that it be modified or corrected.
The contractor 's application was registered as a suit under section 20(2) of the Act and a decree was passed in terms of the award on 18 3 1950.
By that time the Constitution had come into force and the Union of India replaced the Dominion of India as a defendant.
The Union of India filed an appeal to the High Court.
The appeal was allowed in part.
The contractor thereupon appealed to this Court.
The dispute that was referred to the arbitrator consisted of 17 heads of claim but only three of them are contested here, namely items 5, 8 and 17.
51 In the 5th head of claim the contractor claimed Rs. 75,900 as the price of 88 lacs of katcha bricks that were destroyed by rain.
These bricks were not the subject matter of the contract but the contractor put his claim in this way.
The contract was for the supply of 2 1/2 crores of pucca bricks which bad to be delivered according to the following schedule 30 lacs by 25 1 46 50 lacs by 25 2 46 55 lacs by 25 3 46 55 lacs by 25 4 46 60 lacs by 25 5 46.
Delivery was to be at the kiln site.
In order to keep to this schedule the contractor bad to think ahead and work to a particular time table.
First, he had to prepare katcha or unbaked bricks and place them in his kilns for baking.
While this lot was baking be had to prepare and stock another lot of katcha bricks ready to take the place of the baked bricks as soon as they were removed.
It was the duty of the C.P.W.D. to remove these bricks as soon as they were ready for delivery,that is to say, as soon as they were fully baked.
At a certain stage of the contract the C.P.W.D. failed to remove the baked bricks which were ready for delivery and removal.
This caused a jam in the kilns and prevented the contractor from placing a fresh stock of unburnt bricks in the kilns, and in the meanwhile his stock pile of katcha bricks ready for baking kept on mounting up.
Had everything been done to time the 2 1/2 crores of bricks would have been delivered before the rains set in.
But owing to the default of the C.P.W.D. in not removing the burnt bricks which were ready for removal, delay occurred in the time table and the rains set in with the result that88 lacs of katcha bricks were destroyed by the rains.
As this loss was occasioned by the default of the C.P.W.D. the contractor claimed that be should be paid their price.
The reply of the Union Government was two fold.
First, it contended that the katcha bricks formed no part of the contract and even if it was at fault in not 52 taking delivery of the burnt bricks in time all that it could be held liable for would be for breach of that contract; and said that the loss that was occasioned by the damage caused to the katcha bricks which formed no part of the contract was too remote.
Secondly, that compensation for this loss could not in any event be claimed because this kind of situation was envisaged by the parties when the contract was made and they expressly stipulated that the Dominion Government would not be responsible.
The Union Government relied on additional clause 6 of the agreement which is in these terms: "The department will not entertain any claim for idle labour or for damage to unburnt bricks due to any cause whatsoever".
The arbitrator held that this clause was not meant "to absolve the department from carrying out their part of the contract" and so he awarded the contractor Rs. 64,075 under this head.
We are clear that the arbitrator went wrong in law.
Government departments have their difficulties no less than contractors.
There is trouble with labour, there is the likelihood of machinery breaking down in out of the way places and so forth; there was also the danger of thunder storms and heavy showers of rain in the month of May: it will be remembered that the last date of delivery was 25 5 46 if, with that in view, Government expressly stipulated, and the contractor expressly agreed, that Government was not to be liable for any loss occasioned by a consequence as remote as this, then that is an express term of the contract and the contractor must be tied down to it.
If he chose to contract in absolute terms that was his affair.
But having contracted he cannot go back on his agreement simply because it does not suit him to abide by it.
This is not to say that Government is absolved from all liability, but all it can be held responsible for is for damages occasioned by the breach of its contract to remove the pucca bricks which it had undertaken to remove.
But what would such a breach entail? 53 The contractor had a duty under section 73 of the Contract Act to minimise the loss, accordingly he would have had the right to remove the bricks himself and stack them elsewhere and claim compensation for the loss so occasioned; and indeed two of his heads of claim (not in dispute here) relate to that.
He has been awarded Rs. 11,744 11 0 under claim No. 4 for the extra load in connection with the stacking of I crore 7 lacs of bricks due to the accumulation at the kiln site owing to the department 's failure to work to its part of the time table, and in addition, he has been given Rs. 15,500 under claim 13 for the cost of levelling and dressing land to enable him to stack these extra bricks.
Alternatively, he could have sold the bricks in the market and claimed the difference in price, but ordinarily he could not have claimed compensation for damage done to the katcha bricks unless he could have shown that that kind of damage, ordinarily too remote, was expressly contemplated by the parties when the contract was made: section 73 of the Contract Act.
Here it is clear that this was in their express contemplation and they chose to provide against such a contingency by making clause 6 an express clause in their contract.
There can therefore be no doubt that the arbitrator was wrong in his law.
His construction of the terms of the contract was at fault.
The question now arises whether his decision on this point is final despite it being wrong in law.
In India this question is governed by section 16(1) (c) of the of 1940 which empowers a Court to remit an award for reconsideration "where an objection to the legality of the award is apparent upon the face of it".
This covers cases in which an error of law appears on the face of the award.
But in determining what such an error is, a distinction must be drawn between cases in which a question of law is specifically referred and those in which a decision on a question of law is incidentally material (however necessary) in order to decide the question actually referred.
If a question of law is specifically referred and it is evident that the 54 parties desire to have a decision from the arbitrator about that rather than one from the Courts, then the Courts will not interfere, though even there, there is authority for the view that the Courts will interfere if it is apparent that the arbitrator has acted illegally in reaching his decision, that is to say, if he has decided on inadmissible evidence or on principles of construction that the law does not countenance or something of that nature.
See the speech of Viscount Cave in Kelantan Government vs Duff Development Co.(1) at page 409.
But that is not a matter which arises in this case.
The law about this is, in our opinion, the same in England as here and the principles that govern this class of case have been reviewed at length and set out with clarity by the House of Lords in F. B. Absalom Ltd. vs Great Western (London) Garden Village Society(1) and in Kelantan Government vs Duff Development Co.(1).
In Durga Prasad vs Sewkishendas (3) the Privy Council applied the law expounded in Absalom 's case(2) to India: see also Champsey Bhara & Co. vs Jivraj Balloo Spinning and Weaving Co.(4) and Saleh Mahomed Umer Dossal vs Nathoomal kessamal (5).
The wider language used by Lord Macnaghten in Ghulam Jilani vs Muhammad Hassan(1) bad reference to the revisional powers of the High Court under the Civil Procedure Code and must be confined to the facts of that case where the question of law involved there, namely limitation, was specifically referred.
An arbitrator is not a conciliator and cannot ignore the law or misapply it in order to do what he thinks is just and reasonable.
He is a tribunal selected by the parties to decide their disputes according to law and so is bound to follow and apply the law, and if he does not, he can be set right by the Courts provided his error appears on the face of the award The single exception to this is when the parties choose specifically to refer a question of law as a separate and distinct matter.
(1) (2) (3) , 79.
(4) 50 I.A. 324, 330 & 331.
(5) 54 I.A. 427, 430.
(6) 29 I.A. 51, 60.
55 Reference was made to a decision of this Court in A. M. Mair & Co. vs Gordhandass Sagarmull(1) where Fazl Ali, J. quoted a passage from Viscount Simon 's speech in Heyman vs Darwins Ltd.") where the learned Lord Chancellor (Viscount Simon) in turn, quoted from Lord Dunedin in another case.
It was argued on the basis of this that if you have to have recourse to the contract to establish your case, then the dispute must fall within the arbitration clause.
That is undeniable but it is not enough that the dispute should fall within the clause.
It is also necessary that the parties should define what the dispute is and agree to refer the dispute so set out and defined to arbitration, or, if they do not, that the Court should compel them to do so: (see Lord Macmillan in Heyman 's case(1) just cited at pages 369 and 370).
If, therefore, no specific question of law is referred, either by agreement or by compulsion, the decision of the arbitrator on that is not final however much it may be within his jurisdiction, and indeed essential, for him to decide the question incidentally.
Lord Russell of Killowen and Lord Wright were both in the earlier case, F. R. Absalom Ltd. vs Great Western (London) Garden Village Society(1), as well as in Heyman 's case(2) and they would have pointed to any distinction had there been a likelihood of conflict; but in fact there is none and we do not read Fazl Ali J. 's judgment as a decision to the contrary.
We have next to see whether the arbitrator was specifically asked to construe clause 6 of the contract or any part of the contract, or whether any question of law was specifically referred.
We stress the word "specifically" because parties who make a reference to arbitration have the right to insist that the tribunal of their choice shall decide their dispute according to law, so before the right can be denied to them in any particular matter, the Court must be very sure that both sides wanted the decision of the arbitrator on a point of law rather than that of the Courts and that they wanted his decision oil that point to be final.
(1) ; at 798.
(2) at 368.
(3) 56 The clause in the contract that requires disputes about the contract to be referred to arbitration is clause 14 and is in the following terms: "Except where otherwise provided in the contract all questions and disputes relating to the meaning of the specification and instructions here in before mentioned and as to quality of materials or as to any other question, claim, right, matter or thing whatsoever in any way arising out of or relating to the contract, specification, instructions, orders or these conditions, or otherwise concerning the supplies whether arising during the progress of delivery or after the completion of abandonment thereof shall be referred to the arbitration of the Superintending Engineer of the Circle for the time being in the manner provided by law relating to arbitration for the time being in force who after such investigation as he may think proper shall deliver his award which shall be final, conclusive and binding on all parties to the contract".
The dispute sprang out of a series of claims made in a number of letters written by the contractor to the Additional Chief Engineer, C.P.W.D. and culminated in a petition, exhibit B(1), in which the contractor summarised his claims.
The document is not dated.
On receipt of this, someone on behalf of the C.P.W.D. invoked the jurisdiction of the arbitrator.
That letter has not been filed.
The arbitrator then wrote to the contractor and asked him to submit a statement of claim.
That letter has not been filed either but reference is made to it in exhibit C(1), the statement claim which the contractor filed in response to that letter.
As the material documents setting out the terms of reference are not here, we were asked by both sides to infer what the terms were from this statement of claim and the recitals in the award.
The learned counsel for the contractor relied on the following: In the statement of claim "Item 5.
Loss of katcha bricks. .
Rs. 75,900.
The chief reason of the destruction of these bricks was the failure of the department to lift the 57 monthly quota of bricks The argument of the department that they are not liable to compensate us on this account because of clause 6 of the agreement is not correct.
Clause 6 refers to only such cases over which the department has no control.
But if the department would have lifted the bricks (this was entirely under their control) then no such loss would have occurred.
Also be it noted that clause 6 refers only to 'damage ' and not to 'destruction. .
Damage means only partial loss. . .it cannot mean total destruction.
: The award states "The statement of claims submitted by the contractor contains seventeen items in respect of which the contractor claimed a total payment of Rs. 4,76,138 12 0 plus interest i.e., approximate total amount claimed: Rs. 5,03,803 12 0 as detailed below".
Then follow the seventeen items of which item 5 is "Payment for katcha bricks destroyed by rain: Rs. 75,900".
The body of the award deals with this as follows: " Claim No. 5.
Payment for 88.
lacs of katcha bricks destroyed by rain.
The contractor argued etc The Executive Engineer stated . .
The C.P.W.D. moreover were safeguarded by clause 6 of the contract. .
The contractor maintained that clause 6 of the contract could not be invoked when the department was at fault as in this case.
Clause 6 was meant to cover contingencies which were not of the department 's own making.
I hold that the removal of the bricks in such a manner or to prevent accumulation in excess of 60 lacs was an implied contractual obligation on the part of the C.P.W.D. .
I further hold that the C.P.W.D. cannot take shelter behind clause 6 of the contract.
This clause is not, in my opinion, meant 8 58 to absolve the department from carrying out their part of the contract.
It is impossible not to admit this without offending the rudiments of common sense reasoning".
We are of opinion that this is not the kind of specific reference on a point of law that the law of arbitration requires.
In the first place, what was shown to us is no reference at all.
It is only an incidental matter introduced by the Dominion Government to repel the claim made by the contractor in general terms under claim No. 5.
In the next place, this was the submission of the contractor alone.
A reference requires the assent of both sides.
If one side is not prepared to submit a given matter to arbitration when there is an agreement between them that it should be referred, then recourse must be had to the Court under section 20 of the Act and the recalcitrant party can then be compelled to submit the matter under sub section (4).
In the absence of either, agreement by both sides about the terms of reference, or an order of the Court under section 20(4) compelling a reference, the arbitrator is not vested with the necessary exclusive jurisdiction.
Therefore, when a question of law is the point at issue, unless both sides specifically agree to refer it and agree to be bound by the arbitrator 's decision, the jurisdiction of the Courts to set an arbitration right when the error is apparent on the face of the award is not ousted.
The mere fact that both parties submit incidental arguments about a point of law in the course of the proceedings is not enough.
The language of Lord Wright in F. R. Absalom Ltd. vs Great Western (London ) Garden Village Society(1), a case similar to this so far as this point is concerned, is apposite here "There is here no submission of any specific question of law as such and as a specific question of law; no doubt incidentally, and indeed necessarily, the arbitrator will have to decide some questions on the construction of the building contract, but the two matters submitted are both composite questions of law and fact; there is no express submission of the (1) , 616.59 true effect of the contract on the basis of undisputed facts, as in the Kelantan case(1) or as a separate and distinct matter on facts to be separately assumed or found, as in In re King and Duveen(2). .
The arbitrator was not being asked simply and specifically to decide, upon some agreed or assumed basis of fact, the true interpretation of either clause 26 or clause 30 of the conditions or of both together; he was being required to make an award on the two matters submitted on whatever questions of fact and law might emerge".
Clause 32 of the contract in the House of Lords case was the equivalent of clause 14 in ours.
It ran "Provided always that in case any dispute or difference shall arise . . . as to the construction of the contract or as to any matter or thing arising thereunder. . such dispute shall be and is hereby referred to the arbitration and final decision of etc.
" The arbitrator relied on that to invest him with juris diction to determine,, as a matter of law, the construction of clauses 26 30 of that contract.
The House of Lords held that in the absence of a specific reference about the construction of the contract the jurisdiction of the Courts was not taken away.
Lord Russell of Killowen put it this way at page 610 "No specific question of construction or of law was submitted.
The parties had, however, been ordered to deliver pleadings, and by their statement of claim the contractor had claimed that the arbitrator should under his powers revise the last certificate issued etc.
It is at this point that the question of the construction of condition 30 arose as a question of law, not specifically submitted, but material in the decision of the matters which bad been submitted.
This question of law the arbitrator has decided; but if upon the face of the award he has decided it wrongly his decision is, in my opinion, open to review by the Court".
That is exactly the position here.
Simply because the matter was referred to incidentally in the pleadings (1) (2) , 36.60 and arguments in support of, or against, the general issue about liability for damages, that is not enough to clothe the arbitrator with exclusive jurisdiction on a point of law.
The next question is whether the error is apparent on the face of the award.
That; in our opinion, is clear from the passages we have quoted from the award.
We hold that clause 6 expressly relieves the Union Government of all liability under this head of claim and that the arbitrator was wrong in awarding any sum on that account.
The next head in dispute is item No. 8 in the statement of claim: "Cost of additional wages paid to the coolies on account of non supply of ration and cloth Rs.
51,495".
Here again no specific question of law was referred, so all we have to see is whether there is an error of law apparent on the face of the award.
The contractor put his case as follows in the statement of claim: "At the time when this work was allotted to us there was rationing system in the locality.
As per conditions of contract we were bound not to employ local labour and we had to import coolies from far off places.
We had in our employ about 1800 coolies and it was an impossibility to arrange their ration from open market.
This difficulty was brought to the notice of the authorities concerned, and they promised us to supply ration.
It was only after this promise that we signed the agreement. .
From a perusal of these letters it is clear that the department promised us to supply ration. . .
These circumstantial evidences are sufficient enough to show that there was a mutual understanding between the parties that ration will be supplied.
In the eyes of law even circumstantial evidence is sufficient to prove that such a promise was made.
Any breach of that promise makes the department legally liable to compensate for that loss. .
Apart from the legal responsibility it was also a moral responsibility for the department to supply ration".
61 This claim, therefore, was not grounded on any clause of the contract, nor was it said to be implied in the contract.
What was relied on was a collateral promise evidenced, not by the contract, but by two letters written by "the department" and a promise by "the authorities concerned"; and later this promise is turned into a "mutual understanding" and to a "moral responsibility" in addition to a legal one.
The arbitrator dealt with this as follows.
He began by saying "The contractor stated that when he submitted his tender on 25 9 45 he did so in the bona fide belief that the department would make the necessary arrangements, etc.
" Then he sets out the following dates.
On 1 11 45 the contractor was told that his tender had been accepted.
On 9 11 45 the contractor "warned" the Executive Engineer about his "immediate requirements in respect of rations".
The contract was finally accepted and signed on 22 11 45.
Now it is admitted that the contract contains no clause about rations and it is also evident that the question was not raised when the tender was accepted on behalf of the Dominion Government.
The question was raised in a letter to the Executive Engineer, and the contractor signed the contract without waiting for a reply.
It is well settled that governments can only be bound by contracts that are entered into in a particular way and which are signed by the proper authority.
A reference to the agreement, exhibit A(1), will show that it was accepted on behalf of the Dominion Government by the Additional Chief Engineer and not by an Executive Engineer.
A letter written to the Executive Engineer would therefore have no effect and even if it be assumed that the letter was forwarded to the Additional Chief Engineer for consideration, what does it amount to? A tender embodying certain terms is submitted and is accepted on 1 11 45.
Both sides are agreed on all matters contained in it and their conduct shows that both sides indicated that the contract should be reduced to writing.
Be 62 fore the agreement is signed, one party wants to include a further condition in the contract.
We will assume that the request was made to the other contracting party.
But without waiting for the assent of the other side, both sides accept and sign the contract as it existed before the fresh suggestion was made.
It is an error in law to deduce from this that there was acceptance of the fresh proposal.
On the contrary, the legal conclusion is that the new suggestion was dropped and that the contractor was content to accept the contract as it was without ' this condition.
In any case, a person cannot be bound by a one sided offer which is never accepted, particularly when the parties intend that the contract should be reduced to writing.
That is the whole point of insisting on a document.
It excludes speculation as to what was and what was not agreed to however much the matter might have been raised by one of the parties during the stage of negotiation.
The arbitrator continues that the contractor stated that "it was a well known and established fact that Sindri was a rationed area; that the C.P.W.D. were giving rations at controlled rates to their employees and contractors through arrangements with the local Civil Supply Authorities; that nobody working under the C.P.W.D. was allowed to make independent arrangements or approach the Civil Supply Authorities direct" and the contractor contended that the very fact that he tendered such low rates showed that he expected to supply his labourers with rations at controlled rates.
The arbitrator then sets out some more of the contractor 's contentions and from them concludes that "there was an implied contractual obligation for the C.P.W.D. to make available controlled rations to the contractor and that this obligation was not fulfilled with due diligence and care".
He accordingly awarded Rs. 40,000 as compensation under this head.
The error is apparent.
Facts must be based either on evidence or on admissions; they cannot be found to 63 exist from a mere contention by one side especially when they are expressly denied by the other.
The inference from the facts stated above is that the contractor entered into the agreement with his eyes open and whatever his one sided hopes may have been he was content to enter into the agreement as it stood without binding the other side to the new conditions and without even waiting to ascertain the reaction of the other side to his further proposals.
It has to be remembered that rationing was not a matter that was under the direction and control of the Dominion Government.
It was a local matter handled by the then Provincial authorities and under their direction and contract.
The C.P.W.D., as a department of the Dominion Government, was not concerned with rationing except that its employees had to submit to rationing like everybody else in the Sindri area.
This confusion between the Dominion Government and the Provincial Government occurs in the arbitrator 's opening sentence under this head where he sets out the contractor 's contention that "commodities such as rations and cloth which were absolutely essential for the maintenance of his labourers and which were under Government control".
As the arbitrator bases solely on the contractor 's contentions it is evident that he failed to appreciate the fact that the Dominion Government and the Provincial rationing authorities were separate entities distinct from one another.
The position accordingly reduces itself to this: two persons, neither of which is a part of the Provincial Government or has any control over rationing, chose to enter into an agreement for work in a rationed area.
They insisted that their contract should be reduced to writing, and that indeed was essential, this being a contract with the Dominion Government which was incapable of contracting in any other way; they agreed upon and concluded all their terms; then, at the last minute, one side raised a point about rationing but without waiting for a reply and without having the term entered in the contract, he signed the contract as it stood before the point was raised even during the negotiation.
It is 64 an error in law to hold that any contractual obligation can be inferred or implied from these circumstances.
Then there is still another error.
If this implied agreement about rations and cloth does not spring out of the written contract but is to be inferred collaterally as a distinct and subsidiary contract, and we gather that that is the finding, especially as reference was made to section 9 of the Contract Act, then that is not a contract to which the arbitration clause can apply.
Wide though it is, clause 14 is confined to any matter relating to the written con tract and if ration and cloth are not covered by the written contract, they are not matters that relate to it.
If parties choose to add a fresh contract in addition to or in substitution for the old, then the arbitration clause cannot cover the new contract.
See Lord Macmillan in Heyman vs Darwins Ltd.(1).
The last item in dispute in this appeal is claim No. 17 about interest.
The statement of claims sets out "Item 17 Interest on the amount of money involved in this claim at the rate of Rs. 6 percent.
27,665.
This work was finished in May 1946 and it was proper for the department to have decided all our claims at least by 31st December 1947. . . .
But this was not done.
Due to this a heavy amount remained blocked up and we were compelled to take money from our bankers on interest.
We therefore pray for interest for 16 months from 1 1 48 to 31 4 49".
The arbitrator held "The contractor 's contention that his claims should have been settled by January 1948 is, in my opinion, reasonable.
I therefore award interest at 6% for 16 months on the total amount of the awards given i.e., Rs. 17,363".
Then the arbitrator sets out the amounts awarded under each head of claim.
A perusal of them shows that each bead relates to a claim for an unliquidated sum.
The Interest Act, 1839 applies, as interest is (1) at 371.65 not otherwise payable by law in this kind of case (see Bengal Nagpur Ry.Co. vs Ruttanji Ramji(1)), but even if it be assumed that an arbitrator is a "court" within the meaning of that Act, (a fact that by no means appears to be the case), the following among other conditions must be fulfilled before interest can be awarded under the Act: (1) there must be a debt or a sum certain; (2) it must be payable at a certain time or other wise; (3) these debts or sums must be payable by virtue of some written contract at a certain time; (4) There must have been a demand in writing stating that interest will be demanded from the date of the demand.
Not one of these elements is present, so the arbitrator erred in law in thinking that he had the power to allow interest simply because he thought the demand was reasonable.
It was suggested that at least interest from the date of "suit" could be awarded on the analogy of section 34 of the Civil Procedure Code, 1908.
But section 34 does not apply because an arbitrator is not a "court" within the meaning of the Code nor does the Code apply to arbitrators, and, but for section 34, even a Court would not have the power to give interest after the suit.
This was, therefore, also rightly struck out from the award.
We pause to note that there was only a delay of five days at the outside in the over all picture.
The last date for removal of the last instalment of bricks was 25 5 46 and the contractor says under this head that the whole contract was completed by the end of May, 1946.
It is difficult to see how 88 lacs of bricks could have been damaged by rain in the last five days of May, and if the damage occurred before it would have occurred anyway, for on the contractor 's case he had to have a large stack of unbaked bricks on hand ready to enter the kilns in order to keep pace with his time table.
However, that was a (1) 65 I.A. 66. 9 66 matter within the jurisdiction of the arbitrator and is not a matter in which the Courts can interfere.
That concludes Civil Appeal No. 260 of 1953 and we now turn to the other appeal, Civil Appeal No. 12 of 1954.
Only two items are in dispute here.
Heads 4 and 17 of the claim.
The over all pattern of the claim is the same as in the other case.
There was a contractor and he entered into an agreement containing the same terms and conditions, except about the details of supply.
It was signed on the same day as the other and by the same authority on behalf of the Dominion Government., and the matter went before the same arbitrator and the award in this case was given on 1 5 1949, one week before the other award.
Here also, no specific question of law was referred and we need not cover the same ground.
Our decision is the same here as there.
The fourth head of claim is about cloth and rations.
The claim here.
, and the Dominion Government 's reply, is the same as in the other case, but the award in this case is not based on an implied contractual obligation but on "a moral and implied obligation".
The error here is even greater than before.
The sum claimed was Rs. 51,495 and the amount awarded was Rs. 30,000.
The seventeenth head of claim was about interest.
The contractor claimed Rs. 27,665 and the arbitrator awarded Rs. 9,954.
There is the same error of law apparent on the face of the award.
The High Court was right in dismissing the claims made under the heads in dispute here.
The two appeals fail and each is dismissed with costs in this Court.
Appeals dismissed.
| The appellant, a contractor, entered into a contract with the Dominion of India for the supply of bricks.
A clause in the contract required all disputes arising out of or relating to the contract to be refered to arbitration.
Disputes arose and the matter was duly referred.
The arbitrator gave an award in the contractor 's favour.
The Union Government, which by then had displaced the Dominion of India, contested the award on a number of grounds.
Held:(1) that it is not enough for the contract to provide for arbitration; more is necessary.
An arbitrator only gets jurisdiction when either, both the parties specifically agree to refer specified matters or, failing that, the court compels them to do so under the arbitration clause if the dispute is covered by it; (2) the legality of an award cannot be challenged on facts, but it can be challenged on questions of law provided the illegality is apparent on the face of the award: section 16(1)(c) of the ; (3) the only exception is when both parties specifically refer a question of law for the decision of the arbitrator.
In that event they are bound by his decision on that particular question as well as by his decision on the facts.
But a distinction must be drawn between cases in which a question of law is specifically referred and those in which a decision is incidentally material (however necessary) in order to decide the question actually referred.
The law about this is the same in India as in England.
and , followed.
at 79, 50 I.A. 324 at 330 49 331, 54 I.A. 427 at 430, 29 I.A. 51 at 60, at 368 referred to and ; at 798, explained; Quaere: Whether the courts will interfere when a question of law is specifically referred if the arbitrator acts illegally in deciding it, such as deciding on inadmissible evidence or on principles of construction which the law does not countenance.
at 409, referred to; (4) a wrong construction of the contract is an error of law and can be challenged provided the error appears on the face of the award; (5) so is the awarding of interest when the contract does not provide for interest and the requirements of the Interest Act are not fulfilled:65 I.A. 66, referred to.
Quaere: whether the Interest Act applies to arbitrations; (6) when a specific type of loss is directly contemplated by the parties to a contract and they expressly stipulate that no damages will be payable in respect of it they must be bound down to their agreement and any claim for damages in respect of such loss must be dismissed; (7) when the agreement on which the suit is based is not to be found in a contract which has been reduced to writing but has to be implied under section 9 of the Contract Act then the matter is not covered by an arbitration clause of the kind referred to above because the dispute in such a case arises out of and relates to the implied agreement and not to the written contract: at 371, referred to.
|
Appeal No. 11 of 1954.
68 Appeal from the judgment and Decree dated the 20th day of June 1950 of the High Court of Judicature for the State of Punjab at Simla in Regular First Appeal No. 73 of 1941 arising out of the Decree dated the 19th day of December 1940 of the Sikh Gurudaras Tribunal, Lahore in Suit No. 11 of 1938.
Gurbachan Singh and R. section Narula, for the appellant.
Achhru Ram, (Naunit Lal with him), for the respondents Nos.
I and 2.
K. L. Mehta, for the respondents Nos.
3 to 5. 1955.
March 24.
The Judgment of the Court was delivered by JAGANNADHADAS J.
This is an appeal on leave granted by the High Court of Punjab against its judgment affirming the decree of the Sikh Gurdwara Tribunal dated the 19th December, 1940, dismissing the plaintiff 's suit.
The plaintiff in the appeal is the Committee of Management of Sikh Gurdwaras within the Municipal limits of Amritsar (except the Gurdwara Sri Akal Takhat Sahib, Amritsar).
The plaint was filed under section 25 A of the Sikh Gurdwaras Act, 1925, (Punjab Act VIII of 1925) (hereinafter referred to as the Act) for possession of certain properties situated in Amritsar, marked and bounded as specified in the plaint and purporting to have been declared as a Sikh Gurdwara by the Government of Punjab under section 17 of the Act by means of the notification No. 9 G dated the 3rd March, 1937.
The case of the plaintiff Committee is that these properties were, and were determined to be, a Sikh Gurdwara, by name Gurdwara Bunga Sarkar, by the Sikh Gurdwara Tribunal by its decree dated the 4th November, 1935 and confirmed on appeal therefrom by the High Court of Judicature at Lahore, on the 16th June, 1936 and that accordingly the Committee was entitled to possession of the properties.
The facts that have led up to the present appeal are as follows: After the Act was passed and within one year of its commencement the then existing non statutory Shiromani Gur 69 dwara Parbandhak Committee filed a list under section 3 of the Act claiming the suit properties and certain other items attached thereto as belonging to the Gurdwara Harmandir Sahib.
These properties comprised two items called Bunga Sarkar and Bunga Mai Mallan and the shops appurtenant to each of them.
Objections were filed to this list by way of two applications under section 8 of the Act claiming these as private properties.
One was by Sardar Balwant Singh dated the 8th March., 1928 and the other was by Sardar Raghbir Singh dated the 10th March, 1928.
Sardar Raghbir Singh claimed the whole of Bunga Sarkar and its appurtenant shops as well as 1/3rd of the Bunga Mai Mallan and of the appurtenant shops.
Sardar Balwant Singh 's claim was confined to 1/3rd share in Bunga Mai Mallan and in the appurtenant shops.
The other 1/3rd share in Bunga Mai Mallan was apparently treated by these claimants as belong ing to some other person who was not a party to these proceedings.
These two applications were forwarded under section 14 of the Act to the Gurdwara Tribunal for its decision.
The parties to these proceedings entered into a compromise on the 6th february, 1930.
There were two compromises one relating to each of the applications.
The net effect of the compromises was that some out of the items claimed were admitted to be the private property of the respective claimants and the rest as wakf bungas for the Yatries to Sri Darbar Sahib, that the non personal properties were to remain in the management of the claimants, their heirs and representatives as such wakf with certain stipulations as to how that management was to be carried on.
The Tribunal disposed of the two applications before them in terms of these compromises.
It may be mentioned that though the original list under section 3 of the Act was filed by the then non statutory Shiromani Gurdwara Parbandhak Committee, the compromises were entered into by the Managing Committee of the Gurdwaras within the limits of the Municipal Committee, Amritsar, which presumably had already by then been formed Linder section 85 of the Act.
Now, quite independently of these 70 proceedings befere the Tribunal, and prior to the filing of the list under section 3 and of the objections under section 5 above referred to, there had been filed a petition under section 7 of the Act, signed by 55 Sikhs, claiming these very properties as being in themselves a Sikh Gurdwara by name Bunga Sarkar (Maharaja Ranjit Singh Saheb) and enclosing a list of properties as belonging thereto under section 7(2) of the Act.
It does not appear that this petition was brought to the notice of the Gurdwara Tribunal when it passed the decree in terms of the compromise with reference to the objections under section 5 of the Act.
The petition under section 7 was in the usual course followed by a notification issued by the Government on the 18th February, 1930, under section 7(3) of the Act.
This resulted in (1) an objection under section 8 by the Granthis objecting that this was not a Sikh Gurdwara, and (2) two other objections by Sardar Raghbir Singh and Sardar Balwant Singh, already previously above referred to, under section 10 of the Act claiming the properties as their own and objecting to the claim made that they were Sikh Gurdwaras.
These objections were filed on the 5th April, 1930.
It may be noticed that the notification under section 7(3) of the Act was within a few days after the compromise decrees in the proceedings under section 5 of the Act and it does not appear whether the compromises were brought to the notice of the Government or not.
These objections under sections 8 and 10 (and presumably also the petition under section 7) were forwarded to the Tribunal for its decision under section 14 of the Act.
The petition under section 8 filed by the Granthis was contested by the Shiromani Gurdwara Parbandhak Committee (Statutory) and after recording some evidence, the Tribunal came to the conclusion that Bunga Sarkar was a Sikh Gurdwara and declared it as such on the 28th August, 1935.
On the objections under section 10; notices were given to the Committee of Manaaement as well as to the Shiromani Gurdwara Parbandhak Committee but they declined to become parties to it.
The contest under section 10 of the Act 71 was only as between the claimants and some of the Sikhs who filed the petition under section 7.
At the hearing before the Tribunal both sides relied upon the previous compromises in support of their respective claims.
The Tribunal by its decision dated the 4th November, 1935, decided that the properties which had been declared as the properties of Sardar Raghbir Singh and Sardar Balwant Singh respectively, should be declared to be their personal properties and that the rest of the properties claimed to belong to Bunga Sarkar and Bunga Mai Mallan should be declared to be Sikh Gurdwaras and as properties appurtenant thereto.
It was also declared that these two Gurdwaras and the properties held to be appurtenant to them should vest in the management of Sardar Raghbir Singh and Sardar Balwant Singh by virtue of and as per terms of the compromises.
As against these decrees two appeals were presented by the Sikh worshippers to the High Court and the only question that ultimately appears to have been raised was that the direction given by the Tribunal to the effect that the properties should remain in the management of the claimants, Sardar Raghbir Singh and Sardar Balwant Singh, was illegal.
The High Court without giving any decision on the legal question so raised was of the opinion that it was no function of the Sikh Gurdwara Tribunal to pass an order on an application made under section 10 by the claimants that the claimants should manage the properties appurtenant to the Gurdwaras by virtue of the compromises.
They thought that the question of right of management should be left open in these proceedings and that the directions in the decree of the Tribunal relating to the management should be deleted therefrom and that the rest of the decrees of the Sikh Gurdwara Tribunal is to stand.
They expressed their conclusion in the following terms: "That portion of the decree of the Sikh Gurdwara s Tribunal which has declared the respondents ' right to manage the Gurdwaras and the properties appended thereto shall form no part of the decree granted by the Tribunal; the rest of the decree of the Sikh Gur 72 dwaras Tribunal stands, that is to say, the properties which have been declared to be the personal properties of Sardar Raghbir Singh and Sardar Balwant Singh shall remain their properties and the properties which have been declared to be appended to the two Gurdwaras shall remain the properties of the two Gurdwaras".
The High Court also added that though the proceedings mentioned the existence of two Gurdwaras by name Bunga Sarkar and Bunga Mai Mallan, the real position seemed to be that there was only one Gurdwara, viz. Bunga Sarkar, and that Bunga Mai Mallan had no separate existence as a Gurdwara but was a well known part of Bunga Sarkar.
This decision of the High Court was on the 16th June, 1936.
This was followed by notification No. 9 G dated the 3rd March, 1937, under section 17 of the Act which is the foundation of the present suit.
On these facts a number of contentions were raised by both sides before the High Court as well as before us.
The judgment of the High Court as well as the arguments before us have covered a wide range.
On the merits, the case for the plaintiff is quite simple.
The plaintiff says that whatever may be the position with reference to the earlier compromises arrived at between the parties in the proceedings under section 5 of the Act, the later proceedings with reference to those very properties under section 10 of the Act resulted in the judgment of the High Court dated the 16th June 1936, which is conclusive and binding.
By virtue of the said judgment and the notification dated the 3rd March, 1937, following thereupon, the plaintiff is entitled to possession of the properties by virtue of section 25 A of the Act.
On the side of the defendants various objections have been raised which may be summarised as follows: (1) The proceedings under section 10 did not result in any specific declaration in favour of the Committee that the properties in dispute in the present suit constituted a Sikh Gurdwara or belong to a Sikh Gurdwara.
No such declaration can be gathered from the decision of the Tribunal dated the 4th November, 1935, or from that of 73 the High Court on appeal dated the 16th June, 1936.
(2) The Tribunal had no jurisdiction in disposing of an application under section 10 of the Act, to give a positive declaration that the property in question is a Sikh Gurdwara.
Its only function was to decide whether or not the properties claimed were the private properties of the claimants.
Hence even if the decision of the Tribunal and of the High Court can be treated as a decision declaring the properties as a Sikh Gurdwara that is not valid and the notification issued thereupon is void.
(3) Any such decision would be contrary to section 37 of the Act and also contrary to the principles of res judicata and would be, therefore, a nullity on that ground.
(4) The conduct of the Gurdwara Parbandhak Committee and the concerned Committee of Management, in entering into the compromises in the proceedings under section 5 of the Act without disclosing the pendency of the petition filed by the 55 Sikhs under section 7 of the Act, followed up by their declining to be made parties in the section 10 proceedings and in virtually promoting the contest of the proceedings under sections 8 and 10, was fraudulent.
They are accordingly estopped from relying on the decree obtained under section 10 proceedings and basing their right to relief thereon.
(5) The suit under section 25 A lies only where the decision on an objection under section 10(1) is reached after the notification that the Gurdwara is a Sikh Gurdwara is published since the section refers to.
a decision in favour of a "Notified Sikh Gurdwara" implying the pre existence of such notification.
(6) The suit under section 25 A was barred by limitation.
(7) The whole appeal abated in the High Court inasmuch as one of the respondents, Sardar Balwant Singh died during the pendency of the appeal.
His legal representatives were not brought on record in time and the High Court declined to excuse the delay and to set aside the abatement, as a result of which the entire appeal abated, the claim against both the respondents being joint and not being maintainable against one only in the absence of 10 74 the other.
In addition to these contentions which have been put forward before us and strenuously argued by both sides, the High Court also based its decision on the view that section 7 of the Act assumes the existence of a Gurdwara and that a notification issued under section 7 (3) without there being in fact a Gurdwara in existence would be ultra vires.
In the present case, in view of the prior proceedings under section 5 and the compromises following thereupon, the non existence of the Gurdwara as claimed in the petition under section 7(1) must be taken to have been made out and therefore the notification and all the proceedings following thereupon are illegal and ultra vires.
Though we have heard elaborate arguments from both sides on these various contentions, it appeared to us ultimately that the plea of limitation is decisive against the appellants and that it is unnecessary to express any opinion on any of the other contentions raised.
The question of limitation arises with reference to the terms of section 25 A which is as follows: "25 A. (1) When it has been decided under the provisions of this Act that a right, title or interest in immovable property belongs to a Notified Sikh Gurdwara , or any person, the Committee of the Gurdwara concerned or the person in whose favour a declaration has been made may, within a period of one year from the date of the decision or the date of the constitution of the Committee, whichever is later, institute a suit before a tribunal claiming to be awarded possession of the right, title or interest in the immovable property in question as against the parties to the previous petition, and the tribunal shall if satisfied that the claim relates to the right, title or interest in the immovable property which has been held to belong to the Gurdwara, or to the person in whose favour the declaration has been made, pass a decree for possession accordingly.
(2)Notwithstanding anything contained in any Act to the contrary, the court fee payable on the plaint in such suit shall be five rupees".
75 This section provides, for the filing of the suit, the period of one year from the date of the decision or the date of the constitution of the committee whichever is later.
Now the date of the decision in this case must be taken to be the date when the High Court on appeal disposed of the proceedings under section 10, i.e., the 16th June, 1936.
The present suit has been filed on the 25th February, 1938, i.e., clearly beyond one year of the decision.
The question for consideration, therefore, is whether the suit can be said to have been within one year from the date of the constitution of the Committee of the Gurdwara concerned.
Now, one has to turn to sections 85, 86 and 88 of the Act to appreciate which is, the Committee concerned with this Gurdwara and what the date of its constitution is.
Section 85 is as follows (in so far as it is relevant): "Subject to the provisions of section 88, there shall be one committee for the Gurdwaras known as the Darbar Sahib, Amritsar, and the Baba Atal Sahib, and all other Notified Sikh Gurdwaras situated within the municipal boundaries of Amritsar other than the Sri Akal Takht Sahib".
Section 86 is as follows (in so far as it is relevant): "For every Notified Sikh Gurdwara other than a Gurdwara specified in section 85 a committee shall be constituted after it has been declared to be a Sikh Gurdwara under the provisions of this Act".
Section 88 is as follows (in so far as it is relevant): "(1)The committees described in sections 85 and 86 shall be constituted as soon as may be after the constitution of the Board, provided that no committee shall be constituted for any gurdwara under the provisions of this Act unless and until it has been declared to be a Sikh Gurdwara under the provisions of this Act.
(2)When all the members of any committee described in section 85 have been elected or co opted, as the case may be, according to the provisions of that section, the Provincial Government shall notify the fact that the committee has been duly constituted, 76 and the date of the publication of the notification shall be deemed to be the date of the constitution of the committee".
Now, it is not disputed that the present plaintiff which is the Committee of Management for all the Gurdwaras situated within the Municipal limits of Amritsar, except the Gurdwara Sri Akal Takht Sahib was constituted prior to the year 1930 and was in fact functioning at the date of the compromises in the section 5 proceedings dated the 6th February, 1930.
It is also not disputed that by virtue of section 85(2), this committee also became the Committee concerned with the suit Gurdwara, which is admittedly located within the Municipal limits of Amritsar.
But it is contended for the appellants that this Committee becomes concerned with the suit Gurdwara only from the date when the notification under section 17 is issued, i.e., from the 3rd March, 1937, and that, therefore,, the plaintiff had one year from that date for the filing of the suit and that in the situation, section 25 A in providing the alternative period of limitation as being "one year from the date of the constitution of the committee", must be construed reasonably as being one year from the date of the notification in such a case and that for the purposes of this section, the pre existing committee must be deemed to have been constituted for the suit Gurdwara only on the date of the notification.
In support of this contention it has been pointed out that the specific policy of the Act as disclosed in sections 86 and 88 is that no Committee is to be formed for a Gurdwara until after ' it has been declared a Sikh Gurdwara under the provisions of the Act.
It is accordingly urged that the phrase "constitution of the committee" in section 25 A should be construed so as to indicate a point of time not earlier than the notification of the concerned Gurdwara and that in the circumstances and in such cases the date of the notification of the Gurdwara must be the date of the constitution of the concerned committee.
It appears to us, however, that this contention is untenable.
Section 86 in terms relates to a Notified Sikh Gurdwara other than Gurdwaras 77 specified in section 85.
Hence so far as our present purpose is concerned, the policy underlying section 86 does not necessarily apply to the Gurdwaras within the Municipal limits of Amritsar for which a Committee already exists.
Moreover, sub section (2) of section 88 provides with reference to Committees under section 85, that, as soon as all the members described therein have been elected or co opted, the fact should be duly notified, and also declares in clear and categorical terms that the date of the publication of the notification shall be deemed to be the date of the constitution of the Committee.
In the face of this deeming provision relating to these committees, it is not permissible to impute to such a Committee any other date as the date of its constitution for any of the purposes of the Act and to imply an exception and an addendum to the specific deeming provision.
This would be legislating.
We cannot, therefore, accept the contention of the appellant that the date of the notification under section 17 in the present case should be deemed to be the date of the constitution of the Committee concerned for the purposes of section 25 A. It has been urged that this view deprives the Committee of the benefit of the longer alternative period of limitation and that in a case where no notification under section 17 has been issued until after the expiry of an year from the date of the final decision that the Gurdwara claimed is a Sikh Gurdwara, the remedy under section 25 A would become inapplicable.
It may be that an exceptional case of undue delay in the publication of the notification may be a casus omissus but such a delay need not be assumed to be a matter of course.
That, at any rate, is not the present case where the notification was in fact issued within nine months of the decision of the High Court.
The Committee which should have been alert with reference to these matters, had, not only the whole of these nine months to take steps to get the notification published earlier, but, it had three months thereafter to come forward with the present suit.
However this may be, we do not consider that there is any question of hardship, 78 because obviously section 25 A is only an enabling section providing a cheap remedy by way of a suit before the Tribunal itself.
We are clearly of the opinion that the present suit under section 25 A is barred by limitation and on this ground the appeal must fail.
The appeal is accordingly dismissed with costs.
Appeal dismissed.
| The plaintiff which is the Committee of Management for all Gurudwaras situated within the Municipal limits of Amritsar, except the Gurudwara Sri Akal Takht Sabib, was constituted prior to the year 1930 and by virtue of section 85(2) of the Sikh Gurudwaras Act (Punjab Act VIII of 1925) became the Committee concerned with the suit Gurudwara.
There were certain proceedings under the Act in respect of the suit properties which were ultimately decided by the High Court on the 16th June 1936 and the decision was followed by a notification under section 17 of the Act on the 3rd March 1937.
As a result the plaintiff became entitled to get possession of the said properties by instituting a suit before a tribunal under section 25 A of the Act within one year from the date of the decision or the date of the constitution of the Committee, whichever was later.
The present suit was filed on the 25th February 1938 which was beyond one year of the decision and the question was whether the suit can be said to have been instituted within one year of the date of the constitution of the Committee of the Gurudwara concerned, the contention being that the plaintiff must be deemed to have become the committee concerned with the suit Gurudwara only on the date of the notification thereof in 1937 under section 17 of the Act by virtue of the provisions of sections 86 and 88.
Held, that the date of the notification in 1937 under section 17 cannot be deemed to be the date of the constitution of the Committee concerned for the purposes of section 25 A and that the present suit is barred by limitation.
Section 86 does not apply to Gurudwaras within the Municipal limits of Amritsar specified in section 85, in respect of which a Committee already exists and by virtue of sub section (2) of section 88 the date of the publication of the notification of the Committee which already has been in existence since 1930 will be the date of the constitution of the Committee within the meaning of section 25 A.
|
Appeal No. 43 of 1954.
Appeal under Article 132(1) of the Constitution of India from the Judgment and Order dated the 22nd November 1952 of the Judicial Commissioner 's Court, Ajmer, in Misc.
Petition No. 226 of 1952.
N. C. Chatterji (I. N. Shroff, with him) for the appellant.
Porus A. Mehta and P. G. Gokhale for the respondents.
December 3.
The judgment of Mehr Chand Mahajan C.J., Mukherjea, Vivian Bose, Bhagwati and Venkatarama Ayyar JJ.
was delivered by Bose J.
The judgment of Das and Jagannadhadas JJ.
was delivered by Jagannadhadas J. BOSE J.
The appellant is the Istimrardar of Kharwa.
According to him, be has held a cattle fair on his estate every year for some twenty years.
On 8 1 1951 the Chief Commissioner of Ajmer framed certain rules for the regulation of cattle and other fairs in the State of Ajmer.
He purported to do this under sections 40 and 41 of the Ajmer Laws Regulation of 1877 (Reg. III of 1877).
One of the rules required that persons desiring to hold fairs should obtain a permit from the District Magistrate.
Accordingly the appellant applied for a permit.
This was refused on the ground that no more permits were to be issued to private individuals.
The appellant thereupon applied under article 226 of the Constitution to the Judicial 1067 Commissioner 's Court at Ajmer for the issue of a writ directing the authorities concerned to permit the appellant to hold his fair as usual.
He contended that his fundamental rights under the Constitution were infringed and also that the rules promulgated by the Chief Commissioner were ultra vires the Regulation under which he purported to act.
The learned Judicial Commissioner refused to issue the writ but granted leave to appeal under article 132(1) of the Constitution in the following terms: "I am of opinion that the question whether the regulation and the bye laws framed thereunder amount to a reasonable restriction on the appellant 's fundamental right to hold a cattle fair in his own land involves a substantial question of law as to the interpretation of the Constitution".
The leave is confined to the vires of the Regulation and the bye laws but we allowed the appellant to attack the, validity of the District Magistrate 's action as well.
It is admitted that the land on which the fair is normally held belongs to the appellant.
That being so, he has a fundamental right under article 19(1)(f) which can only be restricted in the manner permitted by sub clause (5).
The holding of an annual fair is an occupation or business within the meaning of article 19 (1) (g), therefore, the appellant also has a fundamental right to engage in that occupation on his land provided it does not infringe any law imposing "reasonable restrictions on that right in the interests of the general public", or any law "relating to (i) the professional or technical qualifications necessary for practising. . . or carrying on" the occupation or business in question.
(Article 19(6) as amended in 1951).
The only law relevant here is sections 40 and 41 of Regulation III of 1877.
Under section 40, the Chief Commissioner is empowered, among other things, to make rules about 137 1068 "(a) the maintenance of watch and ward, and the establishment of a proper system of conservancy and sanitation at fairs and other large public assemblies; (b) the imposition of taxes for the purposes mentioned in clause (a) of this section on persons holding or joining any of the assemblies therein referred to; (b) the registration of cattle".
Section 41 provides for penalties in the following terms: "The Chief Commissioner may, in making any rule under this Regulation, attach to the breach of it, in addition to any other consequences that would entire from such breach, a punishment, on conviction before a Magistrate, not exceeding rigorous or simple imprisonment for a month or a fine of two hundred rupees, or both".
These sections were not impugned in the argument before us nor were they attacked in the petition made to the Judicial Commissioner, so we will pass on to the rules made by the Chief Commissioner.
The first three sub rules of Rule I deal with permits.
They prohibit the holding of a fair except under a permit issued by the District Magistrate, and the District Magistrate is enjoined to "satisfy himself, before issuing any permit, that the applicant is in a position to establish a proper system of conservancy, sanitation and watch and ward at the fair".
The fourth sub rule empowers the District Magistrate to "revoke any such permit without assigning any reasons or giving any previous notice".
When the appellant applied for a permit on 9 7 1952) the District Magistrate replied: "It has been decided that as a matter of policy permits to hold fairs will be issued only to local bodies and not to private individuals.
It is, therefore, regretted that you cannot be permitted to hold the fair and you are therefore requested to please abandon the idea".
In our opinion, the rules travel beyond the Regu 1069 lation in at least two respects.
The Regulation empowers the Chief Commissioner to make rules for the establishment of a system of conservancy and sanitation.
He can only do this by bringing a system into existence and incorporating it in his rules so that all concerned can know what the system is and make arrangements to comply with it.
What he has done is to leave it to the District Magistrate to see that persons desiring to hold a fair are in a position "to establish a proper system of conservancy, etc.
" But who, according to this, is to determine what a proper system is: obviously the District Magistrate.
Therefore, in effect, the rules empower the District Magistrate to make his own system and see that it is observed.
But the Regulation confers this power on the Chief Commissioner and not on the District Magistrate, therefore the action of the Chief Commissioner in delegating this authority to the District Magistrate is ultra vires.
Further, under the fourth sub rule of Rule I the District Magistrate is empowered to revoke a permit granted "without assigning any reasons or giving any previous notice".
This absolute and arbitrary power uncontrolled by any discretion is also ultra vires.
The Regulation assumes the right of persons to hold fairs, and all it requires is that those who do so should have due regard for the requirements of conservancy and sanitation; and in order that they may know just what these requirements are, the Chief Commissioner (not some lesser authority) is given the power to draw up a set of rules stating what is necessary.
If they are in a position to observe these rules, they are, so far as the Regulation is concerned, entitled to hold their fair, for there is no other law restricting that right.
Therefore, the Chief Commissioner cannot by Rule invest the District Magistrate with the right arbitrarily to prohibit that which the law and the Constitution, not only allow, but guarantee.
As these sub rules of Rule I are ultra vires, the District Magistrate 's order, which in effect prohibits the holding of the fair, is also bad for, without the aid of these rules or of some other law validly 1070 empowering him to impose the ban, he has no power in himself to do it.
The matter is covered by the decision of this Court in Tahir Hussain vs District Board, Muzafarnagar(1).
The appeal is allowed and the order of the Judicial Commissioner is set aside.
We declare that the rules are void to the extent indicated above and we quash the order of the District Magistrate dated 18 9 1952.
But we make no order about costs because the point on which we have proceeded was not taken in proper time in this Court.
JAGANNADHADAS J.
The order of the District Magistrate dated the 18th September, 1952, declining to grant a permit to hold the cattle fair on the ground that it has been decided to issue permits only to local bodies and not to private individuals is bad for two reasons.
The rules under which he is to grant or refuse permits in this behalf only authorise him to satisfy himself that the applicant is in a position to establish a proper system of conservancy, sanitation and watch and ward at the fair and also to impose such terms and conditions as he may deem fit.
But they do not authorise him to reject an application on the ground on which he has done.
The rules themselves under which the permit has been asked for and with reference to which the District Magistrate declined to grant the permit are not within the ambit of the rule making power.
These rules purport to have been framed in exercise of the powers conferred by sections 40 and 41 of the Ajmer Laws Regulation, 1877.
Section 40 authorises the framing of the rules "for the maintenance of watch and ward and the establishment of a proper system of conservancy and sanitation at fairs and other large public assemblies".
But the actual rules as framed are to the effect (1) that no such fair can be held except under a permit of the District Magistrate, (2) that before issuing a permit the District Magistrate is to satisfy himself that the applicant is in a position (1) A.I.R. 1954 S C. 630, 1071 tion and watch and ward at the fair, (3) that when issuing a permit the District Magistrate can impose such terms and conditions as he may deem fit.
The net effect of these rules is merely to establish a system of ad hoc control by the District Magistrate through the issue of a permit and by the vesting of other powers in him under the rules.
These cannot be said to be rules which in themselves constitute a system of conservancy, sanitation and watch and ward.
Thus the result that is brought about is not within the intend ment of the section which authorises the making of the rules.
A system of ad hoc control of responsible officers may, possibly be one method of regulating the sanitary and other arrangements at such large gatherings.
But if it is intended to constitute a system of ad hoc control with reasonable safeguards, the power to make rules in that behalf must be granted to the rule making authority by the legislative organ in appropriate language.
The impugned order of the District Magistrate being bad on both the above grounds, this is enough to dispose of the appeal and it is not necessary to express any opinion as to whether the impugned order infringes also the appellant 's fundamental rights under article 19.
The appeal must accordingly be allowed.
Appeal allowed.
| Under section 40 of the Ajmer Laws Regulation of 1877 (Reg. III of 1877) the Chief Commissioner is empowered, among other things, to make rules about. . . . the establishment of a proper system of conservancy and sanitation at fairs. . . . .
The first three sub rules of Rule 1, framed by the Chief Commissioner prohibit the holding of a fair except under a permit issued by the District Magistrate and the District Magistrate is enjoined "to satisfy himself, before issuing any permit that the applicant is in a position to establish a proper system of conservancy, sanitation and watch and ward at the fair".
The fourth sub rule empowers the District Magistrate "to revoke any such permit without assigning any reasons or giving any previous notice".
The appellant 's application for a permit to hold a fair was refused by the District Magistrate on the ground that no more permits were to be issued to private individuals.
Held, that under the Regulation it is the Chief Commissioner and not the District Magistrate who has power to frame rules, that the Chief Commissioner had no authority to delegate that power and that the Rules made by the latter are therefore ultra vires; Held further, that the Rule is also ultra vires for the reason that in authorising the District Magistrate to revoke a permit granted " without giving any reason or previous notice" it invests him with a power to prohibit the exercise by the citizen of the constitutionally protected right to bold fairs.
The District Magistrate 's order, which in effect prohibits the holding of the fair, is therefore bad, for, without the aid of these rules or some other law validly empowering him to impose the ban, he has no power in himself to do it.
1066 Per JAGANNADHADAS J. (DAS J. concurring): The impugned order of the District Magistrate is bad: (i)because the rules do not authorise him to reject an application on the ground on which lie has done; (ii)because the not effect of the rules is to establish a system of ad hoc control by the District Magistrate through the issue of a permit and by the vesting of other powers in him under the rules.
This result is not within the intendment of the section which authorises the making of the rules.
Tahir Hussain vs District Board, Muzafarnagar (A.I.R. referred to.
|
Appeals Nos. 92 and 94 of 1950.
24 Appeals from the Judgments and Decrees dated the 20th March 1942 of the Allahabad High Court in First Appeal Nos.
154 and 152 of 1934 arising Out Of the Judgments and decrees dated the 25th August 1932 of the Court of First Additional Subordinate Judge, and First Additional Civil Judge, Moradabad in Original Suit Nos. 90 and 87 of 1931 respectively.
N. C. Chatterji, (section section Shukla with him) for the Appellants.
Gopi Nath Kunzru, (B. P. Maheshwari with him) for Respondent No. 1.
P. C. Agarwala, for Respondent No. 2 in Civil Appeal No. 94 of 1950.
March 22.
The Judgment of the Court was delivered by BosE J.
These appeals arise out of two suits which were heard together along with two other suits with which we are not now concerned.
All four raised the same set of questions except for a few subsidiary matters.
They were tried together and by common consent the documents and evidence in the various cases were treated as common to all.
They were all governed by one common judgment, both in the first Court and on appeal.
The defendants appeal here.
The plaintiff, Mukand Ram, is common to all four cases.
He sues in each suit as the reversioner to one Pandit Nanak Chand who was his materdal grandfather.
The family tree is as below: 25 Nanak Chand d. 23 7 75 W: Mst.
d. Jan. 1875.
Maha Devi Mst.
Durga Devi Mst.
Har Devi d. 1912 d. 1888 d. 10 9 19 H: Nathmal Das H: Jwala Prasad H: Bhawani Shankar Mst.
Ram Pyare Bhukhan Saran Banwari Lal Sital Prasad Shyam Lal Pyare Lal (dead) (dead) (deft.5) Brij Lal Mukand Ram (dead) (Plff.
No.1) 26 The plaintiff 's case is that the properties in the four suits belonged to Nanak Chand who died on 23 7 1856 leaving a widow Mst.
Pato and three daughters, Maha Devi, Durga Devi and Har Devi.
On his death, his widow Mst.
Pato succeeded.
She died in January 1875 and the estate then went to the three daughters.
Of them, Durga Devi died in 1888, Maba Devi in 1912 and Har Devi in 1919.
The plaintiff 's rights as reversioner accrued on Har Devi 's death on 10 9 1919.
But before this came certain alienations which the plaintiff challenges in the present suits.
The suits were filed on 8 9 1931.
In Civil Appeal No. 92 of 1950, the challenge is to a mortgage effected by Durga Devi on 3 3 1887 in favour of Sahu Bitthal Das.
The mortgagee sued on his mortgage, obtained a decree and in execution purchased the properties himself.
The plaintiff 's case is that Durga Devi only had a life estate and, as there was no necessity, the mortgage and the subsequent auction purchase do not bind him.
In Civil Appeal No. 94 of 1950, there are two alienations, both sales.
The first, dated 23 9 1918, was by Pyare Lal (son of Durga Devi) in favour of Shyam Lal, son of Mulchand.
(This is not the Shyam Lal who was Pyare Lal 's brother).
The vendee later sold the properties to the first and second defendants on 5 3 1927.
One of the vendees, the first defendant, is yet another Shyam Lal: Shyam Lal son of Harbilas.
The other sale was by Brij Lal 's guardian on behalf of Brij Lal, Brij Lal then being a minor.
It was on 25 11 1919 in favour of Chheda Lal.
The first and second defendants preempted this sale after a fight in Court and took possession under the decree which they obtained.
The plaintiff 's case is that Har Devi was alive at the date of the first sale and as the reversion had not opened out Pyare Lal bad no power to sell.
In the case of the second sale, the reversion had opened out but Brijlal being more remote than the plaintiff got no title, so that sale is also bad.
The defendants ' case is that the properties in these 27 two suits (as also in the other two suits with which we are no longer concerned) did not belong to Nanak Chand and formed no part of his estate; they belonged exclusively to Mst.
Pato as part of her personal estate.
On 22 1 1864 Mst.
Pato executed a document which she called a deed of agreement but which, if it is anything at all, is a will.
There are no other parties to it and she purports thereby to dispose of her properties after her death.
The defendants in Civil Appeal No. 92 of 1950 have called it a will.
After saying that she will remain in possession and occupation as long as she lives, Pato says that after her death her three daughters will be the owners and will either remain joint possession or will divide the estate in equal shares and, in that event, will take possession of their respective shares and will be the "owners" of them.
But before she died Pato made another disposition of her estate during her life time in the year 1875 which, of course, abrogated the will.
This was done orally.
The defendants say that this was a family arrangement in which each of the three daughters was given certain properties absolutely so that each became the absolute owner of whatever fell to her share.
Pato also gave properties to each of her four grandsons who were then living, namely Kanhaiya Lal, Mukand Ram, Banwari Lal and Sital Prasad.
The defendants asserted that they also took separate and absolute estates immediately and said that each has been holding and dealing with the properties so divided, separately and as absolute owners, ever since.
Thus, at the dates of the transfers now challenged, each alienor had an absolute title to the properties alienated and the plaintiff has none.
The trial Court held that though most of the properties in Pato 's hands came from her husband Nanak Chand, the plaintiff bad not shown that the properties with which his four suits were concerned formed part of Nanak Chand 's estate.
An issue was also framed about the family settlement and one about estoppel.
On both those point 28 the learned Judge found against the plaintiff.
The result was that all four suits were dismissed.
The High Court reversed these findings on appeal and held that all the properties, including the ones in suit, formed part of Nanak Chand 's estate.
The learned Judges also held that though there was a family arrangement, it was a purely voluntary settlement made by Pato and was not made as the result of any dispute and that in any case it did not bind the plaintiff who was not a party to it and who does not claim through any of those who were.
They also held that there was no estoppel.
Accordingly, the plaintiff 's claim was decreed in each of the four suits.
Appeals were filed here in all four suits by the various defendants but Civil Appeals Nos. 91 and 93 of 1950 were dismissed for want of prosecution, therefore the decree of the High Court in the two cases out of which those appeals arose will stand.
We are now only concerned with Civil Appeals Nos. 92 and 94 of 1950.
In the lower Courts much of the effort was concentrated on finding out which items out of a large mass of property belonged to Nanak Chand and which did not.
We do not intend to look into that because it it is unnecessary on the view we take.
We will therefore assume, without deciding, that all the properties in dispute were part of Nanak Chand 's estate.
We will deal first with the family arrangement.
The learned counsel for the plaintiff argued that the defendants never set up a family arrangement though they have used the words "family settlement".
He contended that what they really pleaded was a gift out and out by Pato.
It was pointed out that the defendants never suggested a dispute, neither did they suggest that any one ever questioned or doubted Pato 's absolute title to the property.
Therefore, it was argued, the present case, which is based on the assumption that the property was not Pato 's and that she was laying wrongful claim to it, cannot be allowed because it flies in the face of the defendants ' pleadings.
29 There is not much in this objection.
The defendants did plead a family arrangement and the matter was put in issue and fought out.
The defendants ' case was that all the property was Pato 'section The plaintiff 's case was that it was all Nanak Chand 'section The issues were "4.
Whether Mst.
Pato gave properties separately to each of her three daughters and to daughter 's sons and put them in proprietary possession and they remained absolute owners of their properties and what is its effect on the case? 5.
Whether the arrangement mentioned in issue No. 4 was by way of family settlement and what is its effect on the case?" These issues are broad enough to cover the present point.
If the properties really belonged to Nanak Chand, as the plaintiff claims, then the case for a family settlement becomes all the stronger, for it is clear that Pato laid claim to them as her own properties of which she could dispose by will, for that is what the document of 1864 really is.
If, on the other hand, they were her properties, as the defendants say, then she had the right either to gift them outright or to settle them as the defendants say she did by way of a family arrangement.
In either case, the matter was fully fought out and neither side was misled.
The real question we have to decide is, has the family arrangement been proved? We think it has.
The direct evidence on this point is that of Shyam Lal (D.W. I in C.A. 94/50) and the first defendant there.
He tells us that he had money lending transactions with Har Devi, Kanhaiya Lal, Shyam Lal and Pyare Lal on unregistered bonds from 1902 till 1910 and from 1910 on registered mortgage bonds.
He says that "They" (that is to say, Har Devi, Mukand Ram, Kanhaiya Lal, Shyam Lal and Pyare Lal) "showed one copy of a deed of will and said that Mst.
Pato had given the property to her daughters and grandsons. .
I am illiterate and Kanhaiya Lal brother of Mukand Ram had the deed of will read over to me at 30 the time of mortgaging property in 1909 or 1910.
It was by means of that paper that I came to know that Mst.
Pato had made her daughters and grandsons absolute owners and I know of the property which was mortgaged to me".
Now it is true that the so called will of 1864 does not make provision for the grandsons, nor does it expressly confer an absolute estate on the legatees, but the witness is illiterate and had to depend on what he was told about the contents and meaning of the document, and what we have to test is the truth of his assertion that the plaintiff Mukand Ram and Kanhaiya Lal, and other members of the family, told him that Mst.
Pato had given the property to her daughters and grandsons.
If they told him this, as he says they did, then it operates as an admission against Mukand Ram and shifts the burden of proof to him because he was one of the persons who made the statement.
The statements made by the others are not relevant except in so far as they prove the conduct of the family.
The plaintiff (P.W. 11 in C.A. 91/50) admits that Mst.
Pato divided the estate but says that it was only for convenience of management and that neither she nor her daughters had, or pretended to have, anything more than a life estate.
He denies that there was any gift or family arrangement.
But he had to admit that the grandsons also got properties at the same time.
His explanation is that it was for the purposes of "shradh" and pilgrimage to Gaya and he says that though they were given possession they were not the "owners".
We now have to choose between these two witnesses and see which is telling the truth.
But before doing that we will advert to another member of the family, Pyare Lal, who was examined as a witness (D.W. 17) in C.A. 92/50.
He admits a series of sales made by him but says that he had no wilt of his own and that he did just what Mukand Ram told him.
Now to go back to the year 1864 when Mst.
Pato made the so called will of 1864.
This document was 31 construed by the Privy Council in Mast.
Hardei vs Bhagwan Singh(1) and their Lordships said "In the events which happened this document did not become operative, but it is relevant as showing that at the date of its execution Pato was claiming an absolute right to dispose of the whole of the scheduled property".
Mukand Ram was not a party to that litigation and the decision does not bind him but it operates as a judicial precedent about the construction of that document, a precedent with which we respectfully agree.
She says there that the property "belongs exclusively to me without the participation of anyone else".
That assertion, coupled with the fact that she purported to dispose of the property after her death (which she could not have done as a limited owner), and taken in conjunction with the subsequent conduct of the daughters and that of the grandsons, imports admissions by them that that was her claim and leaves us in little doubt about what she meant.
We therefore reach the same conclusion as the Judicial Committee and hold that Mst.
Pato claimed an absolute estate in 1864.
We will now examine the conduct of the family after Pato 's death and the claims put forward by them from time to time.
First, we have the statement of Mukand Ram in the witness box (P.W. 11 in C.A. 91/50) that on Pato 's death her daughters took separate possession of the properties in the following villages and towns: Har Devi Qutabpur Amawti.
Shakerpore.
Lalpur.
Bagh Alam Sarai.
Houses, Shops, etc.
in Bazaar Kot, Sambhal.
Durga Devi.
Keshopur Bhindi.
Tatarpore Ghosi.
Half Bilalpat.
Qumharwala Bagh.
(1) A.I.R. 1919 P.C. 27.
32 Shehzadi Serai.
Houses, shops, etc.
in Sherkhan Serai, Sambhal.
Maha Devi.
Guretha.
Behrampur Half Bilalpat.
Mahmud Khan Serai.
Houses, etc.
in Kot.
Grove in Alam Serai The plaintiff also admits that the grandsons got some properties but does not give details.
All he says is that they were given properties "for purposes of performance of 'shradh ' and pilgrimage to Gaya".
Next, we have a long series of alienations by different members of the family with claims to absolute ownership which could only have sprung from titles derived either from a gift from Pato or from a family settlement.
We say "family settlement" because we know now that the bulk of the property (and according to the High Court the whole of it) was Nanak Chand 'section We also know that some of it was purchased by Pato after Nanak Chand 's death from the income of the estate.
Pato had the right to purchase properties for herself if she wanted instead of adding them to her husband 's estate and we know she claimed title to the whole as an absolute owner in 1864.
This claim may have been due to a mistaken view of Hindu law that in the absence of sons the widow gets an absolute estate, or it may have been due to other reasons, but that she made the claim is clear, and the subsequent conduct and statements of the family show that they either admitted the correctness of her claim and accepted the properties as gifts from her or they agreed to and acted on a family settlement to avoid disputes on the basis that each got an absolute title to whatever properties fell to his or her share at the time of the division.
The grandsons were minors at the time and were not parties to this arrangement, whatever its origin, and of course the widow and daughters could not enlarge their limited estates so as to bind the grandsons 33 however much they agreed among themselves.
But for the moment we are not considering the legal effect of whatever the arrangement was but whether the conduct of the family gives rise to an inference that there was an arrangement in fact.
A family arrangement can, as a matter of law, be implied from a long course of dealings between the parties: Clifton vs Cockburn(1) and William vs William(1); and we have such a course of dealing here.
First, there is a long series of alienations by Har Devi stretching from 1877 down to 1916.
We tabulate them below with the recitals she made about her title.
17 1 77 Mortgage Qutabpur Amawti "owned by me".
exhibit LL 1 (C.A. 94) 11 1 78 do do Owner: "devolved on me from my exhibit 2J1 mother".
(C.A.91) 20 3 81 do do Owner: "right of Ex.2H1 inheritance from (C.A.91) my father".
7 9 83 Sale.
Lalpur Owner: "right of inheritance".
exhibit 2Gl (C.A. 91) 23 8 87 Mortgage Qutabpur Amawti No recital exhibit
L (C. A. 92) 15 7 05 do do Absolute owner with KanhaiyaEx.
BB 1 (C.A. 94) Laland Mukand Ram.
19 11 08 do do No recital exhibit M 1 (C.A. 94) do 14 11 14 do do do exhibit V (C.A. 92) 23 3 15 do do Owner: with exhibit
X (C.A. 92) Mukand Ram 17 2 16 do do With Mukand exhibit N 1 (C.A. 94) Ram.
No recital 28 3 16 do do Owner: with Mukand Ram and his son exhibit (G.A. 94) Ram Gopal 22 1 18 do Behrampur Owner: with exhibit
DDD 1(C.A. 91) Buzurg Mukand Ram and Bhukan Saran 23 3 18 do do Owner: with exhibit M 1(C. A. 91) Mukand Ram and Pyare Lal It will be observed that Har Devi sometimes claimed to be absolute owner by right of inheritance from her father and at others from her mother in respect of the same village, but whichever way it was, (1) ; (2) 5 34 the claim to absolute ownership Was consistent throughout.
This could only be referable to a family settlement where the origin of the property was in doubt but which was settled by bestowing, or purporting to bestow, an absolute estate on the daughters.
It will also be noticed that in later years Har Devi joined with Mukand Ram but still claimed an absolute estate along with him.
This was for the following reason.
Soon after Mukand Ram attained majority, the mother and sons quarrelled.
On 11 2 1890 they referred their dispute to arbitration, exhibit RR 1 (C.A. 94).
Mukand Ram became a major in 1890 and Kanhaiya Lal in 1884.
It appears from their agreement of 11 2 1890 that Har Deyi claimed an absolute title while her sons said she was only a limited owner.
But the sons agreed to accept a decision to the effect that she had an absolute estate in the whole of the property in dispute between them should the arbitrator so decide.
The properties were Qutabpur Amawti, Shakerpore, Houses, shops, etc.
in Mohalla Kot in Sambhal.
Another significant thing is that in this document both mother and sons agreed that all of Nanak Chand 's grandsons then in being were in separate possession and absolutely entitled to certain other properties which they expressly agreed were not to form the subject matter of the arbitration.
Here again, these titles could only be referable to a family arrangement, for the grandsons could not have got an absolute estate in any other way; nor could Har Devi.
Mukand Ram tells us as P.W. 11 (C.A. 91) that he and his brother Kanhaiya Lal got Shakerpore and some shops in Bazar Kot, Sambhal, as a result of this arbitration, but does not say what happened to Qutabpur Amawti.
But it is significant that Har Devi 's dealings with Qutabpur Amawti after this date were all jointly with Kanhaiya Lal and Mukand Ram.
It may be that the arbitrator awarded it jointly or they agreed to hold it on that basis.
We do not know.
All we know is that they mortgaged it jointly.
35 Behrampur fell to Mukand Ram 's share and in the mortgage of the property in 1918 Har Devi joined with Mukand Ram and Murari Lal 's son Bhukan Saran in one case and with Pyare Lal in the other.
But except for the last two mortgages of 1918 the conduct of Har Devi and her sons for 39 years from 1877 to 1916 as disclosed in these deeds is only consistent with the family arrangement which the defendants allege, for on no other hypothesis could either the mother or the sons have laid claim to an absolute estate.
We will next turn to Durga Devi.
She died in 1888 but before she died she mortgaged Keshopur Bhindi which had fallen to her share on 3 3 1887 by exhibit U 1 (C. A. 93) and claimed to be the owner.
Then there is Maha Devi.
The only direct evidence we have of her conduct is a written statement that she filed in O.S. 177/97, exhibit 2BI (C.A. 91).
She asserted there on 5 1 1898 that she had been in proprietary possession and occupation of her divided share of the property obtained by her from her mother under a deed of will.
The circumstances in which she made this statement are to be found in the judgment in that suit, exhibit GI (C.A. 91).
The suit was by Har Devi against her sister and a transferee who claimed title through the other sister Durga Devi.
Har Devi 's allegation was that Durga Devi had mortgaged Keshopur Bhindi and Tatarpore Ghosi on 3 3 87.
The mortgagee sued on his deed and obtained a decree for sale.
In execution of the decree he purchased the properties himself Durga Devi died in 1888 and Har Devi claimed that Durga Devi had only a limited estate and that Maha Devi and herself were entitled to the properties by survivorship.
Maha Devi refused to support her sister and took up the position that each sister, or at any rate that she, Maha Devi, got an absolute estate in the property that came to her and of which she was placed in separate possession, from Pato.
On 16 12 10 Maha Devi mortgaged Behrampur Buzurg and claimed that it belonged to her, being property left to her by her mother in which no one else had any rights.
The deed 36 is exhibit BB 1 (C.A. 93).
On 2 7 11 she sold Bilalpat and claimed to be its exclusive proprietor, exhibit R 1 (C.A. 93).
We now come to two statements made by Har Devi and Maha Devi as witnesses in that suit.
Strong exception was taken to their admissibility because the plaintiff was not a party to the earlier litigation.
It is a moot point whether they would be admissible under section 32(3) of the Evidence Act, but we need not decide that because we do not intend to use them as proof of the truth of the facts stated in them.
But they are, in our view, admissible to show the conduct of these two ladies.
The conduct of the various members of the family is relevant to show that their actings, viewed as a whole, suggest the existence of the family arrangement on which the defendants rely.
At this distance of time gaps in evidence that would otherwise be available have to be filled in from inferences that would normally have little but corroborative value.
But circumstanced as we are, inferences from the conduct of the family is all that can reasonably be expected in proof of an arrangement said to have been made in 1875.
The statements that Har Devi and Maha Devi made as witnesses are therefore as relevant as recitals made by them in deeds and statements made by them in pleadings.
They do not in themselves prove the fact in issue, namely the family arrangement, because, in the absence of section 32(3), they are not admissible for that purpose, but as their conduct is relevant these statements are admissible as evidence of that conduct.
Maha Devi 's statement is exhibit 2 Al (C.A. 91) and Har Devi 's exhibit 2 Fl (C.A. 91).
Both speak of an arrangement effected by Pato in her life time and say that they entered into separate possession of the properties by reason of that arrangement.
Har Devi says in addition that the grandsons were included in the arrangement and given properties too.
Therefore, we know that this is the title under which each claimed to hold in O.S. No. 177/97.
It is proof of their assertion of this title at that early date and though it is no proof of the truth of those assertions it is proof of the 37 fact that the assertions were made and that is all we need at the moment.
We turn next to the conduct of the grandsons, and first we will consider the plaintiff Mukand Ram and his brother Kanhaiya Lal.
The plaintiff attained majority in 1890 and from that date down to 1922 we have a series of assertions of a title that can only spring from the family arrangement.
First, we have the deed of 11 2 90, exhibit RR 1 (C.A. 94) which we have already considered in connection with Har Devi.
This is the agreement between his brother and himself on the one hand and Har Devi on the other to refer their dispute to arbitration.
We have already commented on the fact that the two brothers asserted an absolute title to properties that were in their possession and acknowledged the absolute title of Pyare Lal and Shyam Lal to the properties of which they were possessed.
The only dispute they were prepared to submit to arbitration was about the properties in Har Devi 's possession and there, they were prepared to accept a decision upholding Har Devi 's claim to an absolute estate.
After this came the following dealings: 20 11 91 Sale Shahzadi Proprietary pos exhibit 2 K1 (C.A. 91) Sarai session "devolved on us by right of inheritance from Pato ".
28 7 93 Sale Dugawatr Proprietary pos exhibit 2 El (C.A. 91) session "by right of inheritance".
2 7 96 Mortgage Qutabpur " ancestral and exhibit KK 1(C.A. Amawti 94) purchased by us": Possessed by us. without the participation of anybody else".
30 1 00 Sale Bazar Mah " Proprietary pos exhibit
U (C.A. 92) mud Khan session" by "right Sarai, Sam of inheritance": bhal " without the par ticipation of anyone else." 15 7 05 MortgageQutabpur Owners:withHarEx.
BB 1(C.A.94) Amawti Devi "without the participation of anyone else".
38 Kanhaiya Lal died about this time and thereafter Mukand Ram continued to make transfers claiming to do so in his own right.
He made the following along with Har Devi.
We have already analysed them.
They were 19 11 08 exhibit
MI (C.A.94) 14 11 14 exhibit
V (C.A.92) 23 3 15 exhibit
X(C A.92) 17 2 16 exhibit
N 1(C.A.94) 28 3 16 EX.MM1(C.A.94) 22 1 18 Ex DDD1(C.A.91) 23 3 18 exhibit
M1(C.A.91) But in addition to these he made the following transfers on his own: 18 2 16 Sale Lashkarpur Absolute owner.
exhibit PP 1 (C.A. 94) 24 4 22 Sale Houses, etc.
do exhibit Y (C.A. 92) in Sambhal 23 11 22 Sale Qutabpur Amawti do exhibit Q (C.A. 92) Next, we come to Shyam Lal.
His alienations were as follows: 19 6 97 Mortgage.
Shops in Sanbhal.
Owner.
exhibit
W 1(C.A. 94) 9 11 07 do House in Sambhal.
No recital exhibit TT 1(C.A. 94) 17 9 09 do Bilalpat.
do exhibit UU 1 (C. A. 94) In addition, he made the following transfers jointly with his brother Pyare Lal: 18 1 06 Mortgage.
Bilalpat & shops No recitals.
exhibit EEE 1 in Sambhal.
(C.A.94) 21 2 10 do Bilalpat & Sabz.
do exhibit AA 1(C.A 94) Pyare Lal also made two transfers on his own 23 9 18 Sale Bilalpat.
"Devolved on exhibit 15(C.A. 94) me"from Nanak Chand by right of inheritance.
2 1 20 do do do exhibit 18 (C. A. 93) Lastly, there is Bhukban Saran, who is Maha Devi 's daughter 's son.
He transferred as follows: 26 3 18 SaleHouses, etc.in Absoluteand Sambhal.
exclusive exhibit MM 1 (C.A.92) owner.
9 1 21 Relinquish Bilalpat do exhibit DD 1 (C.A. 93) ment.
These documents disclose a long line of conduct on the part of the various members of the family and show that from 1877 down to 1922 each dealt with the properties in his or her possession as absolute 39 owner and set up exclusive proprietary title to the properties transferred.
It is true the source of title was not consistently stated, sometimes it was said to be Pato and at others Nanak Chand, but the assertion to a separate, exclusive and absolute title in each is common all through.
There is only one way in which they could have got these exclusive titles and that is by a family arrangement, for whether the property was Nanak Chand 's or whether it was Pato 's, in neither event could any one of these persons have obtained an absolute estate on the dates with which we are concerned: the grandsons, because the reversion had not opened out; the daughters because, either way, they would only be limited owners under the Hindu law.
But if there was a family arrangement assented to by the daughters and later accepted and acted on by the sons when they attained majority, their claim to separate and independent absolute titles is understandable.
It does not matter whether the claims were well founded in law because what we are considering at the moment is not the legal effect of the arrangement but whether there was one in fact.
Now, in spite of all these dealings, the conduct of Har Devi and Mukand Ram and Kanhaiya Lal was not always consistent.
They were greedy and while insisting that they be allowed to hold on to what they had got, they wanted to snatch more if and when they could.
The ball started rolling in 1890 as soon as Mukand Ram attained majority.
There was the reference to arbitration in that year to settle their dispute with their mother Har Devi.
But even there, there was the inconsistency regarding their own properties to which we have already referred.
Mukand Ram 's later explanation in the witness box that they got those properties for shradh purposes and for a pilgrimage to Gaya cannot be believed.
Next, there was the suit by Mukand Ram and Kanhaiya Lal against their aunt Maha Devi in 1895: section No. 21/1895, exhibit 31 (C.A. 91).
That was occasioned by two sales by Maha Devi on 19 2 83 and 20 5 85.
She stoutly maintained that she had an absolute title.
40 The litigation had a chequered career and ultimately the suit was dismissed as barred by time.
Next came suit No. 177 of 1897, exhibit GI (C.A. 91), in which Har Devi sued Maha Devi and a transferee.
This time it was to set aside an alienation by Durga Devi, Durga Devi then being dead.
Har Devi claimed that the property was Nanak Chand 's and that the daughters were limited owners.
But again Maha Devi stood by the family arrangement and asserted an absolute title in all the daughters; exhibit 2BI (C.A. 91).
We have seen that Har Devi entered the box and admitted the arrangement: exhibit 2F 1 (C.A. 91).
The suit very naturally failed, but the result of the litigation is not relevant because the plaintiff was not a party.
What we are examining is the conduct of Har Devi.
In 1913 Har Devi tried again after Maha Devi 's death, this time against alienees from Maha Devi.
This is the suit that went up to the Privy Council, Mst.
Hardei vs Bhagwan Singh(1).
She failed again '.
Having failed against Maha Devi in the 1897 litigation, Har Devi next tried her luck against Maha Devi 's grandson (daughter 's son) Bhukhan Saran, after Maha Devi 's death.
The suit is O.S. 52/14, exhibit 78 (C.A. 94).
This time she succeeded with respect to some items and failed as regards the rest.
But again the result is irrelevant: Exs. 6 and 8 (C. A. 94).
Now what we are examining at the moment is whether Shyam Lal, D. W. I in CA. 94, is to be believed when he says that Mukand Ram, among others, told him about the family arrangement tinder which Pato had divided all her property between her daughters and their sons.
It is evident from what we have said above that Mukand Ram had been consistently asserting such a title for 31 years from 1891 to 1922 despite his aberrations in 1890 and 1895.
In parti cular he did this whenever he wanted to borrow money or to sell property: and he makes a significant admission in the witness box as P. W. 11 in C. A. 91 that (1) A.I.R. 1919 P.C. 27.
41 "In the mortgage or sale of the property over which Mst.
Har Devi was in possession none of her sisters or sisters ' sons joined.
Similarly, in the sale or transfer of the property that came to Durga Devi, none of her sisters or other sisters ' sons joined".
He also admits that there was a division and separate possession from 1876.
He says that it was for convenience of management and says that it was after Pato 's death, but in view of the mass of evidence that we have just analysed, we think it far more likely that he told Shyam Lal just what Shyam Lal says he did.
After all, he was borrowing money from Shyam Lal on each of these occasions; so there is every reason to believe that he would have told Shyam Lal what he had so repeatedly asserted to his other transferees.
We accordingly believe Shyam Lal.
That at once shifts the burden of proof to the plaintiff, and what is his explanation? First, a division of the estate for convenience of management (but that does not explain the long chain of unchallenged transfers bar Har Devi 's efforts in four cases); and second, that the grandsons got property absolutely for the purposes of shradh and pilgrimage: 'an explanation which we disbelieve).
We are therefore left with the plaintiff 's admission to Shyam Lal and that admission, coupled with the conduct and actings of the family, firmly establishes the family arrangement.
We accordingly hold that, whether the property belonged to Pato or to Nanak Chand, Pato claimed an absolute right which the daughters acknowledged, and in return they and their sons were given separate and absolute estates in separate portions of the property immediately.
This arrangement bound the daughters because they were parties to it and received good consideration.
But so far as the sons are concerned, they were minors at that time and were not parties to this arrangement, for no one suggests that they were represented by guardians who entered into it on their behalf.
Therefore, the properties they received were, so far as they are concerned, gifts pure and simple 6 42 from Pato with the assent of her daughters.
It does not matter whether the properties were Pato 's exclusive properties or whether they came to her from her husband because, either way, the title to the properties resided in her and she was the only person competent to pass it on to another.
If her title was absolute, the sons got absolute estates.
If it was the limited title of a Hindu widow, they obtained a limited title good during her life, and, as the daughters consented to the gifts and obtained properties for themselves as a result of the arrangement that resulted in these gifts, they would not be permitted to question the gifts; and the Privy Council so held in Har Devi 's suit against the alienees from Maha Devi: Mst.
Hardei vs Bhagwan Singh(1).
But so far as the grandsons are concerned, the mere, ' fact that each received a separate gift from Pato at a time when they were not competent to assent or to dissent would not in itself bind them.
To achieve that result, there would have to be something more; and it is to that something more that we will now direct our attention.
But before doing that, we will pause to distinguish Rani Mewa Kuwar.
Rani Hulas Kuwar (2); Khunni Lal vs Gobind Krishna Narain (3), and Ramsumran Prasad vs Shyam Kumari (4).
It is well settled that a compromise or family arrangement is based on the assumption that there is an antecedent title of some sort in the parties and the agreement acknowledges and defines what that title is, each party relinquishing all claims to property other than that falling to his share and recognising the right of the others, as they had previously asserted it, to the portions allotted to them respectively.
That explains why no con veyance is required in these cases to pass the title from the one in whom it resides to the person receiving it under the family arrangement.
It is assumed that the title claimed by the person receiving the property under the arrangement had always resided in him or her so far as the property falling to his or her share is concerned and therefore no conveyance is (1) A.I.R. 1919 P.C. 27.
(2) [1874] 1 I.A. 157, 166.
(3) [1911] 38 I A. 87, 102.
(4) [1922] 19 I. A. 342, 348.
43 necessary But, in our opinion, the principle can be carried further and so strongly do the Courts lean in favour of family arrangements that bring about harmony in a family and do justice to its various members and avoid, in anticipation, future disputes which might ruin them all, that we have no hesitation in taking the next step (fraud apart) and upholding an arrangement under which one set of members abandons all claim to all title and interest in all the properties in dispute and acknowledges that the sole and absolute title to all the properties resides in only one of their number (provided he or she had claimed the whole and made such an assertion of title) and are content to take such properties as are assigned to their shares as gifts pure and simple from him or her, or as a conveyance for consideration when consideration is present.
The regal position in such a case would be this.
The arrangement or compromise would set out and define that the title claimed by A to all the properties in dispute was his absolute title as claimed and asserted by him and that it had always resided in him.
Next, it would effect a transfer by A to B, C and D (the other members to the arrangement) of properties X, Y and Z; and thereafter B, C and D would hold their respective titles under the title derived from A. But in that event, the formalities of law about the passing of title by transfer would have to be observed, and now either registration or twelve years adverse possession would be necessary.
But in the present case, we are dealing with an arrangement made in 1875 at a time when the Transfer of Property Act was not in force and no writing was required; an d, as there is no writing, the Registration Act does not apply either.
Therefore, the oral arrangement of 1875 would be sufficient to pass title in this way and that, in our opinion, is what happened.
But these rules only apply to the parties to the settlement and to those who claim through or under them.
They cannot be applied to the minor sons who were not parties either personally or through their guardians and who do not claim title ' either through 44 Pato or her daughters.
So far as they are concerned, what they received were gifts pure and simple and the only assent that could be inferred from mere acceptance of the gift and nothing more would be assent to that particular gift and not assent to the gifts similarly made to others; and for this reason.
When Mukand Ram attained majority he had two titles to choose from.
One from Pato as a limited owner coupled with the assent of the daughters to her gift to him.
In that case, he would hold a limited estate till the reversion opened out.
The gift would be good during Pato 's life time because she had that title to convey, and thereafter, till the three daughters died, because they assented to it and obtained considerable benefit for themselves from the transaction out of which it arose.
The other title would be an absolute one on the basis that Pato was the absolute owner of the properties.
That title could only be referable to the family arrangement, and if Mukand Ram, knowing the facts, assented to the arrangement ex post facto, he will be precluded from challenging it for reasons which we shall now explain.
If the properties were Nanak Chand 's, which is the assumption on which we are deciding this case, then Pato was a limited owner under the Hindu law, but as such she represented the estate and any title she conveyed, whether by gift or otherwise, would not be void; it would only be voidable.
It would be good as against all the world except the reversioner who succeeded when the reversion opened out and he is the only person who would have the right to avoid it; and it would continue to be good until he chose to avoid it.
Therefore, if he does not avoid it, or is precluded from doing so, either because of the law of limitation or by his own conduct, or for any other reason, then no one else can challenge it; and the law is that once a reversioner has given his assent to an alienation, whether at the time, or as a part of the transaction, or later as a distinct and separate act, he is bound though others may not be, and having given his assent he cannot go back on it to the detriment of other persons; all the more so when he himself receives 45 benefit:see Raja Modhu Sudan Singh vs Rooke(1); Bijoy Gopal vs Krishna(1), and Ramgouda Annagouda vs Bhausaheb(3).
Lord Sinha, delivering the judgment of the Privy Council in the last of these three cases, said at page 402: "It is settled law that an alienation by a widow in excess of her powers is not altogether void but only voidable by the reversioners, who may either singly or as a body be precluded from exercising their right to avoid it either by express ratification or by acts which treat it as valid or binding".
This was followed in Dhiyan Singh vs Jugal Kishore(4) though the ground of that decision was estoppel.
We are now founding on another principle which is not grounded on estoppel and which, indeed, is not peculiar to Hindu law.
Estoppel is rule of evidence which prevents a party from alleging and proving the truth.
Here the plaintiff is not shut out from asserting anything.
We are assuming in his favour that Pato had only a life estate and we are examining at length his assertion that he did not assent to the family arrangement.
The principle we are applying is therefore not estoppel.
It is a rule underlying many branches of the law which precludes a person who ' with full knowledge of his rights, has once elected to assent to a transaction voidable at his instance and has thus elected not to exercise his right to avoid it, from going back on that and avoiding it at a later stage.
Having made his election he is bound by it.
So far as the Hindu law is concerned, Lord Dunedin explained in Rangaswami Gounden vs Nachiappa Gounden(5), a case in which a widow gifted properties to her nephew, that though the reversioner is not called upon to exercise his right to avoid until the reversion falls in and so no assent can be inferred from mere inaction prior to the death or deaths of the limited owner or owners, he is not bound to wait and "of course something might be done even before (1) [1897] 24 I.A. 164, 169.
(2) [1906] 34 I.A. 87.
(3) [1927] 54 I.A. 396.
(4) 1952 S.C.R. 478, 488.
(5) [1918] 46 I.A. 72, 86,87. 46 that time which amounted to an actual election to hold the deed good".
Ramgouda case(1) is an illustration of what that something can be, for there the assent was given by the ultimate reversioner before he became in titulo to alienations by a widow, one of which was a gift.
The present case is another illustration.
For the reasons we have given and which we shall now further examine, we hold that the plaintiff, who is in titulo now that the succession has opened out, unequivocally assented to the arrangement with full knowledge of the facts and accepted benefit under it, therefore, be is now precluded from avoiding it, and any attempts he made to go behind that assent when it suited his purpose cannot render the assent once given nugatory even though it was given when he was not in titulo and even though the assent was to a series of gifts.
The real question is whether the plaintiff assented to the family arrangement, and as the plaintiff was not a party to the arrangement his assent to the arrangement itself, and not to something else, must be clearly established, and also his knowledge of the facts.
But we think they have been.
In the first place, there was the express assent in 1890 to the gifts made to the other grandsons on the basis that each grandson got an absolute estate.
Next, there was the long course of dealings by Kanhaiya Lal and Mukand Ram in which they asserted absolute titles.
Mukand Ram tells us in the witness box as P.W. 11 (C.A. 91) that Kanhaiya Lal was the karta of the joint family to which Mukand Ram belonged, therefore Kanhaiya Lal 's dealings with the properties which he and his brother held under a joint and undivided title are also relevant as they will bind Mukand Ram.
And lastly, there is Mukand Ram 's representation to Shyam Lal (D.W. I in C.A. 94) which leaves us in no doubt about his knowledge.
The cumulative effect of this course of conduct leads to a reasonable inference that Kanhaiya Lal and Mukand Ram were holding, not on the basis of a separate and individual gift made by a life owner with the assent of the next set of life 1) [1927] 51 I.A. 396, 402.
47 owners, but on the basis of the family arrangement which was one composite whole in which the several dispositions formed parts of the same transaction under which Mukand Ram himself acquired a part of the estate: see Ramgouda vs Bhausaheb(1).
We are therefore satisfied that the plaintiff 's assent was to this very arrangement.
and that concludes both cases.
In C. A. 94/50 there is, in addition, a direct personal estoppel against the plaintiff.
The transfers that are challenged there are sales of 23 9 18 and 25 11 19 made by two of the grandsons, one personally and the other by the guardian, but the relevant dates for the purposes of the estoppel are later because the representation in this case was not made to the immediate transferees but to the first defendant who obtained title to the properties at a later date, in one case by a sale from the immediate transferee, in the other by pre emption.
But the exact dates do not matter because the representation to the first defendant was made in 1910 before the first defendant 's purchases.
It was made by Kanhaiya Lal and Mukand Ram as as well as by other members of the family.
We have already referred to the first defendant 's evidence.
This case would therefore be governed by Dhiyan Singh vs Jugal Kishore(2) in any event.
But we need not elaborate this further because of the other principle which, in our opinion, is sufficient to dispose of both the present cases.
The result is that both appeals are allowed.
The decrees of the High Court are set aside and those of the first Court dismissing the plaintiff 's claims in those suits out of which Civil Appeals 92 and 94 of 1950 arise are restored.
Costs here and in the High.
Court will be paid by the plaintiff respondent but there will be only one set of costs and they will be divided half and half between the two sets of appellants.
Appeals allowed.
(1) [1927] 54 I.A. 396, 402.
(2) 1952 S.C.R. 478.
| A family arrangement can, as a matter of law, be inferred from a long course of dealings between the parties.
It is well settled that a compromise or family arrangement is based on the assumption that there is an antecedent title of some sort in the parties and the agreement acknowledges and defines what that title is, each party relinquishing all claims to property other than that falling to his share and recognising the right of the others, as they had previously asserted it, to the portions allotted to them Respectively.
That explains why no conveyance is required in these cases to pass the title from the one in whom it resides to the person receiving it under the family arrangement.
It is assumed that the title claimed by the person receiving the property under the arrangement had always resided in him or her so far as the property falling to his or her share is concerned and therefore no conveyance is necessary.
But in view of the fact that the Courts lean strongly in favour of family arrangements that bring about harmony in a family and do justice to its various members and avoid, in anticipation, future disputes which might ruin them all the Supreme Court, carrying the principle further, upheld an arrangement under which one set of members abandons all claim to all title and interest in all the properties in dispute and acknowledges that the sole and absolute title to all the properties resides in only one of their number (provided he or she had claimed the whole and made such an assertion of title) and are content to take such properties as are assigned to their shares as gifts pure and simple from him or her, or as a conveyance for consideration when consideration is present.
The legal position in such a case would be this.
The arrangement or compromise would set out and define that the title claimed by A to all the properties in dispute was his absolute title as claimed and asserted by him and that it had always resided in him.
Next, it would effect a transfer by A to B, C and D (the other members to the arrangement) of properties X, Y and Z; and thereafter B, C and D would hold their respective titles under the title derived from A. But in that event, the formalities of law about the passing of title 23 by transfer would have to be observed, and under the present state of law either registration or twelve years ' adverse possession would be necessary.
But in the present case the arrangement was made in 1875 when the Transfer of Property Act was not in force and no writing was required; and as there is no writing, the Registration Act does not apply either.
Therefore, the oral arrangement of 1875 would be sufficient to pass title in this way and that is what happened.
Once a reversioner has given his assent to an alienation, whether at the time, or as a part of the transaction, or later as a distinct and separate act, he is bound though others may not be, and having given his assent he cannot go back on it to the detriment of other persons; all the more so when he himself receives a benefit.
It is settled law that an alienation by a widow in excess of her powers is not altogether void but only voidable by the reversioners, who may either singly or as a body be precluded from exercising their right to avoid it either by express ratification or by acts which treat it as valid or binding.
The principle applicable to the present case is a rule underlying many branches of the law which precludes a person who, with full knowledge of his rights, has once elected to assent to a transaction voidable at his instance and has thus elected not to exercise his right to avoid it, from going back on that and avoiding it at a later stage.
Having made his election he is bound by it.
Held, that in the present case the plaintiff who is in titulo now that the succession has opened out, had unequivocally assented to the arrangement with full knowledge of the facts and accepted benefit under it, so he is now precluded from avoiding it, and any attempts he made to go behind that assent when it suited his purpose cannot render the assent once given nugatory even though it was given when he was not in titulo and even though the assent was to a series of gifts.
Hardei vs Bhagwan Singh, (A.I.R. ; Clif ton vs Cockburn ( ; ; William vs William ; Bani Mewa Kuwtivar vs Rani Hutlas Kuwar [1874] L.R.
I I.A. 157); Khunni Lal vs Gobind Krishna ( [1911] L.R. 38 I.A. 87); Bamsumirn Prasad vs Shyam Kumar ( [1922] L.R. 49 I.A. 348); Baia Modhu Sudhan Singh v Booke ( [1897] L.R. 24 I.A. 164); Bijoy Gopal vs Sm.
Krishna [1906] L.R. 34 I.A. 87); Ramgouda Annagowda vs Bhauaheb ( [1927] L.R. 54 I.A. 396); Dhiyan Singh vs Jugal Kishore ( [1952] S.C.R. 478 at 488); Rangaswami Gounden vs Nachiappa Gouinden ( [1918] L.R. 46 I.A. 72 at 86 & 87), referred to.
|
on No. 40 of 1955.
Under Article 32 of the Constitution for a Writ of Habeas Corpus.
208 Purshottam Trikumdas, (K. B. Asthana, Syed Murtaza Fazl Ali and Rajinder Narain, with him) for the petitioner.
M.C. Setalvad, Attorney General for India and C.K Daphtary Solicitor General for India (Porus A. Mehta and R.H. Dhebar, with them) for the respondents.
April 7.
The Judgment of Mukherjea C. J., Das, Vivian Bose and Imam JJ.
was delivered by Das J. Sinha J. delivered a separate Judgment.
DAS J. This is a petition for a writ in the nature of a writ of habeas corpus calling upon the respondents to show cause why the petitioner, who is now confined in the Central Jail at Rewa, should not be set at liberty.
The petitioner 's grievance is that he has been deprived of his liberty otherwise than in accordance with procedure established by law.
A rule nisi having been issued, the respondents have filed an affidavit by way of return to the writ.
The question for our decision is whether the return is good and sufficient in law.
The facts leading up to the present petition are few and simple.
In the years 1948 and 1949 the petitioner was the Minister of Industries in the Government of Vindhya Pradesh which was at that time an acceding State within the meaning of section 6 of the Government of India Act, 1935 as amended in 1947.
On the 11th April, 1949 the petitioner was arrested in Delhi on the allegation that he had accepted illegal gratification in order to show favour to Panna Dia mond Mining Syndicate in the matter of the lease of the Diamond Mines at Panna.
In December, 1949 the petitioner along with one Mohan Lal, who was the then secretary in the Ministry of Industries, was put up for trial before the Court of Special Judge, Rewa, constituted under the Vindhya Pradesh Criminal Law Amendments (Special Courts) Ordinance No. V of 1949.
The charges were under sections 120 B, 161 465 and 466 of the Indian Penal Code as adapted for Vindhya Pradesh by the Indian Penal Code (Application to Vindhya Pradesh) Ordinance No. XLVIII of 209 1949.
By his judgment pronounced on the 26th July 1950 the Special Judge acquitted both the accused.
The State preferred an appeal against that acquittal to the Judicial Commissioner of Vindhya Pradesh.
By his judgment pronounced on the 10th March 1951 the Judicial Commissioner reversed the order of acquittal, convicted both the accused and sentenced them to different terms of rigorous imprisonment under the different sections in addition to the payment of certain fines.
On the application of the petitioner and his co accused the Judicial Commissioner on the 12th March 1951 issued a certificate to the effect that four points of law raised in the case and formulated by him in his order Were fit for the consideration of this Court in appeal under article 134 of the Constitution of India.
A petition of appeal was filed in this Court on the strength of this certificate of fitness and it was registered as Criminal Appeal No. 7 of 1951.
As the case involved a substantial question of law as to the interpretation of the Constitution, it was, in April 1953, placed before a Bench of five Judges of this Court as required by article 145(3) of the Constitution.
For convenience of reference we shall call a Bench of five or more Judges as the Constitution Bench.
The validity of the convictions and sentences was challenged before the Constitution Bench on the ground that there had been infringements of articles 14 and 20 of the Constitution.
A further point of law was raised that no appeal lay to the Judicial Commissioner from the acquittal by the special Judge.
By their judgment pronounced on the 22nd May 1953 the Constitution Bench rejected all these objections.
The judgment concluded with the following direction: "The appeal is accordingly directed to be posted for consideration whether it is to be heard on merits".
This was evidently done in view of the fact that the certificate of fitness granted by the Judicial Cormmissioner was limited only to four points of law.
The constitutional points having been disposed of, the appeal was placed before a Division Bench of three Judge who on the 20th October 1953 ordered 27 210 the appeal to be heard on the merits.
The appeal was accordingly put up for hearing before another Division Bench consisting of three Judges.
On the 5th March 1954 this Division Bench allowed the appeal of Mohan Lal and acquitted him but dismissed the appeal of the petitioner with respect to his conviction under sections 161, 465 and 466, Indian Penal Code, as adapted in Vindhya Pradesh, but set aside his conviction on the charge under section 120 B.
The sentence of three years ' rigorous imprisonment was maintained but the sentence of fine was set aside.
On the 18th March 1954 a petition for review was filed on behalf of the petitioner.
It was directed against the judgment of the Constitution Bench pronounced on the 22nd May 1953 repelling the constitutional points as well as against the judgment of the Division Bench dated the 5th March 1954 dismissing the petitioner 's appeal on the merits.
On objection being taken by the Registry against one application being filed for the review of two judgments one of which had been pronounced much earlier than the period allowed for filing a review application, the petitioner filed a second application for review of the judgment of the Constitution Bench and prayed for condonation of the delay in filing the same.
On the 5th April 1954 the application for review was put up for hearing before the same Division Bench which had pronounced the judgment on the merits dated the 5th March 1954.
After considering the points of review relating to that judgment the Division Bench on the same day came to the conclusion that no ground had been made out for review of that judgment and accordingly dismissed the petition.
An order was drawn up as of that date directing the petitioner who had been previously enlarged on bail to surrender and serve out his sentence.
On the 12th April 1954 another petition was filed on behalf of the petitioner praying that the review matter relating to the judgment of the Constitution Bench delivered on the 22nd May 1953 be placed before a Constitution Bench for final disposal.
That review application was put up before a Constitution 211 Bench which on the 17th May 1954 declined to entertain the same.
In the meantime the petitioner had in the last week of April 1954 surrendered and has since then been confined in the Central Jail at Rewa.
The present application has, therefore, been made for a writ of habeas corpus on the allegation that the petitioner has been and is being deprived of his liberty otherwise than in accordance with procedure established by law.
In the present petition the petitioner has again urged that the Court of the Judicial Commissioner of Vindhya Pradesh was not the proper forum for entertaining the appeal against the judgment of the Special Judge and consequently the judgment of the Judicial Commissioner setting aside the acquittal of the petitioner convicting and imposing sentence of imprisonment was void and inoperative.
Alternatively, it has been urged that, assuming that the Judicial Commissioner had jurisdiction to hear the appeal from the Special Judge and his judgment was in accordance with procedure established by law, the appeal filed by the petitioner in this Court against the judgment of the Judicial Commissioner should have been, under article 145(3) of the Constitution, beard and completely disposed of by the Constitution Bench.
As regards the first point as to the incompetency of the Court of the Judicial Commissioner to entertain the appeal from the decision of the Special Judge the same has been fully dealt with by the Constitution Bench and cannot be reagitated.
Indeed, learned counsel appearing in support of this petition has not pressed the same.
The only point urged before us is the alternative plea mentioned above which depends for its decision on a true construction of article 145.
Article 145 by clause (1) authorises this Court, subject to the provisions of any law made by Parliament and with the approval of the President to make rules for regulating generally the practice and procedure of the Court, including, amongst others, rules as to the procedure for hearing appeals, as to the entertainment of appeals under sub clause (c) of clause (1) of article 212 134 and as to the conditions subject to which any judgment pronounced or order made by the Court may be reviewed and the procedure for such review.
Clauses (2) and (3) of the article are in the terms following "(2)Subject to the provisions of clause (3), rules made under this article may fix the minimum number of Judges who are to sit for any purpose, and may provide for the powers of single Judges and Division Courts.
(3)The minimum number of Judges who are to sit for the purpose of deciding any case involving a substantial question of law as to the interpretation of this Constitution or for the purpose of hearing any reference under article 143 shall be five: Provided that, where the Court hearing an appeal under any of the provisions of this Chapter other than article 132 consists of less than five Judges and in the course of the hearing of the appeal the Court is satisfied that the appeal involves a substantial question of law as to the interpretation of this Constitution the determination of which is necessary for the disposal of the appeal, such Court shall refer the question for opinion to a Court constituted as required by this clause for the purpose of deciding any case involving such a question and shall on receipt of the opinion dispose of the appeal in conformity with such opinion".
The contention of the petitioner is that the question whether a particular case involves a substantial question of law as to the interpretation of the Constitution is to be examined at the time when the case first comes before this Court.
If at that stage it is found that it is a case involving a substantial question of law as to the interpretation of the Constitution it becomes irrevocably impressed with that character and quality and the minimum number of Judges who are to sit for the purpose of deciding such case must be a Constitution Bench, that is to say, a Bench of at least five Judges.
The argument then proceeds to say that once the Constitution Bench takes seisin of the case and starts the hearing that 213 Bench and that Bench alone must decide the whole of such case, that is to say, decide all questions, constitutional or otherwise, arising in the case.
Sri Purshottam Trikumdas who appears in support of this petition has strongly relied on the language used in clause (3) and contends that "the case" cannot be split up and that the clause requires the entire case to be disposed of by the Constitution Bench.
He, therefore, urges that the Division Bench had no jurisdiction to take up the case involving substantial ques tions of law as to the interpretation of the Constitution and consequently the judgment of that Division Bench pronounced on the 5th March, 1954 was illegal and void.
According to him, his client 's appeal, in the eye of the law, remains undisposed of and as he had been let out on bail until the disposal of his appeal, his detention in jail pursuant to the judgment of the Division Bench, which is a nullity, amounts to deprivation of his personal liberty otherwise than in accordance with procedure established by law and is an infringement of his fundamental right under article 21 of the Constitution.
The argument at first sight certainly appears to be plausible but on a deeper consideration of the constitutional provisions bearing on the subject and the general principles regulating the procedural powers of Courts we are unable to accept the same as sound or well founded.
In this very case the Judicial Commissioner of Vindhya Pradesh had granted a certificate of fitness under article 134(1)(c).
Consequently under the proviso to clause (3) of article 145 the appeal might well have been placed before a Division Bench consisting of less than five Judges.
In that situation, being satisfied that the appeal involved a substantial question of law as to the interpretation of the Constitution the determination of which was necessary for the disposal of the appeal, that Division Bench could refer the question for the opinion of a Constitution Bench and on receipt of the opinion dispose of the appeal in conformity with such opinion; but to accede to the argument of Sri Purshottam Trikumdas will lead us to hold that while a Division Bench of three 214 Judges could split up this very case, had it been posted before it in the first instance, by referring the con stitutional questions to a Constitution Bench for its opinion and then, after receipt of that opinion, disposing of the rest of the case on merits in conformity with such opinion, a Constitution Bench of five or more Judges before which the case happened to be posted in the first instance could not split up the case by deciding the constitutional questions and leaving the rest of the case to be dealt with and disposed of by a Division Bench of less than five Judges on merits in conformity with the opinion of the Constitution Bench thus saving the time of the Constitution Bench.
Reference may also be made to article 228 which authorises the High Court, if satisfied that a case pending in a Court subordinate to it involves a substantial question of law as to the interpretation of the Constitution the determination of which is necessary for the disposal of the case, to withdraw the case and either to dispose of the case itself or determine the said question of law and return the case to the Court from which it has been so withdrawn so as to enable the said Court to proceed to dispose of the case in conformity with the judgment of the High Court.
Here again learned counsel 's argument leads us to hold that while the High Court can split up a case involving a substantial question of law as to the interpretation of the Constitution a Constitution Bench of this Court cannot do so.
Apart from these provisions of the Constitution there are provisions made by procedural statutes which result in a case being partly heard by one Judge and partly by another Judge.
To cite only a few instances, reference may be made to section 24 and Order 18, rule 15 of the Code of Civil Procedure and sections 350, 526, 528 and 556 of the Code of Criminal Procedure.
The argument of Sri Purshottam Trikumdas, pushed to its logical conclusion, must amount to this that although Courts operating under the ordinary procedural code may split up cases into different stages for the purpose of hearing and decision) a Constitution Bench of this Court cannot do so if a case involving substantial questions of law as to 215 the interpretation of the Constitution happens to be posted before it in the first instance.
Learned counsel for the petitioner recognises the incongruity that results from his argument but contends that it cannot be helped because the relevant provisions referred to above expressly sanction the splitting up of cases whereas the body of clause (3) of article 145 does not.
His argument is that in the cases mentioned above splitting up of cases has to be allowed because the special provisions of the Constitution or other statutes provide for such splitting up in those cases.
He contends that the very fact that these provisions had to be made clearly indicates that but for them there could not have been any splitting up of the case.
It is said that these provisions are exceptions to the general rule of indivisibility of a case.
We are unable to accept this reasoning as correct.
In the first place the proviso to article 145(3), article 228 and the other provisions of the Codes referred to above quite clearly indicate that the splitting up of cases into different stages for bearing and decision is not repugnant to the Constitution or the general principles of procedural law.
The underlying principle of the Constitution is clear and all that it insists upon is that all constitutional questions should be heard and decided by a Bench of not less than five Judges.
As long as this requirement is fulfilled there can be no constitutional objection to the rest of the case being disposed of by a Division Bench of less than five Judges, so as to save the time of the Constitution Bench of five or more, Judges.
In the next place we are not aware of any such general rule of indivisibility as is being insisted upon by learned counsel.
There is nothing in principle which requires that a case,must always be decided in its entirety by one Judge or one set of Judges even though such a case may conveniently be dealt with in two or more stages.
Indeed, in Maulvi Muhammad Abdul Majid vs Muhammad Abdul Aziz(1) the Privy Council pointed out that where a Judge had before (1) L.R. 24 I.A. 22.
216 him a case consisting of two parts, a question of title and an incidental question of account depending on title, it did not require any provision of the Civil Procedure Code to authorise him to decide the first question and reserve the second for further investigation and that to treat such a proceeding as beyond the power of the Court and as an error which barred the proceedings reserved for further decision was a serious miscarriage of justice.
Indeed, the Court often exercises its inherent power, if it thinks fit to do so, to decide questions of jurisdiction or limitation or the like as preliminary questions reserving other questions of fact for future investigation.
The decision of a case at two or more stages may and often does result in the case not being decided by the same Judge, for the Judge who decided at the first stage may, by reason of death, retirement or transfer, be not available for deciding the case at the later stages, it follows, therefore, that no argument can be founded on any supposed general rule of indivisibility of a case for the purpose of its hearing and decision.
The consideration that there is no such general rule as is relied on by learned counsel and that the splitting up of cases is not generally repugnant to law and in particular to the Constitution, leads us to the conclusion that in construing clause (3) of article 145 no quality of indivisibility need be attributed to the words "the case" used therein.
A case may, to begin with, involve a substantial question of law as to the interpretation of the Constitution, but it may cease to do so at a later stage.
Suppose a case which involves a constitutional question is placed before a Constitution Bench but learned counsel appearing in support of the case intimates to the Bench that he does not press any constitutional point, surely he can not, in that situation, insist that the time of a Bench of five or more Judges should be spent on the determination of a case which, by his own election, has ceased to involve any constitutional question.
Likewise, when the constitutional questions involved in the case are disposed of by a Constitution Bench what 217 remains of the case cannot properly or appropriately be described as still a "case involving a substantial question of law as to the interpretation of this Constitution".
It should be borne in mind that when a case or appeal is properly admitted to this Court all that the parties are entitled to is a decision of this Court and not of any Particular Bench.
So long as the minimum number of Judges which the Constitution and the rules framed by this Court prescribe are present to hear and decide the questions raised from stage to stage, they represent the Court for the purpose of giving decisions on its behalf and the parties get all that they are entitled to under the law.
If a Court is entitled to decide a case in stages, as the Privy Council has held it can, there is no reason why article 145(3) should be so construed as to deprive this Court of that inherent power.
It will involve no violation of any principle of natural justice or of any legal principle if we construe clause (3) of article 145 as requiring only that the minimum number of five Judges must sit for the purpose of deciding any case in so far and as long as it involves a substantial question of law as to the interpretation of this Constitution.
We find nothing in the language of clause (3) of article 145 which militates against this interpretation of that clause.
Indeed, it is on this interpretation that the practice has grown up in this Court for a Constitution Bench to dispose of all constitutional questions and to leave the other subsidiary questions for disposal by a Division Bench of less than five Judges in conformity with the opinion of the Constitution Bench.
There is nothing that we find in the body of clause (3) of article 145 which compels us to depart from the famous maxim cursus curiae est lex curiae which was laid down by Lord Coke in Burrowes vs High Commission Court(1) and which was quoted with approval in Habibar Rahman vs Saidannessa Bibi(2).
For reasons stated above we consider that a good and valid return has been made by the respondents to the rule nisi issued to them and this application must be dismissed.
We order accordingly.
(1) 3 Bulst.
48, 53.
331, 335.
218 SINHA J. I regret to have to differ from my learned brethren on the construction of article 145(3) of the Constitution which is the main question in controversy in this case.
Clause (3) of article 145 is in these terms: "The minimum number of Judges who are to sit for the purpose of deciding any case involving a substantial question of law as to the interpretation of this Constitution or for the purpose of hearing any reference under article 143 shall be five: Provided that, where the Court hearing an appeal under any of the provisions of this Chapter other than article 132 consists of less than five Judges and in the course of the hearing of the appeal the Court is satisfied that the appeal involves a substantial question of law as to the interpretation of this Constitution the determination of which is necessary for the disposal of the appeal, such Court shall refer the question for opinion to a Court constituted as required by this clause for the 'Purpose of deciding any case involving such a question and shall on receipt of the opinion dispose of the appeal in conformity with such opinion".
It is noteworthy that the Constitution has not vested this Court with complete power to make rules as to the constitution of Benches for hearing matters coming before this Court in its Original, Appellate or Advisery Jurisdiction.
Clause (2) of article 145 has invested this Court with power to make rules fixing the minimum number of Judges who are to sit for any purpose and for defining the powers of single Judges and Division Courts.
But this power is expressly made subject to the limitation laid down in clause (3) quoted above; that is to say, where any case involves a substantial question of law as to the interpretation of the Constitution (omitting the words not material for our present purpose) the minimum number of Judges prescribed by the Constitution to decide such a case is five.
A case may involve questions of law as to the interpretation of the Constitution, as also other questions.
In this case we have to determine whether clause (3) contemplates the whole case or a part of a 219 case.
In my opinion, the Constitution while laying down clause (3) of article 145 contemplates the whole matter in controversy arising in a case which may include substantial questions of law as to the interpretation of the Constitution as also other questions.
The main clause (3), excepting cases coming within the purview of the proviso does not contemplate a splitting up of a case into parts, one part involving substantial questions of law as to the interpretation of the Constitution and another part or parts not involving such questions.
My reasons for coming to this conclusion are as follows: Clause (3) itself read along with the proviso makes a distinction between a "case" and a "question" of the nature indicated in the proviso to the clause.
The Constitution has clearly indicated that cases coming within the purview of the proviso may be split up so as to admit of the questions of constitutional importance being determined by a Bench of at least five Judges who may be described for the sake of convenience as "Constitution Bench" in contradistinction to a Division Court consisting of less than five Judges, as is contemplated in the proviso.
The main clause (3) requires a case of the description therein set out to be heard and decided by a Constitution Bench, whereas the proviso contemplates that only the question of constitutional importance (using a compendious phrase) has to be decided by a Constitution Bench and the case out of which such a question arises remaining in the seisin of the Division Court before which the case was originally placed for hearing.
The Constitution has placed cases involving substantial questions of law of constitutional importance on a special footing.
If the framers of the Constitution had intended that not the whole case but only particular questions of the nature indicated had to be heard by a minimum number of five Judges, they would have used words similar to those used in the proviso making it permissible for the Constitution Bench to give its opinion for the decision of the case by a Division Court in conformity with that opinion, 220 A reference to the terms of article 228 of the Constitution would also show that the framers of the Constitution were fully alive to the difference between the decision of the "case itself" and a "question of law" of constitutional importance involved in that case.
It has made clear in that article that the High Court shall either decide the whole case including the question of law as to the interpretation of the Constitution which was necessary for the disposal of the case or determine only such a question or questions and return the case to the original court for disposal in conformity with the judgment of the High Court on such question or questions.
The Constitution made these specific provisions to emphasize that there is a distinction between determining the case itself and determining a substantial question of law of constitutional importance.
Can it be said that if clause (3) of article 145 had been enacted without the proviso, a case could be heard piecemeal first by a Constitution Bench which would determine only questions of law as to the interpretation of the Constitution, and then the residue of the case being heard and determined by a Division Court? That, in my opinion, would not be in compliance with the imperative provisions of the main clause (3).
The framers of the Constitution therefore enacted the proviso in the nature of an exception to the general rule laid down in the main clause (3).
It has to be observed that the proviso is limited to appeals only, subject to the further exception that such appeals should not have come up to this Court through the process laid down in article 132 of the Constitution.
It is thus clear that not all cases contemplated in the main clause (3) but only appeals of a particular description would come within the qualifying provisions of the proviso.
The word "case" has not been defined but it may be taken as settled law that it is much wider than a "suit" or an "appeal".
Hence whereas the proviso would apply to appeals brought up to this court, except those under article 132 of the Constitution, the main clause (3) would apply to all appeals and all 221 other matters coming up to this Court in its Original, Appellate and Advisory jurisdictions.
In my opinion, there cannot be the least doubt that the main provisions of clause (3) are all embracing, and contemplate all cases coming up to this Court.
It has not been contended that the present case comes within the purview of the proviso but it has been said that if it is open to a Division Court to refer a question of constitutional importance to a Constitution Bench, why should not a Constitution Bench be competent to refer questions other than those of constitutional importance to a Division Court? The answer is that whereas the former is contemplated by the Constitution in terms, the latter is not.
Nor are there any rules to that effect.
But it has been further observed that the splitting up of a case into parts, one involving questions of constitutional importance and the remaining part not involving questions of that kind, is not against the provisions of the Constitution.
But, in my opinion, if the Constitution has made a specific provision as to the splitting up of a case into parts, one cognisable by a Court of higher jurisdiction like a Constitution Bench and the rest by a court of lower jurisdiction like a Division Court, the argument is not available that a splitting up of a case apart from those specific provisions is also permissible.
In this connection reference was made to certain provisions of the Code of Civil Procedure as also of the Code of Criminal Procedure to show that those Codes do contemplate hearing of the same case in part by different courts, but those are all courts of co ordinate jurisdiction in which the question of the power of the court itself relatively to the subject matter of the case is not in question.
The court which originally dealt with the case and the court which finally came to hear and determine the matter were each one of them competent to deal with the whole matter or any part of it.
That is not the position here.
In this case the argument on behalf of the petitioner is that as admittedly his appeal involved substantial questions of law as to the interpretation of the Constitution and as it did not come 222 within the purview of the proviso to clause (3) of article 145 of the Constitution, it should have been dealt with throughout by a Constitution Bench.
It was suggested in answer to this argument that after the questions of law of constitutional importance had been dealt with by the Constitution Bench the case ceased to be one involving such questions and therefore could have been heard by a Division Court.
But the difficulty in accepting this argument is that once a Constitution Bench was seized of the case, it could not transfer it to another Bench for sharing the decision of that case with it.
That Bench should have heard out the whole case and it had not the power to direct, and it did not so direct, that the remaining part of the case should be heard by a Division Court.
Once a Constitution Bench is seized of the case, it has to hear the case to its conclusion.
There was no process known to the rules framed under the rule making power of this Court by which a case once it came before a Constitution Bench could get transferred from that Bench to a Division Court either automatically or by orders of any authority.
But it has been suggested that it may happen that a Constitution Bench may start the hearing of the case, and before the hearing is concluded one of the Judges is by reason of death or otherwise disabled from hearing out the case and in that event the Chief Justice has the power to constitute another Bench.
But that is quite a different matter.
In that case the hearing by the previous Bench comes to nothing and the Bench constituted afresh by the Chief Justice has to hear out the whole case afresh.
It has also been suggested on the other side that a "case" may mean a part of a case.
In my opinion, that submission is not well founded; because, if that argument were accepted and pushed to its logical conclusion, it may make the provisions of the main clause (3) of article 145 nugatory.
Article 132 of the Constitution has been, as indicated above, excepted from the operation of the proviso to clause (3).
Suppose an appeal is brought to this Court under article 132 of the Constitution as the case involved substantial 223 questions of law as to the interpretation of the Con stitution.
That case besides involving questions of that character, may also involve other questions.
If the argument that a "case" includes part of a case were accepted, then it will be permissible for a Constitution Bench to hear the questions of constitutional importance and leave the rest of the case to be determined by a Division Court, though such a case is expressly excluded from the operation of the proviso and thus is directly within the terms of the main clause (3).
Hence every case coming before this Court involving a question of constitutional importance may be dealt with in part in so far as it relates to that question by a Constitution Bench and the remaining part by a Division Court.
That, in my opinion, was not intended by the framers of the Constitution.
The term "case" therefore must mean the whole matter in controversy before this Court.
Such a matter may relate to one of several questions in controversy in the original court, if the determination of that question is sufficient to dispose of the case within the meaning of the Explanation to article 132 of the Constitution.
It was further argued by the learned Attorney General that the whole clause (3) of article 145 along with the proviso must be read together.
But even so read, the language of clause (3) does not warrant the hearing of the case piecemeal by different Benches unless it comes within the purview of the proviso.
The proviso is meant to cover only a limited class of cases which otherwise would have come within the purview of the main clause (3).
But the proviso cannot have a larger effect than is justified by its language, viz., that only a question of that description has to be referred for the opinion of the larger Bench, the case itself remaining on the file of the smaller Bench.
The proviso thus makes a clear distinction between a "case" and a "question".
It has also been said there is an inherent power in the court to transact its business according to its established practice.
In the first place, this Court is still in its formative stages and it cannot be said to 224 have an "established practice".
Secondly, it cannot establish a practice in the teeth of the provisions of the Constitution which it is pledged to uphold.
The reference to the decision of the Privy Council in Moulvi Muhammad Abdul Majid vs Muhammad Abdul Aziz(1) is not apt because in that case the hearing at the two stages of the trial was to be done by a court of coordinate jurisdiction; that is to say, a court which could hear and determine the whole case or each of the two parts of the case taken separately by itself, unlike the present case in which the two parts of the hearing have been done by two courts of unequal power.
Similarly the reference to the maxim " cursus curiae est lex curiae" of Coke C. J. in Burrowes vs High Commission Court(1), referred to in Habibar Rahman vs Saidannessa Bibi(3) and to the other cases all proceed on the assumption that there is nothing in the statute law against such a course being taken.
But, in my opinion, such a nebulous practice is opposed to the positive provisions of clause (3) of article 145.
In my opinion therefore, the present case comes directly within the main clause (3) of article 145 of the Constitution and is admittedly not covered by the proviso to that clause.
That being so, the petitioner 's appeal to this Court has not been heard and determined in accordance with the procedure established by this Constitution and therefore the petitioner is entitled to the benefit of the protection afforded by article 21 of the Constitution.
His appeal, therefore, has got to be heard and determined in accordance with the procedure laid down in article 145(3) of the Constitution.
I would therefore allow the petition to this extent only that the appeal be heard by a Constitution Bench on a declaration that the judgment of the Division Court dated the 5th March 1954 is not that of a competent court.
BY THE COURT: In accordance with the judgment of the majority, the petition is dismissed.
(1) L.R. 21 I.A. 22.
(2) 3 Bulst.
48, 53.
(3) I.L.R. , 335.
| Held (Per MUKHERJEA C.J., DAS, VIVIAN BOSE, and IMAM JJ.
SINHA J. dissenting) that a Constitution Bench of five or more Judges before which a case happens to be posted in the first instance 207 is competent to split up the case by deciding the constitutional questions and leaving the rest of the case to be dealt with and disposed of by a Division Beach of less than five Judges on merits in conformity with the opinion of the Constitution Bench.
The splitting up of cases into different stages for hearing and decision is not repugnant to the Constitution or the general principles of procedural law.
The underlying principle of the Constitution is clear and all that it insists upon is that all constitutional questions should be heard and decided by a Bench of not less than five Judges.
As long as this requirement is fulfilled there can be no constitutional objection to the rest of the case being disposed of by a Division Bench of less than five Judges, so as to save the time of the Constitution Bench of five or more Judges.
There is no general rule of indivisibility of a case for the purpose of its hearing and decision: vide.proviso to Article 145(3) and Article 228 of the Constitution, section 24 and Order 18, Rule 15 of the Code of Civil Procedure and sections 350, 526, 528 and 556 of the Code of Criminal Procedure.
Article 145(3) of the Constitution cannot be so construed as to deprive the Supreme Court of the inherent power of splitting up a case for the purpose of hearing and decision .
Per SINHA J. The Constitution while laying down clause (3) of Article 145, contemplates the whole matter in controversy arising in a case, which may include substantial questions of law as to the interpretation of the Constitution as also other questions.
The main clause (3), excepting cases coming within the purview of the proviso, does not contemplate a splitting up of a case into parts, one part involving substantial questions of law as to the interpretation of the Constitution and another part or parts not involving such questions.
The language of clause (3) of Article 145 does not warrant the hearing of a case piecemeal by different Benches unless it comes within the purview of the proviso.
The proviso is meant to cover only a limited class of cases which otherwise would have come within the purview of the main clause (3).
But the proviso cannot have a larger effect than is justified by its language, viz., that only a question of that description has to be referred for the opinion of the larger Bench, the case itself remaining on the file of the smaller Bench.
The proviso thus makes a clear distinction between a "case" and a "question".
Maulvi Muhammad Abdul Majid vs Muhammad Abdul Aziz (L.R. 24 I.A. 22), Burrowes vs High Commission Court (3 Bulst.
48) and Habibar Rahman vs Saidannessa Bibi (I.L.R. , referred to.
|
In the matter of Petition for Special Leave to Appeal No. 230 of 1953.
Rajinder Narain for the Respondents.
N. C. Chatterjee (Sukumar Ghose with him) for the Appellants.
April 5.
The Order of the Court was delivered by MUKHERJEA C.J. This is an application by the respondents in Special Leave Petition No. 230 of 1953, praying for summons to the appellants to show cause why the special leave obtained by the latter should not be rescinded in accordance with the provision of Order XIII, rule 13 of the Supreme Court Rules.
The appeal is directed against a judgment of a Division Bench of the Calcutta High Court affirming, on appeal, a decision of a single Judge sitting on the Original Side of that Court.
The appellants, having been refused certificate by the High Court, presented before us an application under article 136 of the Constitution and special leave to appeal was granted to them by an order of this Court dated the 25th May 1954.
By that order the appellants were required to furnish security for costs amounting to Rs. 2,500 within six weeks and the enforcement of the award, which was the subject matter of the appeal, was stayed on condition that the appellants deposited in Court a sum of Rs. 28,000 within four weeks from the date of the order.
On the 15th of June 1954 the Registrar of this Court transmitted to the Original Side of the Calcutta High Court certified copies of the order granting special leave and also of the special leave petition with a request that these documents might be included in the printed records of the case.
It is not disputed that in pursuance of the directions given 246 by this Court the appellants did deposit the amount required as security for costs and also the sum of Rs. 28,000 within the time mentioned in the order.
On the 29th November 1954 the respondents ' Solicitors in Calcutta wrote a letter to the Registrar of the Original Side of the Calcutta High Court complaining of delay on the part of the appellants in prosecuting the appeal.
It was stated inter alia that although six months had elapsed since special leave was granted by this Court, the respondents were not served with notice of the admission of the appeal and no steps were taken by the appellants to get the records printed or transmitted to this Court.
In reply to this letter the Registrar informed the respondents ' Solicitors that according to the practice of the Calcutta High Court it was incumbent on the appellants to make a formal application to the Appellate Bench of the Court for declaring the appeal finally admitted, and this was to be done on notice to the other parties under Order XLV, rule 8 of the Civil Procedure Code and on filing in Court a copy of the order of the Supreme Court granting special leave to appeal as well as the application upon which such order was made.
Unless and until an order was made by the High Court declaring the appeal to be admitted, no action could be taken by the office in the matter.
Thereupon on the 11th of January 1955 an application was filed by the appellants praying that leave might be given to them to file the certified copy of the special leave petition and also that of the order passed upon it and that the appeal might be finally admitted.
This application came up for hearing before the learned Chief Justice and Lahiri, J. of the Calcutta High Court and on the 20th of January 1955 the learned Judges made the following order: "In this matter special leave to appeal to the Supreme Court was granted by that Court on the 25th May 1954.
On the 21st June following, the Appellant furnished the necessary security.
It was then the duty of the Appellant to take the necessary steps for the final admission of the appeal in order that the preparation of the Paper Book might thereafter be 247 undertaken.
Under the Rules and practice of this Court the step to be taken is that the Appellant to the Supreme Court should make an application for leave to file the certified copy of the petition for Special Leave and also a certified copy of the order granting Special Leave which have been filed along with the present application. . . . ." When the matter came up for hearing on the last occasion we enquired whether the Appellants had any explanation to give for the delay which bad occurred.
It was said that the certified copy of the application for Special Leave had been obtained only recently.
It was however not explained why when an application for a certified copy of the order was made a similar application for a certified copy of the petition also could not be made.
In all the circumstances we consider it right that the disposal of the present application should stand over for a month in order that the respondents may take such steps as they desire to take before the Supreme Court".
The above facts and order of the High Court were communicated to the Registrar of this Court by Shri Rajinder Narain, Advocate for the respondents, by his letters dated the 17th and 31st of January 1965 and on the basis of the facts stated above, he requested that action should be initiated by the Registrar against the appellants for non prosecution of the appeal.
The Registrar told the learned Advocate that he had not received any report from the High Court regarding any laches on the part of the appellants and without any such report, it was not possible for him to take any action in the matter.
The Advocate himself, it was said, was quite at liberty to make a formal application to the Court in such way as he considered proper.
The views thus expressed by the Registrar of this Court were communicated by him to the Registrar of the High Court, Original Side, Calcutta.
On the 4th March 1955 Shri Rajinder Narain filed a formal petition addressed to the Registrar alleging inordinate delay on the part of the ap pellants in filing in the High Court certified copies of 248 the Special Leave petition and the order made by this Court thereupon and praying that summons might be issued to the appellants to show cause why the appeal should not be dismissed for non prosecution.
Before the Registrar could take any further steps in the matter, the application of the appellants for final admission of the appeal made in the High Court came up for further consideration before the Appellate Bench consisting of the Chief Justice and Mr. Justice Lahiri and on the 7th March, 1955 the learned Judges made an order directing, for the reasons given therein, adjournment of the application for admission of the appeal before them, sine die pending orders which this Court might pass on the application of the respondents.
The application of the respondents which purports to have been made under Order XIII, rule 13 of the Supreme Court Rules was referred by the Registrar for orders to the Court and it has now come up for hearing before us.
Shri Rajinder Narain appearing in support of the petition has Contended before us that the appellants were guilty of serious laches inasmuch as they did not file in the High Court, till 8 months after the special leave was granted, copies of the special leave petition as well as of the order passed upon it; nor did they make an application to the Appellate Bench for admission of the appeal without which no further steps could be taken in the matter of printing and transmission of the record.
As the appellants could not give any satisfactory explanation for this inordinate delay on their part, the special leave, it is argued, should be rescinded.
Mr. Chatterjee, who appeared for the appellants, has contended @n the other hand that in a case like the one before us where the appeal has come up to this Court by special leave and not by a certificate granted by the High Court, there was no duty cast upon the appellants to make a formal application in the High Court for final admission of the appeal or to file therein certified copies of the special leave petition and the order made thereupon.
His argument is that under Order XXXII, rule 9 of the Original Side Rules of the Calcutta High Court, a 249 Supreme Court appeal must be deemed to have been admitted by the very order of this Court granting special leave and as soon as the appellants have carried out the directions of the Supreme Court regarding furnishing of security or making of other deposits as the case may be, it is incumbent upon the Registrar to issue a notice of the admission of the appeal for service upon the respondents.
Such notice indeed has got to be served by the appellants ' attorney; but as no notice was at all issued by the Registrar in the present case as is contemplated by rule 9 of Order XXXII of the Original Side Rules of the Calcutta High Court, no blame could attach to the appellants for not taking further steps in the matter.
The contention of Mr. Chatterjee appears to us to be wellfounded and as it seems to us that doubts have arisen at times regarding the precise procedure to be followed in cases where an appeal comes to this Court by special leave granted under article 136 of the Constitution, it is necessary to examine the provisions bearing upon it as are contained in the Rules of the Supreme Court or of the High Court concerned read along with the relevant provisions of the Civil Procedure Code.
Ordinarily when a High Court grants a certificate giving leave to a party to appeal to this Court, it is ,that Court which retains full control and jurisdiction over the subsequent proceedings relating to the prosecution of the appeal till the appeal is finally admitted.
It is for the High Court to see that its directions are carried out regarding the furnishing of security or the making of deposit and when these conditions are fulfilled, it has then to declare the appeal finally admitted under Order XLV,rule 8 of the Civil Procedure Code.
The jurisdiction of the Supreme Court begins after the appeal is finally admitted.
When however the appeal comes to this Court on the strength of a special leave ' granted by it, the position is different.
In such cases the order of the Supreme Court granting special leave by itself operates as an admission of the appeal as soon as the conditions in the order relating to fur 250 nishing of security or making of a deposit are complied with.
That this is the true position will be clear from the procedural provisions contained in the Rules of the Supreme Court as well as of the Original Side of the Calcutta High Court.
Order XIII, rule 8 of the Supreme Court Rules lays down: "After the grant of special leave to appeal by the Court, the Registrar shall transmit a certified copy of the order to the court or tribunal appealed from".
Rule 9 then says: "On receipt of the said order, the court or tribunal appealed from shall, in the absence of any special directions in the order, act in accordance with the provisions contained in Order XLV of the Code, so far as applicable".
It is to be noted here that although this rule does refer to the provisions of the Order XLV of the Civil Procedure Code, these provisions are to be followed only so far as they are applicable.
It is surely the duty of the High Court to see that security is furnished or a deposit is made in accordance with the directions of the Supreme Court and these directions are to be found in the order of the Supreme Court which the Registrar is bound to transmit to the High Court under Order XIII, rule 8 of our Rules.
We do not think it is necessary for the appellants to file afresh a copy of the Supreme Court order or the petition upon which it was made in order that they may form part of the record of the Supreme Court appeal.
They would come in the record as soon as they are transmitted by the Registrar in accordance with the rule of our Court mentioned above and would have to be included in the Paper Book when it is printed.
The Registrar of the High Court undoubtedly took these orders as part of the record without the appellants ' filing them afresh, for he accepted the security and deposit of other moneys from the appellants on the basis of these orders.
If there was any failure on the part of the appellants to furnish the security or to make the deposit in the way indicated in the order of the Supreme Court, it would have been the duty of the Registrar of the High Court to intimate these 251 facts to the Registrar of the Supreme Court and the latter thereupon could take steps for revoking the special leave as is contemplated by Order XIII, rule 12 of our Rules.
In our opinion, it is also not necessary for the appellants to make a formal application for admission of the appeal in cases where special leave has been granted by the Supreme Court; and this appears clear from the provision of Order XXXII, rule 9 of the Original Side Rules of the Calcutta High Court which runs as follows: "9.
On the admission of an appeal to the Supreme Court whether by the order of this Court under Order XLV, rule 8 of the Code, or by an order of the Supreme Court giving the appellant Special Leave to Appeal, but subject in the latter case to the carrying out of the directions of the Supreme Court as to the security and the deposit of the amount re quired by rule 5, notice of such admission shall be issued by the Registrar for service on the respondent on the record, whether be shall have appeared on the hearing of the application for a certificate under Order XLV, rule 3 of the Code, or not.
Such notice shall be served by the attorney for the appellant and an affidavit of due service thereof shall be filed by such attorney immediately after such service".
The opening words of this rule plainly indicate that there could be admission of appeal either by order of the High Court under Order XLV, rule 8 of the Civil Procedure Code or by the order of the Supreme Court itself giving special leave to appeal.
(As the order granting special leave itself lays down the conditions to be fulfilled by the appellants, the admission will be regarded as final only when the directions are complied with and as soon as this is done it would be the duty of the Registrar to issue a notice of the admission of the appeal for service upon the respondents).
This notice is to be served by the attorney for the appel lants and an affidavit of due service shall be filed by him immediately after the service is effected.
In the present case the Registrar, Original Side of the, Calcutta High Court should have issued a notice of 252.
the admission of the appeal to be served upon the respondents as soon as the security for costs and other deposits of money were made by the appellants.
This was not done as the procedure to be followed was not correctly appreciated.
It is true that the appellants remained idle for a considerable period of time even after they furnished security and did not take any steps towards printing of the record.
But as there was an initial irregularity in the matter of issuing a notice under.
Order XXXII, rule 9 of the Original Side Rules of the Calcutta High Court, we are unable to hold that the appellants were guilty of any laches for which the special leave deserves to be rescinded.
The result is that the application of the respondents is dismissed.
The Registrar, Original Side of the Calcutta High Court, will now issue a notice under Order XXXII, rule 9 of the Original Side Rules and prompt steps should be taken by the appellants towards printing and transmission of the record to this Court.
We make no order as to costs of this application.
| By an order dated May 25, 1954, the Supreme Court granted the petitioners in the case special leave to appeal against the judgment and order of the High Court at Calcutta.
In accordance with the order, the petitioners furnished the security amounts directed to be deposited within the time specified in the order.
The Registrar of the High Court did not issue any notice of admission of 'appeal to be served by the Appellant 's Solicitor on the Respondents as envisaged in rule 9 of Order XIII, S.C.R. Nor did the Appellant following the practice of the High Court, move that Court for It admission" of the appeal until January 11, 1955.
The Respondents first moved the High Court complaining of default on the part of the appellants in due prosecution of the appeal and latter moved the Supreme Court for action under rule 13 of Order XIII of the Supreme Court Rules.
The application in the High Court was therefore kept pending.
Held: After the grant of special leave under article 136, the Registrar of the Supreme Court transmits, in accordance with the 244 provisions of rule 8 of Order XIII of the Supreme Court Rules, a certified copy of the Supreme Court 's order to the Court or tribunal appealed from, Rule 9 of Order XIII of the Supreme Court Rules enjoins upon the Court or tribunal appealed from to act, in the absence of any special directions in the order, in accordance with the provisions contained in Order XLV of the Civil Procedure Code, so far as they are applicable.
Accordingly the Court or Tribunal to which the order is transmitted receives deposits on account of security for the Respondents ' costs, printing costs, and any other deposits if so ordered by the Supreme Court, and sets about preparing the record of the appeal for transmission to the Supreme Court.
Therefore, action under rule 13 of Order XIII, S.C.R., for rescinding the order granting special leave cannot be initiated unless the Court or tribunal appealed from reports to the Supreme Court that the appellant has not been diligent in taking steps to enable that Court to carry out the directions, if any, contained in the order of the Supreme Court and to act in accordance with the provisions of Order XLV of the Civil Procedure Code so far as applicable to appeals under Article 136 of the Constitution.
In view of rule 9 of Order XIII of the Supreme Court Rules, the application of Order XLV of the Code of Civil Procedure to appeals under Article 136 of the Constitution is restricted.
The Court or tribunal appealed from, no doubt, has to carry out the directions contained in the order granting special leave, and to receive the security for the Respondents ' costs and other necessary deposits, but once the security is furnished and the other deposits are made, the formality of "admission" envisaged by rule 8 of Order XLV of the Civil Procedure Code is unnecessary, because in such cases the order .granting special leave by itself operates as an admission of the appeal as soon as the conditions in the order relating to the furnishing of security or making of deposits are complied with.
Appeals under Article 136 thus stand on a different footing from appeals on grant of certificate by the High Court itself.
In the letter case, the High Court has exclusive jurisdiction over the matter until it admits the appeal under rule 8 of Order XLV of the Civil Procedure Code.
Rule 9 of Chapter 32 of the Original Side Rules of the Calcutta High Court envisages "admission" of appeals to the Supreme Court whether by an order of the Supreme Court or under Order XLV of the Civil Procedure Code.
And when an appeal arising from an order made by the Supreme Court under Article 136 of the Constitution, has been so "admitted", the said rule enjoins upon the Registrar to issue notice of such admission for service by the appellant on the Respondents.
In cases where special leave has been granted by the Supreme Court, it is not necessary for the appellant to move the High Court appealed from for the formal admission of his appeal.
As the order granting special leave itself lays down the conditions to be fulfilled by the appellants, the admission will be regarded as final only when the directions are complied with and as 245 soon as this is done it would be the duty of the Registrar to issue a notice of the admission of the appeal for service upon the respondents.
In default of the issue of such notice, the appellant cannot be held responsible for laches in the prosecution of his appeal with regard to the steps required to be taken after the admission of his appeal.
|
Civil Appeal No. 116 of 1953.
Appeal from the Judgment and Order dated the 23rd day of August 1951 of the High Court of Judicature at Calcutta in Appeal No. 112 of 1950 arising out of the order dated the 24th day of March 1950 of the Registrar of Trade Marks in the matter of Registered Trade Mark No. 3815.
C. K. Daphtary, Solicitor General for India (K. section Shavakasha and R. H. Dhebar, with him) for the appellant.
section C. Isaacs, (P. K. Ghosh, with him) for the res pondents.
April 15.
The Judgment of the Court was delivered by DAS J.
This is an appeal from the judgment and order pronounced on the 23rd August 1951 by a Division Bench of the High Court at Calcutta in Appeal No. 112 of 1950 reversing the decision of the Registrar of Trade Marks dated the 24th March, 1950 whereby he had rectified the register by inserting a disclaimer of the word "Shree" forming part of the respondent company 's registered trade mark No. 3815.
The material facts are as follows: In the year 1897 one Durga Charan Rakhit (since deceased) adopted as his trade mark in respect of the ghee produced and marketed by him a device which, with some slight modification not materially altering its essential 255 features, was, on the application of the respondent company, registered as its trade mark No. 3815.
That mark was and is a device consisting of the word "Shree" written on the top in bold Bengali character, having below it an ornamental figure with the word "Shree" written in the centre in small Deva Nagri character, the word "TRADE" written in English in an inclined manner on the left hand side of the ornamental figure and the word "MARK" written in English in an inclined manner on the right hand side of the ornamental figure and the words "Shree Durga Charan Rakhit" written at the bottom in Bengali characters.
The ornamental figure referred to above consists of a triangle over which is another inverted triangle and in the centre the word "Shree ', in small Deva Nagri character as mentioned above, the whole of the said ornamental figure being enclosed in a circle outside which are twelve ornamental petals.
In the affidavit affirmed by Malli Nath Rakhit, a director of the respondent company and filed in these proceedings, this mark has throughout been referred to as "the said mark SREE".
The said Durga Charan Rakhit having subsequently been adjudged insolvent all his properties including the goodwill of his ghee business and the said mark vested in the Official Assignee of Calcutta.
On the 15th January 1915 the goodwill of the said business including the said mark was sold by the Official Assignee by public auction and one Hem Dev Konch, a minor, was declared as the highest bidder and purchaser.
A notice of the said sale was advertised in the Calcutta Exchange Gazette on the 25th January 1915 by an attorney acting on behalf of the purchaser.
On the 27th January 1915 the said sale was confirmed by a Deed of assignment executed by the Official Assignee.
On the 22nd August 1917 Haripriya Konch, the father and natural guardian of the minor purchaser, acting as such and on behalf of the minor, conveyed to one Ashok Chandra Rakhit, son of the said Durga Charan Rakhit, the goodwill of the business including the right, title and interest in the said mark and the said Ashok Chandra Rakhit carried on the said business 256 and marketed ghee tinder the said mark.
On the 15th September 1926 the said Ashok Chandra Rakhit caused the fact of his ownership of the said mark to be advertised in the Calcutta Exchange Gazette and on the 22nd December 1926 caused to be registered with the Registrar of Assurances of Calcutta a declaration of his ownership of the said mark.
In 1932 the respondent company was incorporated as a private limited company under the Indian Companies Act, 1913 and the said Ashok Chandra Rakhit assigned the goodwill of his said business and his right, title and interest in the said mark to the respondent company.
In 1933 the respondent company 's said mark was registered in the Trade Mark Registry at Hong Kong under the provisions of, the Hong Kong Trade Marks Ordinance, 1909 and the fact of such registration was published in the Straits Settlements Government Gazette.
In 1934 two persons, Rajendra Prasad and Dilliram, were, on complaint, made on behalf of the respondent company, convicted by the Chief Presidency Magistrate of Calcutta under section 486, Indian Penal Code, for infringing the said mark and such conviction was upheld by the Calcutta High Court.
In 1935 one Chiranjilal Sharma was, on like complaint, convicted by the Chief Presidency Magistrate for infringement of the said mark.
The volume of the respondent company 's business in ghee done under the said mark is said to be considerable, the annual turn over varying from Rs. 10,00,000/ to Rs. 15,00,000/ , and the annual cost of advertisement being anything between Rs. 10,000/ and Rs. 39,000/ .
It is also said that the ghee marketed by the respondent company and its predecessors is well known by the said mark and is always asked for under the name "Shree".
The Indian having been brought into force in 1942 the respondent company on the 21st August 1942 filed an application for the registration of its said mark under the Act.
By his letter dated the 29th November 1943 the Registrar proposed that there should be a disclaimer of the word "shree" The respondent company by its 257 agents ' letter dated the 15th February 1944 intimated to the Registrar that, it could not agree to the proposal as "the trade mark Shree is very important in the device" and "the ghee is commonly designated by the trade mark Shree".
The respondent company also submitted an affidavit affirmed by one Bidyut Bikash Rakshit, a director of the respondent com pany, in support of its objection.
The Registrar not having then pressed his proposal for disclaimer the respondent company 's said mark was duly registered as trade mark No. 3815.
It appears that subsequently the Registrar found that the word "Shree" was used by Hindus as an auspicious symbol and placed even on letter heads and that consequently it was not adapted to distinguish within the meaning of the Act.
In course of time, therefore, a practice became established in the Registry whereby the word "Shree" was either refused registration as a trade mark or a disclaimer was enforced if it were made a part of a trade mark.
So inflexible bad been this practice that barring this particular trade mark No. 3815 there was no other trade mark containing the word "Shree" which had been registered without a disclaimer of the word "Shree".
Naturally this circumstance was bound to be regarded as an invidious discrimination and, indeed, pointed reference is said to have been made to it and it was suggested that the Registry should deal impartially and uniformly with all applications in matters relating to practice.
This aspect of the matter having 'been pressed upon the Registrar he took steps under section 46(4) of the and on the 8th March 1947 issued a notice calling upon the respondent company to show cause why the register should not be rectified by entering a dis claimer of the exclusive right in regard to the word "Shree".
The respondent company showed cause by filing an affidavit affirmed by Malli Nath Rakhit to which reference has been made.
After hearing learned counsel for the respondent company the Registrar came to the conclusion that the word "Shree" was 33 258 not adapted to distinguish and, for reasons stated in his judgment delivered on the 24th March 1950, directed rectification of the register by inserting a disclaimer of the word "Shree" in the following terms: "Registration of this Trade Mark shall give no right to the exclusive use of the word 'Shree" '.
Feeling aggrieved by the aforesaid decision the respondent company preferred an appeal to the High Court at Calcutta under section 76 of the Act.
The High Court also took the view that "Shree" was a word which had numerous meanings and that it would be impossible for any trader to contend that he had an exclusive right to the use of 'Such a word.
But the High Court went on to hold that there was no ground whatsoever for the order made by the Registrar as the respondent company had never claimed that it had any right to the exclusive use of the word "Shree".
In the result, the High Court allowed the appeal and set aside the order of the Registrar rectifying the register.
Being of the opinion that the point involved was a novel one in this country and was of importance and would affect the attitude of the Registrar in future cases, the High Court certified that it was a fit case for appeal to this Court under Article 133(1)(c) of the Constitution.
Hence the present appeal by the Registrar.
The order of rectification of the register by inserting a disclaimer was made by the Registrar under section 13 read with section 46(4) of the .
Section 13 runs as follows: "13.
Registration subject to disclaimer: If a trade mark contains (a)any part not separately registered as a trade mark in the name of the proprietor, or for the separate registration of which no application has been made, or (b)any matter common to the trade, or otherwise of a non distinctive character, the tribunal, in deciding whether the trade mark shall be entered or shall remain on the register, may require, as a condition of its being on the register, that 259 the proprietor shall either disclaim any right to the exclusive use of such part or of all or any portion of such matter, as the case may be, to the exclusive use of which the tribunal holds him not to be entitled, or make such other disclaimer as the tribunal may consider necessary for the purpose of defining the rights of the proprietor under the registration: Provided that no disclaimer shall affect any rights of the proprietor of a trade mark except such as arise out of the registration of the trade mark in respect of which the disclaimer is made".
At the outset it will be noticed that the power of the tribunal to require a disclaimer is conditioned and made dependent upon the existence of one of two things which are set out in clauses (a) and (b) and which have been called the jurisdictional facts.
It is only on the establishment of one of the two jurisdictional facts that the Registrar 's jurisdiction regarding imposition of a disclaimer arises.
Before, however, he may exercise his discretion he must find and hold that there are parts or matters included in the trade mark to the exclusive use of which the proprietor is not entitled and it is only after this finding is arrived at that the Registrar becomes entitled to exercise his discretion.
In course of the argument it was at one time contended that upon the establishment of the requisite jurisdictional fact and upon the finding that the proprietor was not entitled to the exclusive use of any particular part or matter contained in the trade mark the Registrar became entitled, without anything more, to require a disclaimer of that part or matter.
This extreme position, however, was not maintained in the end and it was conceded, as indeed it had to be, that the exercise of the power conferred on the Registrar by this section always remained a matter of discretion to be exercised, not capriciously or arbitrarily but, according to sound principles laid down for the exercise of all judicial discretion.
(See the observations of Lord Halsbury, L. C., in Sharp vs Wakefield(1).
As the law of Trade Marks adopted in our Act merely reproduces the English Law with (1) at p. 179.
260 only slight modifications, a reference to the judicial decisions on the corresponding section of the English Act is apposite and must be helpful.
Section 15 of the English Act of 1905 which later on was reproduced in section 14 of the English Act of 1938 and which corresponds to our section 13, was considered by the High Court in .
England in In re Albert Baker Co. 's Application and In re Aerated Bread Company 's Application(1) which is commonly called the A.B.C. case.
In that case Eve, J. found on the evidence that Albert Baker Company were widely known as "A.B.C." or "A.B. & Co." but that the letters "A.B.C." did not exclusively indicate their goods and that those letters being common to the trade they were not entitled to the exclusive use of those letters.
Nevertheless the learned Judge did not hold that that finding alone concluded the matter.
Said the learned Judge: "The first observation which it occurs to me to make is that the object of the Legislature was to relieve traders from the necessity of disclaiming, and I think it follows from this that the condition is one for the imposition of which some good reason ought to be established rather than one which ought to be imposed, unless some good reason to the contrary is made out.
This conclusion is, I think, forti fied by the frame of the section, which is in an enabling form empowering the tribunal to impose the conditions power which, I conclude, the tribunal would only exercise for good cause shewn".
It follows from what has been stated above that the existence of one of the two jurisdictional facts referred to in clauses (a) and (b) of section 13 and the finding that the trade mark contains parts or matters to the exclusive use of which the proprietor is not entitled does not conclude the matter and it must further be established that some good reason exists for the imposition of a disclaimer and the tribunal will only exercise the discretionary power for good cause shown.
(1) ; , 261 The second thing to be borne in mind, if the provisions of section 13 are to be properly understood and carried into effect, is that the section confides a discretionary power in the "tribunal" which, by virtue of section 2(n), means the Registrar or, as the case may be, the Court before which the proceeding concerned is pending.
An application for the rectification of the register may, under sub sections (1) and (2) of section 46, be made either to the Registrar or the High Court and sub section (4) of that section, under which the present proceedings were initiated by the Registrar, authorises both the High Court and the Registrar to take proceedings suo motu.
In view of the fact that discretion is given also to the High Court under section 13 a question may be raised as to whether the observations made by P. O. Lawrence, J. in In the matter of an application by the Diamond T. Motor Car Co.(1) namely, that in dealing with an appeal from the Registrar 's decision under section 8 (2) of the English Act of 1919 the High Court is not fettered by reason of the Registrar on the hearing before him having exercised his discretion, apply to our High Court hearing appeals under section 76 of our Act from decisions of the Registrar given under section 13 of our Act and whether in that situation our High Court may exercise its own discretion just as it could if the proceedings had initially been taken before it.
Assuming, but without deciding, that they do apply, it must, nevertheless, be remembered, adapt ing the language of Lord Macnaghten in Eno vs Dunn(1) that it is the Registrar "to whom in the first instance is committed the discretionary power".
If that authority has exercised his discretion in good faith and not in violation of any law such exercise of discretion should not be interfered with by the High Court merely on the ground that, in the opinion of the High Court, it could have been exercised differently or even that the High Court would have exercised it differently, had the matter been brought before it in the first instance.
The proper approach in (1) at p. 879.
(2) L.R. [1890]15 A.C. 252 at p. 263: at p. 318, 262 such a case is for the High Court to consider, as said by Lord Dunedin in In the matter of an application by F. Reddaway & Co. Ltd.(1), "whether the Registrar had really gone so wrong as to make it necessary to interfere with his discretion".
The third thing to note is that the avowed purpose of the section is not to confer any direct benefit on the rival traders or the general public but to define the rights of the proprietor under the registration.
The registration of a trade mark confers substantial advantages on its proprietor as will appear from the sections grouped together in Chapter IV under the beading "Effect of Registration".
It is, however, a notorious fact that there is a tendency on the part of some proprietors to get the operation of their trade marks expanded beyond their legitimate bounds.
An illustration of an attempt of this kind is to be found in In re Smokeless Powder Co. 's Trade Mark(1).
Temptation has even led some proprietors to make an exaggerated claim to the exclusive use of parts or matters contained in their trade marks in spite of the fact that they had expressly disclaimed the exclusive use of those parts or matters.
Reference may be made to Greers Ltd. vs Pearman and Corder Ltd.(1) commonly called the "Banquet" case.
The real purpose of requiring a disclaimer is to define the rights of the proprietor under the registration so as to minimise, even if it cannot wholly eliminate, the possibility of extravagant and unauthorised claims being made on the score of registration of the trade marks.
The last feature of the section is its proviso.
That proviso preserves intact any right which the proprietor may otherwise under any other law have in relation to the mark or any part thereof.
The disclaimer is only for the purposes of the Act.
It does not affect the rights of the proprietor except such as arise out of registration.
That is to say, the special advantages which the Act gives to the proprietor by reason of the registration of his trade mark do not extend to the (1) at p. 36.
(2) ; (3) , 263 parts or matters which he disclaims.
In short, the disclaimed parts or matters are not within the protection of the statute.
That circumstance, however, does not mean that the proprietor 's rights, if any, with respect to those parts or matters would not be protected otherwise than under the Act.
If the proprietor has acquired any right by long user of those parts or matters in connection with goods manufac tured or sold by him or otherwise in relation to his trade, he may, on proof of the necessary facts, prevent an infringement of his rights by a passing off action or a prosecution under the Indian Penal Code.
Disclaimer does not affect those rights in any way.
Keeping, then, in view the meaning and scope of section 13 of our and its underlying purpose as discussed above we proceed to consider whether in the circumstances of the present case the Registrar had exercised his discretion properly in inserting in the register a disclaimer of the word "Shree".
It has not been disputed that the respondent company 's registered trade mark No. 3815 is a distinctive device properly registrable under section 6 of the Act.
It is also a fact that it contains, as its prominent part, the word "Shree" which is not sepa rately registered as a trade mark in the name of the respondent company and, indeed, no application had been made by it for the separate registration of that word.
There can, therefore, be no doubt as to the existence of the jurisdictional fact referred to in clause (a) of that section.
Further, the Registrar found as a fact, for reasons stated by him, that the word "Shree" was not adapted to distinguish, which means that it did not pass the test for registrability laid down in section 6 and in particular in sub section (3) thereof.
The High Court also unequivocally took the view that "Shree" is a word which had numerous meanings and that it would be impossible for any trader to contend that he had an exclusive right to the use of such a word.
It, therefore, follows that the respondent company 's trade mark was concurrently held to have contained matters of a non distinctive character and consequently the second juris 264 dictional fact was also present in this case.
It, never theless, appeared to the High Court that there was no ground whatsoever for the order made by the Registrar.
The High Court read the decision of the Registrar as proceeding only on what was described as an inflexible practice established in the Registry whereby the word "Shree" was either refused registration as a trade mark or a disclaimer was enforced if it was a part of a trade mark and in this view the case appeared to the High Court to be indistinguishable from the case of In re Cadbury Brothers ' Application(1).
That case was decided under section 9 of the English Act of 1905.
Clause (5) of section 9 was then expressed in language which is somewhat different from clause (5) of section 6 of our Act.
Under section 9(5) of the English Act of 1905 a name, signature or word or words otherwise than such as fell within the description in the preceding paragraphs I to 4 could not, except by the order of the Board of Trade or by the Court, be deemed a distinctive mark. 'Tudor ' being a surname did not fall within clause (4) of that English Act and, therefore, the Registrar had no power to register it as a distinctive mark under clause (5).
Such being the position, the then Registrar of Trade Marks in England adopted a practice that wherever a mark contained 2a name which did not come within clause (4) and which he had no power to register under clause (5), there must be a disclaimer of that word without going into any investigation as to its distinctiveness.
The Registrar in that case declined to register the mark only because it contained a name which could not be registered alone by him under section 9(5), without deciding whether that word was a matter of a distinctive or non distinctive character, in pursuance of the inflexible practice that be had adopted, namely, of refusing registration in the absence of a disclaimer.
This decision of the Registrar was overruled by Sargant, J. The learned Judge, on the materials before him, came to the conclusion that the word 'Tudor ' was not common to the trade (1) ; 265 and that the word as it had been used by the applicants in relation to chocolates was not a matter of non distinctive character and that it had denoted their goods.
Consequently, the jurisdiction to impose a disclaimer did not arise under clause (b) of section 15 of the English Act of 1905.
The jurisdiction, if at all, could, therefore, arise only under clause (a), namely, that the trade mark contained parts not separately registered by the proprietor as trade marks.
Having come to the conclusion that the word 'Tudor ' was a matter of distinctive character as it denoted the goods of the applicant 's manufacture, the Court might have disposed of the case on the short ground that, on that finding, the applicant was entitled to the exclusive use of that name in connection with chocolates and like goods and, therefore, no question of requiring a disclaimer could, in that situation, arise at all.
Treating the matter, however, as still one of discretion, the learned Judge had to take into account the commercial case made on behalf of the applicants, namely, that they would, by disclaiming any right to the exclusive use of the word 'Tudor ', practically be inviting the public to disregard such common law rights as they had acquired to the use of the name 'Tudor ' and held that to impose a disclaimer of that word, in spite of the finding as to its distinctiveness in relation to the goods of the applicants, would be to drive the applicants to take innumerable passing off actions.
The facts of that case appears to us to be clearly distinguishable from those of the case now before us.
Here the concurrent finding of the Registrar and the High Court is that the word "Shree" is not adapted to distinguish and is not a word to the exclusive use of which any trader may claim the right.
In the face of this finding the consideration of the possibility that a disclaimer may drive the respondent company to a crop of passing off actions was not so relevant or urgent as it was in the Tudor case.
In view of the finding in the present case the respondent company could well be left, as it was in fact left, to protect its 34 266 rights by other proceedings, e.g) passing off actions or prosecutions which, by reason of the proviso, were open to be taken by it, if the necessary facts to support such proceedings which were not before the Registrar could be satisfactorily established.
Further, it is not quite correct to say that the Registrar, like his English counterpart, had based his decision entirely on what has been called his invariable practice.
It is no doubt true that the Registrar did, in this case, lay considerable stress on that aspect of the matter and may even be said to have somewhat over emphasized the practice of his Registry but it is not correct to say that his decision was entirely founded on that practice alone.
The materials before the Registrar, appearing on the affidavit filed on behalf of the respondent company, clearly indicated that the respondent company was claiming a proprietary right to the name "Shree".
Indeed, it called its mark as "the said mark Shree" throughout the affidavit and claimed that the said mark "Shree" was well known in the market and that its ghee was asked for and sold under the said mark "Shree".
The two prosecutions launched by it and the other facts men tioned in the main affidavit and the two supporting affidavits of two retail dealers and summarised at the beginning of this judgment clearly indicate that it was claiming the right to the exclusive use of the word "Shree" and, indeed, in its agents ' letter of the 15th February 1944 objecting to any disclaimer of that word, it was referred to "as trade mark Shree" and it was said to be "very important in the devise".
In other words, they put forward the claim that "Shree" itself was also its trade, mark, apart from the device as a whole and that it was an important feature of its device.
It is, therefore, not at all surprising that learned counsel appearing for the respondent company before the Registrar, when asked as to how his client could possibly be affected by disclaiming the word "Shree", said frankly that it was far easier to be successful in an infringement action than in a passing off action.
This clearly indicated that the respondent company did not want any other 267 merchant to use the word "Shree" in his trade mark in respect of ghee and that the respondent company thought that the registration of its trade mark with the word "Shree" contained in it would, per se, give it a right also to that word and that its intention was to launch infringement actions under the Act against any other trader who might happen to use the word "Shree" either alone or as part of his trade mark in respect of ghee.
Further, the Registrar ' may well have thought that the fact that all other traders who had got their trade marks containing the word "Shree" registered had had to submit to a disclaimer of the word "Shree" whereas the respondent company had got its trade mark containing the word "Shree" registered without a disclaimer was calculated to cause embarrassment to other traders and might conceivably encourage the respondent company to contend that the registration of its trade mark by itself and without further evidence gave it a proprietary right to the exclusive use of the word "Shree".
The res pondent company may also find some encouragement from the observations of Lord Radcliffe in De Cordova and others vs Vick Chemical Coy.(1) namely, that if a word forming part of a mark has come in trade to be used to identify the goods of the owner of the mark, it is an infringement of the mark itself to use that word as the mark or part of the mark of another trader, for confusion is likely to result.
These considerations may reasonably have led the Registrar to require a disclaimer.
None of these considerations arose or were adverted to in the Tudor case and this circumstance quite clearly distinguishes the present case from that case.
It is true that where a distinctive label is registered as a whole, such registration cannot possibly give any exclusive statutory right to the proprietor of the trade mark to the use of any particular word or name contained therein apart from the mark as a whole.
As said by Lord Esher in Pinto vs Badman(2): "The truth is that the label does not consist of (1) at p. 106.
(2) at p. 191.
268 each particular part of it, but consists of the combination of them all".
Observations to the same effect will be found also in In re Appollinaris Company 's Trade Marks(1), In re Smokeless Powder Co. (supra), In re Clement and Cie(1) and In re Albert Baker & Company (supra) and finally in the Tudor case referred to above which was decided by Sargant, J.
This circumstance, however, does not necessarily mean that in such a case disclaimer will always be unnecessary.
It is significant that one of the facts which give rise to the jurisdiction of the tribunal to impose disclaimer is that the trade mark contains parts which are not separately registered.
It is, therefore, clear that the section itself contemplates that there may be a disclaimer in respect of parts contained in a trade mark registered as a whole although the registration of the mark as a whole does not confer any statutory right with respect to that part.
As we have already stated the possibility of the proprietor attempting to expand the operation of his trade mark cannot be ignored or overlooked.
It is a thing which must be taken into consideration by the tribunal be it the Registrar or the Court in deciding upon the way it should exercise the discretionary power conferred on it.
Reference has been made by the High Court to the observations of Eve, J. in the A.B.C. case referred to above and the question has been posed as to whether any good cause had been shown for the necessity of disclaimer in this case.
The High Court answers the question immediately by saying that it did not think that any cause had been shown beyond the desirability of having a uniform practice.
This, as we have already stated, is not quite correct, for apart from the practice the Registrar did advert to the other important consideration, namely, that on the evidence before him and the statement of counsel it was quite clear that the reason for resisting the disclaimer in this particular case was that the company thought, erroneously no doubt but (1) (2) 269 quite seriously, that the registration of the trade mark as a whole would, in the circumstances of this case, give it a right to the exclusive use of the word "Shree" as if separately and by itself it was also its registered trade mark and that it would be easier for it to be successful in an infringement action than in a passing off action.
It was precisely the possibility of such an extravagant and untenable claim that called for a disclaimer for the purpose of defining the rights of the respondent company under the registration.
This aspect of the matter does not appear to have been pressed before or adverted to by the High Court.
Considering all the circumstances discussed above, we are not of opinion that the Registrar had gone so wrong as to have made it necessary for the High Court to interfere with his discretion.
If it were to be regarded as a matter of exercise of discretion by the High Court as to whether a disclaimer should be imposed or not, it is quite clear that the attention of the High Court was not drawn to an important consideration, namely, the strong possibility of the respondent company claiming a statutory right to the word "Shree" by virtue of the registration of its trade mark and subject others to infringement actions only on the strength of the registration and without proof of facts which it would have otherwise to establish in order to succeed in a passing off action or a prosecution under the Indian Penal Code and, therefore, the High Court cannot be said to have properly exercised its discretion.
The result, therefore, is that this appeal must be allowed and the respondent company must pay the appellant 's costs in this Court and in the High Court.
| The exercise of the power conferred on the Registrar by section 13 of the is always a matter of discretion to be exercised, not capriciously or arbitrarily but, according to sound principles laid down for the exercise of all judicial discretion.
The existence of the two jurisdictional facts referred to in clauses (a) and (b) of section 13 and the finding that the trade mark contains parts or matters to the exclusive use of which the proprietor is not entitled does not conclude the matter and it must further be established that some good ground exists for the imposition of a disclaimer and the tribunal will exercise the discretionary power for good cause shown, 253.
For the proper understanding and carrying into effect the provisions of section 13 it is necessary to bear in mind that the section confides a discretionary power in the 'tribunal ' which by virtue of section 2(n) means the Registrar or, as the case may be, the Court before which the proceeding concerned is pending.
Assuming but not deciding that in dealing with an appeal under section 76 of the Act from the decisions of the Registrar under section 13 of the Act the High Court is not fettered by reason of the Registrar, on the hearing before him, having exercised his discretion and the High Court may exercise its own discretion, just as it could if the proceedings had been taken initially before it, it must be remembered that it is the Registrar to whom in the first instance is committed the discretionary power.
If that authority has exercised his discretion in good faith and not in violation of any law such exercise of discretion should not be interfered with by the High Court merely on the ground that, in the opinion of the High Court it could have been exercised differently or even that the High Court would have exercised it differently, bad the matter been brought before it in the first instance.
The proper approach in such a case is for the High Court to consider whether the Registrar has really gone so wrong as to make it necessary to interfere with his discretion.
The real purpose of requiring a disclaimer is to define the rights of the proprietor under registration so as to minimise, even if it cannot wholly eliminate, the possibility of extravagant and unauthorised claims being made on the score of registration of the trade marks.
The proviso to section 13 preserves intact any right which the pro . prietor may otherwise under any other law have in relation to the mark or any part thereof.
The disclaimer is only for the purposes of the Act.
It does not affect the rights of the proprietor except such as arise out of registration.
That is to say, the special advantages which the Act gives to the proprietor by reason of the regis tration of his trade mark do not extend to the parts or matters which he disclaims.
Held, that considering all the circumstances of the present case the Registrar had not gone so wrong as to make it necessary for the High Court to interfere with his discretion.
If it were to be regarded as a matter of exercise of discretion by the High Court as to whether a disclaimer should be imposed or not, it is quite clear that the attention of the High Court was not drawn to an important consideration, namely, the strong possibility of the respondent company claiming a statutory right to the word 'Shree ' by virtue of the registration of its trade mark and subject others to infringement actions only on the strength of the registration and without proof of facts which it would have otherwise to establish in order to succeed in a passing off action or a prosecution under the Indian Penal Code and, therefore, the High Court cannot be said to have properly exercised its discretion, 254 Sharp vs Wakefield (L.R. 1891 A.C .
173), Albert Baker Co.s Application and Aerated Bread Company s Application In re ; , In the matter of an application by the Diamond T. Motor Car Co. ([1921] at 379), Eno vs Dun?& ; , In the matter of an application by F. Reddaway & Co. Ltd. ([1926] 44 R.P.C,. 27), Smokeless Powder Co. 's Trade In re ; , Greers Ltd. vs Pearman and Gorder Ltd. ([1922] , Cadbury Brothers ' Application In re ; , De Cordova and others vs Vick Chemical Coy.
([1951] , Pinto vs Badman , Apollinaris Company 's Trade Marks and Clement & Cie In re (L . R. , referred to.
|
Civil Appeal No. 38 of 1954.
Appeal from the Judgment and Decree dated the 14th day of March 1951 of the High Court of Judicature at Patna in M.J.C. No. 230 of 1949.
Mahabir Prasad, Advocate General for the State of Bihar (R. J. Bahadur and section P. Varma, with him '), for the appellant.
C. K. Daphtary, Solicitor General for India (Porus A. Mehta and P.O. Gokhale, with him), for the respondent.
April 18.
The Judgment of the Court was delivered by JAGANNADHADAS J.
This is an appeal by the assessee on leave granted under section 66 A of the Indian Income Tax Act.
The assessee by name Chatturam Horilram Ltd., who is the appellant before us, is a private limited company carrying on in Chota Nagpur the business of exporting mica for sale to foreign countries.
The assessment in question is for the year 1939 40 and the accounting year is the calendar year 1938.
These proceedings were initiated on a notice issued to the assessee under section 34 of the Indian Income tax Act, 1922, (Act XI of 1922) (hereinafter referred to as the Act).
It is the applicability of this section to the facts of this case that is the sole matter for consideration in this appeal.
The circumstances under which the above mentioned notice under section 34 was issued are as follows.
The appellant had previously been assessed to tax on an income of Rs. 1,09,200 for the same year 1939 40.
by an order dated the 22nd December, 1939, which was reduced on appeal by Rs. 31,315.
That assessment was set aside by the Income Tax Appellate Tribunal on the 28th March, 1942, on the ground that the Indian Finance Act of 1939 was not in force during 292 the assessment year 1939 40 in Chota Nagpur, which was a partially excluded area.
On a reference by the Tribunal at the instance of the Income tax authorities, the High Court of Patna agreed with this view and pronounced on the 30th September, 1943, its judgment confirming the setting aside of the assessment.
Meanwhile, the Governor of Bihar promulgated Bihar Regulation IV of 1942, Which was assented to by the Governor General on the 30th June, 1942.
By this Regulation, the Indian Finance Act of 1939 (along with Finance Acts of other years with which we are not concerned) was brought into force in Chota Nagpur retrospectively as from the 30th March 1939.
The relevant portion of the Regulation was in the following terms.
"The Indian Finance Act, 1939, shall be deemed to have come into force in the area to which this Regulation extends on the 30th day of March, 1939".
On the 8th February, 1944, the Income tax Officer passed an order as follows: "Due to recent judgment of the High Court the assessment under section 23(3) stands cancelled and with it the notice under section 34 issued in this case becomes ineffective and is withdrawn.
Assessee derives income from mica mining and dealing, moneylending, mining rents and non agricultural sources of zamindary, and this has escaped assessment in its entirety.
Issue notice under section 22(2) read with section 34 again to file a return of income in the prescribed form and within the prescribed time, and inform the assessee that the original notice under section 34 has been cancelled".
It may be mentioned, in passing, that the notice under section 34 which is referred to in the above order as having become ineffective and as, therefore, withdrawn was a prior one which was issued on the 8th July, 1941, i.e., during the pendency of the assessee 's appeal relating to the earlier assessment before the Income tax Appellate Tribunal.
It is not quite clear from the record in what circumstances 'that notice came to be issued.
But it looks probable that it relates to certain items appearing in the accounts as 293 cash credits to the tune of four lakhs which, as will appear presently, were treated in the later proceedings as concealed income in the absence of any proper explanation by the assessee.
This prior notice under section 34, having been withdrawn, has no bearing on the question at issue before us in this appeal and has not been relied on by either side.
In pursuance of the order dated the 8th February, 1944, quoted above, a fresh notice under section 34 of the Act was issued to the appellant on the, 12th February, 1944.
The income of the assessee company was thereupon determined at a sum of Rs. 4,86,351, which on appeal to the Assistant Commissioner, was reduced by Rs. 11,187.
Out of this amount a sum of Rs. 4,04,618 related to two items of cash credits appearing in the name of the partners of the Company which in the absence of any satisfactory explanation, was treated by the Income tax authorities as secreted profits of the Company.
Before the Income tax Appellate Tribunal two points were raised.
(1) Whether the notice dated the 12th February, 1944, under section 34 of the Act was validly issued.
(2) Whether the Income tax authorities were right in holding that the cash credit items were secret profits.
Both the points were decided against the assessee.
On the assessee 's application to refer both the points for the decision of the High Court, the Tribunal declined to make a reference as regards the second point but referred the first for the opinion of the Court in the following terms: "Whether in the circumstances of the case, the notice issued on 12 2 1944 under section 34 of the Indian Income tax Act was validly issued for the assessment year 1939 40?" The question was answered against the assessee by the High Court and hence this appeal before us.
The assessee attempted to reopen the second question relating to secret profits before the High Court but the learned Judges declined to allow it to be canvassed, since the Tribunal did not refer the question to them.
We are, therefore, concerned in this appeal only with the question relating to the validity of the notice 294 issued on the 12th February, 1944, under section 34 of the Act.
It is obvious that if this notice is found to be invalid the assessee would get relief for the entire amount including the amount of secret profits.
The answer to the question which arises for consideration in this appeal depends on a correct appreciation of the requirements of section 34 of the Act.
Now, it has to be mentioned that section 34 of the Act as it originally stood in the Act of 1922, was amended by Act VII of 1939 and this was in turn amended by Act XLVIII of 1948.
At the relevant date, i.e., for the assessment year 1939 40, section 34 (1) as amended by Act VII of 1939 (and before its amendment in 1948) was in force.
It was as follows: "If in consequence of definite information which has come into his possession the Income tax Officer discovers that income, profits or gains chargeable to income tax have escaped assessment in any year, (or have been under assessed, or have been assessed at too low a rate, or have been the subject of excessive relief under this Act) the Income tax Officer may, (in any case in which be has reason to believe that the assessee has concealed the particulars of his income or deliberately furnished inaccurate particulars thereof, at any time within eight years and) in any other case at any time within four years of the end,of that year, serve on the person liable to pay tax on such income, profits or gains, or, in the case of a company, on the principal officer thereof, a notice containing all or any of the requirements which may be included in a notice under sub section (2) of section 22, and may proceed to assess or re assess such income, profits or gains and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub section".
Omitting from the above sub section those portions which are inapplicable to the facts of the present case marked out within brackets it may be seen that the facts which require to be established for the validity of the notice under this sub section are (I ' the income, profits or gains sought to be assessed should be chargeable to income tax and have escaped assess 295 ment in any year, and (2) the Income tax Officer should have discovered it in consequence of definite information which has come into his possession.
The contention of the learned counsel for the appellant is that, with reference to the facts of this case, none of these conditions can be said to have been satisfied.
It is urged that the income sought to be assessed under these proceedings was not, as a fact, chargeable to income tax during the assessment year 1939 40.
It is said that in any case there can be no question of the income having escaped assessment because, as a fact, the income tax authorities did proceed to assess the income and that what happened is that the proceedings became infructuous by reason of the High Court having pronounced them to be void.
It is also contended that there is no question of discovery of any relevant fact or information, because the non assessment of the income of the assessee for the period in question was in spite of all the information relating to the income of the assessee having been previously furnished and being in the possession of the Income tax Officer as would appear from the order of the Officer dated the 22nd December, 1939.
It is convenient to deal with this last objection in the first instance.
It may be true that all the information relating to the relevant income of the assessee which is now sought to be taxed was in the possession of the Income tax Officer in the year 1939 itself when the return was submitted in compliance with the notice under section 22(2) of the Act then issued.
But what was required under section 34(1) was not merely fresh information as to the income that escaped assessment but information as to the fact of escapement from assessment of the chargeable income.
In the present case the income tax authorities proceeded to assess the appellant in the normal way during the assessment year 1939 40 itself.
Those proceedings became infructuous, by virtue of the decision of the Income tax Appellate Tribunal and the decision of the High Court confirming it, which disclosed that the Indian Finance Act of 1939 was not in operation in 296 the relevant area at the relevant period and that in the absence thereof no valid assessment could be made.
The fact, therefore, that the income of the appellant for the relevant year remained without any valid assessment emerged only on the High Court finally giving its decision that the assessment proceedings previously taken were invalid.
If, in the circumstances, there was "escapement of chargeable income from assessment" a question to be dealt with presently there can be no doubt that this fact can be reasonably said to have been discovered by the Income tax Officer only when he got definite information as to (1) the passing of the Bihar Regulation IV of 1942 applying the Indian Finance Act of 1939 retrospectively for the relevant accounting period, and (2) the judgment of the High Court pronouncing prior proceedings to be invalid It is knowledge of both these facts, together, that would, with reference to the circumstances of the present case, constitute the discovery of the relevant fact in consequence of definite information received by the Income tax Officer.
The information as to both these facts taken together could only be after the decision of the High Court on the 30th September, 1943.
As already stated, the notice under section 34(1) , whose validity is in question, was based on the order of the Income tax Officer dated the 8th February, 1944, after the judgment of the High Court was pronounced.
That order which has been extracted above, shows clearly that it was in consequence of the judgment of the High Court in the back ground of the promulgation of Regulation IV of 1942 that fresh action under section 34 (1) was being initiated.
A number of cases (C.I. T. Bombay vs Sir Mahomed Yusuf Ismail(1); Fazal Dhala vs C.I. T., B.& 0.
Raghavalu Naidu & Sons vs C.I. T., Madras(3); and Raja Benoy Kumar Sahas Roy vs C. I. T., West Bengal(,) have been cited before us to show how the phrase "definite information" and the word "discovery" used in this section have been interpreted by the various (1) [1944] 12 I.T.R. section (3) (2) (4) 297 High Courts.
It is unnecessary to deal with these cases at any length.
There is here no question as to any new subjective facts such as change of opinion consequent on a correct appreciation of law by the very same, or another, or higher officer, that is pressed into service as bringing about "definite information " and "discovery".
We are quite clear that the promulgation of the Regulation and the decision of the High Court are objective facts, information regarding which became available to the Income tax Officer when he passed the order dated the 8th February, 1944, and it is only when these facts came to his knowledge, that the Income tax Officer can be said to have discovered that chargeable income escaped assessment in the relevant year.
The main question that requires consideration in this case is whether, on the facts, it can be said that "income chargeable to income tax has escaped assessment in the relevant year".
The contention of the learned counsel for the appellant is that during the relevant year 1939 40 the income was not chargeable to tax as a fact and that the retrospective operation of the Finance Act for the relevant year by virtue of a later legislation does not make a difference for this purpose.
To decide this question it is necessary to have a clear idea of the scheme of the Income tax Act and its correlation to the Finance Act of each year.
The Income tax Act is a standing piece of legislation which provides the entire machinery for the levy of income tax.
The Finance Act of each year imposes the obligation for the payment of a determinate sum for each such year calculated with reference to that machinery.
As has been pointed out by the Federal Court in Chatturam vs C.I. T., Bihar(1) (quoting from the judgment of Lord Dunedin in Whitney vs Commissioners of Inland Revenue (2).
"there are three stages in the imposition of a tax.
There is the declaration of liability, that is the part of the statute which deter mines what persons in respect of what property are (1) at 126.
(2) 38 298 liable.
Next, there is the assessment.
Liability does not depend on assessment.
That, ex hypothesi, has already been fixed.
But assessment particularises the exact sum which a person liable has to pay.
Lastly, come the methods of recovery if the person taxed does not voluntarily pay".
The same idea has been expressed in slightly different language by Lord Romer in the judgment of the Privy Council reported in C.I.T., Bombay & Aden vs Khemchand Ramdas(1).
Chapter III of the Income tax Act headed "Taxable Income" contains the various provisions with reference to which taxable income is determined.
The tax is leviable under section 3 and is in respect of the total income of an assessee in the previous year.
The total income is defined in section 2, sub section (15).
The application of the Act to the total income in the hands of an assessee is governed by sections 4, 4 A and 4 B and is determined with reference to concepts relating to residence, receipt and accrual, as indicated therein.
Section 3, under which the actual charge of income tax arises, is as follows: "Where any Central Act enacts that income tax shall be charged for any year at any rate or rates, tax at that rate or those rates shall be charged for that year in accordance with, and subject to the provisions of, this Act in respect of the total income of the previous year of every individual, Hindu undivided family, company and local authority, and of every firm and other association of persons or the partners of the firm or the members of the association individually".
It is by virtue of this section that the actual levy of the tax and the rates at which the tax has to be computed is determined each year by the annual Finance Acts.
Thus, under the scheme of the Income tax Act, the income of an assessee attracts the quality of taxability with reference to the standing provisions of the Act but the payability and the quantification of the tax depend on the passing and application of the annual Finance Act.
Thus, income is chargeable to tax independent of the passing of the (1) at 428.
299 Finance Act but until the Finance Act is passed no tax can be actually levied.
A comparison of sections 3 and 6 of the Act shows that the Act recognises the distinction between chargeability and the actual operation of the charge.
Section 6 says "save as otherwise provided by this Act, the following heads of income, profits and gains, shall be chargeable to income tax in the manner hereinafter appearing, etc.
" while section 3, as already quoted above, says that "where any Central Act enacts that income tax shall be charged for any year at any rate or rates, tax at that rate or those rates,, shall be charged for that year, etc." Though, no doubt, sections 3 and 4 are the charging sections in the Act as pointed out in Chatturam vs C.I.T., Bihar(1) at page 125, the wording of section 3 assumes the pre existence of chargeable income as indicated in section 6.
Hence, according to the scheme of the Act the quality of chargeability of any income is independent of the passing of the Finance Act.
In this view, therefore, though, as a fact, on account of the Finance Act not having been extended to the relevant area during the year 1939 40, legal authority was then lacking for the quantification of the tax and imposition of the liability therefor, the income of the assessee for the relevant year was nonetheless chargeable to tax at the time, in the sense explained above.
Indeed, it can also be said that the very fact of Regulation IV of 1942, having brought the Finance Act of 1939 into operation retrospectively, in this area, has factually brought about, in any case, the chargeability of the tax during that very year.
The relevant portion of the Regulation says that "the Indian Finance Act of 1939 shall be deemed to have come into force in the area to which this Regulation extends on the 30th day of March, 1939".
By virtue of this deeming provision the Indian Finance Act of 1939 must be assumed even factually to have come into operation on the date specified and the tax must be taken to have become chargeable in that very year, though the actual liability for payment could not arise until proper and (1) 300 valid steps 'are taken for quantification of the tax.
The contention, therefore, of the appellant that the income was not chargeable to tax in the year 1939 40 cannot be accepted.
The next question that arises is whether the income, though chargeable to tax in the year, can be said to have escaped assessment in the relevant year.
The argument of the learned counsel for the appellant is that since assessment proceedings had in fact been taken during the year 1939 40 by an order of assessment dated the 22nd December, 1939, it cannot be said that the income "escaped" assessment.
He urges that what happened was that, in spite of assessment having been made, the assessment proceedings became infructuous on account of the decision of the Income tax Appellate Tribunal setting aside the same and High Court agreeing with it.
He contends that, in the circumstances, this is no more than a failure of the assessment proceedings but that it is not an escapement from assessment.
He relied upon the Privy Council case in Sir Rajendranath Mukherjee vs C.I. P., Bengal(1), where their Lordships say that "the expression 'has escaped assessment ' cannot be read as equivalent to 'has not been assessed" ' and that "such a reading gives too narrow a meaning to the word 'assessment ' and too wide a meaning to the word 'escaped" '.
Learned counsel for the respondent relies on a number of subsequent 'cases of the various High Courts (Madan Mohan Lal vs C.I.T., Punjab(1); C.I. T., Bombay vs Pirojbai N. Contractor(3); and Kunwar Bishwanath Singh vs C.I. T., C.P.(4) ) which have explained.
this decision of the Privy Council and pointed out that the particular passage in that judgment which is relied upon bad reference to the, facts of that case, viz., the proceedings by way of initial assessment being still pending.
While no doubt the Privy Council case is thus distinguishable, the contention of the learned counsel for the appellant that the escapement from assessment is not to be equated to (1) at 77.
(3) (2) (4) 301 non assessment simpliciter is not without force.
Here again, it is unnecessary to lay down what exactly constitutes "escapement from assessment".
For the purpose of the present case it appears to us sufficient to say that, where earlier assessment proceedings had in fact been taken but failed to result in a valid assessment owing to some lacuna other than that attributable to the assessing authorities, notwithstanding the chargeability of income to the tax, it would be a case of chargeable income escaping assessment and not a case of mere non assessment of income tax.
The proceedings for assessment in the present case have failed to result in a valid assessment by virtue of a legal lacuna, viz., the fact of the Indian Finance Act of 1939 not having been extended to the relevant area for the relevant assessment year.
Learned counsel for the appellant suggests that the failure of the assessment proceedings in this case must be taken to have been due to the lapse of the income tax authorities.
It is said that inasmuch as Regulation IV of 1942 was actually passed during the pendency of the reference in the High Court in respect of the prior proceedings, the result would have been different, if the Regulation had been brought to the notice of the High Court.
There is, however, no reason to think so.
The High Court 's jurisdiction was only to answer the particular question that was referred to it by the Income tax Appellate Tribunal and it is extremely doubtful whether they could have taken notice of a subsequent legislation and answered a different question.
Learned counsel for the appellant also urged that in any case the deeming provision enacted in Regulation IV of 1942, may be taken to have validated the assessment proceedings previously taken in the year 1939 and at best to have restored the assessment order passed by the Income tax Officer on the 22nd December, 1939, and confirmed by the Assistant Commissioner.
But this overlooks the fact that the order had in fact been set aside by the Income tax Appellate Tribunal and that the setting aside was confirmed by the High Court on the reference made to it.
Admittedly the Regulation was passed after the decision of the 302 Income tax Appellate Tribunal.
Notwithstanding that the Regulation IV of 1942 purported to be retrospective) it cannot have the effect of effacing the result brought about by the decision of the Income tax Appellate Tribunal and the High Court on reference, unless there are clear and express words to that effect.
It might have been quite a different matter, if by the date of the Regulation the assessment pro ceedings themselves were still pending as in fact happened with reference to assessment proceedings in this area, in respect of a number of assessees for the subsequent assessment year, 1940 41, which were pending by the date of the relevant Regulation and were continued up to their termination.
They were held to be valid both by the High Court and by the Federal Court when challenged by the assessees.
(See Raja Bahadur Kamakshya Narain Singh vs C.I.T., B. & O.(1); Chatturam vs C.I. T., B. & O.(1); as also Chatturam vs C.I.T., Bihar(1).
It follows, therefore, that, in our view, the income of the assessee 'Chargeable to income tax escaped assessment in the relevant year 1939 40.
The High Court was, therefore, right in answering as it did the question referred to it.
The appeal accordingly fails and is dismissed with costs.
(1) (1946) 14 I.T R. (2) (a) at 126.
| The appellant in this appeal had been assessed to Income Tax which was reduced on appeal but that assessment was set aside by the Income Tax Appellate Tribunal on the ground that the Indian Finance Act of 1939 was not in force during the assessment year in Chota Nagpur.
On a reference by the Tribunal the High Court con firmed the setting aside of this assessment.
By the promulgation of Bihar Regulation IV of 1942 by the Governor of Bihar (which was assented to by the Governor General) the Indian Finance Act of 1939 was brought into force in Chota Nagpur retrospectively as from the 30th March 1939.
On the 8th February 1944 the Income Tax Officer passed an order in pursuance of which a fresh notice was issued under section 34 which resulted in the assessment of the appellant to income tax.
The question for determination in this appeal was whether the notice under section 34 was validly issued.
Held (i) that for the purposes of section 34 of the Act the income, profits or gains sought to be assessed were chargeable to income tax according to the scheme of the Act and the provisions of sections 3 and 4 of the Act; (ii) that it was a case of chargeable income escaping assessment within the meaning of section 34 and was not a case of mere non assessment of income tax because the earlier assessment proceedings in the present case had in fact been taken but failed to result in a valid assessment owing to some lacuna which was not attributable to the assessing authorities.
C.I.T., Bombay vs Sir Mahomed Yusuf Ismail ([1944] , Fazal Dhala vs C.I.T., B. & O. ([1944] 12 I.T.R. 341), Baghavalu Naidu & Sons vs C.I.T., Madras ([1945] , Raja Benoy Kumar Sahas Boy vs C.I.T., West Bengal ([1953] , Chatturam vs C.I.T., Bihar ([1947] F.C.R. 116), Whitney vs Commissioners of Inland Revenue ([1926] A.C. 37), C.I.T. Bombay & Aden vs Khemchand Ramdas ([1938] at 428), Sir Rajendranath Mukherjee vs C.I.T., Bengal ([1934] , Madan Mohan Lal vs C.I.T., Punjab ([1935] , C.I.T., Bombay vs Pirojbai N. Contractor ([1937] , Kunwar 291 Bishwanath Singh vs C.I.T., C.P. ([1942] , Raja Bahadur Kamakshya Narain Singh vs C.I.T. B. & 0.
([1946] and Chatturam vs C.I.T., B. & 0.
([1946] , referred to.
|
Civil Appeal No. 106 of 1953.
Appeal from the Judgment and Order dated the 4th September 1951 of the High Court of Judicature at Calcutta in Appeal from Original Order No. 131 of 1950 arising out of the Order dated the 29th day of August 1950 of the High Court of Calcutta in its Testamentary Intestate Jurisdiction made in Application under Section 263 of the .
P. N. Sen, (A. K. Dutt and section Ghose, with him) for the appellant.
M. C. Setalvad, Attorney General for India (A. N. Sinha, with him) for respondent No. 1. D. N. Mukherji, for respondent No. 2. 1955.
April 15.
The Judgment of the Court was delivered by SINHA J.
This is an appeal against the judgment and order dated the 4th September 1951 of the Calcutta High Court in its appellate jurisdiction reversing those dated the 29th August 1950 of a Judge of that Court sitting on the Original Side granting the appellant 's prayer for revoking and annulling the probate granted in respect of the last will and testament dated the 29th July 1912 of one Binod Lal Ghosh, deceased, whom we shall call the testator in the course of this judgment.
The testator is said to have executed a will on the 29th July 1912 which was registered on the same date at the Calcutta registry office.
By the said will the testator appointed the following five persons as executors or executrices: (1) Anil Nath Basu, Attorney at Law (2) Brindaban Chandra Mitter (These two also figure as attesting witnesses to the will) (3) His adopted son Charu Chandra Ghose (whom we shall call Charu for the sake of brevity) a minor on his attaining majority.
272 (4) His wife Haimabati Dasi, and (5) His brother 's widow Muktakesi Dasi.
He also directed that on the death of the said Anil Nath Basu, his son Achintya Nath Basu, and on the death of Brindaban Chandra Mitter, his son Debi Prosad Mitter will take their places respectively as executors; and on the death of his wife Haimabati Dasi, Charu 's wife, Latikabala Dasi, and on the death of Muktakesi Dasi, his nephew 's wife Sushamabala Dasi, will take her place respectively as executrix.
It is not necessary to set out in detail the legacies created by the will except to state that he created annuities in favour of a number of persons including his wife, his brother 's widow .
Muktakesi Dasi, his daughter in law, his niece in law aforesaid and Charu.
He also made provision in his will for annual payments in respect of the expenses of certain deities and festivals, as also for the funeral expenses of himself and the annuitants aforesaid.
He directed his executors to accumulate Rs. 12,000 a year out of the balance left after meeting the annuities and the other annual expenses aforesaid to be paid over to Charu upon the death of the said Latikabala Dasi and Sushama Bala Dasi who were to share the residue, if any, after paying the annuities and other outgoings referred to above.
It would thus appear that though the testator intended Charu to be the owner of his entire estate including the accumulations after meeting the annuities and the other annual expenses, he did not trust him to the extent of putting that estate into his hands immediately on his attaining majority.
He trusted Charu 's wife and the other ladies in his family more than Charu himself, though he specifically stated in the will "Provided always that the said adopted son shall be deemed to have a vested interest in the said estate immediately on my death".
He appointed his wife Haimabati Dasi as the guardian of the person and property of Charu and of his wife Latikabala Dasi aforesaid.
On the 5th March 1920 the testator is said to have been murdered by Charu who was placed on his trial, 273 convicted for murder and sentenced to transportation for life.
Charu served his term of imprisonment and was released from jail some time in 1933.
On the 30th September 1921 an application for probate of the will aforesaid was made on the Original Side of the Calcutta High Court on behalf of Anil Nath, Muktakesi Dasi and Latikabala Dasi aforesaid.
The application stated that the testator died on the 5th March 1920 at Baranagar, leaving him surviving his adopted son Charu and his widow Haimabati Dasi.
The will dated the 29th July 1912 was recited and the five persons named above were said to have been appointed executors and executrices of the will.
It also stated that Brindaban Chandra Mitter, one of the executors named in the will, had died in July 1913 and his son Debi Prosad Mitter was a minor.
It also recited the death of Haimabati Dasi on the 22nd May 1921, thus explaining why out of the five executors and executrices named in the will the application had been made only on behalf of the surviving three persons.
The assets of the testator 's estate were stated not to exceed a sum of Rs. 4,75,780/ .
The prayer was "that probate of the said will may be granted to your petitioners limited within the Province of Bengal reserving power of making the like grant to the said Charu Chandra Ghose and the said Debi Prosad Mitter (when he comes of age) when they will come and pray for the same".
The grant was made the same day (i.e., 30th September 1921) which fell during the long vacation and the Judge in charge passed the order "Order as prayed" no citations being issued.
This is material in view of what has been alleged subsequently about this grant, as will presently appear.
Nothing was heard about these proceedings until the 24th July 1933 when an application was made by Debi Prosad Mitter aforesaid for the grant of probate to him along with Anil Nath Basu and Latikabala Dasi.
In that application, the previous grant of probate dated the 30th September, 1921, the death of Muktakesi Dasi some time in October 1932 and the 274 fact of his attaining majority some time in January 1924 are recited.
On the 16th September 1933 Debi Prosad Mitter 's application was granted.
It appears that Latikabala Dasi and Sushamabala Dasi applied to the Calcutta High Court on the 4th December 1933 for an order for discharging the executors appointed previously and for a direction to hand over the entire estate of the testator to the applicants.
In answer to the summons Debi Prosad Mitter made an affidavit on the 7th December 1933 in which he recited the previous grants of the probate made in 1921 and 1933; and stated that the testator Binod Lal Ghosh was murdered on the 5th March 1920 by Charu and that on the death of Haimabati in May 1921, the testator 's first cousin Girish Chandra Ghosh became entitled to the residue of the estate of the testator.
In that affidavit be set out the genealogical table of the family of the testator showing how Girish Chandra Ghosh was related to the deceased.
He also made pointed reference to the fact that the surviving grantees of the probate, Anil Nath Basu and Latikabala Dasi, after the death of Haimabati bad not filed any account of the testator 's estate in their capacity as executor and executrix respectively and that on his obtaining probate of the will those persons had not complied with his request of furnishing a statement of accounts about their dealings with the testator 's estate.
He also set out the text of the letter sent by his solicitor to Anil Nath Basu and Latikabala Dasi.
The letter is dated the 4th December 1933.
It does not appear from the record as to what attitude had been taken by the executor and the executrix aforesaid in answer to the call made by Debi Prosad Mitter for submission of accounts of their dealings with the testator 's estate after the grant of probate in 1921 as aforesaid.
Ultimately, on the 16th May, 1934 the High Court dismissed the application for discharging the persons who had been granted the probate.
Girish Chandra Ghosh aforesaid died in December, 1940 without having taken any steps in court claiming his rights, whatever they were, in the 275 testator 's estate.
Anil Nath Basu also died in July, 1948.
He does not appear from the record to have rendered any accounts in respect of his dealings as the managing executor of the will of the deceased.
It was not until the 17th September, 1949 that the appellant, who is one of the four sons of the said Girish Chandra Ghosh, made an application to the Calcutta High Court on the Original Side praying that the probates dated the 30th September, 1921, and the 16th September, 1933 in respect of the will dated the 29th July, 1912 be revoked, annulled and/or set aside and that an administrator pendente lite be appointed.
The petition runs into about twenty printed pages setting out the petitioner 's relationship with the testator, the will and the grant of the probates as aforesaid, the murder of the testator by Charu, his trial, conviction and sentence for that murder.
It was also averred that the testator had "intended to revoke his said will of 29th July, 1912".
Then follows a long recital of facts tending to that conclusion.
Then follows para 19 which is in these terms: "From the said correspondence and papers it is absolutely clear that the said testator revoked his will of 29th July, 1912.
Your petitioner submits that arrangements were being made for handing over the estate of the said Binod Lal Ghosh, deceased, in the hands of the Administrator General of Bengal for the purpose of charity but the said purpose did not mature and under the circumstances your petitioner submits that the said will of 29th July, 1912 has been revoked by the said testator and no further will was executed in its place or stead".
23 is a statement of the grounds on which the case for revocation of the grants is founded.
That paragraph is in these terms: "Your petitioner submits that the probates herein should be revoked as a just cause for doing so exists inter alia, on the following grounds: (a) That no notice of either application for probate was served on your petitioner 's father, although be was the nearest male relative alive at the time when the said Binod Lal Ghosh was murdered; 276 (b) That the grants were obtained fraudulently; (c) That the grants were obtained by means of an untrue allegation of a fact essential to justify the grant; (d)That the grants were obtained by making a false declaration that the property was valued only at Rs. 4,75,780/ , although the High Court in its Criminal Jurisdiction had stated in 1920 that the estate of the said Binod Lal Ghosh was over Rs. 40,00,000/ ; (e) That the grants in any event, are useless and inoperative; (f) That there was no filing of accounts; (g) That the grants were issued by concealing the facts of the intention of the said testator to revoke the will; (h) That the deceased never lived within the Ordinary Original Civil Jurisdiction of this Hon 'ble Court".
The application was opposed by Latikabala Dasi chiefly on the ground that no citation to Girish Chandra Ghosh wag necessary, that in any event, he was cognisant of the probate proceedings and of the estate being administered by the executors and that he stood by.
It was denied by her that the said Girish Chandra Ghosh was the nearest male relative of the testator or that Charu had murdered his adoptive father.
It was also denied that the testator had revoked his will and that he died intestate as a result of which the petitioner and his three brothers became entitled to succeed to his estate.
Achintya Nath Basu took similar grounds in opposition to the application for revocation.
Debi Prosad Mitter by an affidavit of his own denied that there had been any just cause for revoking the probate but added that he had been discharged on his own application from further acting as one of the executors of the testator 's will.
Though no issues were framed, the main grounds for revocation or annulment of the probates were as stated in para.
23 set out above.
Mr. Justice P. B. Mukherjee who dealt with the case on the Original Side, after an elaborate consideration of the facts and circumstances of the case, passed orders revoking 277 and annulling the grants aforesaid and directing "that the will be proved in solemn form on notice to the applicant and the other sons of Girish and also after a general citation to all persons interested in the estate".
He also appointed the applicant, the appellant before us, as an administrator pendente lite with usual powers to take charge of the estate, with costs to the applicant to be paid out of the estate.
He directed the other opponents respondents to bear their own costs.
On the points in controversy he came to the conclusion that Girish was related to the testator as a cousin, that there was no acquiescence on the part of Girish barring the appellant from pursuing his remedy, that the non citation of Girish was by itself not sufficient to invalidate the grant, but that circumstance in conjunction with other facts, viz., of material concealment of the fact that Charu bad murdered the testator and that the testator had entertained an intention to revoke the will, though it had not actually been revoked, was sufficient ground for revoking the grant.
He held further, on the authority of the decision in Mokshadayini vs Karnadhar(1) that the question whether the will bad as a matter of fact been revoked would form the subject matter for final determination after the revocation of the grants when fresh proceedings will be taken after due citation.
He also held that in the circumstances of this case, though there was no averment of wilful default in exhibiting an inventory and accounts of the testator 's estate the executors were actually guilty of such a default and there was thus just cause for revoking the grant.
He did not hold the other grounds of attack against the grant made out by the applicant; that is to say, he did not find it established that the estate was worth over Rs. 40,00,000 and that the declaration of the value of the testator 's estate at Rs. 4,75,780 was false or fraudulent or that the grant bad become useless or inoperative otherwise, or that the case could not be heard by the Calcutta High Court, on the Original Side.
On appeal by Latikabala Dasi, the Appellate Beach (1) , 278 consisting of Sir Trevor Harries, C. J. and Banerjee, J., allowed the appeal and dismissed the application for revocation of the probate with costs of both the courts.
They held that the will in question was genuine and valid in view of the evidence and of the fact that its genuineness or validity had not been questioned specifically in the pleadings.
They also held that there was no revocation of the will or even an intention on the part of the testator to revoke the will.
They also held that Girish was entitled to citation but that the non citation did not materially affect the grant of the probate and that at any rate, Girish being fully aware of the grant stood by, and therefore acquiesced in the grant, and did not take any steps at the right time to question the grant.
They therefore did not think it just and expedient to reopen the proceedings when they were satisfied that there was no real and substantial attack against the genuineness and validity of the will itself.
In this appeal it has been argued on behalf of the appellant on the authority of the decision in Mokshadayini vs Karnadhar(1) that the Appeal Court should have agreed with the Judge on the Original Side in holding that there was material concealment of facts which considered along with the admitted position that no citation had been taken against Girish Chandra Ghosh had vitiated the proceedings for the grant of probate and that the question of the genuineness or validity of the will should have been left over for determination at a later stage of the proceedings.
It was also argued that the omission to exhibit the accounts was in the circumstances of this case wilful default without reasonable cause within the meaning of the law and was sufficient by itself to entitle the applicant to a revocation.
It was also argued that no grounds had been made out in fact to support the legal conclusion drawn by the Appeal Court that there had been an acquiescence on the part of Girish.
On behalf of the 1st respondent the conclusion of the Appeal Bench has been supported on all the grounds.
On behalf of the respondent Debi Prosad Mitter, it (1) 279 was contended that he had been unnecessarily impleaded at all the stages and that he should have been granted his costs out of the estate of the deceased.
The grant of probate was made under the provisions of the Probate and Administration Act (V of 1881); but the (XXXIX of 1925) consolidated the law relating to intestate and testamentary succession and thus incorporated the other Acts relating to the same subject, including Act V of 1881.
In order to be entitled to a revocation or annulment of the grant aforesaid the appellant has to bring his case within the purview of section 263 of the (XXXIX of 1925), which will hereinafter be referred to as the Act).
Section 263 of the Act is substantially in the same terms as section 50 of Act V of 1881.
Section 263 provides that "The grant of probate or letters of administration may be revoked or annulled for just cause".
Under the Explanation "Just cause shall be deemed to exist where (a) the proceedings to obtain the grant were defective in substance, or (b) the grant was obtained fraudulently by making a false suggestion, or by concealing from the court something material to the case, or (c) the grant was obtained by means of an untrue allegation of a fact essential in point of law to justify the grant, though such allegation was made in ignorance or inadvertently, or (d) the grant has become useless and inoperative through circumstances, or (e)the person to whom the grant was made has wilfully and without reasonable cause omitted to exhibit an inventory or account in accordance with the provisions of Chapter VII of this Part, or has exhibited under that Chapter an inventory or account which is untrue in a material respect".
After the explanation, there are eight illustrations of the grounds on which a grant of probate may be revoked, of which the first three are material.
They are as follows: 280 " (i) The court by which the grant was made had no jurisdiction.
(ii) The grant was made without citing parties who ought to have been cited.
(iii) The will of which probate was obtained was forged or revoked".
In this case the appellant tried to take advantage of the first illustration also, by suggesting in one of the grounds set out in para.
23 of his petition quoted above that the testator never lived within the Ordinary Original Civil Jurisdiction of the Calcutta High Court in exercise of which the grant in question had been made.
But that ground was negatived by the trial Judge and as it was not pressed before us, no more need be said about it.
It was vehemently argued at all stages of the case including the appeal before us that admittedly no citation was issued against Girish Chandra Ghosh aforesaid and as he was the person most interested in the testator 's estate besides the legatees named in the will, the case came directly within the purview of clause (a) of the Explanation and Illustration (ii) quoted above.
Girish Chandra Ghosh has been found by the Judge in the first instance to have been the person most vitally interested in the estate of the testator, whether he died intestate or leaving a will, in the events which had happened.
The learned counsel for the contesting respondent suggested that it had not been found by the lower Appellate Court as a fact upon the evidence adduced in this case, that Girish was the nearest agnate of the testator or that Charu had murdered his adoptive father, though these matters had been assumed as facts.
The courts below have referred to good and reliable evidence in support of the finding that Girish was the nearest reversioner to the estate of the testator.
If the will is a valid and genuine will, there is intestacy in respect of the interest created in favour of Char;, if he was the murderer of the testator.
On this question the courts below have assumed on the basis of the judgment of conviction and sentence passed by the High Court in the sessions trial that Charu was the 281 murderer.
Though that judgment is relevant only to show that there was such a trial resulting in the conviction and sentence of Charu to transportation for life, it is not evidence of the fact that Charu was the murderer.
That question has to be decided on evidence.
However, for purposes of this case we shall assume in favour of the appellant that Charu was the murderer.
The result of such an assumption is that Girish being the nearest reversioner to the estate of the testator, in case of intestacy after the death of the testator 's widow in 1921; or in case of testamentary succession after the death of the two legatees, the testator 's daughter in law and the nephew 's wife aforesaid, and the failure of the legacy in favour of Charu on account of the murder would, in either event, have sufficient interest in the estate of the testator to entitle him to challenge the grant and to obtain revocation.
But it is noteworthy that Girish who died in 1940, lived for about 19 years after the grant and took no steps in that direction.
There may be some doubt as to Girish 's knowledge of the probate proceedings and of the grant until 1933; but, in our opinion, there is ample evidence in support of the finding arrived at by the Court of Appeal below that Girish was aware of the grant at the latest in 1933 when Debi Prosad Mitter took proceedings to obtain a grant in his own favour also.
In his application, as indicated above, he clearly stated that Charu was the murderer of his adoptive father and that Girish would succeed to his estate, which otherwise would have gone to Charu.
If Girish had initiated proceedings for revocation of the grant and had insisted on the will being proved in his presence, the courts would have had no difficulty in having all the necessary evidence before it because the chief person who had played the most leading part in the execution of the will, in its registration and in its being admitted to probate, viz., Anil Nath Basu, was then alive and could have been examined.
But for reasons not made clear in these proceedings Girish did not think it worth his while to take any steps in court to 36 282 challenge the will or the grant.
The estate was worth anything between five to forty lakhs, perhaps nearer five lakhs than forty lakhs.
Girish was a mere pensioner belonging to a middle class family.
Either he did not think it worth his while to embark on a litigation with all its uncertainties or he had not the wherewithal to do so.
The record as it stands does not satisfactorily explain the reasons why Girish refrained from making any attempts to get this large estate.
If the will was not genuine or valid, Girish would take the reversionary estate at once because the testator 's widow died in 1921 and there was no other impediment in his way, except to get rid of the will.
If, on the other hand, the will was genuine and valid, even then he would stand to gain all the interest which had been bequeathed in favour of Charu.
The fact that Girish did not take advantage of his position as the nearest reversioner as on partial intestacy goes a long way to support the great probability of the will being valid and genuine, especially as it had been probated and because the appellant in his long petition for revoking the grant has not made the least suggestion casting any doubt on the genuineness and validity of the will.
But it was argued on behalf of the appellant that that stage had not yet arrived and that it would be open to the appellant after obtaining an order of revocation of the grant to show that the will was either not genuine or had not been validly executed.
Great reliance was placed in this connection on the judgment of a Division Bench of the Calcutta High Court in Mokshadayini Dasi vs Karnadhar Mandal (1) where the following observations have been made: "No question of the genuineness of the will arises for consideration till the court has decided that the probate must be revoked on one or more of the grounds specified in section 50 of the Probate and Administration Act.
The only matter for consideration at this stage is, whether the appellants have made out a just cause for revocation of the probate which was granted without notice to them: Brindaban vs Suresh (1) 283 war(1).
The question of genuineness cannot be considered till a case for revocation is made out: Durgavati vs Sourabini(2)".
The observations relied upon by the appellant were made with reference to the facts of that case and were not intended to be of universal application.
As pointed out above, section 263 of the Act also contemplates a case for revocation based on the single ground that the will in respect of which the grant in question was obtained was a forged one.
In such a case, whether or not the will was a forged one would be the only question to be canvassed before the court before the order of revocation could be made.
It was further argued on behalf of the appellant that the appeal should be allowed and the grant revoked on the simple ground, apart from any other considerations, that there had been no citation issued to Girish.
In our opinion, this proposition also is ,much too widely stated.
Section 263 of the Act vests a judicial discretion in the court to revoke or annul a grant for just cause.
The explanation has indicated the circumstances in which the court can come to the conclusion that "just cause" had been made out.
In this connection the appellant relied upon clause (a) quoted above which requires that the proceedings resulting in the grant sought to be revoked should have been "defective in substance".
We are not inclined to hold that they were "defective in substance".
"Defective in substance" must mean that the defect was of such a character as to substantially affect the regularity and correctness of the previous proceedings.
If there were any suggestions in the present proceedings or any circumstances were pointed out to show that if Girish had been cited he would have been able to enter a caveat, the absence of citation would have rendered those proceedings "defective in substance".
It may be that Girish having been found to have been the next reversioner to the testator 's estate in case of intestacy and on the assumption that Charu had murdered the testator, Girish might have been entitled to a revocation of the grant if he (1) 10 C.L.J. 263 at p. Cal.
1001, 284 had moved shortly after the grant of the probate on the simple ground that no citation had been issued to him.
The omission to issue citations to persons who should have been apprised of the probate proceedings may well be in a normal case a ground by itself for revocation of the grant.
But this is not an absolute right irrespective of other considerations arising from the proved facts of a case.
The law has vested a judicial discretion in the Court to revoke a grant where the court may have prima facie reasons to believe that it was necessary to have the will proved afresh in the presence of interested parties.
But in the present case we are not satisfied in all the circumstances of the case that just cause within the meaning of section 263 had been made out.
We cannot ignore the facts that about 27 years had elapsed after the grant of probate in 1921, that Girish in spite of the knowledge of the grant at the latest in 1933 did not take any steps in his lifetime to have the grant revoked, that there was no suggestion that the will was a forgery or was otherwise invalid and that the will was a registered one and had been executed eight years before the testator 's unnatural death.
Hence the omission of citations to Girish which ordinarily may have been sufficient for a revocation of the grant was not in the special circumstances of this case sufficient to justify the court to revoke the grant.
Learned Counsel for the appellant made pointed reference to the decision of their Lordships of the Judicial Committee of the Privy Council in Ramanandi Kuer vs Kalawati Kuer(1).
But that case is an authority for the proposition that where two grounds are taken for revocation of a grant, viz., (1) that persons who ought to have been cited were not cited, and (2) that the will was a forgery, if the first ground is established, the onus is upon the opponents to prove that the will is genuine.
That case is no authority for the proposition that in every case where there is a defect in citation, the court must order a revocation or annulment of the grant.
The annulment is a matter of substance and not of mere form.
The court (1) L.R. 55 I.A. 18, 285 may refuse to grant annulment in cases where there is no likelihood of proof being offered that the will admitted to probate was either not genuine or had not been validly executed.
But, as rightly pointed out by the lower Appellate Court, in the present case where the validity or genuineness of the will has not been challenged, it would serve no useful purpose to revoke the grant and to make the parties go through the mere formality of proving the will over again.
In our opinion, therefore, the omission of citation has had no effect on the regularity of the proceedings resulting in the grant of 1921.
It was next contended that there had been fraudulent concealment of material facts from the court in the proceedings of 1921, and that therefore the case came within the purview of clause (b) of the Explanation quoted above.
It was said in this connection that the petition for the grant of probate made in 1921 did not disclose the following material facts: 1.
That Charu was the murderer of the testator; 2.
That the testator had revoked the will or had at least intended to revoke the will; and 3.
That a false declaration as regards the value of the property constituting the estate of the deceased testator had been made, that is to say, the applicants for probate had concealed from the court the true value of the property which was forty lakhs of rupees and not only Rs. 4,75,780/ as stated by them.
It is true that in para.
4 of the petition for probate it was only stated that Charu had been found guilty of murder by the High Court and was sentenced to transportation for life and had not till then been released from jail.
Our attention was also called to the prayer portion of the petition in which the right of Charu to make an application for probate had been reserved.
We can easily dispose of the last suggestion by observing that it was a mere formal reservation.
It has no such sinister significance as is attributed to it.
It is also true that there is no statement in the application that Charu had murdered the testator.
While agreeing with the Judge in the first court that this was rather disingenuous, we must also 286 hold that that concealment, if it was deliberate, was not material to the case.
Even if that statement had been made in the petition, that would have had no effect on the grant of probate to the petitioners who were before the court.
The fact of the murder is relevant only to this extent, that it would affect the legacies in favour of Charu, but the other legacies would stand and the will would still be open to probate.
The last allegation relating to concealment is on the question of the value of the property left by the testator by his will.
It is not necessary to consider whether if such a concealment had been made out it would have been sufficient to revoke the grant.
It is enough to point out that neither of the courts below has found that the property was really worth anything like forty lakhs of rupees.
This ground has not been pressed before us either.
It must therefore be held that the appellant has failed to bring his case within the rule of material concealment.
The most serious allegation which could have a determining effect on the grant, if made out, is that the testator had revoked the will.
Such an allegation would directly come within the third illustration quoted above.
But unfortunately for the appellant he made no attempt to prove his allegation that there was any such revocation.
Apart from showing that in or about the year 1917 the testator had entertained the intention either of materially altering his will or of altogether revoking it, there is absolutely no evidence in support of the allegation that the testator actually revoked the registered will in question.
For proving that the will had been revoked, it had to be shown that the testator had made another will or codicil or by some writing declared his intention to revoke the will.
Such a document is required by section 70 of the Act to be executed in the same manner as a will.
Such a revocation could also have been proved, as the section lays down, by burning, tearing or otherwise destroying the will by the testator himself or by some other person in his presence and by his direction, thus clearly indicating his intention 287 of revoking the will.
No such proof has been offered in this case.
But it was argued that the appellant would have offered such proof after the order of revocation was made by the court.
That would be to put the cart before the horse.
If an applicant for revocation of a grant alleges as a ground for such revocation that the testator had revoked the will, he has got to prove that alleged fact at least prima facie before he can be entitled to an order of revocation.
There may be cases where such a proof may be offered at a later stage where the revocation is founded upon other grounds, for example, where the court is satisfied that there was substantial defect in the previous proceedings resulting in the grant, or that the grantee had wilfully and without reasonable cause omitted to exhibit an inventory or account; or some such other ground recognized by section 263 as just cause for annulling the grant has been established.
It was also argued on behalf of the appellant that even though he may not have proved that the testator had as a matter of fact revoked the will, he is still entitled to an order of revocation on the ground that he bad entertained the intention of revoking the will.
No authority had been cited before us in support of this contention.
It is open to a person who has made a will at any time to alter or to revoke it; but if he has died leaving a registered will and has not taken any tangible steps to revoke such a will, it is not enough to allege that the testator had at one time entertained the intention of doing so, because such an intention without being translated into action has no effect on the will actually left by him which must be treated as the last will and testament.
It remains to consider the last point, viz., whether the case is within clause (e) of the explanation to section 263.
In this connection ground (f) in paragraph 23 of the petition quoted above is the only allegation.
The omission to submit accounts is not always synonymous with "wilfully and without reasonable cause" omitting to exhibit accounts.
In certain circumstances omission to submit accounts 288 may bring the case within the purview of clause (e) aforesaid because the circumstances may tend to show that the omission was wilful and without reasonable cause.
We have therefore to consider whether in the circumstances of this case the omission to file accounts has the effect of entitling the appellant to an order of revocation.
Under the will the testator intended that Anil Nath Basu should function as the managing executor during his lifetime, as will appear from the relevant portion of paragraph 17 of the will which is as follows: "I direct that my executor Babu Anil Nath Basu shall act alone without interference of my other executors in drawing money from or depositing money to any bank, courts or any other place or places and also in drawing interest of Government Promissory Note, debentures, etc.
and in collecting rents of the houses and also in defending and instituting all suits relating to my estate and for the purpose above to sign cheques, rent bills and all papers relating to any suit in connection with my estate".
It would thus appear that Anil Nath Basu was not only the most competent man being a trained lawyer to administer the estate but had also been in terms vested with the power to handle the cash and the accounts by himself without interference by the other executors.
He must therefore have handled the incomings and the outgoings and been responsible for keeping true and proper accounts.
Whether or not he did so we do not know, because Girish, as already indicated, never made any attempt to question the will or the grant or to call him to account.
We have already made reference to Debi Prosad Mitter 's correspondence with Anil Nath Basu, the managing executor, bearing on the question of accounts.
There is nothing on the record to show what happened on that demand for accounts by Debi Prosad Mitter.
The managing executor was alive up till July 1948 and unfortunately for the appellant, he initiated the revocation proceedings more than a year after his death.
If these proceedings had been started in Anil Nath Basu 's lifetime, he would have been the best person 289 to inform the court as to how matters stood with reference to the accounts.
The fact remains that no accounts appear from the record of this case to have been submitted by the executors.
An application was made before us to take notice of the fact that accounts had been submitted up to date by the 1st respondent who is in charge of the testator 's estate.
But whether or not the respondent has filed accounts during the pendency of this appeal is wholly irrelevant.
We have to determine whether the omission to submit accounts in the circumstances of this case entitles the appellant to have an order of revocation.
In the first place, no proper pleading had been made on this part of the case.
It has not been alleged that there has been a wilful default without any reason, able cause.
Hence no proper foundation was laid in the pleadings for reception of evidence either way.
On that ground alone, in our opinion, the appellant must fail on this part of the case.
It may also be pointed out that in all the circumstances of this case referred to above, particularly in view of the fact that it was never suggested that the will in question was not genuine or had not been validly executed, it must be held that the proceedings leading up to this appeal have been misconceived.
If the appellant has any locus standi, his remedy lay not against the will or against the grant of probate, but under the will.
But it is not for this court to advise what the appellant should have done.
As, in our opinion, all the grounds raised on behalf of the appellant for revoking the grant have failed, it is not necessary to go into the question whether Girish had acquiesced in the grant in question and had therefore barred the door against the appellant from raising any further questions about it.
For the reasons aforesaid we uphold the decision of the court below and dismiss the appeal with costs to the contesting respondent No. 1.
There will be no order as to costs in respect of the other respondent.
| The expression "defective in substance" in Explanation el.
(a) to section 263 of the means that the defect was of such a character as to substantially affect the regularity and correctness of the previous proceedings.
The omission to issue citations to persons who should have been apprised of the probate proceedings may well be in a normal case a ground by itself for revocation of the grant.
But this is not an absolute right irrespective of other considerations arising from the proved facts of a case.
The law has vested a judicial discretion in the court to revoke a grant where the court may have prima facie reasons to believe that it was necessary to have the will proved afresh in the presence of interested parties.
The Supreme Court was not satisfied that in all the circum stances of the present case just cause for the annulment of the grant of probate within the meaning of section 263 of the Act had been made out.
The annulment of the grant of probate is a matter of substance and not of mere form.
The court may refuse to grant annulment in cases where there is no likelihood of proof being offered that the will admitted to probate was either not genuine or had not been validly executed.
Where, as in the present case, the validity or genuineness of the will has not been challenged it would serve no useful purpose to revoke the grant and to make the parties go through the mere formality of proving the will again.
Under the circumstances of the present case the omission of citation has had no effect on the regularity of the proceedings resulting in the grant of 1921.
Mokshadayini Dasi vs Karnadhar Mandal ( [1914] 19 C.W.N. 1108), Brindaban vs Sureshwar ( , Durgavati vs Sourabini ( Cal. 1001) and Ramanandi Kuer vs Kalawati Kiter ( [1927] L.R. 55 I.A. 18), referred to. 271
|
Appeal No. 252 of 1954.
Appeal by Special Leave from the Judgment and Order dated the 22nd January 1953 of the Election Tribunal, Vellore in Election Petition No. 35 of 1952.
N.C. Chatterjee (A. N. Sinha and N. H. Hingorani, with him), for the appellant.
C. V. L. Narayan, for respondent No. 1. 1955.
March 29.
The only question for determination in this appeal by special leave is whether the appellant is disqualified under section 7(d) of the Representation of the People Act, 1951 (hereinafter called the Act) for election to the House of the People, as held by the Election Tribunal, North Arcot, Vellore, by its orders dated the 20th January, 1953 in Election Petition No. 35 of 1952.
The facts of this case are not in dispute and lie within a narrow compass.
The appellant and respondents I to 3 contested the last general elections from the Dharmapuri Parliamentary Constituency in the district of Salem in the State of Madras.
Respondents 4 to 10 who were added subsequently by an order of the Tribunal were also candidates for election.
Their nominations also had been held to be valid but they ultimately withdrew their candidature before the polling took place.
The appellant was in due course declared to have been elected to the House of the People.
Thereafter, on the 5th March, 1952 the 1st respondent filed an election petition before the Election Commission contesting the appellant 's election 85 on the ground that the appellant was disqualified under section 7(d) of the Act as, from the date of his nomination and until the date of election and after, the appellant had a contract with the Government of India in the Postal Department for the transport of postal mail which was a service undertaken by the Government of India.
At this stage it is necessary to state that it is admitted that the appellant is and has been the holder of a stage carriage service permit (exhibit B 2) dated the 26th April 1949, issued by the Regional Transport Authority, Salem, Madras.
It was one of the conditions of the said permit that if called upon the appellant will enter into an agreement with the Government of India for the transport of postal articles and mail bags.
In pursuance of that obligation the appellant entered into a registered agreement with the Government of India on the 16th November 1949 (exhibit A 3) to be noticed in detail hereinafter.
After the appellant had filed his nomination paper, the 1st respondent by his petition dated the 28th November 1951 raised the objection to the effect that his nomination should be rejected on the ground that he had entered into a contract with the Government of India for his own benefit for the transport of mail between Salem and Yercaud.
The Returning Officer for the Dharmapuri Parliamentary Constituency, Salem, by his orders (exhibit A 2) of the same date overruled the objection holding that the service rendered by the appellant of carrying mail is not under an agreement but on an imperative order of the Government under Rule 160 B of the Madras Motor Vehicles Rules.
Apparently the registered agreement (exhibit A 3) had not been placed before him.
To the election petition filed by the 1st respondent the appellant filed his written statement on the 28th May 1952 denying that he was disqualified for election as a member of Parliament by virtue of the provisions of section 7(d) of the Act.
His contention was that "it is the exclusive privilege of the Government of India to convey all postal articles from one place to another and it is a normal function of the Government statutorily reserved to itself.
There is no justifi 86 cation to regard the carrying of mails from one place to another as the performance of any service undertaken by the Government".
It was further averred on behalf of the appellant that it was not justifiable to regard him as having any interest in a contract for the performance of any service undertaken by the appropriate Government within the mischief of section 7(d) of the Act; and that he had been only carrying out the obligations imposed upon him by Rule 160 B of the rules framed under the Motor Vehicles Act.
It was also contended that under article 103 of the Constitution of India the question as to the dis qualification of a member has to be decided by the President whose decision shall be final.
On those pleadings the following issues were framed by the Election Tribunal: 1.Is the nomination of the 1st respt.
invalid because of the prohibition contained in section 7(d) of the Representation of the People Act, 1951, or for any of the reasons set forth in paras.
9 to 11 of the petition? 2.Has this Tribunal no jurisdiction to decide the question as regards the disqualification of the returned candidate, because of article 103 of the Constitution of India? It is not necessary to refer to the additional issue bearing on the question of limitation arising from an interlocutory application for impleading those candidates (respondents 4 to 10) whose nomination had been accepted but who had withdrawn from the contest.
Both these issues were decided against the appellant.
The Tribunal on a very elaborate discussion of the points raised before it, held that the postal service including the transport of mails is a service undertaken by the Central Government within the meaning of section 7(d); that at the date of the nomination the appellant was a contractor under the Central Government; that the agreement between the Government and the appellant involved mutual obligations which could not be referable to a bare statutory duty on the part of the appellant but that it was the result 'of mutual assent based upon a free 87 offer and acceptance; and that the agreement was supported by valid consideration.
The Tribunal also held that article 103 of the Constitution was not a bar to its jurisdiction to decide, the controversy.
Accordingly it allowed the election petition and held the appellant 's election to be void in terms of section 100(1)(c) of the Act, with costs to the respondent.
Hence this appeal.
In this appeal the contentions raised before the Election Tribunal, except the objection to the Tribunal 's jurisdiction in view of the provisions of article 103 of the Constitution, have been pressed before us by the learned counsel for the appellant.
It is manifest that the determination of this case must depend upon the true construction and legal effect of the agreement (exhibit A 3) admittedly entered into by the appellant with the Central Government.
It is therefore necessary to set out in some detail the relevant clauses of the agreement.
The appellant (called the "contractor") is of the one part and the Governor General of India of the other.
The preamble says "Whereas the said contractor Sri.
N. Sathianathan has offered to contract with Governor General for the provision of a Motor Vehicle Service for the transit conveyance and delivery of all postal articles and mail bags as defined in the Indian Post Office Act, 1898, as amended from time to time,. . . from the 15th day of December 1949 to the 14th day of December 1952 and the Governor General has accepted such offer upon the terms and Conditions hereinafter appearing. . .
Now this indenture witnesseth that the contractor in pursuance of the said agreement and in consideration of the premises and of the payments hereinafter agreed to be made to him. . .
It is hereby mutually agreed and declared between and by the parties hereto as follows: 1.Contract to carry: The contractor shall during the continuance of this contract, that is to say, from the 15th day of December 1949 until the 14th day of December 1952 or until the said contract shall be determined by such notice as is hereinafter men 88 tioned or otherwise in (hereinafter referred to as the said contract period) duly and safely convey. . by means of motor vehicles of good and reliable manufacture all postal articles and mail bags. . . ." By clause 4 the contractor is permitted to carry passengers and their luggage by bus provided there is accommodation available and provided that the mail service is not prejudiced in any way.
By clauses 5 and 6 the contractor is required to maintain in good order and repair a number of motor buses and their spare parts at his own expense and to bear all municipal and other taxes payable in respect of the motor vehicles.
Clause 7 contains the schedule of penalties in the event of non completion of any journey or of delay in completion thereof in accordance with the time table, etc.
By clause 8 the contractor is made absolutely liable and responsible for the due and safe custody and delivery in good order and condition of postal articles and mail bags.
By clause 10 nongazetted postal and telegraph officers travelling on duty on the route allotted to the appellant are declared to be entitled to travel free of all charges and such official passengers shall have precedence over ordinary passengers.
Clause 13 provides that the contract shall not be transferred by the contractor to any person or company without the previous consent in writing of the Director General of Posts & Telegraphs.
By clause 15 the Government agrees to pay to the contractor Rs. 200 per month during the subsistence of the agreement "as his remuneration for service to be rendered by him hereunder" '.
This monthly sum of Rs. 200 is liable to be increased or decreased proportionately to the increase or decrease in the mileage to be covered.
Clause 18 is in these terms: "In the event of the contractor failing to secure a renewal of the permit on the line this contract will automatically terminate on the date up to which the old permit shall be valid and in such case no compensation shall be payable to either party for such termination.
This contract may be absolutely determined and put an end to by either of the contracting 89 parties giving four calendar months notice in writing to the other of his intention so to determine and put an end to the same".
Clause 21 contains the usual arbitration clause to the effect that all disputes and differences arising out of or in any wise touching or concerning the agreement shall be referred to the sole arbitration of the Director General of Posts and Telegraphs or his nominee.
It is also provided that the award of the arbitrator shall be final and binding on the parties.
It will be observed that the agreement set out above is a formally drawn up document which satisfies all the requirements of a contract.
It is not the appellant 's case that the contract has been vitiated by undue influence, fraud or such other cause.
But it has been argued that it was a necessary sequel to the stage carriage permit granted by the Transport Authority under the Motor Vehicles Act read along with the relevant rules.
In this connection reference was made to rule 160 B of the Madras Motor Vehicles Rules which is as follows: "It shall be a condition of every stage carriage permit that the holder of the permit shall, if so required by the transport authority which granted the permit, carry mails at such rates and on such terms as the transport authority may fix after consultation with the holder of the permit and the postal authorities concerned".
The rule quoted above has apparently been made under the authority of section 48(d) of the Motor Vehicles Act.
It is common ground that the agreement aforesaid between the appellant and the Central Governmentis in pursuance of rule 160 B aforesaid; but it has been argued on behalf of the appellant that though the agreement aforesaid has the "semblance of a contract", it is lacking in the "essential ingredients of a free consensus of acceptance and offer".
This argument is based on the further contention that the appellant has been carrying mail on his buses in performance of a statutory obligation which cannot come within the mischief of 12 90 section 7(d) of the Representation of the People Act, 1951.
The material portion of the section is in these terms: "A person shall be disqualified for being chosen as, and for being, a member of either House of Parlia ment. . . . . (b)if, whether by himself or by any person or body of persons in trust for him or for his benefit or on his account, he has any share or interest in a contract for. . . . . . the performance of any services undertaken by the appropriate Government".
It has further been argued alternatively that if the agreement has the force of a contract, it is totally lacking in consideration because the monetary consideration provided for in the agreement is no more than the subsidy already fixed by the Regional Transport Officer by his orders dated the 23rd July, 1949; that the agreement in question being with a third party, namely, the Governor General, to render service which was already due to another party, namely, the Transport Authority for the same consideration cannot amount to a valid contract supported by consideration; and finally, that the transport of mail is not a "service undertaken by the Central Government".
In our opinion, there is no substance in any one of these contentions.
It is true that the appellant entered into the contract aforesaid with the Central Government for the transport of postal articles and mail bags on the 16th November, 1949.
From before that date be had been carrying on the business of plying buses on the route allotted to him by the Regional Transport Authority.
But he entered into the contract with his eyes open and knowing full well his rights and liabilities under the same.
No one is compelled to carry on the business of stage carriage service or for the matter of that, of transporting postal articles and mail bags.
In terms of the permit, it is open to the Government to call upon a permit holder to undertake the additional burden of carrying postal articles and mail bags which carries with it the additional remuneration to be fixed by the Transport Authority after consultation with the postal autho 91 rities and the carrier.
It is not every stage carriage permit holder who is called upon to do so.
At the time the appellant entered into the contract with the, Government in the postal department he may not have had any idea of standing for election to the House of the People when in future the general elections came to be held.
If he wished to steer clear of the difficulty created by section 7 of the Act, he could have given due notice to Government under clause 18 of the contract referred to above.
On the expiry of the term of the notice he would have been free to stand for election to a State or Central Legislature.
Section 7 of the Act is clearly intended to.
avoid a conflict between public duty and private interest.
The Tribunal discussed a number of authorities with reference to the English and the American Law of Contract for arriving at the conclusion that the agreement between the appellant and the Government of India in the Postal Department had all the ingredients of a valid contract.
The Tribunal need not have travelled so far afield, especially when the provisions of the Indian Con tract Act which govern the case are sufficient to answer all the contentions raised on behalf of the appellant.
On the face of the transaction the agreement was between two competent parties with their free consent.
There was no question but that there was lawful consideration, The permit for the stage carriage had been granted by, the authority under the Motor Vehicles Act; and the agreement for transport of postal articles and mail bags was between the Government of India in the Postal Department and the appellant for a cash consideration.
But it was argued that the agreement was in pursuance of a pre existing obligation imposed by the rule aforesaid framed under the Motor Vehicles Act.
It is true that the permit does contain a condition that the permit holder may be called upon to undertake transport of mail bags and postal articles but that is only a notice to intending applicants for a stage carriage permit that the grantee of such a per mit may have to render that additional service for an 92 additional remuneration if called upon to do so by the authorities of the Postal Department.
If any one was not prepared to undertake that additional responsibility, he was free not to make an application for such a permit; but that does not mean that the agreement actually entered into between the Postal Department and the permit holder is not an independent contract governed by its own special terms.
As indicated above, clause 18 has reserved the right to either party to terminate the contract on giving four months ' notice.
The appellant must be presumed to have known that the agreement that he had entered into with the Postal Department will stand in the way of his running as a candidate for election to the Central or the State Legislature.
There was nothing to prevent him from giving the necessary notice to the department and thus terminate his agreement so as to be free to stand as a candidate for election to the legislature.
Section 7 of the Act is intended to ensure that there is no occasion for a conflict between public duty and private interests.
The appellant had a clear and free choice before him.
If he was anxious to serve the community as a member of the Central Legislature, he had to give up his private gains in the shape of the remuneration for carrying postal articles and mail bags in his buses.
It may be that on his terminating the agreement with the postal department he would have to give up his stage carriage permit also but not necessarily so.
If on the same route a number of bus services are permitted to different parties, the Postal Department may choose any one of them to enter into the agreement for the carriage of mail bags and postal articles.
But even if there was only one service for the route in respect of which the appellant held the stage carriage permit, if he had to give up his permit, some other party would take his place for running the bus service and carrying the postal articles and mail bags.
It was further argued that the appellant had no hand in the fixing of the remuneration to be paid by the Postal Department for carrying its mails, etc.
But it is clear, by a reference to the terms of the rule 93 quoted above, that the amount of the remuneration had to be fixed by the department after consultation with the carrier.
It was always open to the latter to demur to the terms proposed by the department and if he found that the department was not prepared to accept his terms he was not bound to enter into the agreement.
The fact that he had agreed to carry postal articles and mail bags was possibly an additional qualification for him to obtain a renewal of his permit and thus gave him an advantage over his competi tors.
Hence instead of being an additional burden or a handicap to him, it was an additional advantage to him in the matter of getting a renewal of his permit in preference to others.
The agreement was therefore based on mutual promises, by the appellant to carry the mail bags, etc., and by the Postal Department to pay him suitable remuneration for the services thus rendered.
It was further contended on behalf of the appellant that the Central Government could not be said to have 'undertaken ' any 'service ' within the meaning of section 7(d) of the Act when it made arrangements for the carriage of mail bags and postal articles through the appellant. ' It has not been and cannot be contended that the Government is bound in the discharge of its duties as a sovereign state to make provision for postal mail service.
The provisions of the Indian Post Office Act, VI of 1898, are only enabling in the sense that they authorize the State agency to have the exclusive privilege of conveying letters, etc.
for the convenience of the public and for the benefit of the Government, without making it obligatory upon it to provide every individual and every place with those facilities.
It may be that those facilities are being extended from time to time and are being brought nearer to every home but that is only evidence of the fact that the State as a welfare state is anxious to provide for the conveniences of the public in the matter of communications and correspondence.
That is to say, the Government in the Postal Department has only undertaken a service to be rendered to the community and that such 94 a service is not an essential function of a sovereign state.
It cannot be gainsaid that the Governmentr in the Postal Department is rendering a very useful service and that the appellant has by his contract with the Government undertaken to render that kind of service on a specified route.
The present case is a straightforward illustration of the kind of contract contemplated by section 7(d) of the Act.
At all material times the appellant has been directly concerned, for his own benefit, in the contract of carrying mail bags and postal articles entered into by him with the Government in the Postal Department.
For the reasons aforesaid we have not the least hesitation in holding that the conclusions arrived at by the Tribunal are entirely correct.
The appeal is accordingly dismissed with costs.
Appeal dismissed.
| The question for determination in this appeal was whether the appellant was disqualified under section 7(d) of the Representation of the People Act, 1951 for election to the House of the People.
The material portion of section 7(d) of the Act reads as follows: "A person shall be disqualified for being chosen as and for being, a member of either House of Parliament. . (b) if, whether by himself or by any person or body of persons in trust for him or for his benefit or on his account, he has any share or interest in a contract for. . the performance of any service undertaken by the appropriate Government".
The appellant (a contractor) had entered into an agreement with the Central Government.
The relevant portion of the said agreement was as follows: "The contractor has offered to contract with the Governor General for the provision of a Motor Vehicle Service for the transit conveyance of all postal articles and mail bags from December 15, 1949 to December 14, 1952 and the Governor General has accepted the offer.
"The Government agrees to pay to the contractor Rs. 200 per month during the subsistence of the agreement 'as his remuneration for service to be rendered by him ' ".
Held that on the face of it the agreement was between two competent parties with their free consent, and there was a lawful cash consideration for it.
The Appellant entered into the agreement with his eyes open knowing full well his rights and liabilities under the same.
84 The case was a straightforward illustration of the kind of contract contemplated by section 7(d) of the Act.
At all material times the appellant had been directly concerned, for his own benefit, in the contract of carrying mail bags and postal articles entered into by him with the Government in the Postal Department.
Section 7 of the Act is clearly intended to avoid a conflict between public duty and private interests.
|
Civil Appeal No. 200 of 1954.
Under Article 133 of the Constitution and section 109 of the Code of Civil Procedure from the Judgment and decree dated the 6th December 1952, of the Circuit Bench of the Punjab High Court at Delhi (Weston C.J. and Bhandari J.) in Regular First Appeal No. 72 of 1952, arising out of the Judgment and Decree dated the 14th day of April 1952, of the Court of Subordinate Judge, Delhi in Suit No. 657 of 1950.
N. C. Chatterjee, (Tarachand Brijmohanlal and B. P. Maheshwari, with him) for the Appellant.
R. section Narula, for the Respondent, 405 1955.
April 21.
The Judgment of the Court was delivered by BosE J.
The defendant appeals.
The plaintiffs were the partners of a firm known as Harnam Singh Jagat Singh.
Before the partition of India they carried on the business of cotton cloth dealers at Lyallpur which is now in Pakistan.
The defendant is the Delhi Cloth and General Mills Co. Ltd. It is a registered company carrying on business at Delhi and other places and has its head office at Delhi.
One of the places at which it carried on business before the partition was Lyallpur.
The plaintiffs ' case is that they carried on business with the defendant company for some three or four years before 1947 and purchased cloth from the company from time to time.
In the course of their business they used to make lump sum payments to the defendant against their purchases.
Sometimes these were advance payments and at others the balance was against them.
When there was an adverse balance the plaintiffs paid the defendant interest: see the plaintiff Sardari Lal as P. W. 3.
On 28 7 1947 the account stood in the plaintiffs ' favour.
There was a balance of Rs. 79 6 6 lying to their credit plus a deposit of Rs. 1,000 as security.
On that day they deposited a further Rs. 55,000 bringing the balance in their favour up to Rs. 56,079 6 6.
The defendant company delivered cloth worth Rs. 43,583 0 0 to the plaintiffs against this amount at or about that time.
That left a balance of Rs. 11, 496 6 6.
The suit is to recover this balance plus interest.
The claim was decreed for Rs. 12,496 6 6 and this was upheld on appeal to the High Court.
The defendant appeals here.
The defendant admits the facts set out above but defends the action on the following ground.
It contends that when India was partitioned on 15 8 1947, Lyallpur, where these transactions took place and where the money is situate, was assigned to Pakistan.,.
The plaintiffs fled to India at this time and thus 406 became evacuees and the Pakistan Government froze all evacuee assets and later compelled the defendant to hand them over, to the Custodian of Evacuee Property in Pakistan.
The defendant is ready and willing to pay the money if the Pakistan Government will release it but until it does so the defendant contends that it, is unable to pay and is not liable.
The only question is, what are the rights and liabilities of the parties in those circumstances? The amount involved in this suit, though substantial, is not large when compared with the number of claims by and against persons in similar plight.
The defendant itself is involved in many similar transactions.
A list of them appears in exhibit D 11.
Mohd Bashir Khan, D.W. 1, says that the total comes to Rs. 1,46,209 1 9.
The defendant has accordingly chosen to defend this action as a test case.
The further facts are.
as follows.
At the relevant period, before the partition, cloth was rationed and its distribution controlled in, among other places, the Punjab where Lyallpur is situate.
According to the scheme, quotas were allotted to different areas and the manufacturers and suppliers of cloth could only distribute their cloth to retailers in accordance with those quotas, and dealers in those areas could only import cloth up to and in accordance with the quotas allotted to them.
If the suppliers themselves had a retail shop or business in a given area, then the quota for that area was divided between the supplier and a Government quota holder or quota holders called the nominated importer or importers.
The local agency of the suppliers was permitted to import up to the portion of the quota allotted to it in that area and the suppliers were obliged to give the balance of the quota to the Government quota holder or holders.
The plaintiffs were the Government quota holders for Lyallpur and the defendant company also carried on business there through the General Manager of the Lyallpur Mills.
It is admitted that the defendant owns these mills but it is a matter of dispute before us whether the mills are a branch of the defendant company; but 407 whatever the exact status of the Lyallpur mills may be, it is clear from the evidence and the documents that the General Manager of these mills conducted the defendant 's cotton business at Lyallpur.
It seems that the details of the cloth distribution scheme for Punjab, in so far as it affected the defendant company, were contained in a letter of the 24th October 1945 from the Secretary, Civil Supplies Department, Punjab.
That letter has not been filed and so we do not know its exact contents but reference to it is found in a series of letters written by the defendant company from Delhi to the District Magis trate at Lyallpur.
Those letters range in date from 3 1 1946 to 19 4 1947: (Exs.
P 5 to P 12).
They are all in the same form, only the figures and dates differ.
It will be enough to quote the first, exhibit P 5.
It is dated 3 1 1946 and is from the Central Marketing Organisation of the defendant company, the Delhi Cloth and General Mills Co. Ltd. It is written from Delhi to the District Magistrate, Lyallpur, and is as follows: "The District Magistrate, Lyallpur.
Re: Cloth Distribution Scheme.
Dear Sir Ref:Letter No. 15841 CL (D) 45/8342 of 24th Oct. 1945 from Secretary, Civil Supplies Deptt.
Punjab Govt., Lahore.
Kindly note that we have allotted 28 bales for your district for the month of January 1946.
Out of this a quantity of 18 bales will be despatched to our Retail stores in your district/State and the balance of 10 bales will be available for delivery to your nominated importer.
We shall be obliged if you kindly issue instructions to your nominated importer to collect these goods from us within 15 days of the two dates for delivery fixed, namely by the 20th of January and 5th of February 1946 respectively.
It may be noted that the first half quota will lapse in case delivery is 52 408 not taken by you by the former date and the second half will lapse if not taken by the latter date.
Yours faithfully, D.C. & Gen. Mills Co., Ltd. In each case a copy was sent to the plaintiffs marked as follows: "Copy to nominated importer: Jagat Singh Harnam Singh, Cloth Merchants, Lyallpur".
The Indian Independence Act, 1947 was passed on 18 7 1947 and the district of Lyallpur was assigned to Pakistan subject to the award of the Boundary Commission.
Then followed the partition on 15 8 1947 and at or about that time the plaintiffs fled to India.
This made them evacuees according to a later Ordinance.
But before that Ordinance was promulgated the Assistant Director of Civil Supplies, who was also an Under Secretary to the West Punjab Government, wrote to the defendant 's General Manager at Lyallpur (the General Manager of the Lyallpur Cloth Mills) on 17 2 1948 and told him that "The amount deposited by the non Muslim dealers should not be refunded to them till further orders".
(exhibit D 1).
The defendant did all it could, short of litigation, to protest this order and to try and get it set aside.
Its General Manager at Lyallpur wrote letters to the Assistant Director of Civil Supplies on 14 4 48, 9 8 48 (Exs.
D 2 and D 4) , 23 4 49 (exhibit D 7) and 6 6 49 (exhibit D 8), but the replies were unfavourable.
On 30 4 48 the Assistant Director said that "in no case" should the sums be refunded (exhibit D 3) and on 1 1 1 48 directed that these amounts should be deposited with the Custodian of Evacuee Property (exhibit D 5).
This was in accordance with an Ordinance which was then in force.
Later, on 8 11 48, the General Manager received orders from the Deputy Custodian that the moneys should be deposited with the Deputy Custodian(Ex.
D 6) and on 23 6 49 these orders were repeated by the Custodian (EX.D 9).
Meanwhile, the plaintiffs, who by then had shifted 409 to Delhi, made a series of demands on the defendant in Delhi for payment.
These are dated 3 1 49 (exhibit P.W. 4/4), 27 1 49 (exhibit P.W. 4/1), 11 3 49 (exhibit P.W. 4/3) and 26 3 49 (exhibit P.W. 4/2).
The defeddant 's attitude is summed up in its letter to the plaintiffs dated 12 2 49 (exhibit P 3).
The defendant said that its had received orders from the West Punjab Government, through the Assistant Director of Civil Supplies, not to make any refunds without the orders of the West Punjab Government.
On 15 10 1949 the Ordinance of 1948 was replaced by Ordinance No. XV of 1949 (exhibit D 26) but that made no difference to the law about evacuee funds and properties.
On 4 7 1950 the plaintiffs served the defendant with a notice of suit (exhibit P 14).
This notice was forwarded to the defendant 's General Manager at Lyallpur by the defendant 's Managing Director in Delhi urging the General Manager to try and obtain the sanction of the West Punjab Government for payment of the money to the plaintiffs; and on 27 7 1950 the defendant wrote to the plaintiffs saying "We confirm that the sum of Rs. 11,496 6 6 and Rs. 1,000 are due to you on account of your advance deposit and security deposit respectively with our Lyallpur Cotton Mills, Lyallpur, and the sum will be refunded to you by the said Mills as soon as the order of prohibition to refund such deposits issued by the West Punjab Government and served upon the said Mills is withdrawn or cancelled, and that your claim shall not be prejudiced by the usual time limit of three years having been exceeded ' (exhibit P 4).
The defendant 's reply did not satisfy the plaintiffs, so they instituted the present suit on 16 12 1950.
After the suit, the defendant 's Managing Director wrote personally to the Joint Secretary to the Government of Pakistan on 2 4 1951 but was told on 21 4 1951 that the matter had been carefully examine and that the money must be deposited with the Custodian (exhibit D 25).
A second attempt was made 30 4 1951 (exhibit D 24) and the Joint Secretary was again approached.
Soon after, an Extraordine 410 Ordinance was promulgated on 9 5 1951 (exhibit D 27) exempting "cash deposits of individuals in banks" from the operation of the main Ordinance.
But the Joint Secretary wrote on 2 6 1951 that this did not apply to private debts and deposits and again asked the defendant to deposit the Money with the Custodian (exhibit D 23).
Finally, the Custodian issued an order on 6 11 1951 directing that the deposits be made by the 15th of that month, "failing which legal action will have to be taken against you".
(exhibit D 10).
The money was deposited on 15 11 1951 on the last day of grace (exhibit D 12).
The first question that we must determine is the exact nature of the contract from which the obligation which the plaintiffs seek to enforce arises.
The sum claimed in the suit, aside from the interest, is made up of three items: (1)Rs.
79 6 6 outstanding from a previous account; (2)Rs.
11,496 6 6 being the balance of a sum of Rs. 55,000 deposited on 28 7 1947; and (3) Rs. 1,000 as security.
The three items appear to be linked up but we ' will, for the moment, concentrate on the largest, the deposit of Rs. 55,000.
Both sides have spoken of it as a "deposit" throughout but we will have to examine its exact nature because deposits are of various kinds and it will be necessary to know which sort this was before we can apply the law.
Unfortunately, the evidence is meagre and scrappy, so we have been obliged to piece much disjointed material together to form an intelligible pattern.
It is admitted that the distribution of cloth in this area was controlled by the Government of Punjab (in undivided India) at all material times.
It is also admitted that the plaintiffs were, what were called, "Government nominees" for Lyallpur.
In the plaint the plaintiffs also called themselves the "reserve dealer".
This term has not been explained but the use of these words and the words "nominated importer", indicates that the plaintiffs occupied a privileged ]position.
The letters (Exs.
P 5 to P 12), on 411 which the plaintiffs relied very strongly, also point to that; exhibit P 5, for example, shows that the defendant was obliged to give 10 bales out of a quota of 28 for that area to the plaintiffs under the orders of the Punjab Government and could only keep 18 for its own retail stores in the month of January 1946.
In April the defendant was allowed to keep all 28 but in July the distribution was 35: 25 in the plaintiff 's favour.
In September, November (1946) and April 1947 it was half and half.
In February and March 1947 it was 10 : 26 and 29 : 26 for the plaintiffs and the defendant 's stores respectively.
Now, ordinarily, a privilege has to be paid for and it seems that the price of this privilege was (1) payment of a security deposit of Rs. 1,000 and (2) payment of a second deposit against which cloth was issued from time to time in much the same way as a banker hands out money to a customer against deposits of money in a current account, only here the payments were issues of cloth instead of sums of money.
We draw this inference from what we have said above and from the following facts: (1) Both sides have called the payment a "deposit" in their pleadings; (2) The plaintiffs speak of receiving goods "against this deposit" (paragraph 3 of the plaint) and Mohd. Bashir Khan (D.W. 1) of delivery being made "against this advance"; (3) The plaintiff Sardari Lal (P.W. 3) says that the parties have been carrying on dealings for 3 or 4 years and that "advances used to be made to the mills from time to time.
Sometimes our balance stood at credit"; (4) Sardari Lal says that when their balance was on the debit side, they paid the defendant 's interest but the defendant paid no interest when the balance was in the plaintiffs ' favour.
(This is the position when there is an overdraft in a bank); (5) There was a balance of Rs. 79 6 6 standing in the, plaintiffs ' favour when the deposit of Rs. 55,000 was made; (6) The plaintiffs said in their letter (exhibit P.W. 4/1) 412 to the defendant that they had a "current account" with the defendant in which a sum of Rs. 11,496 6 6 was in "reserve account".
This figure of Rs. 11 ,496 6 6 is made up by including the old balance of Rs. 79 6 6 in this account; (7) In their letter exhibit P 14 the plaintiffs said that they had "deposited" money in the plaintiffs ' account at Lyallpur "as reserve dealers", against that they received goods leaving a balance of Rs. 11,496 6 6.
Again, this figure includes Rs. 79 6 6.
All this shows that the payment of Rs. 55,000 was not just an advance payment for a specified quantity of goods but was a running account very like a customer 's current account in a bank.
The only matter that can be said to indicate the contrary is the fact that the defendant has listed this money in exhibit D 11 under the head "Purchaser 's advance".
But the mere use of this term cannot alter the substance of the transactions any more than the mere use of the word "deposit".
The fact that the parties choose to call it this or that is, of course, relevant but is not conclusive, and in order to determine the true nature of a transaction it is necessary to view it as a whole and to consider other factors.
But in this case we need not speculate because the plaintiffs have themselves explained the sense in which the term "Purchasers advance account" is used.
In their statement of the case which they filed here, they say "The defendants maintained a 'Purchasers advance account ' in their books at Delhi.
The plaintiffs used to pay the defendants advance amounts against which cloth was supplied and the balance had to be adjusted periodically".
But the banking analogy must not be pushed too far.
The stress laid by the parties on the terms "Government nominees", "nominated importer" and Preserve dealer", both in the correspondence and in the pleadings and evidence, suggests that the defendant was dealing with the plaintiffs in their capacity of "Government nominees" and that, in its turn, imports the condition that the dealings would stop the moment the plaintiffs ceased to occupy that pri 413 vileged position.
As we have seen, the import of cloth was controlled by the Punjab Government at all relevant times with the result that the defendant could not sell to anybody it pleased.
The sales had to be to the Government nominees.
Therefore, if Government withdrew their recognition, the defendant would not have been able to sell to the plaintiffs any longer and it is fair to assume that the parties did not contemplate a continuance of their relationship in such an eventuality.
But, as this was not a definite contract for the supply of a given quantity of goods which were to be delivered in instalments but a course of dealings with a running account, it is also reasonable to infer that the parties were at liberty to put an end to their business relationship at anytime they pleased by giving due notice to the other side and in that event whichever side owed money to the other would have to pay.
But, either way, the place of performance would, in these circumstances, be Lyalipur.
We say this because all the known factors were situate in Lyallpur.
The plaintiffs were the Government nominees for Lyallpur and they were resident there.
The defendant carried on business there and the goods had to be delivered at Lyallpur and could not be deliverer] elsewhere, and so performance was to be there.
The accounts were kept at Lyallpur, and though copies appear to have been forwarded to Delhi from time to time, the books were situate there and the Lyallpur office would be the only place to know the up to the minute state of the accounts.
In the circumstances, it is reasonable to assume, as in the case of banking and insurance (matters we shall deal with presently), that on the termination of the contract the balance was to be paid at Lyallpur and not elsewhere.
That localises the place of primary obligation.
This also, in our opinion, imports another factor.
The defendant in Delhi would not necessarily know of any change of recognition by the Lyallpur authorities.
The correspondence with the Collector indicates that the Government nominee cleared the goods from the defendant 's Lyallpur godowns under the orders of the District Magistrate.
If, therefore, the 414 nominee was suddenly changed, intimation of this fact would have to be given to the defendant at Lyallpur and not at Delhi, otherwise there would be a time lag in which the defendant ' Lyallpur office might easily deliver the goods to the plaintiffs as usual despite withdrawal of the recognition.
Everything therefore points to the fact that the notice of termination would have to be given at Lyallpur and the obligation to return the balance would not arise until this notice of termination was received.
That obligation would therefore necessarily arise at Lyallpur.
The plaintiffs ' learned counsel argued very strongly that the defendant 's Lyallpur business was carried on from Delhi and that the accounts were kept there, that there was no branch office at Lyallpur and that Lyalipur had no independent local control of the business.
He relied on the letters written by the defendant to the District Magistrate, Lyallpur, about the allotments of quotas (Exs.
P 5 to P 12) and also on exhibit D 7, a letter written by the defendant 's General Manager at Lyallpur to the Deputy Custodian of Evacuee Property at Lyallpur in which he says that a " Complete list showing the list of all non Muslims falling under item (3) with the amount to be paid has been asked for from our Head Office and will be submitted as soon as received".
Counsel contended that the Lyallpur people bad so little to do with the accounts that they were notable to supply even a list of the persons who dealt with them.
they had to find that out from Delhi.
These matters should have been put to the defendant 's witnesses.
exhibit D 7 was written in reply to a letter from the Deputy Custodian of Evacuee Property.
That letter is exhibit D 6 and in it the Deputy Custodian refers to some earlier correspondence with the Under Secretary to the West Punjab Government, Lahore, which has not been filed.
When we turn to the list that was eventually supplied from Delhi (exhibit D 1 1) we find that it relates to accounts from allover Pakistan such as, Multan, Peshawar, Lahore, Sialkot, Rawalpindi and even Karachi and Sukkar.
Obviously, a local office like the Lyallpur office would not be in 415 a position to supply that sort of information.
The defendant 's accountant at Lyallpur, Sewa Ram (P.W. 4), says that "Purchasers ' deposits at Lyallpur were not recorded in the books of the defendant at Delhi but statements used to be despatched from there to Delhi.
An account book was prepared from statements received from Lyallpur.
That book is known as 'Reference Book ' ".
Presumably, that would also be the practice of the other branch offices, so the head office would be the only place from where a general overall picture (which appears to be what was asked for) could be obtained.
Now, the plaintiffs resided at Lyallpur at all relevant times and the defendant carried on business there through a local General Manager.
We do not know where the contract was made but we do know that the plaintiffs contracted in a special capacity that was localised at Lyallpur, namely as the Government nominees for Lyallpur.
We know that the goods were to be delivered at Lyallpur and could not be delivered anywhere else.
We know that there was a running account and that that account was kept at Lyallpur, and we have held that the 'debt" did not become due till the defendant was given notice at Lyallpur that the business relationship between the parties had terminated.
The termination came about because of acts that arose at Lyallpur, namely the assignment of Lyallpur to the newly created State of Pakistan and the flight of the plaintiffs from Lyallpur which made further performance of the primary contract impossible.
The only factors that do not concern Lyallpur are the defendant 's residence in India and the demands for payment made in Delhi.
The fact of demand is not material because the obligation to pay arose at the date of termination and arose at Lyallpur, but if a demand for payment is essential, then it would, along the lines of the banking and insurance cases to which we shall refer later, have to be made at Lyallpur and a demand made elsewhere would be ineffective.
On these facts we hold that the elements of this contract, that is to say, the contract 53 416 out of which the obligation to pay arose, were most densely grouped at Lyallpur and that that was its natural seat and the place with which the transaction had its closest and most real connection.
It follows from this that the "proper law of the contract", in so far as that is material, was the Lyallpur law.
We have next to see when notice 'to close the account and a demand for return of the balance was made and where.
The plaintiff Jagat Singh (P.W. 5) says that he made a written demand in October 1947.
But the earliest demand we have on record is exhibit P.W. 4/4 dated 3 1 1949.
It is understandable that the plaintiffs, who had to flee for their lives, would have no copies of their correspondence, but it is a matter for comment that the demand which is filed (exhibit P.W. 4/4) does not refer to an earlier demand or demands.
The defendant was asked to produce all the correspondence because the plaintiffs had lost their own files.
The defendant produced all we have on record and no suggestion was made that anything had been suppressed.
Consequently we are not prepared to accept the plaintiffs ' statement and we hold that there was no demand before 3 1 1949.
Another point is that the earlier demand, even if made, could not have been made at Lyallpur.
The plaintiff Jagat Singh says he made the demand to the defendant 's Managing Director.
He resides in Delhi and the plaintiffs had by then fled from Pakistan.
Therefore, the demand could not have been made at Lyallpur, and apart from those demands, there is no other notice of termination, so, technically, the defendant would have been justified in declining to pay on the strength of a demand made in Delhi.
The same defect attaches to exhibit P. W. 4/4.
However, we are fortunately absolved from the need to base on so technical a ground.
Now at the date of the demand the Pakistan Ordinance (exhibit D 26) was in force and under it the defendant was prohibited from paying the money to the plaintiffs who were evacuees according to Pakistan laws.
The defendant was directed, instead, to deposit the money with the Deputy Custodian of Evacuee 417 Property.
This was done on 15 11 1951 (exhibit D 12) and the deposit was made along with other similar deposits.
We now have to determine the legal liabilities which arise out of these facts.
This raises complex questions of private international law, and two distinct lines of thought emerge.
One is that applied by the English Courts, namely, the lex situs; the other is the one favoured by Cheshire in his book on Private International Law, namely, the "proper law of the contract".
The English approach is to treat the debt as property and determine its situs and then, in general, to apply the law that obtains there at the date when payment is due.
But the difficulty of the English view is that they have different sets of rules for ascertaining the situs, with the result that the situs shifts from place to place for different purposes, also that it is determined by intention.
Thus, it can be in one place for purposes of jurisdiction and in others for those of banking, insurance, death duties and probate.
The situs also varies in the cases of simple contract debts and those of speciality.
That a debt is property is, we think, clear.
It is a chose in action and is heritable and assignable and it is treated as property in India under the Transfer of Property Act which calls it an "actionable claim": sections 3 and 130.
But to give it position in space is not easy because it is intangible and so cannot have location except notionally and in order to give it notional position rules have to be framed along arbitrary lines.
Cheshire points out in his book on Private International Law, 4th edition, pages 449 to 451 that the situs rule is not logical and leads to practical difficulties when there is a succession of assignments because it is not possible to fix the situation of a debt under the situs rule in one place and only one place.
Speaking, of that Cheshire, quoting Foote, where Foote says that the assignment of a chose in action arising out of a contract is governed by the "proper law of the contract" paraphrases Foote thus at page 450 418 "If we understand him correctly, the appropriate law is not the 'proper law ' (using that expression in its contractual sense) of the assignment, but the proper law of the original transaction out of which the chose in action arose.
It is reasonable and logical to refer most questions relating to a debt to the transaction in which it has its source and to the legal system which governs that transaction.
One undeniable merit of this is that, where there have been assignments in different countries, no confusion can arise from a conflict of laws, since all questions are referred to a single legal system".
The expression the "proper law of the contract" has been carefully analysed by Cheshire in Chapter VIII of his ' book.
In Mount Albert Borough Council vs Australasian Temperance and General Mutual Life, Assurance Society(1) Lord Wright defined it at page 240 as "that law which the English or other Court is to apply in determining the obligations under the contract", that is to say, obligation as contrasted with performance.
Lord Wright drew the distinction between obligation and performance at page 240.
In a later case, Lord Simonds described it as "the system of law by reference to which the contract was made or that with which the transaction has its closest and most real connexion".
Bonython vs Commonwealth of Australia(2).
Cheshire sets out the definition given by some American Courts at page 203 and adopts it: "It is submitted that, at any rate with regard to the question of valid creation, the proper law is the law of the country in which the contract is localized.
Its localization will be indicated by what may be called the grouping of its elements as reflected in its formation and in its terms.
The country in which its elements are most densely grouped will represent its natural seat the country with which the contract is in fact most substantially associated and in which lies its natural seat or centre of gravity".
(1) ; , (2) , 219.
419 This involves two considerations.
The first is whether the proper law is to be ascertained objectively or whether parties are free to fix it subjectively by ranging over the world and picking out whatever laws they like from any part of the globe and agreeing that those laws shall govern their contract.
Cheshire points out at page 202 that "the subjective theory may produce strangly unrealistic results".
It is also obvious that difficulties will arise if the contract is illegal or against public policy according to the laws of the country in which it is sought to be enforced though lawful according to the laws of the country which the parties choose: see Lord Wright in Mount Albert Borough Council vs Australasian Temperance, etc.
Society(1) at page 240.
Cheshire prefers the view of an American Judge which he quotes at page 203 "Some law must impose the obligation, and the parties have nothing whatsoever to do with that, no more than with whether their acts are torts or crimes".
The contract we are considering is silent about these matters.
There is no express provision either about the law that is to obtain or about the situs.
We have therefore to examine the rules that obtain when that is the case.
The most usual way of expressing the law in that class of case is to say that an intention must be implied or imputed.
In the Bank of Travancore vs Dhrit )Ram(2), Lord Atkin said that when no intention is expressed in the contract the Courts are left to infer one by reference to considerations where the contract was made and how and where it was to be performed and by the nature of the business or transaction to which it refers.
In the Mount Albert Borough Council case(1), Lord Wright put it this way at page 240 "The parties may not have thought of the matter at all.
Then the Court has to impute an intention, or to determine for the parties what is the proper law which, as just and reasonable persons, they ought or would have intended if they had thought about the question when they made the contract".
(1) (2) 69 I.A. 1, 8.
420 But , to us, it seems unnecessarily artificial to impute an intention when we know there was none, especially in a type of case where the parties would never have contracted at all if they bad contemplated the possibility of events turning out as they did.
In our opinion, what the Courts really do, when there is no express provision, is to apply an objective test, though they appear to regard the intention subjec tively, and that is also Cheshire 's conclusion at page 201 where, after reviewing the English decisions, he says "In other words, the truth may be that the judges, though emphasising in unrestricted terms the omnipotence of intention, in fact do nothing more than impute to the parties an intention to submit their contract to the law of the country with which factually it is most closely connected".
If driven to a choice, we would prefer this way of stating the law but we need not decide this because, so far as the present case is concerned, the result is the same whether we apply the proper law of the contract or the English rules about the lex situs.
It may be that in some future case this Court will have to choose between these two views but the question bristles with difficulties and it is not necessary for us to make the choice here.
All we wish to do here is to indicate that we have considered both and have envisaged cases where perhaps a choice will have to be made.
We gather that English judges fall back on the lex situs and make rules for determining the position of a debt for historical reasons.
Atkin, L. J. said in New York Life Insurance Company vs Public Trustee(1) that the rules laid down in England are derived from the practice of ecclesiastical authorities in granting administration because their jurisdiction was limited territorially.
"The ordinary had only a jurisdiction within a particular territory, and the question whether he should issue letters of administration ' depended upon whether or not assets were to be found within his (1) , 119.
421 jurisdiction, and the test in respect of simple contracts was: Where was the debtor residing?. . the reason why the residence of the debtor was adopted as that which determined where the debt was situate was because it was in that place where the debtor was that the creditor could, in fact, enforce payment of the debt".
(See also Dicey 's Conflict of Laws, 6th edition, page 303).
The rules, therefore, appear to have been arbitrarily selected for practical purposes and because they were found to be convenient.
But despite that the English Courts have never treated them as rigid.
They have only regarded them as primafacie presumptions in the absence of anything express in the contract itself: see Lord Wright 's speech in Mount Albert Borough Council case (1) at page 240.
Also, many exceptions have been engrafted to meet modern conditions.
Atkin, L. J. draws attention to one in New York Life Insurance Company vs
Public Trustee(2) at page 120 where he says"therefore, cases do arise where a debt may be enforced in one jurisdiction, and the debtor, being an ordinary living person, resides elsewhere".
So also Lord Wright in Mount Albert Borough Council case(1) at page 240 "It is true that, when stating this general rule, there are qualifications to be borne in mind, as for instance, that the law of the place of performance will prima facie govern the incidents or mode of performance, that is, performance as contrasted with obligation".
and at page 241 he says "Again, different considerations may arise in particular cases, as, for instance, where the stipulated performance is illegal by the law of the place of performance".
And so also Lord Robson in Rex, vs Lovitt(3) at page 220 "It cannot mean that for all purposes the actual situation of the property of a deceased owner is to be (1) ; (2) , 119.
(3)1912 A.C. 212.
422 ignored and regard had only to the testator 's domicil, for executors find themselves obliged in order to get the property at all to take out ancillary probate according to the locality where such property is properly recoverable, and no legal fiction as to its 'following the owner ' so as to be theoretically situate elsewhere will avail them".
And he says at page 221 that these rules are only "for certain limited purposes".
In banking transactions the following rules are now settled: (1) the obligation of a bank to pay the cheques of a customer rests primarily on the branch at which he keeps his account and the bank can rightly refuse to cash a cheque at any other branch: Rex vs Lovitt(1) at 219, Bank of Travancore vs Dhrit Ram(2) and New York Life Insurance Company vs Public Trustee(3) at page 117; (2) a customer must make a demand for payment at the branch where his current account is kept before he has a cause of action against the bank: Joachimson vs Swiss Bank Corporation(4) quoted with approval by Lord Reid in Arab Bank Ltd. vs Barclays Bank(5).
The rule is the same whether the account is a current account or whether it is a case of deposit.
The last two cases refer to a current account; the Privy Council.
case (Bank of Travancore vs Dhrit Ram(2)) was a case of deposit.
Either way, there must be a demand by the customer at the branch where the current account is kept, or where the deposit is made and kept, before the bank need pay, and for these reasons the English Courts hold that the situs of the debt is at the place where the current account is kept and where the demand must be made.
This class of case forms an exception to the rule that a debtor must seek his creditor because, though that is the general rule, there is nothing to prevent the parties from agreeing, if they wish, that that shall not be the duty of the debtor and, as Lord Reid explains in the Arab Bank case(5) at page 531, a contract of current account necessarily implies an (1) (2) 69 I.A. 1, 8 and 9.
(3) , 119.
(4) (5)[1951] A.C. 495, 531.
423 agreement that that shall not be the bank 's duty, otherwise the whole object of the contract would be frustrated.
We have stressed the word "primarily" because the rules we have set out relate to the primary obligation.
If the bank wrongly refuses to pay when a demand is made at the proper place and time, then it could be sued at its head office as well as at its branch office and, possibly, wherever it could be found, though we do not decide that.
But the reason is that the action is then, not on the debt, but on the breach of the contract to pay at the place specified in the agreement: see Warrington, L. J. at page 116 and Atk in, L. J. at page 121 of New York Life Insurance Co. V. Public Trustee(1).
Now the rules set out above are not confined to the business of banking.
They are of wider application and have also been applied in insurance cases: Fouad Bishara Jabbour vs State of Israel(2) and New York Life Insurance Co. vs Public Trustee(1).
Similar considerations obtain in England when an involuntary assignment of a debt is effected by garnishment.
Cheshire has collected a list of English cases at pages 460 to 463 of his Private International Law from which we have quoted above.
He sums up the position at page 461 thus "It is difficult to state the rule with exactitude but it is probably true to say that a debt is properly garnishable in the country where, according to the ordinary usages of business, it would normally be regarded as payable".
But when all is said and done, we find that in every one of these cases the proper law of the contract was applied, that is to say, the law of the country in which its elements were most densely grouped and with which factually the contract was most closely connected.
It is true the judges purport to apply the leX Situs but in determining the situs they apply rules (and modify them where necessary to suit changing modern conditions) which in fact are the very rules (1) (2) , 424 which in practice would be used to determine the proper law of the contract.
The English Judges say that when the intention is not express one must be inferred and the rules they have made come to this: that as reasonable men they must be taken to have intended that the proper law of the contract should obtain.
The other view is that the intention does not govern even when express and that the proper law must be applied objectively.
But either way, the result is the same when there is no express term.
The "proper law," is in fact applied and for present purposes it does not matter whether that is done for the reasons given by Cheshire or because the fluid English rules that centre round the lex situs lead to the same conclusion in this class of case.
That, however, raises a further question.
Which is the proper law? The law that obtains when the contract was made and the obligation fashioned or the law in force at the time when performance is due? Here again, we think the answer is correctly given by Cheshire at page 210, quoting Wolff 's Private International Law, page 424, and Be.
Chesterman 's Trusts(1): "A proper law intended as a whole to govern a contract is administered as 'a living and changing body of law ' and effect is given to any changes occur.
ring in it before performance falls due".
This is what the English Courts did in New York Insurance Co. vs Public Trustee(2), Re.
Banque Des Marchands De Moscou(3), Fouad Bishara Jabbour vs State of Israel(4), and Arab Bank Ld.
vs Barclays Bank(5).
They were all cases in which the law changed because of the outbreak of war and where performance became impossible because of local legislation.
In the last two cases, the debts vested in the Custodian because of local legislation and payment by the debtor to the Custodian was regarded as a good discharge of the debt.
The position in those two cases was just what it is here.
(1)[1923] 2 Ch.
466, 478.
(2) (3) (4) (5)[1954] A.C. 495, 529.
425 Counsel argued that as Lyallpur was part of India, when the contract was made, the Indian law must be applied and that no different intention can be imputed to the parties.
But that is not the law, as we understand it, whether we apply the "proper law" or the situs rules.
The proper law will be the law at Lyallpur applied as a living and changing whole, and this would have been the case even if India had not been divided, because each State had the right to make different local laws even in undivided India, as witness the different money lending laws and the cloth and grain control orders: indeed this very case is an illustration of that, for the controls which gave rise to this very contract were not uniform throughout India.
But even apart from the "proper law" the decision of the Privy Council in Arab Bank Ld.
vs Barclays Bank(1) and of the Queens Bench Division in Fouad Bishara Jabbour vs State of Israel (2 ) negatives this contention when ail intention has to be imputed or a clause in the contract implied.
It is necessary, however, to bear in mind that, under modern conditions, choses in action arising out of contract have two aspects: (1) as property and (2) as involving a contractual obligation for performance.
The property aspect is relevant for purposes of assignment, administration, taxation and the like; the contractual aspect for performance.
In the present case, we are primarily concerned with the property aspect because the Pakistan Ordinance regards debts as property and vests all evacuee property in the Custodian and requires every person holding such property to surrender it to the Custodian on pain of penalties prescribed by the Ordinance, and section 11(2) states that "Any person who makes a payment under subsection (!) shall be discharged from further liability to pay to the extent of the payment made".
The payment was made and that, in our opinion, exonerated the defendant from further liability.
Such payment would operate as a good discharge even under the English rules: see Fouad Bishara Jabbour vs (1) , 529.
(2) 426 State of Israel(1) at page 154 where a number of English authorities are cited, including a decision of the Privy Council in Odwin vs Forbes(2).
That was also the result of the decisions in the following English cases, which are similar to this, though the basis of the decisions was the situs of the debt and the multiple residence of corporations: Fouad Bishara Jabbour vs State of Israel(1), Be Banque Des Marchands De Moscou(3) and Arab Bank Ld.
vs Barclays Bank (4).
The same result follows from the decision of the Judicial Committee in the Bank of Travancore Ltd. vs Dhrit Ram(5) where Lord Atkin said "When consideration is being given to the question, what law did the parties intend to govern the contract? it seems proper to bear in mind that the promisor is a bank incorporated under Travancore law with, apparently, some connection with the State of Travancore, and governed as to its business by any law of Travancore that may affect banking. .
The only difference between that case and this is that at the date of the deposit in this case there was no difference between the laws of Punjab and Delhi on the present point.
But they could have differed even if India had not been divided, as we have just pointed out.
The English cases are, however, in point and we can see little in principle to distinguish them from this case.
The learned counsel for the plaintiffs respondents argued that even if the law is what we have said, the Pakistan Ordinance does not apply to this case because "a cash deposit in a bank" is excluded.
The argument was based on the definition of "property" in section 2(5) of the Ordinance.
But this is not a cash deposit in a bank as between the plaintiffs and the defendant.
It is a debt which the defendant owes, or owed, to the plaintiffs, and the same definition states that "property" means, among other things, any debt or actionable claim The portion of the definition which speaks of a "cash deposit in a bank" means that such a deposit is not to be treated as (1) (2) (3) (4) , 529, (5)69 I. A. 1, 9. 427 "property" for the purposes of the Ordinance as between the bank and the customer who owns or controls the deposit.
We hold, therefore, that whether the proper law of the contract applies or the English law of situs in a case of this kind, the defendant is exonerated because, the debt being "property", the Ordinance divested the plaintiffs of ownership in it and vested the debt in the Custodian and at the same time interfered with the obligation for performance by providing that payment to the Custodian shall operate as a discharge of the obligation.
But we wish to emphasize that we decide this because payment was in fact made to the Custodian and that we express no opinion about what would happen in a case where there is no payment and the defendant has no garnishable assets in Pakistan out of which the West Punjab Government could realise the debt by attachment of the defendant 's property.
Different conclusions might possibly arise in such a case.
Lastly, it was urged that the Pakistan Ordinance is a penal law and is confiscatory in character, therefore, no domestic tribunal will recognise it or give effect to it.
That proposition is, in any event, too widely stated, but we are unable to condemn this law as opposed to the public policy of this country be,cause we have exactly the same kind of laws here, as do other civilised countries which find themselves in similar predicament or at the outbreak of war; see Arab Bank Ltd. vs Barclays Bank(1) and also Fouad Bishara Jabbour vs State of Israel(2) and Re.
Munster(3) where a like argument was repelled.
We hold that this legislation is not confiscatory.
The same rules apply to the item of Rs. 79 6 6 and to the deposit of Rs. 1,000 as security.
The appeal succeeds.
The decrees of the lower Courts are set aside.
A decree will now be passed dismissing the plaintiffs ' claim, but in the special circumstanoes of this case the parties will bear their own costs throughout.
(1) (2) , 157, (3) [1920] 1 ch.268.
| During the years in question cloth was rationed at Lyallpur, then a part.
of the Punjab in undivided India, and sales could only be made to government nominees and other authorised persons.
The plaintiffs, resident in Lyallpur, were the government nominees, The 403 defendant company, with its head office at Delhi had a branch office and mills at Lyallpur, and supplied the plaintiffs with cloth from time to time in accordance with the government quota through its branch manager at Lyallpur.
Their dealings lasted some 4 or 5 years prior to 1947.
In accordance with their contract the plaintiffs left a security deposit of Rs. 1,000 with the defendant 's branch manager at Lyallpur, and deposited further sums of money with him from time to time at Lyallpur.
The defendant supplied the plaintiffs with their quota of cloth against those deposits.
There was thus a running account between the parties in which the balance was sometimes in the plaintiffs ' favour and sometimes against them; when against, they paid the defendant interest on the "overdraft".
The goods had to be supplied at Lyallpur and all moneys were paid there.
The accounts were kept at Lyallpur though copies were sent to the defendant 's head office at Delhi.
In 1947, when India was partitioned, Lyallpur was assigned to Pakistan.
The plaintiffs thereupon fled the country and entered India as refugees.
They settled in Delhi and thus became "evacuees" according to a Pakistan ordinance.
At that time there was a balance of Rs. 11,496 6 6 in the plaintiffs ' favour.
They accordingly made a demand at Delhi for payment of this sum and for return of their security deposit.
In the meanwhile the Pakistan Government issued an ordinance (1) vesting all evacuee property in the Custodian of Evacuee Property in Pakistan (2) prohibiting the 'payment of money to evacuees; and (3) requiring all moneys payable to, or claimable by, evacuees to be paid to the Deputy Custodian of Evacuee Property in Pakistan.
Payments so made were to operate as a discharge from further liability to the extent of the payment.
Breach of this law was punishable as an offence.
The Deputy Custodian demanded payment from the defendant of the moneys owing to the plaintiff.
After some correspondence and demur, the payment was made as required.
The defendant pleaded this as a defence to the action.
Held: (1) Lyallpur was the place of primary obligation because under the contract the balance remaining at its termination was to be paid there and not elsewhere, accordingly the demand for payment made at Delhi before a demand and refusal at Lyallpur was ineffective; (2) That the elements out of which the contract to pay arose were most densely grouped at Lyallpur, so Lyallpur was the natural seat of the contract and the place with which it had its closest and most real connection.
Accordingly, the "proper law of the contract" was the Lyallpur Law; (3) Under the English doctrine also the situs of the debt was Lyallpur; and so 404 (4) either way, the Lyallpur law applied (5) as it obtained at Lyallpur at the time when performance was due because a " proper law" intended as a whole to govern a contract is administered as a "living and changing body of law", accordingly, effect is given to any changes occurring in it before performance is due; (6) a "debt" being a chose in action is "property" within the meaning of the Pakistan Ordinance and so, (7) the money was rightly paid to the Deputy Custodian and that operated as a good discharge and exonerated the defendant from further liability.
But quaere, whether different conditions would not arise in a case where no payment is made and the defendant has no garnishable assets in Pakistan out of which the West Punjab Government could realise the debt out of the defendant 's property there.
(8)The provisions of the Pakistan ordinance relevant to the case are not opposed to the public policy of India and so can be relied on as a defence to an action of this nature.
Appeal allowed.
Mount Albert Borough Council vs Australasian Temperance, etc.
; , Bonython vs Commonwealth of Australia at 219), Bank of Travancore vs Dhirt Ram (69 I.A. I at 8), New York Life Insurance vs Public Trustee ([1924] 2 Ch.
101 at 119), Rex vs Lovitt , Joachinsons vs Swiss Bank Corporation ([1921] 3 K.B. 110), Arab Bank vs Barclays Bank at 531), Fouad Bishara vs State of Israel ([1954] 1 A.E.R. 145).
Chesterman 's Trusts [(1923] 2 Ch.
466 at 478), Be.
Banque Des Marchands De Moscou ([1954] 2 A.E.R. 746), Odwin vs Forbes and Re. Munster ([1920] 1 Ch.
268), referred to.
|
Civil Appeal No. 85 of 1954.
Appeal under Article 133(1)(c) of the Constitution from the Judgment and Decree dated the 6th November, 1950, of the High Court of Judicature at Allahabad in F.A. No. 141 of 1949.
section Ramaswamy Iyer (K. R. Choudhry, with him) for the appellant.
M. C. Setalvad Attorney Generalfor India (C. P. Lal, with him) for the respondent.
April 21.
The Judgment of the Court was delivered by IMAM J.
This is an appeal against the decision of the Allahabad High Court affirming the decision of the Civil Judge of Allahabad.
The appellant was appointed to the United Provinces Civil (Executive) Service in 1940 and in due course was confirmed.
He was posted to various stations and in 1944 he was posted to Lakhimpur Kheri, where he joined in July, 1944.
On the 23rd August, 1944, the Deputy Commissioner of Lakhimpur Kheri received a telegram from Government informing him that the appellant was suspended forthwith pending inquiry into his conduct and that a copy of the telegram was forwarded to the appellant for information.
On the 26th August, 1944, the Deputy Commissioner wrote to the appellant that he was required to appear before the Commissioner of the Lucknow Division on the 28th August, 1944, to answer the charges, a copy of which would be forwarded to him.
He further in.
formed the appellant that he could treat his case under rule 55 of the Civil Services (Classification Control and Appeal) Rules of 1930, published in the United Provinces Gazette of June 28, 1930.
The appellant was further informed that in view of his suspension his leave application was cancelled.
On the 28th August, 1944, the appellant appeared before the Commissioner at Lucknow and protested against the procedure adopted by him for the inquiry.
The Commis 394 sioner having completed the inquiry on the 1st September, 1944, submitted his report to Government.
The Commissioner, however, recommenced the inquiry on September 11, 1944, and after completing the inquiry submitted the papers to Government on the 30th September, 1944.
The Government of the United Provinces by an order dated the 25th November, 1944, dismissed the appellant from the United Provinces Civil (Executive) Service.
This order was served on the appellant on the 1st December, 1944, and he submitted a memorial to the Governor on August 7, 1945, which was rejected on the 28th May, 1947.
During the period of suspension the appellant was paid subsistence allowance at the rate of one fourth of his salary which was then Rs. 310 per month.
The appellant gave notice under section 80 of the Code of Civil Procedure of his intention to bring a suit and on the 2nd January, 1948, he filed his suit.
He asked for a declaration that the order of dismissal was wrongful, illegal, void and inoperative and that he still continued to be a member of the Civil Service entitled to full pay with all increments as they fell due.
He prayed for a decree for recovery of arrears of salary amounting to Rs. 16,810 8 0 less subsistence allowance already drawn from August 24, 1944, to December 31, 1947.
In the alternative he prayed for a declaration that the order of dismissal was wrongful and that a decree to the extent of Rs. 1,20,000 with interest by way of damages may be passed in his favour.
He paid the requisite court fee on the valuation of Rs. 1,20,000.
This alternative claim was deleted from the plaint as a result of an amendment, having regard to a subsequent decision of the Privy Council* which held that a person illegally dismissed from Government service could only get a declaration that the order was inoperative and that he still continued to be a member of the Service.
The appellant asked for refund of the extra court fee paid which was rejected by the Civil Judge by a separate order.
The Civil Judge, however, decreed High Commissioner for India and High Commissioner for Pakistan vs 1.
M. Lal, [1948] L.R. 75 I.A. 225.
395 the appellant 's suit in part declaring that the order dismissing him from service was illegal and that he still continued to be a member of the United Provinces Civil (Executive) Service.
The Civil Judge, however, declined to pass a decree for arrears of salary.
Against the decision of the Civil Judge the appellant appealed to the High Court and his appeal was dismissed.
The respondent did not appeal against the decision of the Civil Judge or file a cross objection.
The appeal in the High Court proceeded on the basis that the order of dismissal made against the appellant was illegal and that it was rightly declared that he continued to be a member of the service of the United Provinces Civil (Executive) Service.
The only two questions which were considered and decided by the High Court were as to whether the appellant was entitled to a decree for arrears of salary and a refund of the excess court fee paid by him.
Both these questions were decided against the appellant by the High Court which subsequently gave him a certificate for leave to appeal to this court.
It may be stated at once that in view of the decision of this court in The State of Bihar vs Abdul Majid(1) there can be no question now that the appellant had the right to institute a suit for recovery of arrears of salary as he was dismissed illegally.
It is unnecessary, therefore, to refer to the elaborate discussion of the law in this respect to be found in the judgment of the learned Judges of the High Court.
When this appeal came on for hearing before this court and the appellant had been heard the Attorney General in the course of his argument bad contended that the order of suspension of August 1944 subsisted although the order of dismissal had been declared illegal by the Civil Judge and all that the appellant was entitled to was subsistence allowance and not salary so long as the order of suspension remained effective.
This plea was not taken in the written statement filed in the trial court, nor was there any issue framed in this respect.
The Attorney General (1) , 396 asked for time to file an additional written statement on behalf of the respondent.
This court allowed time for the respondent to do so and the appellant was also given time to reply to any additional written statement filed on behalf of the respondent.
The respondent filed the additional written statement and the appellant filed his reply to it.
Thereafter the appeal came on for bearing again and the learned Advocate for the appellant made his submissions on the additional written statement and the Attorney General replied to the same.
So far as the payment of excess court fee is concerned, the learned Advocate for the appellant did not urge this point in his opening argument but urged it in reply after the Attorney General bad concluded his argument.
Apart from the question as to whether the Advocate can be allowed to urge a point like this in reply when no submission had been made by him in his opening, it seems there is no merit in the submission made by the Advocate.
The court fee had been paid on Rs. 1,20,000 which was claimed as damages.
At the time the suit was instituted the law as then understood permitted such a claim to be made.
The decision of the Privy Council, however, made it clear that no such claim could be mad e and all that a Government servant could ask for was a declaration that the order of dismissal was illegal and that he still continued to be a member of the Civil Service.
The decision of the Privy Council clarifying the position could not be a ground for refund of court fee when at the time it was paid it was in accordance with the law as then understood.
Indeed the appellant did not appeal or file an application against the order of the Civil Judge refusing to pass an order of refund.
In the High Court he did not ask for this relief on the basis of any statutory provision.
He invoked the inherent powers of the High Court.
The Court Fees Act contains certain provisions for refund of court fee paid by a party but admittedly the present case is not covered by any of those provisions.
It seems, therefore, that the High Court in the circumstances of the present case rightly refused 397 to order a refund of the excess court fee paid by the appellant.
It also does not appear that the Civil Judge acted illegally in refusing to order a refund.
On the additional written statement filed in this court by the respondent a question has arisen whether the order of suspension was valid and during the period it was in force the appellant could recover arrears of salary.
The learned Advocate for the appellant contended that an order of suspension is a penalty under rule 49 of the Classification Rules and it was against all sense of natural justice to impose a penalty upon a Government servant pending an in quiry against him under rule 55 of the said rules.
An order imposing the penalty of suspension was an appealable order under rule 56 of the Classification Rules and under rule 59 of the said rules, an appellate authority was bound to consider whether the facts on which the penalty was imposed had been established and whether those facts disclosed sufficient grounds for imposing such a penalty.
Rule 54 of the Fundamental Rules authorises a revising or an appellate authority, when it finds that the Penalty of suspension was unjustified or not wholly justified, to make an order granting to the Government servant his full pay and any allowance to which he was entitled if he was honourably acquitted and in other cases such proportion of pay and allowances as it may prescribe.
The penalty of suspension, it was urged, involved serious loss in the matter of salary and allowances and to impose this penalty pending an inquiry was to prejudge the case against a Government servant and in effect to make his right of appeal a meaningless remedy.
It was pointed out that in some of the rules framed by a Government or quasiGovernment authority the penalty of suspension pending an inquiry was specifically provided for, such as rule 95 of the Bihar and Orissa Service Code re ferred to in Abdul Majid 's case and rule 1711 of the Indian Railway Establishment Code.
On behalf of the appellant reference was also made to certain decisions to the effect that as between master and servant, the master had no power of suspension unless 398 there was an express term to that effect in the contract between them.
The Attorney General conceded that apart from the Classification Rules and the Fundamental Rules he was not aware of any other rules under which the penalty of suspension could be imposed upon a Government servant.
He also conceded that under the Classification Rules an order of suspension was a penalty.
He further conceded that as between master and servant the former had no power of suspension unless the terms of the contract between them permitted it or a statute or a rule provided for it but this principle, he said, did not apply to a person in the service of the Crown in India.
He, however, contended that under rule 49 of the Classification Rules a penalty of suspension could be imposed pending an inquiry.
There was nothing in the rule itself which enjoined that a penalty could only be imposed at the conclusion of an inquiry.
The penalty could be imposed for good and sufficient reasons which may be based on materials already existing pending an inquiry.
After the inquiry there may be the imposition of a severer penalty or a definite period of suspension may be fixed or there may be cancellation of the order of suspension.
No doubt there was a right of appeal against an order imposing a penalty of suspension pending an inquiry but the provisions of rule 54 of the Fundamental Rules did not necessarily lead to the conclusion that the penalty of suspension could only be imposed after an inquiry.
Clause (a) of the said rule might contemplate a case where the penalty had been imposed after an inquiry but clause (b) could cover a case where the penalty had been imposed pending an inquiry.
In the present case, he said, there was no contravention of any principle of natural justice as the appellant had an opportunity of explaining the accusation made against him.
The letter of the Commissioner of Lucknow Division with its annexure, marked Exhibit A in the trial court, clearly showed that the Deputy Commissioner, Lakhimpur Kheri had recorded statements of persons with ref erence to three cases and the appellant saw him in 399 connection therewith.
He admitted the facts but tried to explain them.
He, however, declined to give his statement in writing.
The order of suspension made against him was based on materials of which he was fully aware.
In the alternative the Attorney General urged that in the year 1944 the appellant was a member of the Civil Service of the Crown in India holding office during the pleasure of the Crown.
There was, therefore, inherent power in the Crown and its representative to pass an order of suspension against the appellant pending an inquiry.
The Classification Rules and Fundamental Rules were merely directions for general guidance and they did not constitute a contract between the Crown and its servants.
For this proposition he referred to the observations of Lord Hobhouse in the case of Shenton vs Smith(1).
He also relied upon the following observations of Lord Roche in the case of B. Venkata Rao vs Secretary of State for India in Council (2) .
"Section 96 B in express terms states that office is held during pleasure.
There is, therefore, no need for the implication of this term and no room for its exclusion.
The argument for a limited and special kind of employment during pleasure but with an added contractual term that the rules are to be observed is at once too artificial and too far reaching to commend itself for acceptance.
The rules are manifold in number and most minute in particularity, and are all capable of change. . . . . .
Incon venience is not a final consideration in a matter of construction, but it is at least worthy of consideration and it can hardly be doubted that the suggested procedure of control by the Courts over Government in the most detailed work of managing its services would cause not merely inconvenience but confusion".
In the courts below the principal question for consideration was whether the appellant could recover arrears of salary having been illegally dismissed.
It was not pleaded that the order of suspension was (1) (2) L.R. 64 I.A. 55.
51 400 valid and during the period it was in force the appellant could not recover arrears of salary and no specific issue was framed in this respect.
If the decision of this court in Abdul Majid 's case had been available to the courts below, they would have held that the appellant was entitled to recover arrears of salary when he had been illegally dismissed and they would have bad further to decide whether the order of suspension was valid and during the period it was in force the appellant could recover arrears of salary.
On the additional written statement filed by the respondent in this court, the submissions of the Advocate for the appellant and the Attorney General would require examination and it might have been necessary to consider whether the case should not be remanded to the court of trial.
It is unnecessary, however, to record a decision on these submissions having regard to the attitude adopted by the Advocate for the appellant.
He objected to the case being remanded as such a course would involve the appellant in heavy expenditure and harassment.
The appellant preferred to give up his claim for arrears of salary less subsistence allowance paid to him from the date of the order of suspension until the date of the order of dismissal.
He, however contended that the order of suspension continued to be in force only until the 25th November, 1944, the date of the order, of dismissal.
On that date the order of suspension ceased to exist and the appellant was entitled to recover arrears of salary from the 25th November, 1944, to the 31st December, 1947, inclusive.
The Attorney General strongly contended that it continued to be in force and that it was not at all affected by the declaration of the Civil judge that the order of dismissal was illegal.
In view of that decision the order of dismissal must be regarded as a nullity and non existent in the eye of law.
The inquiry, the outcome of which was the order of dismissal, had not therefore ended.
It could only end with a valid order which would replace the order of suspension Until that happened the accusation against the appellant remained and the inquiry had not ended.
He referred to the case of M. Gopal Krishna Naidu vs 401 State of Madhya Pradesh(1).
On behalf of the appellant reliance was placed on the case of Provincial Government, Central Provinces and Berar through Collector, Amraoti vs Shamshul Hussain Siraj Hussain(2).
The order of suspension made against the appellant was clearly one made pending an inquiry.
It certainly was not a penalty imposed after an enquiry.
As the result of the inquiry an order of dismissal by way of penalty had been passed against the appellant.
With that order, the order of suspension lapsed.
The order of dismissal replaced the order of suspension which then ceased to exist.
That clearly was the position between the Government of the United Provinces and the appellant.
The subsequent declaration by a Civil Court that the order of dismissal was illegal could not revive an order of suspension which did not exist.
The case referred to by the Attorney General is not directly in point and that decision does not conflict with the case relied upon by the appellant.
The appellant is, therefore, entitled to recover arrears of salary from the 25th of November, 1944, to 31st December, 1947.
The appeal is accordingly allowed in part with costs throughout and the decree of the courts below is set; aside.
The plaintiff 's suit is decreed for arrears of salary from the 25th of November, 1944, to the 31st of December, 1947, inclusive.
The appellant had claimed Rs. 16,810 8 0 less subsistence allowance already drawn as arrears of pay from the 24th of August, 1944, to the 31st December, 1947.
As his claim for arrears of salary from the 24th of August, 1944, to the 25th of November, 1944, is given up, the total salary payable to him during this period less subsistence allowance already drawn, must be deducted from the sum of Rs. 16, 810 8 0.
The judgment of the High Court as well as the additional written statement filed by the respondent in this court show that subsequent to the decree passed by the Civil Judge the appellant was treated as under suspension until he was dismissed by a fresh order of (1) A.I.R. 1952 Nag.
(2) I.L R. ; A.I.R. (36) 402 dismissal and that he has been paid subsistence allowance for the entire period.
Such subsistence allowance as has been paid to the appellant from the 25th of November, 1944, to the 31st December, 1947 inclusive, must, therefore, be credited to the respondent and the same must be adjusted against the salary claimed by the appellant.
A decree will accordingly be prepared stating the amount recoverable by the appellant.
The appellant was permitted to appeal in forma pauperism As he has succeeded in the appeal, the Registrar shall calculate the amount of court fee which would have been paid by the appellant if he had not been allowed to appeal as a pauper and incorporate it in the decree.
The court fee shall be paid by the appellant and the same will be recoverable by the Government of India from him and shall be the first charge on the amount decreed to him.
Under Rule 7 of Order XIV of the Rules of this Court., the appellant will be allowed the fees paid by him to his Advocates, in the taxation of costs.
| The appellant, a member of the United Provinces Civil (Executive) Service, was suspended from service with effect from the 24th August, 1944, pending an enquiry into his conduct.
As a result of enquiry and report by the Commissioner, the Government passed an order on the 25th November, 1944, dismissing the appellant from service, which order was served on the appellant on the 1st December, 1944.
The appellant instituted a suit for a declaration that the order of dismissal passed against him was wrongful, illegal and inoperative, and that he continued to be in service and 'was entitled to a decree for recovery of arrears of his salary.
The plaint included an alternative prayer for a declaration that the order of dismissal was 50 392 wrongful and for a decree for Rs. 1,20,000/ by way of damages being passed in his favour.
The requisite court fee on the valuation of Rs. 1,20,000/ was paid.
The claim for damages was later on abandoned in view of the decision of the Privy Council in High Commissioner for India and High Commissioner for Pakistan vs I.M. Lal(1) and consequential amendments were made in the plaint.
The Civil Judge granted a declaration that the order of dismissal was illegal and that the appellant continued to be in service in spite of that order.
But he declined to grant a decree for arrears of salary on the ground that a suit therefor was not maintainable.
A prayer for the refund of the additional court fee paid in respect of the claim for damages was also refused.
The respondent did not appeal against the decision that the order of dismissal was illegal.
But the appellant took the matter in appeal to the High Court which, affirming the decision of the Civil Judge, negatived his claim for arrears of salary and also refused refund of court fee.
Leave was, however, granted to appeal to the Supreme Court.
In view of the decision of the Supreme Court in the case of The State of Bihar vs Abdul Majid(2), the respondent did not dispute the right of the appellant to recover arrears of pay.
But he sought to support the decision on the ground that the order of dismissal dated the 25th November, 1944, having been declared to be illegal and void, the order of suspension dated the 24th August, 1944, became revived and that that would bar the claim for arrears of salary.
Held that the order of suspension made against the appellant being one pending an enquiry, it lapsed with the order of dismissal and the subsequent declaration by the Civil Court that the order of dismissal was illegal could not revive an order which had ceased to exist.
The question whether the order of suspension dated the 24th August, 1944, was valid and whether it was passed after due enquiry, would be material only with reference to the claim for salary for the period between the 24th August, 1944 and the 1st December, 1944, and as the appellant did not press the claim for that period there was no need to direct an enquiry on that point.
Held further that the claim for refund of extra court fee could not be granted inasmuch as the decision of the Privy Council clarifying the position could not be a ground for the refund of excess court fee when at the time it was paid it was in accordance with the law as it then stood.
The State of Bihar vs Abdul Majid ([1954] S.C.R. 786), Shenton vs Smith ([1896] A.C. 229), B. Venkata Rao vs Secretary of State for India in Council (L.R. 64 I.A. 55), M. Gopal Krishna Naidu vs State of Madhya Pradesh (A.I.R. , Provincial Government, Central Provinces and Berar through Collector, Amraoti vs Shamshul Hussain Siraj Hussain (I.L.R. , referred to.
(1) [1948] L.R. 75 I.A. 225.
(2) 393
|
Appeal No. 212 of 1954.
Appeal from the Judgment and Decree dated the 10th day of November 1953 of the High Court of Judicature at Bombay in Appeal No. 8 of 1953 under the Letters Patent, against the decree dated the 23rd day of September 1952 of the said High Court in Appeal No. 67 of 1952 from Original Decree arising out of Order dated the 20th November 1951 of the City Civil Court, Bombay, in Summary Suit No. 233 of 1948.
R.Subramania Iyer and K. R. Choudhry, for the appellant.
H.J. Umrigar, J. B. Dadachanji and Rajinder Narain, for the respondent.
March 7.
The following Judgments were delivered.
DAS J.
The facts leading up to this appeal are few and simple.
Two persons named Mahomedali Habib and Sakerkhanoo Mahomedali Habib used to carry on business as merchants and pucca adatias in bullion and cotton at Bombay under the name and style of Habib & Sons.
In 1948 that firm instituted a suit in the Bombay City Civil Court, being Summary Suit No 233 of 1948, against the present appellant Juga lkishore Saraf, a Hindu inhabitant carrying on business at Bombay, for the recovery of Rs. 7,113 7 0 with interest at 6 per cent.
per annum said to be due by him to the firm in respect of certain transactions in gold and silver effected by the firm as pucca adatias.
On the 7th February,. 1949 when that summary suit was still pending a document was executed whereby it was agreed that the two partners would transfer and Messrs Raw Cotton Company, Limited, (hereinafter called the respondent company) 1372 would accept the transfer of, inter alia, all book and other debts due to them in connection with their business in Bombay and full benefit of all securities for the debts and all other property to which they were entitled in connection with the said business.
The respondent company did not take steps under 0.
XXII, r. 10 of the Code of Civil Procedure to get themselves substituted as plaintiffs in the place and stead of Habib & Sons, the plaintiffs on record, but allowed the suit to be continued in the name of the original plaintiffs.
Evidently, the two partners migrated from India to Pakistan and their properties vested in the Custodian of Evacuee Property.
On the 15th December 1949 a decree was passed in the summary suit for the sum of Rs. 8,018 7 0 for the debt and interest and the sum of Rs. 410 for costs of the suit, aggregating to Rs. 8,428 7 0, and for further interest at 4 per cent.
per annum from the date of the decree until payment.
Habib & Sons being the plaintiffs on record the decree was passed in their favour.
On the 11th December 1950 the Custodian of Evacuee Property, Bombay, informed the respondent company that by an order made on the 2nd August 1950 the Additional Custodian of Evacuee Property had confirmed "the transaction of transfer" of the business of Habib & Sons to the respondent company.
On or about the 25th April, 1951 the respondent company presented before the Bombay City Civil Court a tabular statement purporting to be an application for execution under Order XXI,rule 11 of the Code of Civil Procedure.
In the last column of the tabular statement, under the heading "The mode in which the assistance of the Court is required", the respondent company prayed that the Court "be pleased to declare the Applicants the assignees of the decree as the decrement debt along with other debts bad been transferred by the plaintiffs to the Applicants by a deed of assignment dated the 7th February 1949 which was confirmed by the Custodian of Evacuee Property, Bombay, and order them to be substituted for the plaintiffs".
There was, in that column, no specification of any of the modes in which the assist 1373 ance of the Court might be required as indicated in clause(j)of Order XXI,rule 11 of the Code.
On the 10th May 1951 the Bombay City Civil Court issued a notice under Order XXI, rule 16 of the Code to Habib & Sons, who were the decree holders on record, and Jugalkishore Saraf, who was the defendant judgment debtor, requiring them to show cause why the decree passed in the suit on the 15th December 1949 in favour of the plaintiffs and by them transferred to the respondent company, should not be executed by the said transferees against the said defendant judgment debtor.
The defendant judgment debtor showed cause by filing an affidavit affirmed by him on the 15th June 1951.
Amongst other things, he denied that the document in question had been executed or that the document transferred the decree to the respondent company.
The matter was tried on evidence and the execution of the document was proved by the evidence of an attesting witness which has been accepted by the executing Court.
The executing Court, however, rejected the second contention and made the notice absolute with costs and gave leave to the respondent company to execute the decree against the judgment debtor.
The judgment debtor filed an appeal before the High Court.
The appeal was heard by Dixit, J. Before him the execution of the document was not challenged and nothing further need be said about that.
The only substan tial question raised wag whether the respondent company were the transferees of the decree within the meaning of Order XXI, rule 16.
The learned Judge answered the question in the affirmative on the authority of the decisions of the Bombay High Court in Purmananddas Jivandas vs Vallabdas Wallji(1) and in Chimanlal Hargovinddas vs Ghulamnabi(2) and affirming the order of the executing Court dismissed the appeal.
The judgment debtor preferred a Letters Patent Appeal before the High Court which was dismissed by Chagla, C.J., and Shah, J., following the two earlier decisions mentioned above.
They, however, (1) Bom.
(2) I.L.R. 1374 granted, under article 133 (1) (c) of the Constitution, a certificate of fitness for appeal to this Court.
The principal question urged before us is as to whether the respondent company can claim to be the transferees of the decree within the meaning of Order XXI, rule 16 of the Code of Civil Procedure.
Order XXI, rule 16 of the Code of Civil Procedure, omitting the local amendments which are not material for our present purpose, provides: "16.
Where a decree or, if a decree has been passed jointly in favour of two or more persons, the interest of any decree holder in the decree is transferred by assignment in writing or by operation of law, the transferee may apply for execution of the decree to the Court which passed it; and the decree may be executed in the same manner and subject to the same conditions as if the application were made by such Provided that, where the decree or such interest as aforesaid, has been transferred by assignment, notice of such application shall be given to the transferor and the judgment debtor, and the decree shall not be executed until the Court has heard their objections (if any) to its execution: Provided also that, where a decree for the payment of money against two or more persons has been transferred to one of them, it shall not be executed against the others".
The first thing that strikes the reader is the sequence of events contemplated by this rule.
It postulates, first, that a decree has been passed and, secondly, that decree has been transferred (i) by assignment in writing or (ii) by operation of law.
The cardinal rule of construction of statutes is to read the statute literally, that is by giving to the words used by the legislature their ordinary, natural and grammatical meaning.
If, however, such a reading leads to absurdity and the words are susceptible of another meaning the Court may adopt the same.
But if no ,such alternative construction is possible, the Court must adopt the ordinary rule of literal interpretation.
In the present case a literal construction of the rule 1375 leads to no apparent absurdity and, therefore, there can be no compelling reason for departing from that golden rule of construction.
It is quite plain that if .Order XXI, rule 16 is thus construed the respondent company cannot possibly contend that the decree now sought to be executed by them was, after its passing, transferred to them by an assignment in writing within the meaning of that rule, for the document in question was executed on the 7th February 1949 but the decree was passed subsequently on the 15th December 1949.
Whether they can claim to have become the transferees of the decree after it was passed by operation of law within the meaning of this rule or to have otherwise become entitled to the benefit of it is a different matter which will be considered later on.
For the moment it is enough to say that there had been no transfer of the decree to the respondent company by any assignment in writing executed after the decree was passed, as contemplated and required by Order XXI, rule 16.
Indeed, Dixit, J., conceded "If the language of Order XXI, rule 16 is strictly construed, it seems to me that the Respondents have no case".
And so did chagla , C,J.; when he said; ". . and it is perfectly clear that if one were to construe rule 16 strictly there is no assignment of the decree in favour of the first respondent".
The learned Chief Justice, like Dixit, J., however, departed from the rule of strict or literal construction as they felt pressed by the fact that the Bombay High Court had consistently taken the view that there might be an equitable assignment of a decree which would constitute the assignee an assignee for the purpose of rule 16 and that what the Court must consider is not merely a legal assignment but also an assignment which operates in equity.
The equitable principle relied upon by the Bombay High Court is what had been enunciated by Lord Westbury in Holroyd vs Marshall(1) in the following words: (1) ; , 210, 211.
176 1376 "It is quite true that a deed which professes to convey property which is not in existence at the time is as a conveyance void at law, simply because there is nothing to convey.
So in equity a contract which engages to transfer property, which is not in existence, cannot operate as an immediate alienation merely because there is nothing to transfer.
But if a vendor or mortgagor agrees to sell or mortgage property, real or personal, of which he is not possessed at the time, and he receives the consideration for the contract, and afterwards becomes possessed of property answering the description in the contract, there is no doubt that a Court of Equity would compel him to perform the contract, and that the contract would, in equity, transfer the beneficial interest to the mortgagee or purchaser immediately on the property being acquired.
This, of course, assumes that the supposed contract is one of that class of which a Court of Equity would decree the specific performance".
The same principle was thus reaffirmed by Jessel, M.R., in Collyer vs Isaacs(1): "A man can contract to assign property which is to come into existence in the future, and when it has come into existence, equity, treating as done that which ought to be done, fastens upon that property, and the contract to assign thus becomes a complete assignment".
Applying the above principles to the facts of the instant case the High Court came to the conclusion that the document of the 7th February, 1949, on a proper reading of it, constituted an assignment of the decree.
The reasoning, shortly put, is: that on a true construction the document in question amounted to.
a transfer of the decree that was expected to be passed in the pending suit, that as the decree was not in existence at the date of the document it operated as an agreement to transfer the decree when it would be passed, that such an agreement could be enforced by a suit for specific performance as indicated by the (1) L.R. 19 Ch.
D. 312, 351.
1377 Privy Council in Raja Sahib Perhlad vs Budhoo(1), that as soon as a decree was passed equity, treating as done what ought to be done, fastened upon the decree and the agreement for transfer became the transfer of the decree and the transferee became a transferee of the decree within the meaning of Order XXI, rule 16.
It is to be noted that to attract the application of this equitable principle there must be an agreement to transfer the decree to be passed in future.
As soon as the decree is passed equity fastens upon it and, by treating as done what ought to be done, that is by assuming that the transferor has executed a deed transferring the decree to the transferee as in all conscience he should do equity regards the transferee as the beneficial owner of the after acquired decree.
The equitable principle we are considering only implements or effectuates the agreement of the parties.
This equity does not, however, take upon itself the task of making any new agreement for the parties either by filling up the lacunas or gap in their agreement or otherwise.
If, therefore, there is no agreement between the parties to transfer the future decree the equitable principle referred to above can not come into play at all.
In order, therefore, to test the propriety of the application of this equitable principle to the facts of the present case we have to enquire whether there was here any agreement between the parties to transfer the decree to be passed in the then pending suit.
This necessarily leads us to scrutinize the terms of the document in question and ascertain its true meaning and import.
No point has been taken before us that the document of the 7th February 1949 is only an executory agreement and not a deed of transfer.
Indeed, the argument has proceeded before us, as before the Court below, that the document in question is a completed deed of transfer.
This relieves us of the task of closely examining the form of the document.
For our present purpose we have, therefore, only to consider what properties were covered by the document.
The High Court has held that the decree to be 2(1) [1869] 12 M.I.A. 275; 2 B.L.R. 111.
1378 passed was also included in this document.
The reasoning appears to be this: Clause 1 of the document comprised six several items of properties.
Each of these items referred to "the said Indian business".
The Fourth item was "All the book and other debts due to the vendors in connection with the said Indian business and the full benefits of all securities for the debts" and the last and residuary item was "All other property to which the vendors are entitled in connection with the said Indian business".
One of the book debts was the subject matter of the pending suit.
The decree that the plaintiff would obtain in, that suit would, therefore, be property or right "in connection with the said Indian business".
Therefore, as they were transferring all property in connection with their business they must have intended to transfer the future decree also.
Therefore, it must be regarded as covered by the document.
I am unable to accept this line of reasoning.
It cannot be overlooked that there was no mention in that document of any suit or decree to be passed in that suit as one would have expected if the parties really intended to transfer the future decree also.
In this connection it is significant that the residuary item covered "All properties to which the vendors are entitled" and not all properties to which they might in future become entitled.
Reference may also be made to the provisions of the Transfer of Property Act.
Under section 8 of that Act the transfer of property passes to the transferee all the interest which the transferor is then capable of passing in the property and in the legal incidents thereof, and if the property transferred is a debt or actionable claim, also the securities therefore.
It is urged that as the respondent company thus became entitled, by virtue of this document read in the light of section 8, to all the rights and remedies including the right to prosecute the pending suit and to obtain a decree the decree that was eventually passed automatically and immediately upon its.
passing must be taken as having been transferred by this very document.
This argument appears to me to really amount to a begging of the question, The 1379 transfer of the debt passed all the interest which the transferors were then capable of passing in the debt and in the legal incidents thereof.
There was then no decree in existence and, therefore, the transferors could not then pass any interest in the non existing decree.
Therefore, section 8 of the Transfer of Property Act does not assist the respondent company.
Upon the assignment of the debt the respondent company undoubtedly became entitled to get themselves substituted under Order XXII, rule 10 as plaintiffs in the pending suit but they did not choose to do, so and allowed the transferors to continue the suit and a decree to be passed in their favour.
The true position, therefore, is that at the date of the transfer of the debt to the respondent company the transferors could not transfer the decree, because the decree did not exist.
On a true construction of the document the transferors agreed only to transfer, besides the five items of specified properties, "All other properties to which the vendors are entitled", that is to say, all properties to which at the date of the document they were entitled.
At the date of the document they had the right to proceed with the suit and to get such relief as the Court by its decree might award but no decree had yet been passed in that suit, and, therefore, property to which they were then entitled could not include any decree that might in future be passed.
It is significant that there was, in the document, no provision purporting in terms to transfer any future decree.
Section 8 of the Transfer of Property Act does not operate to pass any future property, for that section passes all interest Which the transferor can then, i.e., at the date of the transfer, pass.
There was thus no agreement for transfer and much less a transfer of a future decree by this document.
All that was done by the transferors by that document was to transfer only the properties mentioned in clause 1 together with all legal incidents and remedies.
The properties so transferred included book debts.
A book debt which was made the subject matter of the pending suit did not, for that reason, cease to be a book debt and, therefore, it was also transferred but no 1380 decree to be passed in respect of that book debt was If in terms transferred.
In such a situation there was no room or scope for the application of the equitable principle at all.
The transfer in writing of a property which is the subject matter of a suit without in terms transferring the decree passed or to be passed in the suit in relation to that property does not entitle the transferee to apply for execution of the decree as a transferee of the decree by an assignment in writing within the meaning of Order XXI, r. 16.
See Hansraj Pal vs Mukhraj Kunwar(1) and Vithal vs Mahadeva(2).
In my judgment the decree was not transferred or agreed to be transferred to the respondent company by the document under consideration and the latter cannot claim to be transferees of the decree by an assignment in writing as contemplated by Order XXI, rule 16.
The matter, however, has been argued before us at length on the footing that the decree had been transferred or agreed to be transferred by this document and therefore.
, the equitable principle came into play and that as soon as the decree was passed the respondent company became the transferees of the decree by assignment in writing within the meaning of Order XXI, rule 16.
As considerable legal learning has been brought to bear on the question of the application of the equitable principle and its effect on the prior written agreement and as the different decisions of the High Courts are not easily reconcilable, I consider it right to record my views on that question.
I shall.
, then, assume, for the purposes of this part of the argument, that the document of the 7th February 1949 was a completed deed of transfer covering the decree to be passed in future in the then pending suit.
Under the Transfer of Property Act there can be no transfer of property which is not in existence at the date of the transfer.
Therefore, the purported transfer of the decree that might be passed in future could only operate as a contract to transfer the decree to be performed in future, i.e., after the passing of the (1) All.
(2) [1924) 1381 decree.
The question then arises: What is the effect of the operation of the equitable principle on the decree as and when it is passed? Where there is a contract for the transfer of property which is not in existence at the date of the contract, the intending transferee may, when the property comes into existence, enforce the contract by specific performance, provided the contract is of the kind which is specifically enforceable in equity.
It is only when the transferor voluntarily executes a deed of transfer as in all conscience he should do or is compelled to do so by a decree for specific performance that the legal title of the transferor in that property passes from him to the transferee.
This transfer of title is brought about not by the prior agreement for transfer but by the subsequent deed of transfer.
This process obviously involves delay, trouble and expenses.
To obviate these difficulties equity steps in again to short circuit the process.
Treating as done what ought to be done, that is to say, assuming that the intending transferor has executed a deed of transfer in favour of the intending transferee immediately after the property came into existence, equity fastens upon the after acquired property and treats the beneficial interest therein as transferred to the intending transferee.
The question for consideration is: Is this transfer brought about by the earlier document whereby the property to be acquired in future was transferred or agreed to be transferred? In other words, can it be said, in such a situation, that the after acquired property had been transferred, proporio vigore, by the earlier document? Does that document operate as an assignment in writing within the meaning of Order XXI, rule 16? Learned counsel for the respondent company contends that the answer to these questions must be in the affirmative.
He relies on several cases to which reference may now be made.
In Purmananddas Jivandas vs Vallabdas Wallji (supra) the facts were these.
In May 1859 one died leaving his properties to executors in trust for the appellant.
In August 1868 the executors filed a suit in the Original Side of the Bombay High Court 1382 against Luckmidas Khimji for recovery of money lent to him as manager of Mahajan Wadi.
During the pendency of the suit, the executors on the 11th May 1870 assigned in very wide and general terms all the properties of the testator to the appellant including "all movable property, debts claims and things in action whatsoever vested in them as such executors".
The appellant was not brought on the record but the suit proceeded in the name of the executors.
On the 23rd January 1873 a decree was passed for the plaintiffs on the record, i.e. the executors, for Rs. 31, 272 13 5 which was made a first charge on the Wadi properties.
The appellant thereupon applied for execution of the decree under section 232 of the Code of 1882 (corresponding to our Order XXI, rule 16), as transferee of the decree.
The Chamber Judge dismissed the application.
On appeal Sargent, C. J., and Bayley, J., held that the appellant was competent to maintain the application.
After pointing out that the ssignment was in the most general terms, Sargent, C. J., observed: ". . . . and the effect of this assignment was, in equity, to vest in Purmananddas the whole interest in the decree which was afterwards obtained.
But it has been suggested that Purmananddas is not a transferee of the decree under section 232 of the Civil Procedure Code, because the decree has not been transferred to him "by assignment in writing or by operation of law", and that, therefore, he is not entitled to apply for execution.
There is no doubt that in a Court of equity, in England the decree would be regarded as assigned to Purmananddas, and he would be allowed to proceed in execution in the name of the assignors.
Here there is no distinction between "law" and "equity", and by the expression 'by operation of law ' must be understood the operation of law as administered in these Courts.
We think under the circumstances that we must hold that this decree has been transferred to Purmananddas 'by operation of law ' The last sentence in the above quotation, standing by itself, quite clearly indicates that the learned 1383 Chief Justice was of the view that as the benefit of the decree became available to the appellant by operation of the equitable principle it had to be held that the decree had been transferred to the appellant "by operation of law" rather than by an assignment in writing and that is how it was understood by the reporter who framed the head note.
The learned Chief Justice, however, immediately after that last sentence added: "In the present case the decree has been transferred by an assignment in writing as construed in these Courts".
This sentence prima facie appears to be somewhat in consistent with the sentence immediately preceding and it has given rise to a good deal of comments in later cases.
The learned Chief Justice has not referred to any case in which the Bombay High Court had adopted such a construction.
The case of Ananda Mohon Roy vs Promotha Nath Ganguli(1) follows the decision of the Bombay High Court in Purmananddas Jivandas vs Vatllabdas Wallji (supra).
It should be noted, however, that in this Calcutta case the decree was obtained and the transfer was made on the same day and it was held that though there was no assignment of the decree in so many words the property with all arrears of rent having been assigned to the mortgagee simultaneously with the passing of the decree the assignment passed the decree also.
The case of Chimanlal Hargovinddas vs Ghulamnabi (supra) has been strongly relied upon.
In that case a shop was held by A and B as tenants incommon.
In May 1936 A agreed to sell his half share ,to C.
As per arrangement A filed a partition suit on the 16th January 1937 to recover his share.
The disputes in the suit were referred to arbitration by order of Court and eventually the umpire made his award on the 16th January 1939 declaring that A was entitled to a half share.
A then, on the 7th March, 1939, sold all his rights under the award (which was (1) ; , 177 1384 called a decree) to C by a registered deed.
C did not apply for substitution of his name on the record of the suit.
The Court passed a decree upon the award on the 1st September, 1939.
On the 24th November 1939 C applied for execution of the decree.
It was held that C was entitled to execute the decree under Order XXI, rule 16, for what had been transferred to him was not merely A 's half share in the property but all his rights under the award including the right to take a decree.
In this case, having regard to the terms of the previous agreement and the fact that the parties were treating the award as a decree the intention was quite clear that by the subsequent deed of sale both the award and the decree upon it had been transferred.
It was quite clearly recognised by the Full Bench that if the sale deed transferred only.
A 's half share in the property or only his right to take a decree C could not apply under Order XXI, rule 16.
Reading the three cases relied on by learned counsel for the respondent company it seems to me that they proceeded on the footing that the equitable title related back to the earlier agreement in writing and converted the agreement to transfer the future decree into an assignment in writing of that decree as soon as it was passed.
Some support is sought to be derived by learned counsel for this doctrine of relation back from the above quoted observations of Lord Westbury in Holroyd vs Marshall (supra) "that the contract would, in equity, transfer the beneficial ' interest" and of Jessel, M.R., in Collyer vs Isaacs (supra) that "the contract to assign thus becomes a complete assignment".
I find considerable difficulty in accepting this argument as sound.
In the first place the Lord Chancellor and the Master of the Rolls were not concerned with the question of relation back in the form in which it has arisen before us.
In the next place it must not be overlooked that the equitable principle herein alluded to is not a rule of construction of documents but is a substantive rule which confers the benefit of the after acquired property on the person to whom the transferor had, by his agreement, promised to transfer the same.
Thus, by treating as done that 1385 which ought to be done, equity fastens upon the after acquired property and brings about a transfer of it.
The implication of this principle, to my mind, is clearly that the agreement, by itself and proprio, vigore, does not transfer the property when it is subsequently acquired but that instead of putting the intending transferee to the trouble and expense of going to Court for getting a decree for specific performance directing the promisor to execute a deed of transfer which when executed will transfer the afteracquired property, equity intervenes and places the parties in a position relative to each other in which by the prior agreement they were intended to be placed as if a deed of transfer had been made.
As I apprehend the position, it is by the operation of equity on the subsequent event, namely, the actual acquisition of the property on its coming into existence that the beneficial interest therein is transferred to the promisee.
This transfer, to my mind, is brought about by operation of equity which is something dehors the prior agreement.
It is true that that agreement makes the application of the equitable principle possible or I may even say that it sots the equity in motion but, nevertheless, it is equity alone which denudes the transferor of his interest in the after acquired property and passes it to the intending transferee.
That being the true position, as I think it is, the after acquired property cannot, logically and on principle, be said to have been transferred to the intending transferee by the agreement in writing.
I do not see on what principle this transfer can be said to relate back to the previous agreement.
I am fortified in my view by the observations of Lord Cave in the case of Performing Right Society vs London Theatre of Varie ties(1).
In that case, in 1916 a firm of music publishers, being members of the plaintiff society, assigned by an indenture of assignment to the society the performing right of every song, the right of performance of which they then possessed or should thereafter acquire, to be held by the society for the period of the assignor 's membership.
Subsequently, a certain (1) 1386 song was written, and the copyright in it, together with the right of performance, was assigned by the author to the said firm, but there was no fresh assignment in writing by the firm to the plaintiff society such as was required by section 5(2) of the Copyright Act, 1911.
The defendants, who were music hall proprietors, permitted this song to be publicly sung in their music hall without the consent of the plaintiff society.
The plaintiff society then sued the defendants for infringement of their performing rights and claimed a perpetual injunction.
The defence was that as there was no assignment in writing of the copyright subsequently acquired by the firm to the plaintiff society the latter was not the legal owner and, therefore, was not entitled to a perpetual injunction.
Discussing the nature of the right acquired by the plaintiff society under the indenture of 1916 and its claim to the after acquired copyright secured by the firm and referring to section 5, sub section (2) of the Copyright Act, 1911, Viscount Cave, L.C., observed at p. 13: "There was on the respective dates of the instruments under which the appellants claim no existing copyright in the songs in question, and therefore no owner of any such right; and this being so, neither of those instruments can be held to have been an assignment "signed by the owner of the right within the meaning of the section.
No doubt when a person executes a document purporting to assign property to be afterwards acquired by him, that property on its acquisition passes in equity to the assignee: Holroyd vs Marshall, ; ; Tailby vs Official Receiver, 13 A.C. 523; but how such a subsequent acquisition can be held to relate back, so as to cause an instrument which on its date was not an assignment under the Act to become such an assignment, I am unable to understand.
The appellants have a right in equity to have the performing rights assigned to them and in that sense are equitable owners of those rights; but they are not assignees of the rights within the meaning of the statute.
This contention, therefore, fails", 1387 The above observations, to my mind, completely cover the present case.
On a parity of reasoning the respondent company may have, by operation of equity, become entitled to the benefit of the decree as soon as it was passed but to say that is not to say that there has been a transfer of the decree by the document of the 7th February 1949.
And so it has been held in several cases to which reference may now be made.
In Basroovittil Bhandari vs Ramchandra Kamthi(1) the plaintiff assigned the decree to be passed in the pending suit.
The assignee was not brought on the record under section 372 of the 1882 Code corresponding to Order XXII, rule 10 of the present Code but the suit proceeded in the name of the original plaintiff and a decree was passed in his favour.
The assignee then applied for execution of that decree claiming to be a transferee decree holder under section 232 of the 1882 Code.
That application was dismissed.
White,C.J., observed: "We are asked to hold that in the event which happened in this case the appellant is entitled to be treated as the transferee of a decree from a decree holder for the purposes of section 332, notwithstanding that at the time of the assignment.
there was no decree and no decree holder.
It seems to us that we should not be warranted in applying the doctrine of equity on which the appellant relies, which is stated in Palaniappa vs Lakshmanan, I.L.R. , for the purpose of construing section 232 of the Code.
We think the words "decree holder" must be construed as meaning decree holder in fact and not as including a party who in equity may afterwards become entitled to the rights of the actual decree holder, and that the words of the section relating to a transfer of a decree cannot be construed so as to apply to a case where there was no decree in existence at the time of the agreement".
It is true that the case of Purmananddas Jivandas vs Vallabdas Wallji (supra) was not cited in that case but the case of Palaniappa vs Lakshmanan() which (1) , (2) Mad.
1388 adopted the equitable principle enunciated by Jessel, M.R., in Collyer vs Isaacs (supra) on which that Bombay case bad been founded was brought to the notice of the Court.
In Dost Muhammad vs Altaf HUsain Khan(1) one M instituted a suit for recovery of some immovable property.
During the pendency of the suit M transferred his interest in the property to the respondent.
The respondent did not apply to bring himself on the record and the suit went on in the name of M as the plaintiff.
By a compromise decree M was awarded a portion of the property.
After the decree was passed the respondent applied to execute the decree as the transferee of the decree.
The Munsiff rejected the application but the District Judge reversed his order.
On second appeal Chamier, J., found it impossible to treat the respondent as the transferee of the decree, for the document on which he relied was executed before the decree was passed.
Peer Mahomed Rowthen vs Raruthan Ambalam(2) may also be referred to.
In that case the Madras High Court followed its earlier decision in Basroovittil Bhandari vs Ramchandra Kamthi (supra).
The case of Thakuri Gope V. Mokhtar Ahmad(3) does not carry the matter any further, for it only follows the three earlier cases herein before mentioned.
Mathurapore Zamindary Co. Ltd. vs Bhasaram Mandal(4) represents the view taken by the Calcutta High Court.
In that case Hennessey and his brothers, who were Zamindars, instituted rent suits against their tenants.
Pending those suits Hennessey and his brothers transferred the Zamindari to the appellant company.
The appellant company did not get themselves substituted as plaintiff but allowed the suits to proceed in the names of the original plaintiffs who were the transferors.
Eventually, decrees were passed in favour of Hennessey and his brothers.
The appellant company then applied for execution.
The executing Court and the lower appellate Court held that (1) (2) (3)[1922] C.W.N. (Patna) 256; A.I R. 1922 Pat.
(4) Cal.
1389 the appellant company was not a transferee of the decree.
The appellant company thereupon preferred, this second appeal to the High Court.
it was held that the appellant company could not apply under Order XXI, rule 16, for that rule could not properly cover a case where there was no decree at the date of the assignment of the property and the term "decree holder" could not cover a party who, in equity, might afterwards have become entitled to the rights of the actual decree holder.
The case of Ananda Mohon Roy vs Promotha Nath Ganguli (supra) was explained as being based really on the construction that was put upon the conveyance, namely, that it covered a decree which had been passed "simultaneously with, if not before, the execution of the conveyance".
After pointing out that in Purmananddas Jivandas vs Vallabdas Wallji (supra) the transferor and transferee stood in the position of trustee and cestui que trust and that that circumstance might have attracted the application of the equitable principle the Court could not assent to the broad proposition supposed to have been laid down in that case that the transferee in equity became a transferee of the decree by the prior agreement so as to come under Order XXI, rule 16 and preferred to follow the decision of the Madras High Court in Basroovittil Bhandari vs Ramchandra Kamthi (supra) and the other decisions to which reference has been already made.
In Pandu Joti Kadam vs Savla Piraji Kate(1) one Tuljaram obtained a decree on a mortgage against the appellant Pandu Joti.
Later on, the respondent Savla brought a suit against the appellant Pandu and Tuljaram.
In that suit a decree was passed directing Tuljaram to transfer the mortgage decree ' to Savla.
The respondent Savla thereupon without having obtained, amicably or by execution of his decree, an actual assignment of the mortgage decree sought to execute that decree.
It was held that although Savla had a legal right, by executing his own decree, to compel his judgment debtor Tuljaram to assign to him the mortgage decree obtained by Tuljaram, such (1) 1390 right alone, without an assignment in writing, did not make him a transferee of the mortgage decree so as to be entitled to execute that decree.
Even the Bombay High Court (Fawcett and Madgavkar, JJ.) in Genaram Kapurchand Marwadi vs Hanmantram Surajmal(1) followed the decision of the Madras High Court in Basroovittil Bhandari vs Ramchandra Kamthi (supra).
The question came up for consideration in connection with a plea of limitation.
There in February 1914 the appellant obtained an assignment of the rights of the plaintiff in a pending suit which was thereafter continued by the original plaintiff.
In November 1914 a decree was passed in favour of the original plaintiff.
The appellant made several applications for execution of the decree in 1916, 1917, 1920 and 1921 all of which were dismissed.
In November 1923 the appellant obtained a, fresh assignment in writing from the plaintiff and made a fresh application for execution.
The judgment debtor pleaded that the earlier applications were not in accordance with law and did not keep the decree alive.
It was held that although the appellant was entitled, in equity, to the benefit of the decree he did not, before he actually obtained an assignment of the decree in 1923, become a transferee of the decree by an assignment in writing within Order XXI, rule 16 and, therefore, the applications made by him prior to 1923 were not made in accordance with law and, therefore, the last application was barred by limitation.
This decision clearly proceeded on the ground that Order XXI, rule 16 contemplated only the transfer of a decree after it had been passed.
The case of Abdul Kader vs Daw Yin(2) does not ,assist the respondent company, for in that case the Court took the view that, on its true construction, the deed under consideration in that case actually transferred the decree that bad already been passed.
In Prabashinee Debi vs Rasiklal Banerji(3), Rankin, C.J., considered the previous cases and preferred to (1) ; (2) A.I.R. 1920 Rang.
(3) Cal.
1391 follow the case of Mathurapore Zamindary Co. Ltd. vs Bhasaram Mandal (supra).
The case of Purna Chandra Bhowmik vs Barna Kumari Debi(1) does not, when properly understood, afford any support to the contention of the respondent company.
There the defendant No. 1 had executed a mortgage bond in favour of the plaintiff assigning by way of security the decree that would be passed in a pending suit which he, the defendant No. I had instituted against a third party for recovery of money due on unpaid bills for work done.
After this mortgage a decree was passed in that suit in favour of the defendant No. 1 who bad continued that suit as the plaintiff.
The plaintiff claiming to be the assignee by way of mortgage of that decree instituted this suit against two defendants.
The defendant No. 1 was the plaintiff in the earlier suit who had mortgaged to the plaintiff the decree to be passed in that suit and the defendant No. 2 was a person who claimed to be a transferee of the same decree under a conveyance subsequently executed in his favour by the first defendant.
The judgment debtor under the decree in the first suit was not made a party defendant in this suit.
The first defendant did not contest this suit and it was only contested by the second defendant.
One of the points raised by the contesting defendant was that this subsequent suit which was one for a, pure declaration of title was bad under section 42 of the Specific Relief Act inasmuch as the plaintiff did not pray for consequential relief in the shape of a permanent injunction restraining him, the contesting defendant, from executing the decree.
In repelling that argument as manifestly untenable Mukherjea, J., as he then was, said: "All that the plaintiff could want possibly at the present stage was a declaration that she was an assignee of the decree and if she gets a declaration it would be open to her to apply for execution of the decree under Order XXI, rule 16, of the Code of Civil Procedure.
No other consequential relief by way of (1) I.L.R. 178 178 1392 injunction or otherwise could or should have been prayed for by the plaintiff in the present suit".
It will be noticed that the construction of Order XXI, rule 16, was not in issue at all.
The question was not between the person claiming to be the transferee of the decree and the judgment debtor.
Indeed, the judgment debtor was not a party to this suit at all.
The simple question was whether the suit was maintainable under section 42 by reason of the absence of a prayer for consequential relief.
In view of the facts of that case the observation quoted above appears to me to be a passing one not necessary for the decision of the question then before the Court and not an expression of considered opinion on the meaning, scope and effect of Order XXI, rule 16.
All the cases, except the three cases relied on by learned counsel for the respondent company, quite clearly lay down and I think correctly that Order XXI, rule 16, by the first alternative, contemplates the actual transfer of the decree by an assignment in writing executed after the decree is passed And that while a transfer of or an agreement to transfer a decree that may be passed in future may, in equity, entitle the intending transferee to claim the beneficial interest in the decree after it is passed, such equitable transfer does not relate back to the prior agreement and does not render the transferee a transferee of the decree by an assignment in writing, within the meaning of Order XXI, rule 16.
Learned counsel for the respondent company then contends that even if the respondent company did not, by force of the prior agreement in writing read in the light of the equitable principle alluded to above or of the provisions of the Transfer of Property Act, become the transferees of the decree by an assignment in writing, they, nevertheless, became the transferees of the decree "by operation of law" within the meaning of Order XXI, rule 16.
That phrase has been considered by the different High Courts in numerous cases but the interpretations put upon it are not at all uniform and it is difficult to reconcile all of them.
1393 In this judgment in the present case the executing court expressed the view that the phrase could only mean that the rights had been transferred "on account of devolution of interest on death, etc".
In delivering the judgment in the Letters Patent Appeal, Chagla, C.J., said: "The operation of law contemplated by Order XXI, rule 16 is not any equitable principle but operation by devolution as in the case of death or insolvency".
The learned Chief Justice does not give any reason for the view expressed by him but assumes the law to be so.
The genesis for such assumption is probably traceable to the observations of Sir Robert P. Collier who delivered the judgment of the Privy Council in Abedoonissa Khatoon vs Ameeroonissa Khatoon(1).
The question arose in that case in this way.
One Wahed sued his father Abdool for possession of certain properties.
The trial Court dismissed the suit and Wahed appealed to the High Court.
During the pendency of the appeal Wahed died and his widow Abedoonissa was substituted in the place of Wahed for prosecuting the appeal.
The High Court allowed the appeal and by its decree declared that Wahed was in his lifetime and those who became his heirs were entitled to recover the properties in suit.
Abedoonissa applied for execution of the decree for herself and for one Wajed who was said to be the posthumous son of Wahed born of her womb.
Objection was taken, inter alia, that Wajed was not the legitimate son of Wahed.
This objection was overruled and it was held that Abedoonissa was entitled to execute the decree for herself and as the guardian of Wajed.
Then the judgment debtor Abdool died.
Abdool 's widow Ameeroonissa filed a suit for a declaration that Wajed was not the legitimate son of Wahed and for setting aside the last mentioned order.
Abedoonissa took the point that the matter was concluded by principles of res judicata.
To that Ameeroonissa 's reply was that the proceeding in which the question of the legitimacy of Wajed was decided was wholly incompetent so far as (1) [1876] L.R. 4 I.A. Cal.
1394 Wajed was concerned because, the decree being in favour of Abedoonissa, Wajed was not a transferee of the decree within the meaning of section 208 of Act VIII of 1859 corresponding to Order XXI, rule 16 of the present Code and could not apply for execution and that being so any adjudication on his status in such proceeding was not binding at all.
The question for decision in the suit was whether Wajed was a transferee of the decree within the meaning of section 208 of the Code of 1859.
It was in that connection that Sir Robert P. Collier in delivering the judgment of the Privy Council, after quoting that section, observed: "It appears to their Lordships, in the first place, that,, assuming Wajed to have the interest asserted, the decree was not, in terms of this section, transferred to him, either by assignment, which is not pretended, or by operation of law, from the original decree holder.
No incident bad occurred, on which the law could operate, to transfer any estate from his mother to him.
There had been no death; there bad been no devolution; there had been no succession.
His mother retained what right she had; that right was not transferred to him; if he had a right, it was derived from his father; it appears to their Lordships, therefore, that be is not a transferee of a decree within the terms of this section".
The above observations seem to put upon the phrase by operation of law" an interpretation which, in the language of Chakravartti, J., in his judgment in Sailendra Kumar vs Bank of Calcutta(1) "suggests that it would apply only in cases where certain events, not connected with any act on the part of anybody towards making a transfer, happen and the law, operating on those events, brings about a transfer".
Some of the decisions of certain High Courts to be presently cited seem to assume that their Lordships of the Privy Council were out to give an exhaustive enumeration of the cases of transfer of property by operation of law but I find myself in agreement with Chakravartti, J., that there is no reason for making (1) I.L.R. 1395 such an assumption and treating these observations as the text of a statute.
In Dinendranath Sannyal vs Ramcoomar Ghose(1) Sir Barnes Peacock pointed out the great distinction between a private sale in satisfaction of a decree and a sale in execution of a decree.
One of the principal distinctions so pointed out was: "Under the former the purchaser derives title through the vendor, and cannot acquire a better title than that of the vendor.
Under the latter the purchaser notwithstanding he acquires merely the right, title and interest of the judgment debtor, acquires that title by operation of law adversely to the judgment debtor, and freed from all alienations or incumbrances effected by him subsequently to this attachment of the property sold in execution".
Here the act of the decree holder in seeking execution by attachment and sale and the act of the Court in directing attachment and sale cannot possibly be said to be the happening of an event unconnected with the act of making a transfer such as death or devolution or succession referred to in Abedoonissa 's case (supra) could be said to be.
By the act of applying for execution the decree holder quite clearly desires that the judgment debtor should be stripped of all his right, title and interest in the property attached and sold and the order of the Court has the effect of so denuding the judgment debtor and of passing his right, title and interest to the purchaser of the property at the Court sale.
This transfer 'of property is not by any assignment in writing executed by the transferor in favour of the transferee but is brought about by the operation of the statutory provisions relating to and governing execution of decrees.
Thus this Privy Council decision itself shows that transfers "by operation of law" were not intended by it to be confined to the three cases of death, devolution or succession.
More often than not transfers "by operation of law" will be found to be brought about by the opera (1) [1889] L.R. 8 I.A. 65, 75.
1396 tion of statutory law.
Thus when a person dies testate there is a devolution of his properties to his legal representatives by operation of the law of testamentary succession which is now mainly statutory in this country.
When a person is adjudged insolvent his properties vest in the official assignee and that transfer is brought about by the operation of the insolvency laws which have been codified.
Court sale of property in execution of a decree vests the right, title and interest of the judgment debtor in that property in the auction purchaser thereby effecting a transfer by operation of the law embodied in the Code of Civil Procedure.
Likewise, statutes in some cases provide for the forfeiture of property, e.g. property in relation to which an offence has been committed, namely, illicit liquor or opium, etc., and thereby effect a transfer of such property from the delinquent owner to the State.
It is neither necessary nor profitable to try and enumerate exhaustively the instances of transfer by operation of law.
Suffice it to say that there is DO warrant for confining transfers "by operation of law" to transfers by operation of statutory laws.
When a Hindu or a Mohammaden dies intestate and his heirs succeed to his estate there is a transfer not by any statute but by the operation of their respective personal law.
In order to constitute a transfer of property "by operation of law" all that is necessary is that there must be a passing of one person 's rights in property to another person by the force of some law, statutory or otherwise.
Reference has already been made to the case of Purmananddas Jivandas vs Vallabdas Wallji (supra) where, by applying the equitable principle, Sargent, C.J., upheld the appellant 's right to maintain the application for execution.
In the beginning the learned Chief Justice founded his decision on the ground that the appellant had become the transferee of the decree "by operation of law".
This view appears to me to be logical, for it was by the operation of the equitable principle that the right, title and interest of the transferor in the after acquired decree became the property of the appellant, In other words, 1397 it was equity which operated on the decree as soon as it was passed and passed the interest of the decree , holder to the appellant.
The result of this transmission was to transfer the property from the decree holder to the appellant and this transfer was brought about by the operation of the equitable principle discussed above which is as good as any rule of law.
The actual decision in Purmananddas Jivandas vs Vallabdas Wallji (supra) may well be supported as an in stance of transfer by operation of law and indeed Sargent, C.J., himself first described the transfer in that case as being one by operation of law.
The same remarks apply to the other two cases of Ananda Mohon Roy vs Promotha Nath Ganguli (supra) and Chimanlal Hargovinddas vs Ghulamnabi (Supra) relied on by learned counsel for the respondent company.
In Abdul Kader vs Daw Yin (supra) in July 1928 the plaintiff obtained a decree that a certain sale deed be set aside on payment of a certain sum and for possession of the properties and mesne profits.
In August 1928, i.e., after the passing of the decree the plaintiff executed a deed for the sale of the properties to the appellant who by the terms of the deed was to obtain possession of the properties through Court on payment of the amount mentioned therein.
The plaintiff deposited the necessary amount and applied for execution of the decree but she died shortly thereafter.
Thereupon the appellant applied for execution of the decree.
On a construction of the terms of the sale deed the Court came to the conclusion that the sale deed covered the decree and, therefore, the appellant was a transferee of the decree by assignment in writing.
This was sufficient to dispose of the case but the learned Judges tried to reconcile some of the earlier cases by deducing two propositions: (1) that the words "by operation of law" cannot be invoked so as to make an assignment operative to transfer the decree and the right under it which would upon the true construction of its terms, otherwise, be inoperative in that regard; and (2) that although in certain cases principles of equity may be relied on, e.g., in the case of a transfer 1398 by trustees and a beneficiary, such principles cannot be considered as rendering a transfer valid "by operation of law".
It is difficult to appreciate the implication of the first proposition.
When on a true construction of the deed it actually operates to transfer a decree then in existence, no equitable principle need be invoked, for in that case the transfer is by the deed itself and as such is by an assignment in writing.
It is only when the deed does not effectively transfer the decree because, for instance, the decree is not then in existence, but constitutes only an agreement to transfer the decree after it is passed that the invocation of the equitable principle becomes necessary and it is in those circumstances that equity fastens and operates upon the decree when it is passed and effects a transfer of it.
If, however, the learned Judges meant to say that if on a true construction of the deed it did not cover the decree then the equitable principle would not come into play at all and in that case the principle of transfer by operation of law could not be invoked, no exception need then be taken.
As regards the second proposition which appears to be founded on the observations of Mukherji, J., in Mathurapore Zamindary Co. 's case (supra) I do not see why the equitable principle may be relied on only in the case of a transfer by trustees to cestui que trust.
Indeed, it was applied in the two earlier English cases as between mortgagor and mortgagee and in Performing Right Society vs London Theatre of Varieties (supra) to an indenture of assignment of copyright to be acquired in future made between persons who did not stand in the relationship of trustee and beneficiary.
Nor do I see why, in cases where the equitable principle applies, the transfer should not be regarded as one by operation of law.
In Mahadeo Baburao Halbe vs Anandrao Shankarrao Deshmukh(1) the judgment confined transfers by operation of law to cases of death, devolution or succession for which, as already stated, I see no warrant.
(1) Bom.
1399 The decision in Periakatha Nadar vs Mahalingam(1) is somewhat obscure.
There a receiver appointed in a partnership action filed a suit against a debtor of the firm and obtained a decree.
Thereafter the assets of the firm including the decree were directed to be sold by auction amongst the partners.
This order was made in spite of the objection of the partners.
The decree was purchased by one of the partners who was defendant No. 2.
The purchaser then applied for execution of the decree.
Pandrang Rao, J. said, at p. 544: "It appears to us that the words 'operation of law ' cannot apply to, a case where a person has become the owner of a decree by some transaction inter vivos.
It applies to cases where the decree has been transferred from one to another by way of succession or where there is a bankruptcy or any similar event which has the effect in law of bringing about such a transfer".
If the purchaser of a property in execution sale becomes the transferee of the property by operation of law 1, for one, cannot see why the purchaser of a property at an auction sale held in a partnership action under the order of the Court made in invitum will not be a transferee by operation of law.
If an involuntary execution sale is not a transaction inter vivos why should an auction sale held in a partnership action in the teeth of opposition of the parties be a transaction inter vivos? The learned Judges concluded that as no particular form of assignment was prescribed for transfer, the order of the Court might be treated as an assignment in writing of the decree.
I find it much easier to hold that there was in that case a transfer by operation of law than that the Court acted as the agent of the partners and the order of the Court was the assignment in writing.
The law authorised the Court in a partnership action to order the sale of the partnership assets and consequently the sale passed the interest of all the partners other than the purchasing partner in the decree solely to (1) A.I.R. 1936 Mad.
179 179 1400 the latter.
I do not see why a transfer thus brought about should not, like a transfer effected by a Court sale in execution, be regarded as a transfer by operation of law.
Further, as,I have already said, there is no valid reason for confining transfer by operation of law to succession and bankruptcy or the like.
In G. N. Asundi vs Virappa Andaneppa Manvi(1) a father sued his sons for a declaration of his sole title to a decree previously obtained by the sons against a third party on promissory notes.
The parties came to a compromise and a joint petition signed by the father and the sons was filed in Court in which it was stated that the sons had no objection to surrender all their rights in the decree to the father.
The Court passed a decree in accordance with the compromise.
On an application for execution by the father of the decree on the promissory notes it was held that on its true construction the compromise petition amounted to an assignment of the decree within the meaning of Order XXI rule 16.
So far there can be no difficulty; but the learned Judges went on to say, without, I think, any good reason, that transfer by operation of law was obviously intended to be confined to testamentary and intestate succession, forfeiture, insolvency and the like.
This was only because the Court felt bound to hold that the decision in Abedoonisa 's case had so limited it.
It was also pointed out I think correctly that a decree declaring the title of the decree holder to another decree previously passed in another suit did not effect a transfer of the earlier decree by operation of law and the decree holder under the latter decree did not become the transferee of the earlier decree by operation of law within the meaning of Order XXI, rule 16.
This was also held in a number of cases including Mahadeo Baburao Halbe 's case (supra) and Firm Kushaldas Lekhraj vs Firm Jhamandas Maherchandani(2).
This must follow from the very nature of a declaratory decree.
A declaratory decree does not create or confer any new right but declares a pre existing right.
Therefore, when a (1) I.L.R. (2) A.I.R. 1944 Sind 230.
1401 declaratory decree declares the right of the decree holder to another decree passed in an earlier suit, there is no divesting of interest of one person and ' vesting of it in another.
There is no transfer at all and, therefore, the person in whose favour the declaratory decree is passed does not fall within Order XXI, rule 16, Code of Civil Procedure.
The last case to which reference need be made is that of Maya Debi vs Rajlakshmi Debi(1).
There a Darpatnidar deposited under section 13(4) of the Bengal Patni Taluqa Regulation (VIII of 1819) the arrears of revenue to avoid a putni sale and entered into possession of the putni as he was entitled to do under the above section.
He then filed a suit and obtained a decree for arrears of rent due to the Patnidar from another Darpatnidar.
Subsequently he relinquished possession in favour of the Patnidar by giving a notice to the Patnidar.
The question was whether the Patnidar, after he got back the possession of the putni, could be regarded as the assignee of the decree which had been obtained by the Varpatnidar against another Darpatnidar.
It was held that in view of the provisions of section 13(4) the Patnidar on getting back possession of the putni became the transferee of the decree by operation of law.
It was also held that the notice given by the Darpatnidar to the Patnidar could also be construed as an assignment in writing, The result of the authorities appears to me to be that if by reason of any provision of law, statutory or otherwise, interest in property passes from one person to another there is a transfer of the property by operation of law.
There is no reason that I can see why transfers by operation of law should be regarded as confined to the three cases referred to by the Privy Council in Abedoonissa 's case.
If, therefore, I were able to construe the document of the 7th February 1949 to be a transfer or an agreement to transfer the decree to be passed in future then I would have had no difficulty in holding that by operation of equity the beneficial interest in the decree (1) A.I.R. 1950 Cal.
1. 14O2 was immediately after its passing taken out of the transferors and passed to the respondent company and that the latter had become the transferees of the decree now sought to be executed by operation of law.
As, however, I have held that that document did not cover the decree, there was no room for the application of the equitable principle and the respondent company cannot, therefore, claim to come under Order XXI, rule 16 as transferees by operation of law and cannot maintain the application for execution.
There is another ground on which the right of the respondent company to maintain the application for execution has been sought to be sustained.
This point was not apparently taken before the High Court and we have not had the advantage and benefit of the opinion of the learned Judges of that Court.
Section 146 of the Code of Civil Procedure on which this new point is founded provides as follows: "146.
Proceedings by or against representatives.
Save as otherwise provided by this Code or by any law for the time being in force, where any proceeding may be taken or application made by or against any person, then the proceeding may be taken or the application may be made by or against any person claiming under him".
There are two questions to be considered before the section may be applied, namely, (1) whether the Code otherwise provides and (2) whether the respondent company can be said to be persons claiming under the decree holder.
As regards.
(1) it is said that Order XXI, rule 16 specifically provides for application for execution by a transferee of decree and, therefore, a transferee of decree cannot apply under section 146 and must bring himself within Order XXI, rule 16.
This is really begging the question.
Either the respondent company are transferees of the decree by an assignment in writing or by operation of law, in which case they fall within Order XXI, rule 16, or they are not such transferees, in which event they may avail themselves of the provisions of section 146 if the other condition is fulfilled.
There is nothing in Order XXI, rule 16 which, expressly or by necessary implication 1403 precludes a person, who claims to be entitled to the benefit of a decree under the decree holder but does not answer the description of being the transferee of that decree by assignment in writing or by operation of law, from making an application which the person from whom he claims could have made.
It is said: what, then, is meant by the words "save as otherwise provided by this Code"? The answer is that those words are not meaningless but have effect in some cases.
Take, by way of an illustration, the second proviso to Order XXI, rule 16 which provides that where a decree for payment of money against two or more persons has been transferred to one of them it shall not be executed against the others.
This is a provision which forbids one of the judgment debtors to whom alone the decree for payment of money has been transferred from making an application for execution and, therefore, he cannot apply under section 146 as a person claiming under the decree holder.
As the respondent company do not fall within Order XXI, rule 16 because the document did not cover the decree to be passed in future in the then pending suit that rule cannot be a bar to the respondent company making an application for execution under section 146 if they satisfy the other requirement of that section, namely, that they can, be said to be claiming under the decree holder.
A person may conceivably become entitled to the benefits of a decree without being a transferee of the decree by assignment in writing or by operation of law.
In that situation the person so becoming the owner of the decree may well be regarded as a person claiming under the decree holder and so it has been held in Sitaramaswami vs Lakshmi Narasimha(1), although in the earlier case of Dost Muhammad vs Altaf Husain (supra) it was held otherwise.
The case of Kangati Mahanandi Reddi vs Panikalapati Venkatappa(2) also hold that the provisions of Order XXI, rule 16 did not prevent execution of the decree under section 146.
In that case it was held that the appli (1) Mad. 510.
(2) A.I.R. 1942 Mad. 21, 1404 cant could not execute the decree under Order XXI, rule 16 but he could execute the same under section 146.
The main thing to, ascertain is as to whether the respondent company had any right, title or interest in the decree and whether they can be said to be persons claiming under the decree holder.
I have already held that the document under consideration did not transfer the future decree and, therefore, the equitable principle did not apply and, therefore, the respondent company did not become a transferee of the decree within the meaning of Order XXI, rule 16.
What, then, was the legal position of the respondent company? They had undoubtedly, by the document of the 7th February 1949, obtained a transfer of the debt which was the subject matter of the then pending suit.
This transfer, under the Transfer of Property Act, carried all the legal incidents and the remedies in relation to that debt.
The transferors no longer had any right, title or interest in the subject matter of the suit.
After the transfer it was the respondent company which had the right to continue the suit and obtain a decree if the debt was really outstanding.
They, however, did not bring themselves on the record as the plaintiffs in the place and stead of the transferors but allowed the latter to proceed with the suit.
The transferors, therefore, proceeded with the suit although they had no longer any interest in the debt which was the subject matter of the suit and which had been transferred by them to the respondent Company.
In the premises, in the eye of the law, the position of the transferors, vis a vis the respondent company, was nothing more than that of benamidars for the respondent company and when the decree was passed for the recovery of that debt it was the respondent company who were the real owners of the decree.
As between the respondent company and the transferors the former may well claim a declaration of their title.
Here there is no question of transfer of the decree by the transferors to the respondent company by assignment of the decree in writing or by operation of law and the respondent company cannot apply for execution of the 1405 decree under Order XXI, rule 16.
But the respondent company are, nonetheless, the real owners of the decree because it is passed in relation to and for the recovery of the debt which undoubtedly they acquired by transfer by the document under consideration.
The respondent company were after the transfer, the owners of the debt which was the subject matter of the suit and the legal incidents thereof and consequently were the real owners of the decree.
The respondent company derived their title to the debt by transfer from the transferors and claimed the same under the latter.
When the respondent company be,came the owner of the decree immediately on its passing they must, in relation to the decree, be also regarded as persons claiming under the transferors.
The respondent company would not have become the owner of the decree unless they were the owners of the debt and if they claimed the debt under the trans ferors they must also claim the relative decree under the transferors as accretions, as it were, to their original right as transferees of the debt.
In my opinion, the respondent company are entitled under section 146 to make the application for execution which the original decree holders could do.
In Mathurapore Zamindary Co. Ltd. vs Bhasaram Mandal (supra) Mukherji, J., felt unable to assent to the broad proposition that Courts of execution have to look to equity in considering whether there has been an assignment by operation of law.
I see no cogent reason for taking this view.
If the executing Court can and, after the amendment of Order XXI, rule 16 by the deletion of the words "if that Court thinks fit", must deal with complicated questions relating to transfer of decree by operation of statutory provisions which may be quite abstruse, I do not see why the executing Court may not apply its mind to the simple equitable principle which operates to transfer the beneficial interest in the after acquired decree or to questions arising under section 146.
Section 47 of the Code of Civil Procedure does require that the executing Court alone must determine all questions arising between the 1406 parties or their representatives and relating to the execution,, discharge or satisfaction of the decree and authorises it even to treat the proceedings as a suit.
As the assignees from the plaintiff of the debt which was the entire subject matter of the suit the respondent company were entitled to be brought on the record under Order XXII, rule 10 and must, therefore, be also regarded as a representative of the plaintiff within the meaning of section 47 of the Code.
Learned Counsel for the appellant contends that the application for execution was defective in that although it purported to be an application for execution under Order XXI, rule 1 1, it did not comply with the requirements of that rule in that it did not specify any of the several modes in which the assistance of the Court was required.
The application was undoubtedly defective as the decision in the case of Radha Nath Das vs Produmna Kumar Sarkar(1) and Krishna Govind Patil vs Moolchand Keshavchand Gujar(1) will show but this objection was not taken before the executing Court which could then have returned the application, nor was any objection taken by the appellant at any later stage of the proceedings.
Further, it appears that the respondent company actually presented another tabular statement for execution specifying the mode in which the assistance of the Court was required.
In these circumstances, it is not open to the appellant to contend that the application is not maintainable.
The result, therefore, is that this appeal must be dismissed with costs.
BHAGWATI J.
I agree that the appeal be dismissed with costs.
I would however like to record my own reasons for doing so.
Habib & Sons, a partnership firm which carried on business as merchants and Pukka Adatias in bullion and cotton in Bombay filed a suit against the Appellant in the City Civil Court, Bombay being Summary (1) I.L.R. (2) A.I.R. 1911 Bom.
1407 Suit No. 233 of 1948, to recover a sum of Rs. 7,113 7 0 with interest and costs.
During the pendency of the suit an agreement was arrived at between Habib & Sons and the Respondents on the 7th February, 1949 under which Habib & Sons transferred to the Respondents inter alia. .
Fourthy: All the book and other debts due to the Vendors in connection with the said Indian business and the full benefit of all securities for the debts. . .
Sixthly: All other property to which the Vendors are entitled in connection with the said Indian business".
As consideration for the said transfer the Respondents undertook to pay satisfy, discharge and fulfill all the debts, liabilities contracts and engagements of the vendors in relation to the said Indian business and to indemnify them ' against all proceedings, claims and demands in respect thereof.
The Respondents did not take any steps under Order XXII, rule 10 of the Code of Civil Procedure to bring themselves on the record of the suit as plaintiffs in place and stead of Habib & Sons and a decree was passed in favour of Habib & Sons against the Appellant on the 15th December, 1949 for Rs. 8,428/7/ inclusive of interest and costs with interest on judgment at 4 per cent.
per annum till payment.
Both the partners of Habib & Sons were declared evacuees and by his order dated the 2nd August, 1950 the Custodian of Evacuee Property, Bombay confirmed the transaction of transfer of the business of Habib & Sons to the Respondents as evidenced by the agreement dated the 7th February, 1949.
A communication to that effect was addressed by the Custodian to a Director of the Respondents on the 11th December 1950.
On the 25th April, 1951 the Respondents filed in the City Civil Court, Bombay an application for execution under Order XXI ' rule 11 of the Code of Civil Procedure to execute the decree obtained by Habib & Sons against the Appellant.
That application was by the Respondents as assignees of the decree and the mode in which the assistance of the Court was required was that the Court should declare the Respon 1408 dents the assignees of the decree as the decretal debt along with other debts were transferred by Habib & Sons to them by a deed of assignment dated the 7th February, 1949 which was confirmed by the Custodian of Evacuee Property, Bombay and should order them to be substituted for the plaintiffs.
A notice under Order XXI, rule 16 of the Code of Civil Procedure was issued by the Court on the 10th May, 1951, calling upon Habib & Sons and the Appellant to show cause why the decree passed in favour of Habib & Sons and by them transferred to the Respondents, the assignees of the decree should not be executed by the said transferees against the Appellant.
The Appellant showed cause and contended (1) that the deed of assignment in favour of the Respondents was not executed by Habib & Sons and (2) that the assignee of the subject matter of the suit and not of the decree itself was not entitled to apply for leave under Order XXI, Rule 16 of the Code of Civil Procedure.
The Chamber Summons was adjourned to Court in order to take evidence whether the document in question was executed by Habib & Sons or not.
Evidence was led at the hearing and the Court held the document duly executed by the two partners of Habib & Sons and as such duly proved.
On the question of law the Court followed the decisions in Purmananddas Jiwandas vs Vallabdas Wallji (1) and Chimanlal Hargovinddas vs Gulamnabi(2) and held that the Respondents were entitled to execute the decree under Order XXI, rule 16 of the Code of Civil Procedure.
An appeal was taken by the Appellant to the High Court against this decision of the City Civil Court.
The appeal came for hearing before Dixit, J.
The finding that the deed of assignment was duly proved was not challenged.
But the contention that inasmuch as there was no transfer of the decree itself, but only of the property the Respondents were not entitled to apply to execute the decree was pressed and was negatived by the learned Judge.
The learned Judge observed that if the language of Order XXI, (1) Bom.
(2) I.L.R. 1409 rule 16 was strictly construed it seemed to him that the Respondents had no case.
But he followed the decisions in Purmananddas Jiwandas vs Vallabdas Wallji(1) and Chimanlal Hargovinddas vs Gulamnabi(2) and dismissed the appeal.
A Letters Patent Appeal was filed against this decision of Dixit, J. and it came on for hearing and final disposal before a Division Bench of the High Court constituted by Chagla, C.J. and Shah, J. The Division Bench also were of the opinion that if one were to construe Order XXI, rule 16 strictly there was no assignment of the decree in favour of the respondents.
They however were of the opinion that the High Court had consistently taken the view that there could be an equitable assignment of a decree, which would constitute the assignee an assignee for the purpose of Order XXI, rule 16 and that what the Court must consider was not merely a legal assignment but also an assignment which operated in equity.
They then considered the two Bombay decisions which had been relied upon by the City Civil Court as well as by Dixit, J. and came to the conclusion that the deed of assignment fell within the principle of those two decisions, that it constituted an equitable assignment of the decree which was ultimately passed in favour of Habib & Sons, that the application for execution was maintainable under Order XXI, rule 16 and dismissed the appeal.
The Appellant applied for and obtained the necessary certificate under article 133 (1)(c) of the Constitution.
Order XXI, rule 16 provides for an application for execution by transferee of a decree and runs as under: "Where a decree. . . . . . is transferred by assignment in writing or by operation of law, the transferee may apply for execution of the decree to the Court which passed it; and the decree may be executed in the same manner and subject to the same conditions as if the application were made by such decree holder: (1) Bom.
(2) I.L.R. 1410 Provided that, where the decree I has been transferred by assignment, notice of such application shall be given to the transferor and the judgment debtor, and the decree shall not be executed until the Court has heard their objections (if any) to its execution The transfer contemplated under this rule is either by assignment in writing or by operation of law.
It was not contended by the Appellant at any stage of the proceedings that there was in this case a transfer by operation of law or that the agreement dated the 7th February 1949 was not an assignment of all the rights which Habib & Sons had in connection with the Indian business.
The question therefore that falls to be considered is whether the deed of assignment dated the 7th February 1949 operates as a transfer of the decree by assignment in writing within the meaning of Order XXI, rule 16 of the Code of Civil Procedure.
A strict and narrow construction has been put upon the words "where a decree is transferred by assignment in writing" by the High Court of Madras in Basroovittil Bhandari vs Ramchandra Kamthi(1) and the decisions following it, particularly Kangati Mahanandi Reddi vs Panikalapati Venkatappa & Another(2) and by the High Court of Calcutta in Mathurapore Zamindary Co. Ltd. vs Bhasaram Mandal(1) which is followed in Prabashinee Debi vs Rasiklal Banerji(4).
They have held that the words "decree holder" must be construed ' as meaning decree holder in fact and not as including a party who in equity may afterwards become entitled to the rights of the actual decree holder and that the language of Order XXI, rule 16 (old section 232) cannot be construed so as to apply to a case where there was no decree in existence at the time of the assignment and this position was in effect conceded by Dixit, J. and by the Division Bench when they observed that on a strict construc (1) , (2) A.I R. 1942 Madras 21.
(3) Calcutta 703.
(4) Calcutta 297.
1411 tion of Order XXI, rule 16 there was no assignment of the decree in favour of the Respondents.
A contrary view has however been taken by the High Court of Bombay in Purmananddas Jiwandas V. Vallabdas Wallji(1) and Chimanlal Hargovinddas V. Gulamnabi(2).
These two decisions have applied the equitable principle enunciated by Sir George Jessel, M. R. in Collyer vs Isaacs(1) as under: "The creditor had a mortgage security on existing chattels and also the benefit of what in form was an assignment of non existing chattels which might be afterwards brought on to the premises.
That assignment, in fact, constituted only a contract to give him the after acquired chattels.
A man cannot in equity, any more than at law, assign what has no existence.
A man can contract to assign property which is to come into existence in the future, and when it has come into existence, equity, treating as done that which ought to be done, fastens upon that property, and the contract to assign thus becomes a complete assignment".
The High Court of Calcutta also applied the same principle in Purna Chandra Bhowmik vs Barna Kumari Debi(4) and the High Court of Madras in Kangati Mahanandi Reddi vs Panikalapati Venkatappa and another(5) observed that if the matter were res integra much might perhaps be said for the contention that the assignee under similar circumstances could execute the decree under Order XXI, rule 16.
The decision in Purmananddas Jivandas V. Vallabdas Wallji(1) and the equitable principle enunciated therein was brought to the notice of the learned Judges who decided the case of Mathurapore Zamindary Co. Ltd. vs Bhasaram Mandal(6) but was negatived by them and they relied upon the observations of the Privy Council in dealing with a somewhat similar provision contained in Section 208 of Act VIII of 1859 in the case of Abedoonissa Khatoon vs Ameeroonissa Khatoon(1): (1) Bom. 506.(2) I.L.R. (3) L.R. 19 Ch. D. 342.(4) I.L.R [1939] 2 Calcutta 341.
(5) A.I.R. 1942 Madras 21.(6) Calcutta 703.
(7) (1876) L.R. 4 I.A. 66.
1412 "Their Lordships have further to observe, that they agree with the Chief Justice in the view which he expressed, that this was not a section intended to apply to cases where a serious contest arose with respect to the rights of persons to an equitable interest in a decree".
Rankin, C.J. laid stress upon this aspect of the question and delivered a similar opinion in Prabhashinee Debi vs Rasiklal Banerji(1) at page 299: "There seem to be two possible views of the rule.
One view would be to say that there must be a decree in existence and a transfer in writing of that decree.
That is the strict view a view which the courts in India have taken.
The only other possible view would be to say that, while other cases are within the rule such as cases where a person claims to be entitled in equity under an agreement to the benefit of the decree it is optional with the courts to give effect to the rule according as the case is a clear one or one which requires investigation of complicated facts or difficult questions of law unsuited for discussion on a mere execution application.
In that view, if it were understood that the court had a complete discretion to apply the rule or not, it might be that the rule would be workable; but I do not think that any such discretion as that is intended to be given by the rule" and he fortified himself in his conclusion by relying upon the deletion of the words "if that Court thinks fit the decree may be executed" when the Civil Procedure Code of 1908 was enacted.
Order XXI, rule 16 of the Code of Civil Procedure is a statutory provision for execution by the transferee of a decree and unless and until a person applying for execution establishes his title as the transferee of a decree he cannot claim the benefit of that provision.
He may establish his title by proving that he is a transferee of a decree by assignment in writing or by operation of law.
Section 5 of the Transfer of Property Act defines a "transfer of pro (1) [1931] I.L.R.59 Calcutta 297.
1413 perty" as an act by which the transferor conveys property in present or in future to the transferee or transferees.
A transfer of a decree by assignment in writing may be effected by conveying the decree in present or in future to the transferee.
But even for the transfer to operate in future the decree which is the subject matter of the transfer must be in existence at the date of the transfer.
The words "in present or in future" qualify the word "conveys" and not the word "property" in the section and it has been held that a transfer of property that is not in existence operates as a contract to be performed in the future which may be specifically enforced as soon as the property comes into existence.
As was observed by the Privy Council in Rajah Sahib Perhlad vs Budhoo(1): "But how can there be any transfer, actual or constructive, upon a contract under which the vendor sells that of which he has not possession, and to which he may never establish a title? The bill of sale in such a case can only be evidence of a contract to be performed in future, and upon the happening of a contingency, of which the purchaser may claim a specific performance, if be comes into Court shewing that he has himself done all that he was bound to do".
It is only by the operation of the equitable principle that as soon as the property comes into existence and is capable of being identified, equity taking as done that which ought to be done fastens upon the property and the contract to assign thus becomes a complete equitable assignment.
In the case of a decree to be passed in the future therefore there could be no assignment of the decree unless and until the decree was passed and the agreement to assign fastened on the decree and thus became a complete equitable assignment.
The decree not being in existence at the date of the transfer cannot be said to have been transferred by the assignment in writing and the matter resting merely in a contract to be performed in the future which may be specifically enforced as soon as the decree was passed there would be no transfer (1) 1414 automatically in favour of the "transferee" of the decree when passed.
It would require a further act on the part of the "transferor" to completely effectuate the transfer and if he did not do so the only remedy of the "transferee" would be to sue for specific performance of the contract to transfer.
There would therefore be no legal transfer or assignment of the decree to be passed in future by virtue of the assignment in writing executed before the decree came into existence and the only way in which the transferee could claim that the decree was transferred to him by assignment in writing would be by the operation of the equitable principle above enunciated and the contract to assign having become a complete equitable assignment of the decree.
Is there any warrant for importing this equitable principle while construing the statutory 'Provision enacted in Order XXI, rule 16 of the Code of Civil Procedure? The Code of Civil Procedure does not prescribe any mode in which an assignment in writing has got to be executed in order to effectuate a transfer of a decree.
The only other statutory provision in regard to assignments in writing is to be found in Chapter VIII of the Transfer of Property Act which relates to transfers of actionable claims and an actionable claim has been defined in section 3 of the Act as "a claim to any debt. . . or to any beneficial interest in movable property not in the possession, either actual or constructive, of the claimant, which the Civil Courts recognize as affording grounds for relief. . . .
A judgment debt or decree is not an actionable claim for no action is necessary to realise it.
It has already been the subject of an action and is secured by the decree.
A decree to be passed in future also does not come as such within the definition of an actionable claim and an assignment or transfer thereof need not be effected in the manner prescribed by section 130 of the Transfer of Property Act.
If therefore the assignment or transfer of a decree to be passed in the future does not require to be effectuated in the manner prescribed in the statute there would be no objection to the 1415 operation of the equitable principle above enunciated and the contract to assign evidenced by the assignment in writing becoming a complete equitable assignment of the decree when passed.
The assignment in writing of the decree to be passed would thus result in a contract to assign which contract to assign would become a complete equitable assignment on the decree being Passed and would fulfill the requirements of Order XXI, rule 16 in so far as the assignment or the transfer of the decree would in that event be effectuated by an assignment in writing which became a complete equitable assignment of the decree when passed.
There is nothing in the provisions of the Civil Procedure Code or any other law which prevents the operation of this equitable principle and in working out the rights and liabilities of the transferee of a decree on the one hand and the decree holder and the judgment debtor on the other, there is no warrant for reading the words "where a decree. . . . . is transferred by assignment in writing" in the strict and narrow sense,, in which they have been read by the High Court of Madras in Basroovittil Bhandari vs Ramchandra Kamthi(1) and the High Court of Calcutta in Mathurapore Zamindary Co. Ltd. vs Bhasaram Mandal(2) and Prabashinee Debi vs Rasiklal Banerji(3).
It is significant to observe that the High Court of Calcutta in Purna Chandra Bhowmik vs Barna Kumari Debi(1) applied this equitable principle and held that the plaintiff in whose favour the defendant had executed a mortgage bond assigning by way of security the decree that would be passed in a suit instituted by him against a third party for recovery of money due on unpaid bills for work done was entitled to a declaration that be was the assignee of the decree passed in favour of the defendants and was as such entitled to realise the decretal debt either amicably or by execution.
If the plaintiff was thus declared to be the assignee of the decree subsequently passed in favour of the defendant and entitled to realise the decretal amount by execution he could (1) [1907] 17 MI.L.J. 391.
(3) Cal.
(2) Cal.
(4) I.L.R. 181 1416 apply for execution of the decree and avail himself of the provisions of Order XXI, rule 16 as the assignee of the decree which was passed subsequent to the date of the assignment in writing in his favour.
There could be no objection to decide questions involving investigation of complicated facts or difficult questions of law in execution proceedings, as section 47 of the Code of Civil Procedure authorises the Court executing the decree to decide all questions arising therein and relating to execution of the decree and subsection (2) further authorises the executing Court to treat a proceeding under the section as a suit thus obviating the necessity of filing a separate suit for the determination of the same.
The line of decisions of the High Court of Bombay beginning with Purmananddas jivandas vs Vallabdas Wallji(1) and ending with Chimanlal Hargovinddas vs Gulamnabi (2) importing the equitable principle above enunciated therefore appears to me to be more in consonance with law and equity than the strict and narrow 'interpretation put on the words "where a decree. . . . is transferred by assignment in writing" by the High Courts of Madras and Calcutta in the decisions above noted.
Even if an equitable assignment be thus construed as falling within an "assignment in writing" contemplated by Order XXI, rule 16 of the Code of Civil Procedure it would in terms require an assignment of the decree which was to be passed in the future in favour of the assignor.
In the present case, it is impossible to read the deed of assignment dated the 7th February, 1949 as expressly or by necessary implica tion assigning in favour of the Respondent the decree which was going to be passed by the City Civil Court in favour of Habib & Sons.
There is however another aspect of the matter which was not urged before the Courts below in the present case nor does it appear to have been considered in most of the judgments above referred to.
There is no doubt on the authorities that a mere transfer of property as such does not by itself spell out (1) Bom.
(2) I.L R. 1946 Bom.276.
1417 a transfer of a decree which has been passed or may be passed in respect of that property and it would require an assignment of such decree in order to effectuate the transfer (vide Hansraj Pal vs Mukhraji Kunuvar & others(1), Mathurapore Zamindary Co. Ltd. vs Bhasaram Mandal(2), and Kangati Mahanandi Reddi vs Panikalapati Venkatappa & another(3).
Where however the property which is transferred is an actionable claim within the meaning of its definition in section 3 of the Transfer of Property Act the consequences of such transfer would be different.
An actionable claim means a claim to any debt, or to any beneficial interest in moveable property not in the possession, either actual or constructive, of the claimant, which the Civil Courts recognize as affording grounds for relief, and a transfer of an actionable claim when effected by an instrument in writing signed by the transferor is under section 130 of the Act complete and effectual upon the execution of such instrument, and thereupon all the rights and remedies of the transferor, whether by way of damages or otherwise, vest in the transferee, whether such notice of the transfer as is therein provided be given to the debtor or not.
If the book debt or the property which is an actionable claim is thus transferred by an assignment in writing all the rights and remedies of the transferor in respect thereof including the right to prosecute the claim to judgment in a Court of law either in a pending litigation or by institution of a suit for recovery of the same vest in the transferee immediately upon the execution of the assignment as a necessary corollary thereof.
Not only is the actionable claim thus transferred but all the necessary adjuncts or appurtenances thereto are transferred along with the same to the transferee.
Section 8 of the Act provides that unless a different intention is expressed or necessarily implied, a transfer of property passes forthwith to the transferee all the interest which the transferor is then capable of passing in the property and in the legal incidents thereof These incidents include where the property is (1) All. 28.
(2) Cal.
(3) A.I.R. 1942 Mlad.
21. 1418 a debt or other actionable claim, the securities there for. . . . . but not arrears of interest accrued before the transfer.
In cases of transfer of book debts or property coming within the definition of actionable claim there is therefore necessarily involved also a transfer of the transferor 's right in a decree which may be passed in his favour in a pending litigation and the moment a decree is passed in his favour by the court of law, that decree is also automatically transferred in favour of the transferee by virtue of the assignment in Writing already executed by the transferor.
The debt which is the subject matter of the claim is merged in the decree 'and the transferee of the actionable claim becomes entitled by virtue of the assignment in writing in his favour not only to the book debt but also to the decree in which it has merged.
The book debt does not lose its character of a debt by its being merged in the decree and the transferee is without anything more entitled to the benefit of the decree passed by the court of law in favour of the transferor.
It would have been open to the transferee after the execution of the deed of assignment in his favour to take steps under Order XXXII, rule 10 of the Code of Civil Procedure to have himself substituted in the pending litigation as a plaintiff in place and stead of the transferor and prosecute the claim to judgment; but even if he did not do so he is not deprived of the benefit of the decree ultimately passed by the court of law in favour of the transferor, the only disability attaching to his position being that under section 132.
of the Act he would take the actionable claim subject to all the liabilities and equities to which the transferor was subject in respect thereof at the date of the transfer.
The transferee of the actionable claim thus could step into the shoes of the transferor and claim to be the transferee of the decree by virtue of the assignment in writing executed by the transferor in his favour and could therefore claim to execute the decree as transferee under Order XXI, rule 16 of the, Code of Civil Procedure.
This aspect could not be considered by the High 1419 Court of Bombay in Purmananddas Jivandas vs Vallabdas Wallji(1) because the assignment there was executed on the 11th May, 1870, i.e. before the enactment of the Transfer of Property Act in 1882.
The Court therefore applied the equitable principles and came to the conclusion that the equitable assignment which was completed on the passing of the decree was covered by the old section 232 of the Code of Civil Procedure.
It was also not considered by the Full Bench of the High Court of Bombay in Chimanlal Hargovinddas V. Gulamnabi (2) nor by Dixit, J. or by the Division Bench in the present case.
The High Court of Patna in Thakuri Gope and Others vs Mokhtar Ahmad & Another(3), went very near it when it observed that all that was transferred was an actionable claim, but did not work out the consequences thereof and its reason in was deflected by the consideration of the equitable principles and the applicability thereof while construing the provisions of Order XXI, rule 16 of the Code of Civil Procedure.
The High Court of Calcutta in Purna Chandra Bhowmik vs Barna Kumari Debi(4) definitely adopted this position and observed at p. 344: "In my opinion, what was transferred was the claim to a debt and as such would come within the definition of actionable claim as given in section 3 of the Transfer of Property Act.
The mere, fact that the claim was reduced by the Court did not make, in my opinion, any difference".
It no doubt applied the equitable principle also and held that the mortgage.
must be deemed to have attached itself to the decree which was for a definite amount as soon as the decree was passed, but further observed that the plaintiff was entitled to a declaration that she was an assignee of the decree and if she got that declaration it would be open to her to apply for execution of the decree under Order XXI, rule 16 of the Code of Civil Procedure.
I am sure that if this aspect of the question had been properly presented to Dixit, J. or the Division Bench in the (1) Bom.
(3) A.I.R.[1922] Patna 563, (2) I.L.R.[1946] Bom.
(4) I.L.R, , 1420 present case they also would have come to the same conclusion.
Mr. Umrigar, learned counsel for the Respondents, further urged that even if the Respondents were not entitled to the benefit of Order XXI, rule 16 of the Code of Civil Procedure they were the true owners of the debt and the decree which was ultimately passed by the City Civil Court in favour of Habib and Sons by virtue of the deed of assignment dated the 7th February 1949 and that under section 146 of the Code of Civil Procedure execution proceedings could be taken and application for execution could be made by them as persons claiming under Habib & Sons.
The deed of assignment transferred the debt which was the subject matter of the pending litigation in the City Civil Court between Habib & Sons and the Appellant.
Habib & Sons could have taken proceedings in execution and made the application for execu tion of the decree against the Appellant and the Respondents claiming under Habib & Sons by virtue of the deed of assignment were therefore entitled to take the execution proceedings and make the application for execution under Order XXI, rule II of the Code of Civil Procedure.
He also urged that Order XXI, rule 16 of the Code of Civil Procedure did not prohibit such execution proceedings at the instance of the Respondents and for this purpose relied upon the observations of the learned Judges of the High Court of Madras in Kangati Mahanandi Reddi vs Panikalapati Venkatappa & another(1) at page 23: "We are unable to hold that merely because rule 16 has been interpreted as applying only to decrees in existence at the time of the transfer, it prohibits an application by a transferee who obtained the transfer of a decree, a transfer which is legally valid and is embodied in a written deed (as rule 16 requires) before the decree was actually passed.
To permit execution by such a transferee, in our opinion, in no way violates the principles which are embodied in rule 16 or in Order XXI generally.
The appellant here is the (1) A I.R. 1942 Mlad.
1421 true owner of the decree, and he has his written title 'deed, and that is all that the law requires".
It was however urged on behalf of the Appellant that section 146 did not apply because Order XXI, rule 16 was a specific provision in the Code of Civil Procedure which applied when a person other than a decree holder wanted to execute the decree and if the Respondents could not avail themselves of Order XXI, rule 16 of the Code of Civil Procedure they could not avail themselves of section 146 also.
Reliance was placed in support of this contention on a decision of the High Court of Patna in Thakuri Gope and others vs Mokhtar Ahmad and another(1) and another decision of the High Court of Allahabad in Shib Charan Das vs Ram Chander & others(2).
This contention of the Appellant is obviously unsound.
Order XXI, rule 16 provides for execution of a decree at the instance of a, transferee by assignment in writing or by operation of law and enables such transferee to apply for execution of the decree to the Court which passed it.
If a transferee of a decree can avail himself of that provision by establishing that he is such a transferee he must only avail himself of that provision.
But if he fails to establish his title as a transferee by assignment in writing or by operation of law within the meaning of Order XXI, rule 16 of the Code of Civil Procedure there is nothing in the provisions of Order XXI, rule 16 which prohibits him from availing himself of section 146 if the provisions of that section can be availed of by him.
That is the only meaning of the expression "save as otherwise provided by this Code".
If a person does not fall within the four corners of the provision of Order XXI, rule 16 of the Code of Civil Procedure that provision certainly does not apply to him and the words "save as otherwise :provided in this Code" contained in section 146 would not come in the way of his availing himself of section ,146 because Order XXI, rule 16 cannot then be construed as an "otherwise provision" contained in the Code.
I am therefore of the opinion that if the Respondents could not avail themselves of Order XXI, (1) A.I.R. 1922 Patna 663.
(2) A.I.R. 1922 All. 98, 1422 rule 16 of the Code of Civil Procedure they could certainly under the circumstances of the present case take the execution proceedings and make the application for execution of the decree passed by the City Civil Court in favour of Habib & Sons under section 146 of the Civil Procedure Code.
An objection was however taken on behalf of the Appellant during the course of the arguments before us though no such objection was taken in the Courts below, that the application for execution made by the Respondents was defective inasmuch as it was not an application in proper form under Order XXI, rule 11 of the Code of Civil Procedure.
Order XXI, rule 11(2) (j) prescribes that particulars in regard to the mode in which the assistance of the Court was required should be set out there in.
The respondents had in their application for execution filed before the City Civil Court not mentioned any of these particulars but had only stated that the Court should declare them the assignees of the decree as the decretal debt along with other debts were transferred by Habib & Sons to them by the deed of assignment dated the 7th February 1949 which was confirmed by the Custodian of Evacuee Property, Bombay and should order them to be substituted for Habib & Sons.
This was no compliance with the provisions of Order XXI, rule 11(2) (j) and therefore there was no proper application for execution before the Court and the same was liable to be dismissed.
Reliance was placed in support of this contention on a decision of the High Court of Calcutta in Radha Nath Das vs Produmna Kumar Sarkar(1), where it was held dissenting from a decision of the High Court of Bombay in Baijnath Ramchander vs Binjraj Joowarmal Batia & Co. (2) that under Order XXI, rule 16 of the Code of Civil Procedure the ,assignee of a decree cannot make two applications, one for recording the assignment and another for executing the decree.
The assignee of a decree could only make one application for execution under Order XXI, rule 1 1 of the Code of Civil Procedure specifying therein the mode in which the assistance of the Court (1) I.L.R. [1939] 2 Calcutta 325.
(2) I.L.R [1937] Bombay 691.
1423 was required and it was only after such application had been made to the Court which passed the decree that the Court would issue notice under Order XXIL rule 16 to the transferor and the judgment debtor and the decree would not be executed until the Court had heard their objections if any to its execution.
Sen, J. in that case observed at page 327: "It seems to me to be obvious from the wording of the rule that there can be no notice to the transferor or judgment debtor and no hearing of any objection unless and until there is an application for execution.
Tile notice and the entire proceedings under Order XXI, rule 16, originate from an application for execution.
If there is no such application the proceedings are without any foundation.
Order XXI, rule 16, of the Code nowhere provides for an application to record an assignment or for an application for leave to execute a decree by an assignee or for an application for substitution".
This in my opinion correctly sets out the position in law and in so far as the two decisions of the High Court of Bombay in Baijnath Ramchander vs Binjraj Joowarmal Batia & Co.(1) and Krishna Govind Patil vs Moolchand Keshavchand Gujar(2) decide anything to the contrary they are not correct.
The position was clarified by a later decision of the High Court of Bombay in Bhagwant Balajirao and Others vs Rajaram Sajnaji & Others(3) where Rajadhyaksha and Macklin, JJ.
held, following Radha Nath Das vs Produmna Kumar Sarkar(1) that an application made by an assignee of a decree must under Order XXI, rule 16 be for the execution of the decree and not merely for the recognition of the assignment and for leave to execute the decree.
It was urged before the learned Judges that the practice in the High Court of Bombay was to entertain applications of this kind, but they observed that the practice if such a practice prevailed was opposed to the provisions of the Order XXI, rule 16 of the Code of Civil Procedure.
The contention therefore urged on behalf of the Appellant that the (1) I.L.R.[1937] Bom.
(3) A.I.R.[1947] Bom.
(2) A.I.R.[1941] Bom. 302 (F.B.) (4) I.L.R. 182 1424 application for execution in the present case was defective appears to have some foundation.
This defect however was not such as to preclude the Respondents from obtaining the necessary relief.
The application which was filed by them in the City Civil ' Court was headed "application for execution under Order XXI, rule 11 of the Code of Civil Procedure" and the only defect was in the specification of the mode in which the assistance of the Court was required.
The particulars which were required to be filled in column J. were not in accordance with the requirements of Order XXI, rule 11(2) (j) and should have specified one of the modes therein prescribed and certainly a declaration that the respondents were the assignees of the decree and the order for their substitution as the plaintiffs was certainly not one of the prescribed modes which were required to be specified in that column.
The practice which prevailed in the High Court of Bombay as recognised in Baijnath Ramchander vs Binjraj Joowarmal Batia & Co(1) and also in Bhagwant Balajirao and others vs Rajaram Sajnaji & others(3) appears to have been the only justification for making the application in the manner which the respondents did.
That defect however according to the very same decision in Bhagwant Balajirao and others vs Rajaram Sajnaji & others(3) was purely technical and might be allowed to be cured by amendment of the application.
As a matter of fact Order XXI, rule 17 lays down the procedure on receiving applications for execution of a decree and enjoins upon the Court the duty to ascertain whether such of the requirements of rules 11 to 14 as may be applicable to the case have been complied with and if they have not been complied with the Court has to reject the application or allow the defect to be remedied then and there or within a time to be fixed by it.
When the application for execution in the present case was received by the City Civil Court, the Court should have scrutinised the application as required by Order XXI, rule 17(1) and if it was found that the (1) I.L.R. (2) A.I.R. 1947 Bom 157.
1425 requirements of rules 11 to 14 as may be applicable were not complied with as is contended for by the Appellant, the Court should have rejected the application or allowed the defect to be remedied then and there or within a time to be fixed by the Court.
Nothing of the kind was ever done by the City Civil Court nor was any objection in that behalf taken on behalf of the Appellant at any time until the matter came before this Court.
On the 27th March, 1952 however a further application for execution was filed by the Respondents in the City Civil Court specifying in column 'J ' the mode in which the assistance of the Court was required and it was by ordering attachment and sale of the moveable property of the Appellant therein specified.
This further application for execution was a sufficient compliance with the provisions of Order XXI, rule I 1 (2) (j) and was sufficient under the circumstances to cure the defect, if any, in the original application for execution made by the Respondents to the City Civil Court on the 25th April, 1951.
This objection of the Appellant therefore is devoid of any substance and does not avail him.
The appeal accordingly fails and is dismissed with costs.
IMAM J. I have had the advantage of perusing the judgments of my learned brethren.
I agree that the appeal must be dismissed with costs and in the view expressed by them that the respondent should be permitted under the provisions of section 146 of the Code of Civil Procedure to execute the decree passed in favour of Habib & Sons, as one claiming under the latter.
The document under which the respondent claimed to execute the decree was treated as a deed of transfer in the courts below and not merely as an agreement to transfer.
By this document there was a transfer of all the book and other debts due to Habib & Sons in connection with the Indian business and the full benefit of all securities for the debts.
The document, however, neither in terms, nor by any reasonable inter 1426 pretation of its contents purported to transfer any decree which Habib & Sons may obtain in the future.
It seems to me, therefore, that the respondent cannot claim to be a transferee of the decree, which was subsequently obtained by Habib & Sons, by an assignment in writing within the meaning of Order XXI, rule 16 of the Code of Civil Procedure.
Order XXI of the Code of Civil Procedure relates to execution of decrees and orders.
Rule 1 of that Order relates to payments under a decree which has been passed.
Rules 4 to 9 relate to the transfer of an existing decree for execution.
The normal rule is that a decree can be executed only by the person in whose name it stands and rule 10 enables him to do so, while rule 16 of Order XXI, enables the transferee of the decree to execute it in the same manner and subject to the same conditions as an application for execution made by the decree holder.
It seems to me, therefore, that there must be a decree in existence which is transferred before the transferee can benefit from the provisions of rule 16.
The ordinary and natural meaning of the words of rule, 16 can carry no other interpretation and the question of a strict and narrow interpretation of its provisions does not arise.
The position of an assignee, before a decree is passed, is amply safeguarded by the provisions of Order XXII, rule 10, which enables him to obtain the leave of the Court to continue the suit.
Thereafter the decree, if any, would be in his name which he could execute.
I agree with my learned brother Das, J., that the provisions of Order XXI, rule 16 contemplate the actual transfer by an assignment in writing of a decree after it is passed and that while a transfer of or an agree ment to transfer a decree that may be passed in future may, in equity, entitle the intending transferee to claim the beneficial interest in the decree after it is passed, such equitable transfer does not render the transferee a transferee of the decree by assignment in writing within the meaning of Order XXI, rule 16.
In this respect the decisions of the Madras High Court in Basroovittil Bhandari vs Ramchandra Kamthi(1) (1) (1907] , 1427 and of the Calcutta High Court in Mathurapore Zamindary Co. Ltd. vs Bhasaram Mandal(1) and Prabashinee Debi vs Rasiklal Banerji (2) are correct.
As at present advised, I would like to express no opinion as to whether the expression "by operation of law" can be given the interpretation suggested by my learned brother Das, J., as it is unnecessary to do so in the present appeal.
Appeal dismissed.
| H & S filed a suit against the appellant for recovery of money and during the pendency of the suit a document was executed on the 7th February, 1949, whereby H & S transferred to the respondents all book and other debts due to them together with all securities for the debts and all other property to which they were entitled in connection with their business in Bombay.
One of the book debts was the subject matter of the suit, but there was no mention in that document of the suit or the decree to be passed in the suit.
The respondents did not take any steps under Order XXII, rule 10, of the Code of Civil Procedure to get themselves substituted as plaintiffs in the place of H & S, but allowed the suit to be continued in the name of the original plaintiffs, and on the 15th December, 1949, a decree was passed in favour of H & S against the appellant.
On the 25th April, 1951, the respondents filed in the City Civil Court, Bombay, an application for execution of the decree under Order XXI, rule 11 of the Code, and a notice under Order XXI, rule 16 was issued by the Court calling upon H & S and the appellant to show cause why the decree should not be executed by the transferees, the respondents.
The appellant contended inter alia that as the respondents were only the assignees of the debt which was the subject: matter of the suit and not of the decree itself they were not entitled to execute the decree.
Held, that the respondents as the transferees of the debt which was the subject matter of the suit were entitled to make an application for execution of the decree under section 146 of the Code of Civil Procedure as persons claiming under the decree holder.
The effect of the expression " save as otherwise provided in this Code" contained in section 146 is that a person cannot make an application under section 146 if other provisions of the Code are applicable to it.
Per DAs and IMAM JJ., BHAGWATI J. dissenting.
Order XXI, rule 16, by the first alternative, contemplates the actual transfer by an assignment in writing of a decree after it is passed and while a transfer of or an agreement to transfer a decree that may be passed in future may, in equity, entitle the transferee to claim the beneficial interest in the decree after it is passed, such 1370 equitable transfer does not render the transferee a transferee of the decree by assignment in writing within the meaning of Order XXI, rule 16.
Per DAS J.
The transfer in writing of a property which is the subject matter of a suit without in terms transferring the decree passed or to be passed in the suit does not entitle the transferee to apply for execution of the decree under Order XXI, rule 16, as a transferee of the decree by an assignment in writing.
If by reason of any provision of law, statutory or otherwise, interest in property passes from one person to another, there is a transfer of the property by operation of law.
There is no warrant for confining transfers "by operation of law" to the three cases of death, devolution or succession or to transfers by operation of statutory laws only.
If the document in question could be construed to be a transfer of or an agreement to transfer the decree to be passed in future, then on the decree being passed, by operation of equity, the respondents would become the transferees of the decree by operation of law within the meaning of Order XXI, rule 16.
Per BHAGWATI J. Section 5 of the Transfer of Property Act defines a "transfer of property" as an act by which the transferor conveys property in present or in future to the transferee or transferees.
The words "in present or in future" qualify the word "conveys" and not the word "property" in the section.
A transfer of property that is not in existence operates as a contract to be performed in the future which may be specifically enforced as soon as the property comes into existence.
It is only by the operation of this equitable principle that as soon as the property comes into existence and is capable of being identified, equity taking as done that which ought to be done, fastens upon the property and the contract to assign becomes a complete equitable assignment.
There is nothing in the provisions of the Code of Civil Procedure or any other law which prevents the operation of this equitable principle, and an assignment in writing of a decree to be passed in future would become a complete equitable assignment on the decree being passed and would fall within the "assignment in writing" contemplated by Order XXI, rule 16 of the Code.
A mere transfer of property as such does not by itself spell out a transfer of a decree which has been passed or may be passed in respect of that property and it would require an assignment of such decree in order to effectuate the transfer.
But where the property is an actionable claim within the meaning of the definition in section 3 of the Transfer of Property Act and is transferred by means of an instrument in writing, the transferee could by virtue of section 130 of the Transfer of Property Act step into the shoes of the transferor and claim to be the transferee of the decree and apply for execution of the decree under Order XXI, rule 16 of the Code of Civil Procedure.
Per IMAM J. There must be a decree in existence which is transferred before the transferee can benefit from the provisions 1371 of rule 16.
The ordinary and natural meaning of the words of rule 16 can carry no other interpretation and the question of a strict and narrow interpretation of its provisions does not arise.
Case law reviewed.
|
Civil Appeal No. 20 of 1955.
Appeal from the Judgment and Order dated the ' 29th day of September 1954 of the High Court of Judicature at Madras in Original Side Appeal No. 113 of 1954 arising out of the order dated the 9th day of August 1954 of the said High Court in its Ordinary Original Civil Jurisdiction in Application No. 3542 of 1954.
376 C. K. Daphtary, Solicitor General for India (H. J. Umrigar, Mohan Kumaramangalam and Rajinder Narain, with him) for the appellants.
B. H. Dhebar and P. G. Gokhale for respondent No. 1.
Samarendra Nath Mukherjee and B. N. Ghose for respondent No. 2.
N. P. Engineer, (B. Moropant and V.J. Taraporewala, with him) for respondent No. 3. 1955.
April 20.
The Judgment of the Court was delivered by BHAGWATI J.
This appeal with a certificate under article 133 (1) (c) of the Constitution is directed against the judgment of the High Court of Judicature at Madras dismissing the appeal of the Appellants and refusing to set aside a sale effected by Respondent 2 of certain properties belonging to the Madras Electric Tramways (1904) Ltd. hereinafter called the Company, above the ground at Vepery, Madras and Mylapore, including the machinery cars, etc.
and buildings as scrap to Respondent 3 in his capacity as the Receiver of the trustees of the debenture holders of the Company.
The Appellants are the Secretary and President respectively of the Madras Tramways Workers Association (Registered No. 1253) a Trade Union registered under the Trade Unions Act.
The workmen employed by the Company are entitled under the award of the Special Industrial Tribunal, Madras in I. D. No. 9 of 1953 published in the Fort St. George Gazette, dated the 8th July, 1953 being G. 0.
Ms. No. 3024/53 to a payment of nearly Rs. 7,00,000 out of which the workers belonging to the Madras Tramways Workers Association alone would be entitled nearly to a sum of Rs. 4,35,000 and are thus the major creditors of the Company.
The Company was incorporated in England with its principal office situated at No. 1, Rundalls Road, Vepery, Madras 7 and was running the Tramway Service in Madras with licence issued to it by the Government under the Tramways Act.
It had issued 377 1300 First Debentures of CIOO each and the debenture holders had appointed the Beawer Trust Ltd., England as trustees.
By an Indenture made in England on the 13th October 1924 the Company charged by way of first charge in favour of the trustees all its undertaking properties and assets for the time being both present and future including its uncalled capital with the payment of all moneys for the time being owing on the security of the debentures and such charge was to rank as a floating charge.
By two subsequent deeds made at Madras dated the 26th March, 1925 and 6th July, 1950 certain immovable properties belonging to the company were mortgaged in favour of the said trustees.
The said Trustees appointed Respondent 2, the Managing Director of the Company and day to day management of the Tramway Service and of the business of the Compay, as their Receiver.
He took possession as such Receiver,, from the midnight of 11th April, 1953 of all the assets of the Company including moneys in the bank to the credit of the Company and after that date the Tramways Service was suspended and still remains suspended.
One J. B. Beardsell, one of the Directors of the Company filed O. P. No. 419 of 1953 as the duly constituted Attorney of the Company for winding up the Company on the ground that it was unable to pay its debts and that it bad ceased to carry on its business.
An order for the winding up of the Company was made by the Court on the 20th January, 1954 and the Official Receiver, High Court, Madras, was appointed the Official Liquidator.
Since all the assets including the moneys of the Company were in possession of Respondent 2, the Official Receiver was unable to take charge of anything except the records of the Company.
Soon after the order for winding up the Respondent 2 advertised in the newspapers on the 23rd January, 1954 for the sale of the properties and assets of the Company.
At the end of the conditions of sale he stated in paragraph 7 that "the sales are for the time being subject to the approval of the High Court 378 at Madras and it will be for the undersigned to obtain such approval for accepted offers free of all costs to the purchaser".
At the time of the order of winding up, two suits were pending in the High Court, C.S. No. 191 of 1952 filed by the Company against the State of Madras for Rs. 1,33,204 9 0 and interest thereon being electric charges alleged to have been collected by the State of Madras in excess of those payable by the Company and paid by the company under protest and C.S. No. 368 of 1953 filed by the State of Madras against the Company for the recovery of Rs. 9,26,123 2 3 with interest thereon, being the difference alleged to be due in respect of the electric charges under the old rates and the revised rates applicable to the Company.
During the pendency of the said suits Respondent 2 gave an undertaking in Application No. 4533 of 1953 in Civil Suit No. 368 of 1953 that he would not without the orders of the High Court dispose of any of the assets of the Company which were in his possession till the disposal of the suit C.S. No. 368 of 1953.
The two suits aforesaid were tried together and were disposed of by a common judgment on the 16th March 1954.
On the 16th July 1954 Respondent 2 agreed to sell and Respondent 3 agreed to buy the movable properties of the Company the particulars of which were set out in the agreement entered into on that date, for a price of Rs. 4,01,658 of which half was paid on the signing of the agreement and the other half was agreed to be paid out of the proceeds of sale to be made by the purchasers of the assets as scrap.
On the 23rd July 1954 the Official Receiver, High Court, Madras (Respondent 5 herein) filed an application No. 3542 of 1954 for setting aside the said sale of the assets of the Company on the grounds, inter alia, that it was prejudicial to the interests of the General body of unsecured creditors, that the same had been concluded with undue haste and without adequate publicity and in violation of Respondent 2 's said undertaking to the Court.
It also asked for an injunction restraining the Respondent 2 from 379 handing over and the Respondent 3 from either taking over or breaking up the assets purchased by him pending, the disposal of the said application.
This application was based on a report of the Official Receiver in which after setting out the relevant facts he submitted that even though under section 229 of the Indian Companies Act the Company which was admittedly insolvent was governed by rules prevailing with regard to the respective rights of the secured and unsecured creditors and to debts provable and valuation of annuities governing the administration in insolvency and secured creditors generally stood outside the liquidation and were entitled to have the remedy of realising the security and proving before him for the deficiency, if the properties of the Company could be sold for a price higher than the amount due to the Trustees of the debenture holders there was a possibility of a surplus coming into his bands for the benefit of the unsecured creditors.
If the Respondent 2 proved before him for any deficiency due to the secured creditors, it would certainly affect the rights of unsecured creditors, and moreover though the secured creditors might realise the security, it will be in the interests of the unsecured creditors to see that a fair and proper price was obtained.
He therefore submitted that in the interests of the unsecured creditors it was just and necessary to have a fair valuation ascertained and an enquiry held to ascertain whether the sale by the Respondent 2 in favour of Respondent 3 was bona fide and for a proper price.
Respondent 2 filed an affidavit in reply in August 1954 contending inter alia, (1) that the offer by the Respondent 3 was the highest, that he had received and that this had been accepted bona fide, (2) that in the advertisement the condition as to the previous sanction of the Court was inserted because of the undertaking that be had given to the Court in C.S. No. 368 of 1953 and that this undertaking lapsed with the dismissal of the said suit on the 16th March 1954, (3) that he had been advised by the Solicitors in England for the debenture trustees that it was unnecessary for him to obtain 380 the sanction of the Court and that he had been instructed not to apply for such sanction and (4) that the sale was bona fide and he had secured as good a price as could be obtained.
By its judgment and order dated the 9th August 1954 Mr. Justice Balakrishna Ayyar (in Chambers) dismissed the said application with costs.
The learned Judge held that the question whether Respondent 2 had violated the undertaking given by him was not germane to the application before him, that undoubtedly the Respondent 2 did give wide publicity of his intention to sell the assets of the Company, that it could not be said that the sale was sub rosa on the ground of want of wide publicity to the intended sale of the Company 's assets and that the Respondent 3 's offer was the best offer received by the Respondent 2 looking both to the abstract of offers appended to the affidavit of the Respondent 2 in the said application, and looking to the other offers pointed out to him by Respondent 5.
The learned Judge further referred to the offer of the Corporation of Madras and said that the said Corporation had not made any firm offer at all and that the offer of one A. Chettiar of Rs. 4,25,000 made on 5th August 1954 during the hearing of the application was an offer made by a person who did not appear to him to be of a man of sound financial status.
The learned Judge in his judgment also recorded the fact that during the hearing of the application the Respondent 3 offered to sell to the Madras Municipal Corporation the entire assets he had purchased at the same price which he paid for it but the Corporation were not prepared to accept the offer.
The Respondent 5 accepted the said judgment and decision and did not prefer any appeal against the same.
But the Appellants who were not parties to the proceedings applied for and obtained from the High Court leave to appeal from the said decision.
This appeal also was dismissed by the High Court with costs on the 24th September 1954.
The High Court differed from the finding of the Trial Court and held that due publicity had not been given to the 381 intended sale and observed that if the matter rested merely on a decision of that point they would have allowed the appeal and set aside the sale.
They how ' ever held that in the absence of fraud or want of bona fides on the part of the seller along with that of the buyer the sale in favour of the Respondent 3 could not be set aside.
The High Court further considered the question whether the said sale was void as being without the leave of the Court in view of section 232 of the Indian Companies Act and answered that question in the negative.
The High Court further held that a secured creditor had a right to realise his security without seeking the assistance of the court and remaining outside the winding up.
Being aggrieved by the said judgment and decree of the High Court the Appellants applied for leave to appeal to this Court and such leave was granted by the High Court on the 24th September 1954.
The bona fides of the Respondent 2 in the matter of the sale were not challenged either in the Courts below or before us and there were concurrent findings of fact that the price obtained by Respondent 2 was the best price available under the circumstances.
It was however urged by the learned Solicitor General for the Appellants: (I) that the High Court, having found that due publicity had not been given to the intended sale, ought not to have allowed the Respondent 3 at that stage to raise the question as to whether the Court had any power or jurisdiction to set aside the sale except on the ground that it was vitiated by fraud or for want of bona fides and (2) that the sale by Respondent 2 being a sale held without leave of the winding up Court was void under section 232(1) of the Indian Companies Act.
The High Court bad allowed the Respondent 3 to raise the question even at that late stage inasmuch as it was a pure question of law and the learned Solicitor General therefore rightly did not press the first contention before us.
The main argument centered round the second contention, viz., whether the sale effected by the Respondent 2 without leave of the winding up Court was void and hence liable to be set aside.
382 The decision of this question turns upon the true construction of section 232 of the Indian Companies 'Act, which runs as under: "(I) Where any company is being wound up by or subject to the supervision of the Court, any attachment, distress or execution put in force without leave of the Court against the estate or effects or any sale held without leave of the Court of any of the properties of the company after the commencement of the winding up shall be void.
(2) Nothing in this section applies to proceedings by the Government".
It may be noted that the words "or any sale held without leave of the Court of any of the properties" underlined above were inserted by Act XXII of 1936.
Before this amendment section 232(1) was almost in identical terms with section 228(1) of the English Companies Act of 1948.
Two other sections of the Indian Companies Act may be noted in this context, viz. section 171:"When a winding up order has been made or a provisional liquidator has been appointed no suit or other legal proceeding shall be proceeded with or commenced against the company except by leave of the Court, and subject to such terms as the Court may impose." and Section 229: "In the winding up of an insolvent company the same rules shall prevail and be observed with regard to the respective rights of secured and unsecured creditors and to debts provable and to the valuation of annuities and future and contingent liabilities as are in force for the time being under the law of insolvency with respect to the estates of persons adjudged insolvent; and all persons who in any such case would be entitled to prove for and receive dividends out of the assets of the company may come in under the winding up, and make such claims against the company as they respectively are entitled to by virtue of this section;" which correspond respectively to sections 231 and 317 of the English Companies Act of 1948.
383 The position of a secured creditor in the winding up of a company has been thus stated by Lord Wrenbury in Food Controller vs Cork(1): "The phrase 'outside the winding up ' is an intelligible phrase if used, as it often is, with reference to a secured creditor, say a mortgagee.
The mortgagee of a company in liquidation is in a position to say "the mortgaged property is to the extent of the mortgage my property.
It is immaterial to me whether my mortgage is in winding up or not.
I remain outside the winding up ' and shall enforce my rights as mortgagee".
This is to be contrasted with the case in which such a creditor prefers to assert his right, not as a mortgagee, but as a creditor.
He may say 'I will prove in respect of my debt '.
If so, he comes into the winding up".
It is also summarised in Palmer 's Company Precedents Vol.
II, page 415: "Sometimes the mortgagee sells, with or without the concurrence of the liquidator, in exercise of a power of sale vested in him by the mortgage.
It is not necessary to obtain liberty to exercise the power of sale, although orders giving such liberty have sometimes been made".
The secured creditor is thus outside the winding up and can realise his security without the leave of the winding up Court, though if he files a suit or takes other legal proceedings for the realisation of his security he is bound under section 231 (corresponding with section 171 of the Indian Companies Act) to obtain the leave of, the winding up Court before he can do so although such leave would almost automatically be granted.
Section 231 has been read together with section 228(1) and the attachment, sequestration, distress or execution referred to in the latter have reference to proceedings taken through the Court and if the creditor has resort to those proceedings he cannot put them in force against the estate or effects of the Company after the commencement of the winding up without the leave of the winding up Court.
The (1) 1923 Appeal Cases 647.
49 384 provisions in section 317 are also supplementary to the provisions of section 231 and emphasise the position of the secured creditor as one outside the winding up, the secured creditor being, in regard to the exercise of those rights and privileges, in the same position as he would be under the Bankruptcy Act.
The corresponding provisions of the Indian Companies Act have been almost bodily incorporated from those of the English Companies Act and if there was nothing more, the position of the secured creditor here also would be the same as that obtaining in England and he would also be outside the winding up and a sale by him without the intervention of the Court would be valid and could not be challenged as void under section 232(1) of the Indian Companies Act.
It was however urged that the addition of the words "or any sale held without leave of the Court of any of the properties" had changed the position of the secured creditor and even though the secured creditor realised the security without the intervention of the Court such sale, if effected by him without the leave of the winding up Court, was void.
It was pointed out that these words did not find their place in the corresponding section 228(1) of the English Companies Act and therefore even though any attachment, distress or execution put in force without leave of the Court against the estate or effects of the company after the commencement of the winding up was void under the terms of the section 232(1) as it originally stood, the words "or any sale held without leave of the Court of any of the properties" of the company were wide enough to include not only a sale held through the intervention of the Court but also a sale effected by the secured creditor without the intervention of the Court whether the sale was by private treaty or by public auction.
It was contended on the other hand on behalf of the contesting Respondent, Respondent 3, that the amendment was made in order to get over the decision of the Allahabad High Court in Kayastha Trading and Banking Corporation Ltd. vs 385 Sat Narain Singh(1) and that in any event on a true construction of section 232(1) as amended the words "any sale held" had reference in the context only to sales held by or effected through the intervention of the Court and not sales effected by the secured creditor without the intervention of the Court.
The decision of the Allahabad High Court above referred to had held on a construction of section 232(1) as it then stood, that an execution was not put in force merely when the property of the judgment debtor was sold in pursuance thereof, but it was put in force when the property was attached and hence where the property of an insolvent company was attached prior to the date of the commencement of the winding up but was actually sold subsequent to such date, the sale was not void and could be upheld.
There was an earlier decision of the Patna High Court in Baldeo Narain Singh vs The, United India Bank Ltd.(1) in which a contrary decision had been reached exactly under similar circumstances.
It is well known that this conflict was resolved and the decision of the Allahabad High Court was got over by inserting this amendment by Act XXII of 1936.
The statement of objects and reasons is certainly not admissible as an aid to the construction of a statute.
But it can be referred to for the limited purpose of ascertaining the conditions prevailing at the time which actuated the sponsor of the Bill to introduce the same and the extent and urgency of the evil which he sought to remedy.
State of West Bengal vs Subodh Gopal Bose and Others(3).
The amendment of section 232(1) inserted by Act XXII of 1936 was designed to prevent such sales as were upheld by the decision of the Allahabad High Court in Kayastha Trading and Banking Corporation Ltd. vs Sat Narain Singh(1) and it would be permissible to refer to that portion of the statement of objects and reasons for the purpose of ascertaining the extent and urgency of the evil which was sought to be remedied by introducing the amendment.
It follows therefore that the (1) Allahabad 433 (2) [1915] 38 Indian Cases 91.
(3) ; , 628.
386 amendment could not have been intended to bring within the sweep of the general words "or any sale held without the leave of the Court of any of the properties" sales effected by the secured creditor outside the winding up.
Even apart from this intendment there are certain canons of construction which also tend to support the same conclusion.
Prior to the amendment the law was well settled both in England and in India that the secured creditor was outside the winding up and he could realise his security without the intervention of the Court by effecting a sale of the mortgaged premises by private treaty or by public auction.
It was only when the intervention of the Court was sought either by putting in force any attachment, distress or execution within the meaning of section 232(1) as it stood before the amendment or proceeding with or commencing a suit or other legal proceedings against the company within the meaning of section 171 that leave of the Court was necessary and if no such leave was obtained the remedy could not be availed of by the secured creditor.
The sale of the mortgaged premises was also brought by the amendment on a par with the attachment, distress or execution put in force at the instance of the secured creditor and having regard to the context such sale could only be construed to be a sale held through the intervention of the Court and not one effected by the secured creditor outside the winding up and without the intervention of the Court.
It is a well recognised rule of construction that "when two or more words which are susceptible of analogous meaning are coupled together noscunter a sociis, they are understood to be used in their cognate sense.
They take, as it were, their colour from each other.
, that is.
, the more general is restricted to a sense analogous to the less general.
(Maxwell on Interpretation of Statutes, Tenth Edition, p. 332).
The Judicial Committee of the Privy Council also expressed itself in similar terms in Angus Robertson & Others vs George Day(1): (1) , 69. 387 "It is a legitimate rule of construction to construe words in an Act of Parliament with reference to words found in immediate connection with them".
Having regard therefore to the context in which these words "any sale held without leave of the Court of any of the properties" have been used in juxtaposition with "any attachment, distress or execution put into force without leave of the Court against the estate or effects" it would be a legitimate construction to be put upon them that they refer only to sales held through the intervention of the Court and not to sales effected by the secured creditor outside the winding up and without the intervention of the Court.
There is also a presumption against implicit alteration of law and that is enunciated by Maxwell on Interpretation of Statutes, 10th Edition, at page 81 in the following terms: "One of these presumptions is that the legislature does not intend to make any substantial alteration in the law beyond what it explicitly declares, either in express terms or by clear implication, or, in other words, beyond the immediate scope and object of the statute.
In all general matters outside those limits the law remains undisturbed.
It is in the last degree improbable that the legislature would overthrow fundamental principles, infringe rights, or depart from the general system of law, without expressing its intention with irresistible clearness. . . . .
This passage from Maxwell was approved of by Their Lordships of the Privy Council in Murugian, P. vs Jainudeen, C. L.(1) and Their Lordships agreed that the law was correctly stated in the passage just cited.
To the same effect are also the observations of the Court of Appeal in National Assistance Board vs Wilkinson(1) where it was held that the Statute is not to be taken as affecting a fundamental alteration in the general law unless it uses words pointing unmistakably to that conclusion.
In that case at page 658 Lord Goddard, C.J. observed: (1) [1954] 3 Weekly Law Reports 682, 687, (2) 388 "But it may be presumed that the legislature does not intend to make a substantial alteration in the law beyond what it expressly declares.
In Minet vs Leman(1), Sir John Romilly, M. R. stated as a principle of construction which could not be disputed that 'the general words of the Act are not to be so construed as to alter the previous policy of the law, unless no sense or meaning can be applied to those words consistently with the intention of preserving the existing policy untouched ' ".
If the construction sought to be put upon the words "or any sale held without leave of the Court of any of the properties" by the Appellants were accepted it would effect a fundamental alteration in the law as it stood before the amendment was inserted in section 232(1) by Act XXII of 1936.
Whereas before the amendment the secured creditor stood outside the winding up and could if the mortgage deed so provided, realise his security without the intervention of the Court by effecting a sale either by private treaty or by public auction, no such sale could be effected by him after the amendment and that was certainly a fundamental alteration in the law which could not be effected unless one found words used which pointed unmistakably to that conclusion or unless such intention was expressed with irresistible clearness.
Having regard to the circumstances under which the amendment was inserted in section 232(1) by Act XXII of 1936 and also having regard to the context we are not prepared to hold that the Legislature in inserting that amendment intended to effect a fundamental alteration in law with irresistible clearness.
Such a great and sudden change of policy could not be attributed to the Legislature and it would be legitimate therefore to adopt the narrower interpretation of those words of the amendment rather than an interpretation which would have the contrary effect.
(Vide the observations of the Privy Council in Vasudeva Mudaliar & Others vs Srinivasa Pillai & another(1).
(1) ; (2) (19O7) I.L.R. 30 Madras 426, 433, 389 It may be observed in this connection that section 171 enacts a general provision with regard to suits or other legal proceedings to be proceeded with or commenced against the company after a winding up order has been made and lays down that no suit or other legal proceedings shall be proceeded with or commenced against the company except by leave of the Court and subject to such terms as the Court may impose.
This general provision is supplemented by the supplemental provisions to be found respectively in sections 229 and 232(1) of the Act.
Section 229 speaks of the application of insolvency rules in winding up of insolvent companies and section 232(1) speaks of the avoidance of certain attachments, executions, etc., put into force without the leave of the Court against the estate and effects of the company and also of any sale held without the leave of the Court of any of the properties of the company after the commencement of the winding up.
Section 229 recognises the position of the secured creditor generally as outside the winding up but enables him in the event of his desiring to take the benefit of the winding up proceedings to prove his debt, to value the same and share in the distribution pro rata of the assets of the company just in the same way as he would be able to do in the case of insolvency under the Presidency Towns Insolvency Act or the Provincial Insolvency Act.
Section 232(1) also has reference to legal proceedings in much the same way as legal proceedings envisaged by section 171 of the Act and the attachment, distress or execution put in force or the sale held are all of them legal proceedings which can only be resorted to through the intervention of the Court.
The word "held" in connection with the sales contemplated within the terms of the amended section also lends support to this conclusion and this conclusion is further fortified by the terms of section 232(2) which says that nothing in this section applies to proceedings by the Government, thus in effect indicating that what are referred to in section 232(1) are proceedings within the meaning of that term as used in section 171 of the Act.
390 The Federal Court also put a similar construction on the provisions of section 171 read with section 232(1) of the Act in The Governor General in Council vs Shiromani Sugar Mills Ltd. (In Liquidation)(1) "Section 171 must, in our judgment, be construed with reference to other sections of the Act and the general scheme of administration of the assets of a company in liquidation laid down by the Act.
In particular, we would refer to section 232.
Section 232 appears to us to be supplementary to section 171 by providing that any creditor (other than Government) who goes ahead, notwithstanding a winding up order or in ignorance of it, with any attachment, distress, execution or sale, without the previous leave of the Court, will find that such steps are void.
The ref erence to "distress" indicates that leave of the Court is required for more than the initiation of original proceedings in the nature of a suit in an ordinary Court of law.
Moreover, the scheme of the application of the company 's property in the pari passu satisfaction of its liabilities, envisaged in section 211 and other sections of the Act, cannot be made to work in co ordination, unless all creditors (except such secured creditors as are "outside the winding up" in the sense indicated by Lord Wrenbury in his speech in Food Controller V. Cork(1) at page 671) are subjected as to their actions against the property of the company to the control of the Court.
Accordingly, in our judgment, no narrow construction should be placed upon the words "or other legal proceeding" in section 171. 'In our judgment, the words can and should be held to cover distress and execution proceedings in the ordinary Courts.
In our view, such proceedings are other legal proceedings against the company, as contrasted with ordinary suits against the company".
We are therefore of the opinion that the sale effected by Respondent 2 as the Receiver of the Trustees of the debenture holders on the 16th July 1954 was valid and binding on all parties concerned and could not be challenged as it was sought to be done by the (1) , 55.
(2) 391 Official Receiver.
The position was rightly summed up by the High Court as under: "We thus reach the position that no leave of Court was needed before the Receiver appointed by the mortgagee debenture holders exercised the power of sale and that as there is no allegation of want of bona fides or recklessness or fraud against the Receiver in exercising such a power, it would follow that the sale held by the Receiver is valid and effectual to convey title to the purchaser and that such a sale cannot be avoided on the ground either of want of due notice given by the Receiver before effecting the sale or on the ground of undervalue".
The result therefore is that the appeal fails and must be dismissed with costs of the contesting Respondent 3.
The other Respondents who have appeared before us will bear and pay their own costs of the appeal.
| The secured creditor is outside the winding up and can realism his security without the leave of the winding up Court, though if he files a suit or takes other legal proceedings for the realisation of his security he is bound under section 171 of the Indian Companies Act to obtain the leave of the winding up Court before he can do so although such leave would almost automatically be granted.
375 It is a legitimate rule of construction to construe words in an Act of Parliament with reference to words found in immediate connection with them.
It is also a well recognized rule of construction that the legislature does not intend to make a substantial alteration in the law beyond what it explicitly declares either in express words or by clear implication and that the general words of the Act are not to be so construed as to alter the previous policy of the law, unless no sense or meaning can be applied to those words consistently with the intention of preserving the existing policy untouched.
Held therefore that having regard to the context in which the words "any sale held without leave of the Court of any of the properties" added in section 232(1) by the amending Act XXII of 1936 have been used in juxtaposition with "any attachment, distress or execution put into force without leave of the Court against the estate or effects" it would be a legitimate construction to be put upon them that they refer only to sales held through the intervention of the Court and not to sales effected by the secured creditor outside the winding up and without the intervention of the Court, and that the amendment was not intended to bring within the sweep of the general words sales effected by the secured creditor outside the winding up.
Held accordingly that in the present case the sale effected by respondent No. 2 as the receiver of the trustees of the debenture holders in July 1954 was valid and binding on all parties concerned and could not be challenged as it was sought to be done by the Official Receiver.
Food Controller vs Cork(1923 A.C. 647), Kayastha Trading and Banking Corporation Ltd. vs Sat Narain Singh ([1921] I.L.R. 43 All. 433), Baldeo Narain Singh vs The United India Bank Ltd. ([1915] , State of West Bengal vs Subodh Gopal Bose and others ; , Angus Robertson and others vs George Day , Murugian, P. vs Jainudeen, C. L. ([1954] 3 W.L.R. 682), National Assistance Board vs Wilkinson ([1952] 2 Q.B. 648), Vasudeva Mudaliar and others vs Srinivasa Pillai and another ([1907] I.L.R. and The Governor General in Council vs Shiromoni Sugar Mills Ltd. (In Liquidation) (1946 F.C.R. 40), referred to.
|
vil Appeal No. 139 of 1955.
Appeal under Articles 132 and 133 of the Constitution of India against the Judgment and Order dated the 23rd December 1953 of the High Court of Judicature for the State of Punjab in Civil Writ Application No. 24 of 1953.
N.C. Chatterjee, (B. section Narula, with him) for the appellant.
G.S. Pathak and Veda Vyas, (Ganpat Rai, with them), for respondent No. 5 1955.
September 6.
The Judgment of the Court was delivered by BOSE J.
The proceedings that have given rise to this appeal arise out of an election petition before the Election Tribunal, Delhi.
The appellant Shrimati Sucheta Kripalani together with the contesting respondent Shrimati Manmohini Sahgal and others were candidates for election to the House of the People from the Parliamentary Constituency of New Delhi.
The polling took place on 14th January, 1952, and when the votes were counted on 18th January, 1952, it was found that the appel lant had secured the largest number of votes and that the contesting respondent Manmohini came next.
The appellant was accordingly notified as the returned candidate on 24th January, 1952.
On 6th March, 1952, the appellant filed her return of election expenses.
This was found to be defective, and on 17th April, 1952, the Election Commission published a notification in the Gazette of India disqualifying the appellant under Rule 114(5) of the Representation of the People (Conduct of Elections and Election Petitions) Rules, 1951, on the ground that she bad "failed to lodge the return of election expenses in the manner required" and that she had thereby "incurred the disqualifications under clause (c) of section 7 and section 143 of the Representation of the People Act, 1951".
452 In view of this the appellant submitted a fresh return with an explanation under Rule 114(6) on 30th April, 1952.
This was accepted by the Commission and on 7th May, 1952, it published a notification in the Gazette of India under Rule 114(7) stating that the disqualification had been removed.
In the meanwhile, on 7th April, 1952, the contesting respondent Manmohini filed an election petition praying that the appellant 's election be declared void and that she (the petitioner) be declared to have been duly elected.
It will be noticed that this was before 17th April, 1952, the date on which the Election Commission disqualified the appellant.
The validity of the election was attacked on many grounds.
A number of major corrupt practices were alleged and the return which the appellant had filed on 6th March,1952, of her election expenses was challenged as a minor corrupt practice on two grounds: (1) that the return was false in material particulars and (2) that it was not in accordance with the rules and so was no return at all in the eye of the law.
Particulars of the instances in which the return was challenged as false were then set out.
The appellant filed her written statement in reply on 7th October, 1952.
It will be noticed that this was after she had put in her second return and after the Election Commission had removed the disqualification due to the first return.
Her reply was as follows: (1) That as the disqualification with respect to the return of her election expenses had been removed by the Election Commission under section 144 of the Representation of the People Act, 1951, this question could not be reopened; (2) That a minor corrupt practice which cannot vitiate an election and which is not capable of materially affecting an election is wholly outside the scope of a proper election petition and so no cognisance of it can be taken by the Election Tribunal; (3) That only such matters can be put in issue as are necessary to decide whether the election of the returned candidate is liable to be set aside within the meaning of section 100(2) of the Act, 453 The contesting respondent Manmohini filed a replication on 15th October, 1952.
In it she said: (1)that the Election Commission did not and could not decide whether the return was or was not false in material particulars and so the question was still open.
(This had reference to the first return dated 6th March., 1952.); (2) that in any event "even the revised return is false in material particulars and the objections with regard to the original return also apply exactly with regard to the revised return".
The broad propositions of law raised by points (2) and (3) in the appellant 's written statement were also denied.
Then followed an item by item reply to the allegations made by the appellant in the list which she had appended to her written statement.
That list was a reply to the particulars of false return and corrupt practices furnished by the contesting respondent Manmohini.
It is evident then that Manmohini attacked the second return on exactly the same grounds as the first and, furnished the same particulars.
Now we have spoken of these returns as the first and the second.
But counsel on both sides agreed before us that the first return was in fact no return at all in the eye of the law and that therefore the contesting respondent 's real attack was on the second return which must be regarded as the only return which the law will recognise as a valid return.
It was agreed that there cannot be two returns of expenses: either the one originally filed is amended or it is treated as a nullity so far as it purports to be a return.
In view of this agreement, it is not necessary for us to express any opinion on the matter and we will concentrate our attention on what, for convenience, we will continue to call the second return.
The first point that now arises is whether the decision of the Election Commission to remove the disqualification attaching to the first return precludes an enquiry into the falsity of the second return simply because the respondent Manmohini alleged that the 454 particulars of the falsity are exactly the same as before.
Our answer to that is No.
If the first return is no return in the eye of the law, then the only return we are concerned with is the second and that must be treated in the same way as it would have been if it had been the only return made.
If there had been no other return and this return had been challenged on the grounds now raised, it is clear that the truth of the allegations made would have to be enquired into.
That enquiry cannot be shut out simply because the allegations against the second return happen to be exactly the same in the matter of its falsity as in the case of the first return.
We are therefore of opinion that the jurisdiction of the Tribunal to enquire into these matters was not ousted on that account.
Our reasons for this are these.
Section 76 of the Act requires every candidate to file a return of election expenses in a particular form containing certain prescribed particulars.
The form and particulars are set out in the Rules.
Section 143 prescribes the penalty for failure to observe those requirements.
It is disqualification.
This ensues if there is a "default" in making the return.
It also ensues: "if such a return is found. . upon the trial of an election petition under Part VI. . to be false in any material particular".
That places the matter beyond doubt.
The trial of an election petition is conducted by an Election Tribunal and this section makes it incumbent on the Tribunal to enquire into the falsity of a return when that is a matter raised and placed in issue and the allegations are reasonably connected with other allegations about a major corrupt practice.
The jurisdiction is that of the Tribunal and not of the Election Commission.
The duty of the Election Commission is merely to decide under Rule 114(4) whether any candidate has, among other things, "failed to lodge the return of election expenses. in the manner required by the Act and these rules".
It is a question of form and not of substance.
If 455 0 the return is in proper form no question of falsity can arise unless somebody raises the issue.
If it is raised, the allegations will be made in some other document by some other person and the charges so preferred will be enquired into by the Tribunal.
If the return is not in proper form, disqualification ensues but the Election Commission is invested with the power to remove the disqualification under Rule 114(6).
If it does, the position becomes the same as it would have been had the Election Commission decided that the form was proper in the first instance.
That would still leave the question of falsity for determination by the Tribunal in cases where the issue is properly raised.
Mr. Chatterjee contended on behalf of the appellant that we were not concerned with the second return in this appeal and 0strongly protested against Mr. Pathak being allowed to argue this point.
But that has been the main bone of contention almost from the start.
When the election petition was filed, there was only one return to attack.
The second had not been put in.
Later, when it was put in, the contesting respondent, Manmohini, attacked, both and the appellant herself said that questions about the falsity of the return could not be gone into because of the Election Commission 's order removing the disqualification.
That argument applies as much to the second as to the first return and raises an issue about the respective jurisdictions of the Election Commission and the Election Tribunal on this point.
The Tribunal decided against the appellant on this point and held, as we do, that the Election Commission was not concerned with the issue of fact about the falsity of the return.
The appellant then filed a petition under article 226 to the High Court and questioned the Tribunal 's jurisdiction to enquire into the issue of falsity.
The High Court upheld the Tribunal 's decision and the appellant pursued the matter here both in her grounds of appeal and in her statement of the case.
She cannot at this stage ask us to leave 456 the matter open so that she can come here again and re agitate this question.
We accordingly overrule Mr. Chatterjee 's objection.
The next question argued was whether an Election Tribunal can enquire into a minor corrupt practice if it is of such a nature that, standing by itself, it could not have been made the basis of an election petition because it could not materially affect the result of the election.
We need not go into that because the question is purely academic in this case.
The allegation about the minor corrupt practice does not stand by itself.
There are also allegations about major corrupt practices which require investigation and the minor corrupt practices alleged are reasonably connected with them.
Section 143 of the Act is a complete answer to the question of the Tribunal 's jurisdiction on this point when it is properly seised of the trial of an election petition on other grounds.
Whether it could be properly seised of such a trial if this had been the only allegation, or if the minor corrupt practice alleged was not reasonably connected with the other allegations about major corrupt practices, does not therefore arise.
As the trial is proceeding on the other matters the Tribunal is bound under section 143, now that the issue has been raised, also to enquire into the question of the falsity of the return.
Without such an enquiry it cannot reach the finding which section 143 contemplates.
We need not look into the other sections which were touched upon in the arguments and in the Courts below because section 143 is clear and confers the requisite jurisdiction when a trial is properly in progress.
The appellant has failed on every question of substance that she raised.
There was some vagueness in the Election Tribunal 's order about which of the two returns formed the basis of the enquiry on this point but even if the Tribunal intended to treat the first return as the basis, that did not really affect the substance because exactly the same allegations are made about the second return and the issue of fact would therefore have to be tried in any event.
The appel 457 lant 's whole endeavour was to circumvent such an enquiry and oust the Tribunal 's jurisdiction.
In that she has failed, so she will pay the contesting respondent 's costs throughout.
The appeal fails and is dismissed with costs all through.
| The provisions of the Representation of the People Act and the Rules framed thereunder assign distinct and different jurisdictions to the Election Commission and an Election Tribunal so far as a Return of election expenses is concerned.
Where there are allegations of major corrupt practices and a Tribunal constituted is in lawful seisin of the dispute, section 143 of the Act gives it the sole jurisdiction and makes it incumbent on it to inquire into the falsity of any particulars mentioned in the return where such falsity is alleged and brought into issue and is reasonably connected with the major corrupt practices.
What the Election Commission has to do under Rule 114(4) is to satisfy itself that the return is in the prescribed form.
It is no part of its function to inquire into the correctness of any particulars mentioned therein.
That question can only arise when some one raises a dispute and brings the matter into issue.
Consequently, in a case where, as in the present, the Election Commission removed the disqualification it had imposed on the returned candidate for lodging a defective return of election expenses on the lodging of a fresh return; Held, that the decision of the Election Commission removing the disqualification attaching to the first return in no way precluded the Tribunal from inquiring into the falsity of the particulars in the second return although they were identical with those challenged in the first return; that the removal of the disqualification only meant that the accepted return was the only valid return, being the first to be correct in form, and the Tribunal had only that return before it, 451
|
ivil Appeal No. 26 of 1955.
Appeal under Article 136 of the Constitution of India from the Judgment and Order dated the 28th February, 1953, of the Election Tribunal, Vellore, in Election Petition No. 84 of 1954.
N.C. Chatterjee, (R. Ganapathy Iyer, with him), for the appellant.
Naunit Lal, for respondent No. 1. 1955.
September, 15.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
This is an appeal by special leave against the order of the Election Tribunal, Vellore, declaring the election of the appellant to the Legislative Assembly void on the ground that there had been a violation of section 123(7) of the Representation of the People Act No. XLIII of 1951.
Under that section, it, is a major corrupt practice for a candidate or his agent to incur or authorise the incurring of expenditure in contravention of the Act or any rule made thereunder.
Rule 117 provides that: "No expense shall be incurred or authorised by a 471 candidate or his election agent on account of or in respect of the conduct and management of an election in any one constituency in a State in excess of the maximum amount specified in respect of that Constituency in Schedule V".
Under Schedule V, the maximum expense specified for election to the Madras State Legislature from a single member constituency, such as Ranipet, is Rs. 8,000.
The return of the expenses lodged by the appellant showed that he had spent in all Rs. 7,063 for the election, and that was within the limit allowed.
The charge against him in the petition was that he had failed to disclose in his return two sums of Rs. 500 each, spent for election purposes, and that with the addition of those amounts, the maximum speci fied had been exceeded.
As regards the first amount, the facts found are that on 12 9 1951 the appellant applied to the Tamil Nad Congress Committee for permission to contest the election as a Congress candidate, and along with his application he paid Rs. 500 out of which Rs. 100 was subscription for membership and Rs. 400 deposit, which was liable to be returned under the rules, in case the applicant was not adopted as the candidate, but not otherwise.
In fact, the appellant was adopted as the Congress candidate, and it was on that ticket that he fought and won the election.
The second payment of Rs. 500 was on 23 9 1951 to the North Arcot District Congress Committee, which was in charge of the Ranipet Constituency.
The Tribunal held that both these sums were paid for purposes of election and should have been included in the return made by the appellant, that if they were so included, the maximum prescribed was exceeded, and that therefore section 123(7) had been contravened, and accordingly declared the election void under section 100(2) (b) of the Act.
The appellant disputes the correctness of this order.
The Tribunal also recorded as part of the order a finding that the appellant had become subject to the disqualifications specified in section 140, sub clauses (1) (a) and (2).
The appellant attacks this finding on 60 472 the ground that it was given without notice to him, as required by the proviso to section 99.
The points that arise for decision in this appeal are (1) whether on the facts found, there was a contravention of section 123(7) of Act No. XLIII of 1951and (2) whether the finding that the appellant had become disqualified under section 140 is bad for want of notice under the proviso to section 99 of the Act.
(1) Taking first the sum of Rs. 500 paid by the appellant to the Tamil Nad Congress Committee on 12 9 1951, the contention of the appellant is that section 123(7) and Rule 117 have reference only to expenses incurred by a candidate or his agent, that the appellant was nominated as a candidate only on 16 11 1951, and that as the payment in question was made long prior to the filing of the nomination paper, the provisions aforesaid had no application.
That raises the question as to when the appellant became a 'candidate ' for purposes of section 123(7).
Section 79(b) of Act No. XLIII of 1951.
defines a candidate thus: "Candidate" means a person who has been or claims to have been duly nominated as a candidate at any election, and any such person shall be deemed to have been a candidate as from the time when, with the election in prospect, he began to hold himself out as a prospective candidate".
Under this definition which applies to section 123(7), all election expenses incurred by a candidate from the time when, with the election in prospect, he holds himself out as a prospective candidate and not merely from the date when he is nominated, will have to enter into the reckoning 'under Rule 117 read with Schedule V. That the election was in prospect when the amount of Rs. 500 was paid is clear from the very application of the appellant dated 12 9 1951 wherein he states that he desires "to contest as a 'Congress candidate in the forthcoming election".
That is not disputed by the appellant.
What he contends is that though the election was in prospect, he bad not become a prospective candidate at that time, and that he became so only when the Congress 473 adopted him as its candidate on 13 11 1951.
It was argued that it was open to the Congress Committee either to adopt him as its candidate or not, that if it did not adopt him, he could not, under the rules to which he had subscribed, stand for election at all, that until he was actually adopted therefor, his candidature was nebulous and uncertain, and that the application was consequently nothing more than a preliminary step in aid of his becoming a prospective candidate.
The question when a person becomes a candidate must be decided on the language of section 79(b).
Under that section, the candidature commences when the person begins to hold himself out as a prospective candidate.
The determining factor therefore is the decision of the candidate himself, not the act of other persons or bodies adopting him as their candidate.
In The Lichfield, case(1) at page 36, Baron Pollock observed: "I think the proper mode of judging a question of this kind is to take it from the point of view of the candidate himself.
Every man must judge when he will throw himself into the arena.
But it is his own choice when he throws down the glove and commences his candidature".
When, therefore, a question arises under section 79(b) whether a person had become a candidate at a given point of time, what has to be seen is whether at that time he had clearly and unambiguously declared his intention to stand as a candidate, so that it could be said of him that he held himself out as a prospective candidate.
That he has merely formed an intention to stand for election is not sufficient to make him a prospective candidate, because it is of the essence of the matter that he should bold himself out as a prospective candidate.
That can only be if he communicates that intention to the outside world by declaration or conduct from which it could be inferred that he intends to stand as a candidate.
Has that been established in this case? When the appellant made the payment of Rs. 500 to (1) 474 the Tamil Nad Congress Committee, did he merely evince an intention to stand as a candidate, or did he hold himself out as a prospective candidate? The application contains a clear declaration of his intention to contest the election, and that declaration is backed by the solemn act of payment of Rs. 500.
The appellant had thus clearly and unambiguously conveyed to the Committee his intention to stand as a candidate, and he thereby became a prospective candidate within the meaning of section 79(b).
The possi bility that the Congress might not adopt him as its ,candidate does not, as already mentioned, affect the position, as the section has regard only to the volition and conduct of the candidate.
It is true that if the Congress did not adopt him, the appellant might not be able to stand for election.
But such a result is implicit in the very notion of a prospective candidate, and does not militate against his becoming one from the date of his application.
It was also urged for the appellant that the declaration was made not to the constituency in the North Arcot District but to the Central Committee at Madras, and that unless there was proof of holding out to the electorate, the requirements of section 79(b) were not satisfied.
It may be that the holding out which is contemplated by that section is to the Constituency; but if it is the Central Committee that has to decide who shall be adopted for election from the concerned constituency, any declaration made to the Committee is, in effect, addressed to the constituency through its accredited representative.
The question when a candidature commences is, as has been held over and over again, one of fact, and a decision of the Tribunal on that question is not liable to be reviewed by this Court in special appeal.
In the present case, the Tribunal has, in a well considered judgment, formulated the correct principles to be applied in determining when a candidature commences, examined the evidence in the light of those principles, and recorded a finding that the appellant was a prospective candidate when he made the payment of 475 Rs. 500 on 12 9 1951, and we do not find any ground for differing from it.
Then, there is the payment of Rs. 500 made to the North Arcot District Congress Committee on 23 9 1951.
The contention of Mr. Chatterjee with reference to this payment is that unlike the payment dated 12 9 1951, this was not spent for purposes of election but was donation made to the Committee out of philanthropic motives.
It has been frequently pointed out that while it is meritorious to make a donation for charitable purposes, if that is made at the time or on the eve of an election, it is open to the charge that its real object was to induce the electors to vote in favour of the particular candidate, and that it should therefore be treated as election expense.
In The Wigan Case(1), Bowen, J. observed: ". .
I wish to answer the suggestion that this was merely charity.
Charity at election times ought to be kept by politicians in the background. .
In truth, I think, it will generally be found that the feeling which distributes relief to the poor at election time, though those who are the distributors may not be aware of it, is really not charity, but party feeling following in the steps of charity, wearing the dress of charity, and mimicking her gait".
In The Kingston Case(2), Ridley, J. said: "Now assume for the moment that a man forms a design, which at the time is in prospect, for that is the point; yet if circumstances alter, and an election becomes imminent, he will go on with that design at his risk".
It would again be a question of fact whether the payment of Rs. 500 by the appellant on 23 9 1951 was a pure act of charity or was an expense incurred for election purposes.
It was admitted by the Secretary of the North Arcot District Congress Committee that it was usual for the Tamil Nad Congress Committee to consult the local Committee in the matter of adoption of candidates, and that at the time the payment was made, it was known that the appellant had ap plied to be adopted by the Congress.
Exhibit A(7) (1) , (2) , 476 which is a statement of receipts and payments of the North Arcot District Congress Committee for the period 24 9 1951 to 24 5 1952 shows that the Committee started with an opening balance of Rs. 7 12 2, and that various amounts were collected including the sum of Rs. 500 paid by the appellant and utilised for election expenses.
The Tribunal held on a consideration of these facts that the payment in question could not be regarded as innocent, and "not motivated by the desire to obtain the recommendations of the North Arcot District Congress Committee for candidature of the first respondent".
No ground has been shown for differing from this conclusion.
It was finally contended for the appellant that the two payments dated 12 9 1951 and 23 9 1951 could not be said to be expenses incurred on account of the conduct and management of an election, and reliance was placed on the decision in The Kennington Ca8e(1), where it was held that payments made for the running of a newspaper started for supporting a candidate were not expenses incurred in the conduct and management of an election.
The facts of the present case have no resemblance to those found in that case, and the following comment on that decision in Parker 's Election Agent and Returning Officer, Fifth Edition, page 241 is instructive: "But this decision could not be safely followed except where the facts are precisely similar".
On the findings recorded above, the expenses incurred by the appellant come to Rs. 8,063, and the corrupt practice specified in section 123(7) has been committed.
The election was therefore rightly set aside under section 100(2)(b) of Act No. XLIII of 1951.
(2) It is next contended for the appellant that the Tribunal was in error in recording as part of the order a finding that by reason of the contravention of section 123(7), the appellant had become subject to the disqualification specified in section 140, without giving notice to him as required by the proviso to section (1) 477 99.
The question whether a party to an election petition is entitled to a notice under the proviso in respect of the very charges which were the subject matter of enquiry in the petition itself, has been considered by this Court in Civil Appeal No. 21 of 1955, and it has been held therein that if the party had opportunity given to him in the hearing of the petition to meet the very charge in respect of which a finding is to be recorded under section 99 (1) (a), then he is not entitled to a further notice in respect of the same matter, under the proviso.
In the present case, the finding under section 99(1) (a) relates to the very payments which were the subject matter of enquiry in the election petition, and therefore no notice was required to be given to the appellant under the proviso.
This objection also fails, and the appeal must accordingly be dismissed.
The respondent has stated through his counsel Shri Naunit Lal that he does not propose to contest the appeal.
There will accordingly be no order as to costs.
Appeal dismissed.
| The appellant, who fought and won the election as a Congress candidate, had applied to the Tamil Nad Congress Committee on 12 9 51 for party nomination stating his desire "to contest as a Congress candidate in the forthcoming election '? and paid a sum of Rs. 500 of which Rs. 100 was subscription for membership and Rs. 400 a deposit, liable to he refunded in case the application was refused.
On 23 9 51 he paid another gum of Rs. 500 as donation to the District Congress Committee.
On 13 11 51 he was adopted by the Congress as its candidate.
His nomination paper for the election was filed on 16 11 51.
The charge against him in the election petition was that he had failed to include these two sums in his return of election expenses and with the addition of these sums the maximum limit of election expenses prescribed for the constituency would be exceeded.
The Tribunal found that both these sums were paid for election purposes and the maximum prescribed had been exceeded and, therefore, section 123(7) had been contravened and declared the election void under section 100(2)(b) of the Act.
The Tribunal also recorded a _finding that the appellant was liable to the disqualifications specified in section 140, clauses (1)(a) and (2).
Held, affirming the decision of the Tribunal, that the exact point of time from which a person must be deemed to be a candidate within the meaning of section 79(b) of the Representation of the People Act is the time when, with the election in prospect, he himself decides to stand as a candidate and communicates such decision to others leaving no manner of doubt as to his intention.
This must be an met of his own volition and not that of other persons or bodies adopting him as their candidate.
The Lichfield case, [1895] 5 p.m. & H. 1, referred to.
That the applicant was a candidate from the date of his application to the Tamil Nad Congress Committee and the two sums were election expenses incurred by him and should have been shown in his return.
470 That the commencement of candidature in a particular case is.
a question of fact to be determined by the Tribunal and its decision in this regard is not liable to be reviewed by the Supreme Court in an appeal by special leave.
That whether a particular sum paid at the time or on the eve of the election was a donation, an act of charity or an election expense must depend on whether or not such payment was open to the charge of having been made in order to induce the voters to vote in favour of the donor.
This again is a question of fact to be decided by the Tribunal.
The Wigan case, , and The Kingston case , relied on.
The Kennington case, (1886] , held inapplicable.
That it was not necessary for the Tribunal to 'serve a notice under the proviso to section 99 of the Act on the appellant, a party to the election petition, to enable the Tribunal to record his liability to disqualification under section 140 of the Act in respect of the chargelevelled against him.
|
ivil Appeal No. 21 of 1955.
Appeal under Article 133(1)(c) of the Constitution of India against the Judgment and Order dated the 12th January 1954 of the Pepsu High Court in Civil Misc.
No. 182 of 1953.
M. C. Setalvad, Attorney General of India, Veda Vyas and Jagannath Kaushal, (Naunit Lal, with them),for the appellant.
The respondents did not appear.
September 15.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
The appellant was a candidate for election to the Legislative Assembly of the State of PEPSU from the Dhuri Constituency, and having secured the largest number of votes was declared duly elected.
The first respondent who is one of the electors in the Constituency filed the petition out of which the present appeal arises, for setting aside the election on the grounds, inter alia, (1) that the nomination of one Mali Singh had been wrongly rejected by the returning officer, and (2) that the ap pellant was guilty of the corrupt practice of bribery.
The Tribunal held that both these grounds were made out, and accordingly set aside the election.
It further recorded a finding in terms of section 99 (1) (a) of the Representation of the People Act No. XLIII of 1951 that the appellant was proved to have committed the corrupt practice of bribery as mentioned in section 123(1) of the Act.
The Appellant thereupon filed in the High Court of Patiala and East Punjab States 450 Union an application under Article 227 attacking the finding of the Tribunal that he was guilty of bribery.
The order of the Tribunal in so far as it set aside his election was not challenged.
By order dated 12 1 1954 the High Court upheld the findings of the Tribunal, and dismissed the application, and by order dated 7 6 1954 granted a certificate for appeal to this Court under Article 133(1)(c).
That is how the appeal comes before us.
On behalf of the appellant, the learned AttorneyGeneral raised two contentions: (1) The finding that the appellant was guilty of bribery was reached in disregard of the mandatory provisions of section 83, and that it was besides open to other legal objections; and (2) the finding recorded under section 99 of the Act was bad, because no notice was given to the appellant, and no enquiry held as required by the proviso to section 99.
This point was not taken in ' the application under Article 227, and was sought to be raised at the time of the argument in the High Court; but the learned Judges declined to entertain it.
(1) On the first question, the complaint of the appellant is that in the election petition the allegations relating to bribery were vague and wanting in particulars, and that the petition should accordingly have been dismissed under sections 83 and 85 of the Act; that the charge that was sought to be proved at the hearing was at variance with the charge as alleged in the petition, and that the Tribunal had erred in giving a finding of bribery on the basis not of the allegations in the petition but of the evidence adduced at the trial.
The allegations in the petition relating to this charge are as follows: "The sweepers of Small Town Committee, Dhuri were each granted good work allowance at Rs. 5 p.m. for three months only during Election days, simply because they happened to be voters in the said Constituency, vide letter No. ST/1(4)/52/20702 dated 7th December, 1951.
All this was done to induce these sweepers to vote for the respondent No. 1, The allowance was against the Rules", 460 The reply of the appellant to this charge was as follows: "The sweepers of Small Town Committee represented to me in writing that their pays should be increased, and they also quoted the pays that the employees of other Small Town Committees and Municipal Committees were getting.
The representation was forwarded to the Secretariat.
The Secretariat examined it on merits, passed legal orders.
Such concessions were also shown to other employees of the various Small Town Committees and Municipal Committees in Pepsu before and after this case.
This was an official act done in the routine and not to induce the sweepers to vote for respondent No. 1".
On these averments, the following issue was framed: "5.
Whether the sweepers of Small Town Committee, Dhuri, were granted good work allowance at Rs. 5 p.m. for three months only during the election days in order to induce them to vote for the Respondent No. 1?" At the trial, the petitioner examined the Darogba of the Small Town Committee (P.W. 28), and five sweepers, P.Ws. 12, 13, 14, 39 and 40, and their evidence was that sometime in November 1951 the appellant came to Dhuri, enquired about the number of sweepers in the service of the Committee, and offered to raise their pay if they would vote for him, that the sweepers thereupon held a meeting and considered the suggestion of the appellant, and then decided to vote for him, if the pay was increased.
It must be stated that the appellant was then Minister for Health, and was in charge of Local Administration.
On 28 11 1951 he passed an order on a memorial sent by the sweepers that their pay would be increased by Rs. 5 per mensem.
Objection to the order was taken by the Department, and thereupon, the appellant passed the modified order dated 7 12 1951 granting good work allowance for a period of three months from December 1951 to February 1952.
The Tribunal accepted the evidence on the side of the petitioner that the appellant offered to increase the salary of the sweepers in 1951, and held that the order dated 461 7 12 1951, granting good work allowance for the election period was the outcome of the bargain come to in November 1951, and that the charge of bribery had been established.
It is contended for the appellant that in the petition there was no mention of the bargain on which the finding of bribery by the Tribunal was based, that the charge in the petition related only to the order dated 7 12 1951, and that accordingly it was not open to the petitioner to travel beyond the petition and adduce evidence in proof of a bargain which had not been pleaded.
This is to put too technical and narrow a construction on the averments.
The charge in the petition was not merely that the appellant had passed the order dated 7 12 1951 but that he had passed it with a view to induce the sweepers to vote for him.
That clearly raised the question as to the circumstances under which the order came to be passed, whether it was in the course of official routine as the appellant pleaded, or under circumstances which were calculated to influence the voters.
Issue 5 put the matter beyond doubt, when it pointedly raised the question whether the grant was "for three months only during the election days in order to induce them (the sweepers) to vote for the respondent No. I".
Under the circumstances, the complaint that the evidence and the finding as to the bargain went beyond the pleadings and should be ignored appears to be without any substance.
It may be that the allegations in the petition are not as full as they might have been; but if the appellant was really embarrassed by the vagueness of the charge, it was open to him to have called for particulars; but he did not do so.
At the trial, the petitioner first adduced evidence, and his witnesses spoke to the bargain in November, 1951.
It is stated on behalf of the appellant that he objected to the reception of the evidence on the question of bargain, as it was not pleaded.
But this is denied by the petitioner in his affidavit filed in the High Court dated 3 12 1953.
Even apart from this, the witnesses on behalf of the petitioner gave evidence on this point on the 8th and 11th 462 November, 15th and 16th December, 1952, and on the 2nd February, 1953.
Then the appellant entered on his defence.
On 26 2 1951 he examined R.W. 4, a member of the Small Town Committee, to rebut the evidence on the side of the petitioner, and himself went into the box and deposed to the circumstances under which the order came to be passed.
Having regard to the above facts, there is and can be no complaint that the appellant was misled, or was prejudiced by the alleged defect in the pleadings.
The contention that is urged for him is that the petition should have been dismissed under section 83 for want of particulars.
This was rightly rejected by the High Court as without force, and we are in agreement with it.
It is next contended that there is no evidence or finding that the sweepers were entitled to vote in the Constituency, or that the appellant was a candidate as defined in section 79(2) at the time when the bargain was made.
But the allegation in the petition is clear that the order dated 7 12 1951 was made with a view "to induce the sweepers to vote for the appellant".
The reply of the appellant to this was that the order was made in the course of official routine and "not to induce the sweepers to vote" for him.
Far from there being any specific denial that the sweepers were electors, the reply of the appellant proceeds on the basis that they were entitle to vote.
This objection was not raised before the Tribunal, and, as pointed out by the High Court, P.W. 12 does say in his evidence that he is a voter.
This contention must accordingly be overruled.
Nor is there any substance in the contention that there is no proof that the appellant was a candidate at the time of 'the bargain.
this again is an objection which was not taken before the Tribunal, and on the evidence of the witnesses examined on the side of the petitioner which was accepted by the Tribunal, the appellant would be a prospective candidate as defined in section 79(b) of the Act.
The finding that the appellant is guilty of bribery is therefore not open to attack.
(2) It is next contended that the order of the 463 Tribunal in so far as it recorded a finding that the ap pellant had committed the corrupt practice specified in section 123(1) is bad, as no notice was given to him as required by the proviso to section 99 and no opportunity to show cause against it.
Section 99 runs as follows: "99.
(1) At the time of making an order under section 98 the Tribunal shall also make an order(a) whether any charge is made in the petition of any corrupt or illegal practice having been committed at the election, recording (i) a finding whether any corrupt or illegal practice has or has not been proved to have been committed by, or with the connivance of, any candidate or his agent at the election, and the nature of that corrupt or illegal practice; and (ii) the names of all persons, if any, who have been proved at the trial to have been guilty of any corrupt or illegal practice and the nature of that practice, together with any such recommendations as the Tribunal may think proper to make for the exemption of any persons from any disq ualifications which they may have incurred in this connection under sections 141 to 143.
Provided that no person shall be named in the order under sub clause (ii) of clause (a) unless(a) he has been given notice to appear before the Tribunal and to show cause why he should not be so named; and (b) if he appears in pursuance of the notice, he has been given an opportunity of cross examining any witness who has already been examined by the Tribunal, and has given evidence against him, of calling evidence in his defence and of being heard The point for decision is whether it was obligatory on the part of the Tribunal to issue notice under the above proviso to parties to the election petition before recording a finding under section 99(1)(a).
The contention of the appellant is that under section 99 (1) (a) the Tribunal has to record the names of all persons 59 464 who are proved to have been guilty of corrupt or illegal practice, that that would include both parties to the petition as well as non parties, that the proviso requires that notice should be given to all persons who are to be named under section 99 (1) (a), subclause (ii), and that the appellant was accordingly entitled to fresh notice under the proviso.
It is argued that if the language of the enactment is interpreted in its literal and grammatical sense, there could be no escape from the conclusion that parties to the petition are also entitled to notice under the proviso.
But it is a rule of interpretation wellestablished that, "Where the language of a statute, in its ordinary meaning and grammatical construction, leads to a manifest contradiction of the apparent purpose of the enactment, or to some inconvenience or absurdity, hardship or injustice, presumably not intended, a construction may be put upon it which modifies the meaning of the words, and even the structure of the sentence".
(Maxwell 's Interpretation of Statutes, 10th Edition, page 229).
Reading the proviso along with clause (b) thereto, and construing it in its set ting in the section, we are of opinion that notwithstanding the wideness of the language used, the proviso contemplates notice only to persons who are not parties to the petition.
The object of giving notice to a person under the proviso is obviously to give him an opportunity to be heard before a finding is given under section 99 (1) (a) (i) that he has committed a corrupt or illegal practice.
This clearly appears from clause (b) of the proviso, which enacts that the person to whom notice is to be given should have an opportunity of crossexamining witnesses who had been examined before and given evidence against him, of calling his own evidence and of being heard.
This is in accordance with the rule of natural justice which requires that no one should be condemned without being given an opportunity to be heard.
The reason of the rule, therefore, requires that notice should be given to persons who had had no previous opportunity in respect of the matters mentioned in sub clause (b) to the pro 465 viso.
Such for example would be witnesses, and possibly agents of the parties, as observed in Nyalchand Virchand vs Election Tribunal(1), though it is not necessary to decide that point, but it cannot refer to parties to the petition who have had every opportunity of taking part in the trial and presenting their case.
Where an election petition is founded on a charge of corrupt practice on the part of the candidate, that becomes the subject matter of enquiry in the petition itself.
, If at the trial the Tribunal came to the conelusion that the charge had been proved, then it has to hold under section 100(2) (b) that the election is void, and pass an order to that effect under section 98 (d).
Section 99 (1) enacts that the finding of corrupt practice under section 99 (1) (a) (i) or naming a person under section 99 (1) (a) (ii) should be at the time of making an order under section 98.
If the contention of the appellant is to be accepted, then the result will be that even though there was a full trial of the charges set out in the petition, if the Tribunal is disposed to bold them proved it has first to give notice of the finding which it proposes to give, to the parties, and hold a fresh trial of the very matters that had been already tried.
That is an extraordinary result, for which it is difficult to discover any reason or justification.
It was argued by the learned Attorney "General that the giving to a party to a proceeding a second opportunity to be heard was not unknown to law, and he cited the instance of an accused in a warrant case being given a further opportunity to recall and cross examine prosecution witnesses after charge is framed, and of a civil servant being given an opportunity under Article 311 to show cause against the action proposed to be taken against him.
In a warrant case, the accused is not bound to crossexamine the prosecution witnesses before charge is framed, and in the case of civil servants, the decision that they are entitled to a second opportunity was based on the peculiar language of sections 240(2) and (3) of the Government of India Act, 1935, and Article 311 of the Constitution.
They are (1) [1953] 8 Election Law Reports 417, 421, 466 exceptional cases, and do not furnish any safe or useful guidance in the interpretation of section 99.
The appellant also sought support for his contention that notice should be given under the proviso even to persons who are parties to the election petition, in the provision in section 99 (1) (a) (ii) that the Tribunal might make such recommendations as it thinks proper for exemption of any persons from any disqualifications which may have been incurred under sections 141 to 143.
The argument is that the disqualifications mentioned in section 143 could only be with reference to candidates, as they relate to default in filing return of election expenses or in filing false returns, that before the Tribunal could take action under this provision it would have to give notice to the persons affected thereby who must necessarily be parties to the petition, and that if the proviso applies when action is to be taken under section 143, there is no reason why it should not apply when action is to be taken under the other sections of the Act as well.
The fallacy in this argument is in thinking that notice to a person is requisite for making a recommendation under section 99(1) (a) (ii).
Section 99(1) (a) (ii) deals with two distinct matters naming persons who are proved to have been guilty of corrupt and illegal practices, and recommending whether there should be any exemption in respect of the disqualifications mentioned in sections 141 to 143, and the proviso, properly construed, requires notice only in the former case and not the latter.
It will be noticed that while in cases falling within sections 139 and 140 the disqualification is automatic and immutable, in cases falling within sections 141 to 143 the Election Commission has power to grant exemption under section 144 of the Act.
It is to guide the Commission in exercising its powers under section 144, that the Tribunal is directed in section 99 (1) (a) (ii) to make any recommendations with reference thereto.
The jurisdiction of the Tribunal in respect of this matter is purely advisory.
There is nothing to prevent the Commission from taking up the question of exemption under section 144 suo motu, even though the 467 Tribunal has made no recommendation.
Indeed, there is nothing to prevent the person adversely affected from applying directly to the Commission for exemption.
While, therefore, there is compelling reason why a person should have an opportunity of showing cause before he is named, there is none such when the question is one of recommendation.
As we construe the proviso, it confers no right on any person, party or stranger, to be heard on the question whether he should be recommended for exemption from the disqualifications under sections 141 to 143.
The provision for exemption in section 99 (1) (a) (ii) therefore does not lend any support to the contention of the appellant that notice should be given to parties to the petition under the proviso before they are named.
Reliance was also placed by the appellant on the decision of the Election Tribunal in Kesho Ram vs Hazura Singh(1), wherein it was held by a majority that notice under the proviso to section 99 should be given to the parties to the petition also.
For the reasons given above, we do not agree with the decision of the majority.
Our conclusion is that while the persons to be named under section 99(1)(a)(ii) would include both parties to the petition as well as non parties, the proviso thereto applies only to persons who had no opportunity of taking part in the trial, and that, therefore, whether notice should issue under the proviso will depend on whether the person had an opportunity to cross examine witnesses who had given evidence against him and to adduce his own evidence.
This conclusion is in accord with the law in England.
Under section 140 sub clause (1) of the Representation of the People Act, 1949, an election Court has to state in its report the names of all persons who are found guilty of corrupt and illegal practice but "in the case of some one who is not a party to the petition nor a candidate on behalf of whom the seat or office is claimed by the petition", the court has to issue notice to him, give him an opportunity of being (1) (1953] 8 Election Law Reports 320.
468 heard by himself, and calling evidence in his defence.
It was sugested for the appellant that the law as enacted in section 99 makes a deliberate departure from that under section 140(1) of the English Act.
The difference in the wording between the two sections is due to the difference in the arrangement of the topics of the two statutes, and there is no reason to hold that with reference to the substance of the matter, there was any intention to depart from the English law on the subject; nor is there any reason therefor.
In the present case, the appellant was a party to the petition, and it was his election that was being questioned therein.
He had ample opportunity of being heard, and was, in fact, heard, and therefore there was no need to issue a notice to him under the proviso to section 99 before recording a finding under section 99 (1) (a) (ii).
Further, even if we agree with the contention of the appellant that notice under the proviso should be given to a party to the petition, seeing that the reliefs which could be claimed in the election petition under section 84 are those mentioned in section 98, and that action under section 99 (1) (a) is to be taken at the time when the order under section 98 is pronounced, there is no insuperable difficulty in treating the notice to the party in the election petition as notice for purposes of the proviso to section 99(1) (a) as well.
This reasoning will not apply to persons who are not parties to the petition, and a notice to them will, be necessary under the proviso, before they axe named.
In the result, all the contentions urged in support of the appeal fail, which must accordingly be rejected.
As the respondent has not appeared to contest the appeal, there will be no order as to costs.
| Where the respondent in an election petition contended that the allegations in the election petition were vague and wanting in particulars, but did not call for any particulars which it was open to him to do and was not found to have been misled or in any way prejudiced in his defence, it was not open to him to contend that the petition was liable to be dismissed for non compliance with the provisions of section 83 of the Act.
Clauses (a) and (b) of the proviso to section 99 of the Representation of the People Act read together leave no scope for doubt that clause (a) contemplates notice only to such persons as were not parties to the election petition and it is, therefore, not obligatory on the Tribunal under cl.
(a) to issue notices on such persons as were parties in order that it may name them for disqualification under sub clause (ii) of section 99(1)(a) of the Act.
Clause (b) to the proviso obviously has the effect of excluding such persons as have already had the opportunity of cross examining witnesses, calling evidence and of being heard, which the clause seeks to afford.
The Indian and the English Law on the matter are substantially the same.
Kesho Ram vs Hazura Singh, [1953] 8 Election Law Reports 320, overruled.
The jurisdiction that sub clause (ii) of section 99(1)(a) of the Act confers on the Tribunal for making recommendation for exemption 458 from disqualifications mentioned in sections 141 to 143 is purely advisory.
Where it omits to do so, aggrieved parties have access to the Election Commission which under section 144 has the power to act suo motu.
No person, be he a party or a stranger, has a right to be heard by the Tribunal on the question of such exemption and, therefore, no question of any service of notice under the proviso in this regard can arise.
Even supposing that the proviso requires notice on a party to the election petition, the notice to him of the election petition itself can be treated as a notice under the proviso.
|
201 of 1952) under article 32 of the Constitution for the enforcement of fundamental rights.
B. K. Varma.and G. C. Mathur for the petitioner.
M.C. Setalvad, Attorney General for India, (Porus A. Mehta, with him) for the respondent.
March 13.
The Judgment of the Court was delivered by BOSE J.
This is a petition under article 32 of the Constitution in which the petitioner seeks redress for what, according to him, is a breach of his fundamental rights under articles 14 and 16(1) of the Constitution.
It was argued at considerable length by the petitioner in person.
Then, when our judgment was nearly ready, he put in a petition asking for a rehearing and for permission to file some fresh papers.
When that was refused he came again on another,day and asked for leave to engage an agent and appear through counsel as he felt he had not been able to do justice to his case in person.
(It may be mentioned that though he had originally engaged an agent he dismissed him before the hearing when he appeared in person.) We granted his request and counsel reargued the case for him but has not carried the matter any further.
The facts are these.
657 In October,1945, the petitioner was employed by the Government of India on a five year contracting, the Directorate General of Resettlement and Employment of the Ministry of Labour.
This was after selection by the Federal Public Service Commission.
After a short period of practical training, he was posted in January, 1946, at Jabalpur as the Manager of the Sub Regional Employment Exchange and was later confirmed in this appointment.
This contract of service was due to expire in 1950.
Shortly before its expiration the Government of India made him a new offer, embodied in its letter dated the 30th June, 1950, to continue him in service on the expiry of his contract on the terms specified in that letter.
Among them were the following: (3) Other conditions of service: On the termination of your contract you will be allowed to continue in your post temporarily for the period of the Resettlement and Employment Organisation and will be governed by the Central Civil Services (Temporary Service) Rules, 1949, unless you are a permanent Government servant.
" He was asked in the letter to intimate to the Ministry of Labour whether he was willing to continue in service on those terms and he admits that he accepted the offer and continued in service, He was not a permanent Government servant though it was contended in argument that he was, for he was on a five year contract and the work for which he was employed, namely Resettlement and Employment, was itself only of a temporary character.
Therefore, the Temporary Service Rules applied.
On those rules, ' rule 5 is material.
It runs as follows: 5 (a) The service of a temporary Government servant who is not in quasi permanent service shall be liable to termination at any time by notice in writing given either by the Government servant to the appointing authority, or by the appointing authority to the Government servant.
658 (b) The period of such notice shall be one month, unless otherwise agreed to by the Government and by the Government servant.
" Quasi permanent service is defined in the rules and it is clear that the petitioner does not come within that class.
It is also an undisputed fact that there was no agreement between the petitioner and Government regarding the period of the notice.
Therefore, according to this rule, which was a term in the petitioner 's contract of further service, his services were liable to termination at any time by ' one month 's notice in writing.
This notice was given on 25th November, 1950, and he was told that his services would terminate on the expiry of one month from 1st December, 1950.
A large field was covered in the course of the arguments, and had the matter not been re argued we would, for the petitioner 's satisfaction, have dealt with the contentions raised more fully than will be necessary now that counsel has appeared.
The petition is under article 32(1) of the Constitution and so it must be shown that a fundamental right has been infringed.
It was argued that the rights infringed are the ones conferred by articles 14 and 16(1).
Taking article 14 first, it must be shown that the ,petitioner has been discriminated against in the exercise or enjoyment of some legal right which is open to others who are similarly situated.
The rights which he says have been infringed are those confered by article 31 1.
He says he has either been dismissed or removed from service without the safeguards which that article confers.
In our opinion, article 31 1 has no application because this is neither a dismissal nor a removal from service, nor is it a reduction in rank.
It is an ordinary case of a contract being termi nated by notice under one of its clauses.
The services in India have long been afforded certain statutory guarantees and safeguards against arbitrary dismissal or reduction in rank Under 659 section 240 of the Government of India Act, 1935, the safeguards were limited to those two cases.
Under.
the present Constitution, a third was added, namely removal from service.
In order to understand the difference between "dismissal" and "removal" from service, it will be necessary to turn to the Rule,; which governed, and with modifications still govern, the "services" in India because of article 313 of the Constitution.
Part XII of the Civil Services (Classification, Control and Appeal) Rules relating to Conduct and Discipline includes rule 49 which sets out the various penalties to which a member of the services can be subjected for indiscipline and misconduct.
They are seven in number and include censure, suspension, reduction in rank, removal from service and dismissal from service.
The Act of 1935 selected only two of these possible penalties as serious enough to merit statutory safeguards, namely reduction in rank and dismissal from service. 'The Constitution has added a third to the list.
The distinction which is drawn between the two is explained in rule 49.
There is first removal from service "which does not disqualify from future employment " and there is next dismissal from service "which ordinarily disqualifies from future employment.
" Then follows an Explanation: The discharge (c) of a person engaged under contract, in accordance with the terms of his contract, does not amount to removal or dismissal within the meaning of this rule.
" These terms are used in the same sense in article 3ll.
It follows that the article has no application here and so no question of discrimination arises, for the "law" whose protection the petitioner seeks has no application to him.
There was no compulsion on the petitioner to enter into the contract he did.
He was as free under the law as any other person to accept or to reject the 660 offer which was made to him.
Having accepted, he still has open to him all the right , and remedies available to other persons similarly situated to enforce any rights under his contract which have been denied to him, assuming there are any, and to pursue in the ordinary courts of the land such remedies for a breach as are open to him to exactly the same extent as other persons similarly situated.
He has not been discriminated against and he has not been denied the protection of any laws which others similarly situated could claim.
The remedy of a writ is misconceived.
Article 16(1) is equally inapplicable.
The whole matter rests in contract.
When the petitioner 's first contract (the five year one) came to an end, he was not a permanent Government servant and Government was not bound either to re employ him or to continue him in service.
On the other hand, it was open to Government to make him the offer it did of a continuation of his employment on a temporary and contractual basis.
Though the employment was continued, it was in point of fact, and in the eyes of the law, under a new and fresh contract which was quite separate and distinct from the old even though many of its terms were the same.
Article 16(1) deals with equality of opportunity in all matters relating to employment or appointment to any office under the State.
The petitioner has not been denied any opportunity of employment or of appointment.
He has been treated just like any other person to whom an offer of temporary employment under these conditions was made.
His grievance, when analysed, is not one of personal differentiation but is against an offer of temporary employment on special terms as opposed to permanent employment.
But of course the State can enter into contracts of temporary employment and impose special terms in each case, provided they are not inconsistent with the Constitution, and those who choose to accept those terms and enter into the contract are bound by them, even as the State is bound.
When the employment is permanent there are certain statutory guarantees but in the absence of 661 any such limitations government is, subject to the qualification mentioned above, as free to make special, contracts of, service with temporary employees, engaged in, works of a temporary nature, as any other employer.
Various matters relating to the merits of the case were referred to but we express no opinion about whether the petitioner has other rights which he can enforce in other ways.
We are dealing here with a writ under article 32 to enforce a fundamental right and the only point we decide is that no fundamental right has been infringed.
When the matter was first argued we had decided not to make any order about costs but now that the petitioner has persisted in reopening the case and calling the learned Attorney General here for a second time, we have no alternative but to dismiss the petition with costs.
Petition dismissed.
Agent for the petitioner: Bajinder Narain.
| The petitioner was employed by the Government of India on a five year contract in the Resettlement and Employment Directorate of the Ministry of Labour.
When his contract was due to expire the Government made him a new offer to continue him in service in his post temporarily for the period of the Resettlement and Employment Organisation on the condition that he will be governed by the Central Civil Services (Temporary Service) Rules, 1949, which provided for termination of the contract by month 's notice on either side.
He accepted the offer and continued in service, but subsequently his services were terminated after giving him one month 's notice, The petitioner applied for relief under article 32 (1) of the Constitution alleging that his funda mental rights under articles 311, 14 and 16 (1) of the Constitution were infringed: Held, (i) that article 311 had no application as this was not a case of dismissal or removal from service nor a reduction in rank but only an ordinary case of a contract being terminated by notice under one of its clauses, the difference between dismissal and 656 removal being that the former ordinarily disqualifies from future employment but not the latter; (ii) article 14 had no application as he had not been discriminated against and had not been denied the protection of any laws which others similarly situated could claim; (iii) article 16 was equally inapplicable as the petitioner was not denied equal opportunity in a matter relating to appointment or employment but had been treated just like any other person to whom an offer of temporary employment under these conditions was made.
The State can enter into contracts of temporary employment and impose special terms in each case, provided they are not inconsistent with the Constitution, and those who choose to accept those terms and enter into the contract are bound by them, even as the State is bound.
|
ivil Appeal No. 136 of 1965.
Appeal by Special Leave from the Judgment and Order dated the 15th November 1954 of the Election Tribunal, Quilon, Travancore Cochin, in Election Petition No. 18 of 1954.
section Mohan Kumara Mangalam, H. J. Umrigar and Rajinder Narain, for the appellant.
T. R. Balakrishnan, for respondent No. 1. 1955.
September 19.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
This is an appeal by special leave against the order of the Election Tribunal, Quilon declaring the election of the appellant to the Legislative Assembly of the State of Travancore 479 Cochin from the Shencottah Constituency void on the ground that he was disqualified to stand for election under section 7(d) read with section 9(2) of Act No. XLIII of 1951.
Under section 7(d), a person is disqualified for being chosen as a member of the Legislative Assembly of a State, if he is interested in any contract for the supply of goods or for the execution of any works for the Government of that State.
Section 9(2) declares that if any such contract has been entered into by or on behalf of a Hindu undivided family, every member thereof shall be subject to the disqualification mentioned in section 7(d); but that if the contract has been entered into by a member of an undivided family carrying on a separate business in the course of such business, other members of the family having no share or interest in that business shall not be disqualified under section 7(d).
The contract in the present case was for felling trees in a Government forest and transporting them for delivery at the places specified therein.
There is now no dispute that this contract is one that falls within section 7(d) of the Act.
The point in controversy is simply whether the contract with the Government was entered into on behalf of the joint family, of which the appellant is a member.
The agreement stands in the name of one Kuppuswami Karayalar, and the allegations in the petition are that he is a mere name lender for one Krishnaswami Karayalar, who is the manager of a joint family consisting of himself and his sons, the appellant being one of them, and that he entered into the contract in question on behalf of and for the benefit of the joint family.
The case of the appellant, on the other hand, is that Kuppuswami whose name appears in the contract was the person solely entitled to the benefits thereof, that he was not a name lender for Krishnaswami Karayalar, and that further neither he nor the joint family had any interest in the contract.
Certain other pleas were also put forward by him, but they are not now material.
61 480 The following issues were framed on the above con tentions: " (2) Is the said joint family the owner of the right and benefits of the contract for the felling and removal of timber from Coupe No. 4, Nedumangad Taluq, entered into with the Forest Department, Travancore Cochin State? Has the joint family any interest in the said contract? (3) Is Mr. Kuppuswami Karayalar whose name appears as the contractor only a name lender for the joint Hindu family of which the respondent is a member?" On issue 3, the Tribunal found that Krishnaswami Karayalar was the real contracting party, and that Kuppuswami was a benamidar for him, and on issue 2, that the contract was entered into on behalf of the joint family, of which the appellant was a member.
On these findings, it held that the appellant was disqualified under section 7(d) read with section 9(2), and declared his election void.
The appellant questions the correctness of this order firstly on the ground that the finding that Kuppuswami is a benamidar for Krishnaswami Karayalar is not warranted by the evidence, and secondly on the ground that the finding that Krishnaswami entered into the contract on behalf of the joint family is based on a mistake of law and is unsustainable.
On the first question, Mr. Kumaramangalam for the appellant admitts that there is evidence in support of the conclusion that Kuppuswami was a benamidar for Krishnaswami, but contends that it is meagre and worthless.
The question whether a person is a benamidar or not, is purely one of fact, and a finding thereon cannot be interfered with in special appeal, if there is evidence on which it could be based.
We must, therefore, accept the finding of the Tribunal that it was Krishnaswami, the father of the appellant, who was the real contracting party to the agreement with the Government.
The next question is whether Krishnaswami entered into the contract in his own personal capacity or as manager of the joint family.
The Tribunal found 481 as a fact that the business started by Krishnaswami Karayalar was a new venture, and instead of proceeding next to consider on the evidence whether in entering into the contract he acted for himself or for the joint family, it entered into a discussion whether under the Hindu law there was a presumption that a business started by a coparcener was joint family business.
After observing that there was no such presumption "in the case of an ordinary manager", it held that "the law is different when the manager happens to be also the father".
It then referred to certain decisions in which it had been held that the sons were liable for the debts incurred by the father for a new business started by him, and held "on the above authorities that the joint family of the respondent is the owner of the right and benefit of the present contract".
The appellant contends that the statement of law by the Tribunal that there is a presumption that a new business started by the father is joint family business is erroneous, and that its finding that the joint family of which the appellant was a member had an interest in the contract of Krishnaswami could not be supported, as it was based solely on the view which it took of the law.
This criticism is, in our opinion, well founded.
Under the Hindu law, there is no presumption that a business standing in the name of any member is a joint family one even when that member is the manager of the family, and it makes no difference in this respect that the manager is the father of the coparceners.
It is no doubt true that with reference to a trade newly started there is this difference between the position of a father and a manager, that while the debts contracted therefor by the former would be binding on the sons on the theory of pious obligation, those incurred by a manager would not be binding on the members, unless at least there was necessity for the starting of the trade, as to which see Ram Nath vs Chiranji Cal(1), Chotey Lai vs Dulip Narain (2) and Hayat Ali vs Nem Chand(3).
But (1) ,All. 605.
(2) Patna 386.
(3) A.1,R. 1945 Lab. 169, 482 it is one thing to say that the sons are liable for the debts contracted by the father in the trade newly started by him, and quite another thing to treat the trade itself as a joint family concern.
We are therefore unable to accept the finding of the Tribunal that the contract of Krishnaswami Karayalar should, as a matter of law, be held to be a joint family business of himself and his sons.
This conclusion, however, is not sufficient to dispose of the matter.
The case of the respondent that Krishnaswami entered into the contract with the Government of Travancore Cochin on behalf of the joint family rests not merely on a presumption of law but on evidence as to facts and circumstances which, if accepted, would be sufficient to sustain a finding in his favour.
In the view it took of the law on the question, the Tribunal did not discuss the evidence bearing on this point or record a finding thereon.
It is therefore necessary that there should be a remittal of the case for 'a consideration of this question on the evidence.
The appellant contends that there is only the evidence of the respondent in support of the plea that the contract was entered into by Krishnaswami on behalf of the joint family, and that this Court could itself record a finding thereon.
But it is argued by the respondent that there are in the judgment of the Tribunal several observations which would support the conclusion that the contract was entered into on behalf of the joint family.
Thus ' it is pointed out that in para 5 of the judgment the Tribunal observes that Krishnaswami Karayalar started this new business with a view to discharge the family debts.
It further observes in para 6 that the business required an initial investment of about Rs. 25,000 to Rs. 30,000, and that while there is evidence that about Rs. 7,000 had been borrowed by Krishnaswami Karayalar, there is no evidence bow the balance was made up.
The contention of the respondent is that this must have proceeded from the joint family funds, and that implicit in the finding of the Tribunal.
It is this is also mentioned in the judgment of the Tribunal that 483 Krishnaswami was anxious to support his son, the present appellant, and that many of the witnesses whom the respondent was obliged to examine, were really anxious to help the appellant.
(Vide para 12).
We do not, however, desire to express any opinion on these contentions, as we propose to leave them to the decision of the Tribunal.
We accordingly set aside the order of the Tribunal, and direct that the Election Commission do reconstitute the Tribunal to hear and decide the question whether Krishnaswami Karayalar entered into the contract with the Government of Travancore Cochin on behalf of the joint family or for his own personal benefit, on a consideration of the evidence on record.
It is made clear that no further evidence will be allowed.
The parties will bear their own costs in this Court.
Appeal allowed.
Case remitted for hearing.
| There is no presumption in Hindu Law that a business standing in the name of a member of the Hindu joint family is joint family business, even when that member is the manager or the father.
There is this difference between the position of the father starting a new business and a mere manager doing so that while the debts contracted by the father in such business are binding on the sons on the theory of a son 's pious obligation to pay his father 's debt, those contracted by the latter are not binding on the other 478 members of the family unless, at least, it can be shown that the starting of the business was necessary.
Ram Nath vs Chiranii Lal, ([1934] I.L.R. 57 All. 605), Chhotey Lal Chaudhury vs Dalip Narain Singh, ([1938] I.L.R. 17 Patna 386), Hayat Ali Shah vs Nem Chand (A.I.R. , referred to.
But this distinctive position of the father does not by itself make the new business started by him a joint business of the undivided family.
The question of benami is a question of fact and where there is evidence to support a finding that a person is a benamidar for another, the Supreme Court in a Special appeal will not interfere with it.
Consequently, in a case where an election was challenged on the ground that the candidate returned was interested in a contract entered into by his father, benami in the name of another, with the Government for felling trees and transporting timber and as such disqualified to stand for election under section 7(d) read with section 9(2) of the Representation of the People Act and the Tribunal found on evidence that the father was the real contracting party but without considering the evidence on the other point which, if believed, might sustain a finding that the father was meting on behalf of the family, presumed as a matter of law that the ion had interest in the contract and declared the election void, Held, that the Tribunal took an erroneous view of the law and made a wrong presumption, so its decision must be set aside, and as the findings are not sufficient for disposal of the matter the case must be remitted back for rehearing on the evidence on record.
|
nder Article 32 of the Constitution for the enforcement of fundamental rights.
K.L. Gauba, (Gopal Singh, with him), for the Petitioners in Petitions Nos. 337 to 343 and 481 of 1954.
K.L. Gauba, (section D. Sekhri, with him), for the Petitioners in Petitions Nos. 344, 446 and 349 of 1954.
K. L. Gauba, (R. Patnaik and section D. Sekhri, with him), for the Petitioner in Petition No, 345 of 1954, 166 K.L. Gauba, (N. C.Chakravarty and section D. Sekhri, with him) for the Petitioner in Petition No. 347 of 1954.
K.L. Gauba, (B. Moropant and section D. Sekhri, with him), for the Petitioner in Petition No. 348 of 1954.
Rajni Patel and M. section K. Sastri, for the Petitioner in Petition No. 364 of 1954.
Rajni Patel and I. N. Shroff, for the Petitioners in Petitions Nos. 365 and 366 of 1954.
J.B. Dadachanji and Rajinder Narain, for the Petitioner in Petition No. 690 of 1954.
M.C. Setalvad, Attorney General for India, C. K. Daphtary, Solicitor General for India (P. A. Mehta, R. H. Dhebar for P. G. Gokhale, with them), for the Respondents in all Petitions.
April 6.
The Judgment of the Court was delivered by BHAGWATI J.
These petitions under article 32 of the Constitution are directed against the Bombay Merged Territories and Areas (Jagirs Abolition) Act, 1953, Bombay Act XXXIX of 1954 which was passed by the Legislature of the State of Bombay to abolish jagirs in the merged territories and merged areas in the State of Bombay.
The Bill was passed by the Legislature on the 22nd September 1953 and received the sanction of the Upper House on the 26th September 1953.
The President gave his assent to it on the 13th June 1954 and by a notification dated the 15th July 1954 it was brought into effect from the 1st August 1954.
In view of the notification the Petitioners filed these petitions on the 30th July 1954 challenging the vires of the Act (hereinafter called the impugned Act) and asking for the issue of appropriate writs restraining inter alia the State of Bombay from giving effect to its provisions.
On applications made to this Court on the 31st July 1954 the operation of the impugned Act was stayed pending the bearing and final disposal of the petitions, 167 The Petitioners in Petitions Nos. 337, 344, 345, 346, 347 and 349 of 1954 are relations of the Ruler of the erstwhile State of Idar.
The Petitioners in Petitions Nos. 338 and 342 of 1954 are relations of the Ruler of the erstwhile State of Chhota Udaipur.
The Petitioners in Petitions Nos. 339 and 341 are relations of the Ruler of the erstwhile State of Devgad Baria.
The Petitioner in Petition No. 343 of 1954 is a relation of the Ruler of the erstwhile State of Rajpipla.
The Petitioners in Petition No. 340 of 1954 are jagirdars of the erstwhile State of Rajpipla.
The Petitioner in Petition No. 348 of 1954 is a relation of the Ruler of the erstwhile State of Bansda.
The Petitioners in Petitions Nos. 365 and 366 of 1954 are jagirdars of the erstwhile States of Idar and Lunawada respectively.
The Petitioner in Petition No. 481 of 1954 is a relation of the Ruler of the erstwhile State of Mohanpur.
The Petitioners in Petition No. 690 of 1954 are the holders of personal Inams from the erstwhile State of Rajpipla.
All the petitioners except the last claim to be hereditary jagirdars under grants made by the respective States for the maintenance of themselves, their families and dependents and hold the jagirs as Jiwai Jagirs.
The holders of the personal Inams in Petition No. 690 of 1954 used to pay salami to the erstwhile State of Rajpila and are included within the definition of "jagirdar" being holders of agir villages within the meaning of the definition thereof contained in the impugned Act.
The Petitioner in Petition No. 364 of 1954 claims to be the owner of 60 villages in the patta or territory of Moti Moree comprised in the erstwhile State of Idar as the Bhumia or under lord and contends that his holding does not fall within the definition of jagir as given in the impugned Act and that therefore in any event the State of Bombay is not entitled to enforce the impugned Act against him.
All these Petitioners have challenged the vires of the imapugned Act mainly relying upon the agreements of merger entered into by the Rulers of the respective States with the Dominion of India on or about the 19th March 1948 and the collateral letters of guarantee 168 passed by the Ministry of States in their favour on subsequent dates, the contents of which were regarded as part of the merger agreements entered into by them with the Dominion of India.
The merger agreements were in the form given in Appendix XIII to the White Paper at page 183: "FORM OF MERGER AGREEMENT SIGNED BY RULERS OF GUJARAT AND DECCAN STATES AGREEMENT MADE THIS day of between the Governor General of India and the of Whereas in the immediate interests of is desirous that the administration of the State should be integrated as early as possible with that of the Province of in such manner as the Government of the Dominion of India may think fit; It is hereby agreed as follows: ARTICLE 1.
The of hereby cedes to the Dominion Government full and exclusive authority, jurisdiction and powers for and in relation to the Governance of the State and agrees to transfer the administration of the State to the Dominion Government on the day of 1948 (hereinafter referred to as "the said day").
As from the said day the Dominion Government will be competent to exercise the said powers, authority and jurisdiction in such manner and through such agency as it may think fit.
ARTICLE 2.
The shall with effect from the said day be entitled to receive from the revenues of the State annually for his privy purse the sum of rupees free of taxes.
This amount is intended to cover all the expenses of the Ruler and his family, including expenses on account of his personal staff, maintenance of his residences, 169 marriages and other ceremonies, etc.
and will neither be increased nor reduced for any reason whatsoever.
The said sum may be drawn by the in four equal instalments in advance at the beginning of each quarter by presenting bills at the State Treasury or at such other Treasury as may be specified by the Dominion Government.
ARTICLE 3.
The shall be entitled to the full ownership, use and enjoyment of all private properties (as distinct from State properties) belonging to him on the date of this agreement.
The will furnish to the Dominion Government before the day of 1948 an inventory of all the immovable property, securities and cash balance held by him as such private property.
If any dispute arises as to whether any item of property is the private property of the or State property, it shall be referred to such officer with judicial experience as the Dominion Government may nominate and the decision of that officer shall be final and binding on both parties.
ARTICLE 4.
The shall be entitled to all personalprivileges enjoyed by them whether within or outside the territories of the State, immediately before the 15th day of August 1947.
ARTICLE 5.
The Dominion Government guarantees the succession, according to law and custom, to the gadi of the State and to the personal rights, privileges, dignities and titles.
In confirmation whereof Mr. Vapal Pangunm Menon, Secretary to the Government of India in the Ministry of States, has appended his signature on behalf and with the authority of the Governor General of Indiab and has appended his 22 170 signature on behalf of himself, his heirs and successors, of Dated Secretary to the Government of India, Ministry of States".
The letters of guarantee subsequently executed by the Ministry of States in favour of the respective Rulers contained the following guarantees: "(1) Your privy purse will be fixed in accordance with the formula applied in relation to the fixation of the privy purse of the Deccan States Rulers whose States have merged into the Bombay Province.
The amount will be fixed in perpetuity to you, your heirs and successors, and will neither be increased nor reduced for any reason whatsoever.
It will be free of all taxes, whether imposed by the Government of Bombay or by the Government of India and it will not be taken into account in the assessment of your world income to income tax or super tax.
(2) The cash balances and other assets of your State on the day you transfer the administration of your State to the Dominion Government will, as far as possible, be spent for the benefit of the people of your State.
(3) You will be entitled to the full ownership, use and enjoyment of all Darbari or private properties (as distinct from State Properties) belonging to you on the date of your making over the administration of your State to the Dominion Government.
Darbari properties will include palaces, houses, residences, guest houses, stables, garages, quarters, outhouses, etc.
which are at the date of transfer of administration in bonafide personal use or occupation of the Ruler or members of his family or personal staff, irrespective of whether the property is situated in the Capital, or at any other place in the State, or in Bombay, or anywhere else outside.
(4) The continuation in service of the permanent members of the public services of your State is hereby guaranteed on conditions which will be no less advantageous than those on which they were serving 171 on 1st April 1948.
In the event of continuation of service not being possible in any case, reasonable compensation will be paid.
(5) Pensions, gratuities, annuities, and allowances, granted by the State to the members of its public services who have retired or have proceeded on leave preparatory to retirement before 1st April 1948 as also the enjoyment of the ownership of Khangi villages, lands, jagir, grants, etc.
existing on 1st April 1948 are hereby Guaranteed.
This guarantee is without prejudice Co the right of Government of Bombay to issue any legislation which does, not discriminate against the states and their subjects.
(6) All emblems, insignia, articles and other Paraphernalia of the Ruler will be considered as belonging to, and be regarded as his private property.
(7) No order passed or action taken by you before the date of making over the administration to the Dominion Government will be questioned unless the order was passed or action taken after the 1st of April 1948 and is considered by the Government of India to be palpably unjust or unreasonable.
The decision of the Government of India in this respect will be final.
(8) No enquiry shall be made nor shall proceedings lie in any Court in India against you, whether in a personal capacity or otherwise, in respect of anything done or omitted to be done by you or under your authority during the period of your administration of the State.
(9) Every question of disputed succession in regard to a Gujarat State which has signed an agreement integrating the administration of the State with that of the Province of Bombay shall be decided by a Council of Rulers of Gujarat States after referring it to the High Court of Bombay and in accordance with the opinion given by that High Court.
All questions relating to the rights, dignities and privileges of the Ruler will also be considered by the Council of Rulers who shall make suitable recommendations to the Government of Bombay and the Government of India.
The Council shall consist of the Rulers of all 172 full jurisdictional Gujarat States, whether salute or non salute.
No ruler who is less than 21 years of age shall however be a member of the Council.
The Council will elect one of its members to be the President of the Council.
The President and the members of the Council will hold office for a term of five years from the date on which they enter upon the duties of their respective offices.
2.The contents of this letter will be regarded as part of the merger agreement entered into by you with the Governor General of India".
The contention which has been urged before us by the Petitioners relying upon clause 5 of the Letters of Guarantee aforesaid is that the enjoyment of the ownership of the jagirs existing on the 1st April, 1948 was guaranteed, that this guarantee was binding on the State of Bombay, that the State of Bombay and therefore the State Legislature had waived the right, if any, or in any event had no legislative competence to enact any legislation depriving the holders of the jagirs of their right of ownership over the same, and that even though the Government of Bombay has reserved to itself the right to issue any legislation which did not discriminate against the states and their subjects, the impugned Act was ultra vires inas much as no legislation could be undertaken which would have the effect of depriving the holders of the jagirs of their ownership over the same and the provisions of the impugned Act were in any event discriminatory against the States and their subjects or in other words the impugned Act was confiscatory and also discriminatory.
It was contended on the other hand on behalf of the State of Bombay that the agreements of merger and the letters of guarantee were executed by the Dominion of India and were not binding on the State of Bombay, that the Petitioners were not parties to the agreements of merger and letters of guarantee and that they were not entitled to enforce the same, that even if they be treated as parties thereto the dispute between the parties arose out of the provisions of the agreements and covenants which were entered into or 173 executed before the commencement of the Constitution by the Rulers of the respective states and to which the Government of Dominion of India was a party and that therefore this Court had no jurisdiction to interfere in the said disputes by virtue of the provisions of article 363 of the Constitution, that the State Legislature had plenary powers of legislation within the ambit of its sphere unless the Constitution itself expressly prohibited legislation on the subject either absolutely or conditionally, that no such prohibition could be spelt out of the terms of clause 5 of the letters of guarantee and that the impugned Act was intra vires the powers of the State Legislature and could not be challenged.
Once that position was established it was further urged that the jagirs in question were estates within the definition of the expression in article 31 A(2) (a) of the Constitution and the impugned legislation being a legislation providing for the acquisition by the State of the estates and the rights therein or for the extinguishment or modification of the same could not be challenged as void on the ground that it was inconsistent with or abridged any of the rights conferred by any provisions of Part III of the Constitution, and that therefore the impugned Act could not be challenged as violative of any of the fundamental rights of the Petitioners.
It was also urged that none of the provisions of the impugned Act were confiscatory or in any manner whatever discriminatory, fair and adequate compensation having been provided for the abolition of the jagirs and the States and their subjects not having been dealt within any discriminatory manner as compared with the subjects of the original State of Bombay.
As regards the contention that the agreements of merger and the letters of guarantee were executed by the Dominion of India and were not binding on the State of Bombay it was urged on behalf of the Petitioners that the Government of the Dominion of India was certainly bound by those guarantees and this obligation of the Dominion Government devolved upon the Province of Bombay when the erstwhile States which were parties to the agreements of merger 174 and the letters of guarantee became merged in the Province of Bombay, under clause 8 of the States ' Merger (Governors ' Provinces) Order, 1949 (Appendix XLIV, White Paper, Page 297), that these obligations were thus deemed to have been undertaken by the Dominion Government on behalf of the absorbing Province, viz., the Province of Bombay and were binding upon the Province of Bombay, and that when the Constitution came into force from the 26th January 1950 all rights, liabilities and obligations of the Government of each Governors ' Province whether arising out of any contract or otherwise were under article 294 of the Constitution to be the rights, liabilities and obligations respectively of the Government of each corresponding State and these obligations of the Province of Bombay accordingly became the obligations of the State of Bombay.
It was further urged that the State of Bombay was thus bound by all the obli gations which bad been undertaken by the Dominion Government under the agreements of merger and letters of guarantee above referred to, and it could not lie in the mouth of the State of Bombay to repudiate the same.
This argument is not without force, but we do not consider it necessary to decide this question because even assuming that the State of Bombay was bound by these obligations, the question still remains how far the Petitioners before us are entitled to enforce these obligations against the State of Bombay.
The Petitioners were certainly not parties to these agreements of merger and letters of guarantee eo nominee.
They could only claim to be parties to the same by reason of the fact that the Rulers of the erstwhile States did not negotiate these agreements of merger or obtain the letters of guarantee only in respect of their personal rights and properties but also represented the States and their subjects in the matter of obtaining the same and the subject of these States were therefore represented by the Rulers and were entitled to the benefit of whatever obligations were undertaken by the Dominion of India qua the States and their subjects.
It is therefore arguable that the Rulers 175 of the erstwhile States as also their subjects would be in a position to enforce these obligations.
This position was however sought to be negatived by relying upon the following observation of their Lordships of the Privy Council in Vajesingji Joravarsingji vs Secretary of State for India in Council(1) at page 360: "But a summary of the matter is this: when a territory is acquired by a sovereign state for the first time that is an act of state.
It matters not how the acquisition has been brought about.
It may be by conquest, it may be by cession following on treaty, it may be by occupation of territory hitherto unoccupied by a recognized ruler.
In all cases the result is the same.
Any inhabitant of the territory can make good in the municipal Courts established by the new sovereign only such rights as that sovereign has, through his officers, recognised.
Such rights as he had under the rule of predecessors avail him nothing.
Nay more, even if in a treaty of cession it is stipulated that certain inhabitants should enjoy certain rights, that does not give a title to those inhabitants to enforce these stipulations in the municipal Courts.
The right to enforce remains only with the high contracting parties".
These observations were quoted with approval in Secretary of State vs Sardar Rustsam Khan & Others(2) at page 124.
It was therefore urged that it will be the high contracting parties, viz., the Rulers of the respective States who would be in a position to enforce these obligations and not the Petitioners for whose benefit these obligations were undertaken by the Dominion Government.
We do not feel called upon to pronounce upon the validity or otherwise of these contentions also for the simple reason that the Petitioners would be out of Court either way.
If they were deemed to be parties to the agreements of merger and letters of guarantee they would be faced with the bar to the maintainability of the petitions under article 363 of the Constitution which lays down that neither the Supreme (1) 51 Indian Appeals 357.(2) 68 Indian Appeals 109.176 Court nor any other Court shall have jurisdiction in any dispute arising out of any provision of a treaty, agreement, covenant, engagement, sanad or other similar instrument which was entered into or executed before the commencement of the Constitution by any 'Ruler of an Indian State and to which the Government of the Dominion of India. . . . was a party.
If on the other hand they were deemed not to have been parties to the same they would not be the contracting parties and would certainly not be able to enforce these obligations.
It was therefore urged on behalf of the Petitioners that the dispute between the parties did not arise out of the provisions of the agreements of merger and the letters of guarantee which were entered into or executed by the Rulers of the respective States and to which the Government of the Dominion of India was a party.
According to the Petitioners they merely challenged the vires of the impugned Act and relied upon clause 5 of the letters of guarantee in order to establish the position that the State Legislature had no legislative competence to legislate on the subject of the abolition of jagirs.
That was, it was submitted, not a dispute arising out of the agreements of merger and letters of guarantee but arose out of the act of the State Legislature in enacting the impugned Act in direct contravention of the guarantee incorporated in clause 5 of the letters of guarantee.
This argument however would not avail the Petitioners, because if one looked into the averments contained in their petitions it was clear that the whole ambit of the petitions was to enforce clause 5 of the letters of guarantee.
The Petitioners relied upon clause 5 of the letters of guarantee which had been obtained by the Rulers of the erstwhile State from the Dominion Government and complained that the State Legislature had enacted the impugned Act which it had no power to enact having regard to clause 5 of the said letters of guarantee and were wrongfully depriving the Petitioners of the jagirs, the ownership of which had been guaranteed thereunder.
The whole of the petitions were nothing else except the 177 claim to enforce the Petitioners ' rights under the letters of guarantee, and the disputes therefore were clearly in respect of the agreements of merger and the letters of guarantee and were covered by article 363 (1) of the Constitution.
A similar contention had been raised on behalf of the plaintiffs in State of Seraikella and Others vs Union of India and Another(1) and was repelled by Kania, C.J. at page 490 as under: "The plaintiff contends firstly that it had signed the Instrument of Accession through its Ruler.
The State next complains that, acting beyond the powers given over under the Instrument of Accession,.the Dominion of India and the State of Bihar are trespassing wrongfully on its legislative and executive functions, that the Dominion of India and the State of Bihar are making laws which they have no power to make, having regard to the Instrument of Accession, and are wrongfully interfering with the administration of the State beyond the rights given to them under the Instrument of Accession.
The whole plaint is nothing else except the claim to enforce the plaintiff 's right under the Instrument of Accession.
The dispute therefore in my opinion clearly is in respect of this Instrument of Accession and is covered by Article 363(1) of the Constitution of India.
The question of the validity of the different enactments and orders is also based on the rights claimed under the Instru ment of Accession so far as the plaintiff is concerned".
It could not therefore be urged that what the Petitioners were doing was not to enforce the obligations undertaken by the Dominion Government under the agreements of merger and the letters of guarantee, or that the disputes between the parties did not arise out of the provisions of the agreements of merger and the letters of guarantee which were entered into or executed by the Rulers of the respective States and to which the Government of Dominion of India was a party within the meaning of Article 363 of the Constitution.
(1) ; 23 178 If that was the position the jurisdiction of this Court was ousted and this Court could not interfere in those disputes.
Assuming however that the Petitioners were entitled to enforce the obligation and guarantee incorporated in clause 5 of the letters of s guarantee the further difficulty in the way of the Petitioners is that the State Legislature was fully competent to enact the impugned Act notwithstanding the terms of the guarantee.
The legislative competence of the State Legislature can only be circumscribed by express prohibition contained in the Constitution itself and unless and until there is any provision in the Constitution expressly prohibiting legislation on the subject either absolutely or conditionally, there is no fetter or limitation on the plenary powers which the State Legislature enjoys to legislate on the topics enumerated in the Lists II & III of the Seventh Schedule to the Constitution.
It was conceded on behalf of the Petitioners that the topic of legislation which was covered by the impugned Act was well within List II of the said Schedule and the vires of the impugned Act could not be challenged on that ground.
The ground of attack was that the Dominion Government and therefore the State Government bad waived its right to legislate on the topic of the abolition of jagirs or had in any event put a fetter or limitation on their power to issue any legislation in that behalf by the terms of the guarantee contained in clause 5 of the letters of guarantee.
It was contended that under the terms of clause 5 an absolute guarantee had been given by the Dominion Government in regard to the enjoyment of the ownership of jagirs and that the Dominion Government and therefore the State of Bombay were precluded from enacting any legislation which had the effect of destroying that ownership.
This contention however could not be supported by the terms of clause 5 which embodied in the first part thereof the terms of the guarantee, and went on to provide in the second part that this guarantee was without prejudice to the right of the Government of Bombay to issue any legislation which did not discriminate against the States and their 179 subjects.
It was therefore not an absolute guarantee but was circumscribed or cut down by the reservation of the power to make law with respect to jagirs provided such law did not discriminate against the States and their subjects.
The right of the Government of Bombay which was thus reserved covered the whole of the guarantee embodied in the first part of the clause and there was nothing in these terms which would go to show that the ownership of the jagirs could not be touched and the legislation, if any, was to be enacted in regard to certain incidents of enjoyment of such ownership.
The right of the Government of Bombay to issue any legislation with regard to the enjoyment of the ownership of jagir lands was expressly reserved and this right covered also legislation in regard to the abolition of the jagirs and the Government of Bombay was therefore entitled under the terms of this clause 5 to issue any legislation in regard to the same provided however that such legislation did not discriminate against the States and their subjects.
That was the only fetter or limitation, imposed upon the right of the Government of Bombay to issue any legislation in regard to the enjoyment of the ownership of jagir lands and if that fetter or limitation could also be imposed on the State Legislature the Petitioners would have had a right to challenge the impugned Act on the ground that it discriminated against the States and their subjects.
The fetter or limitation upon the legislative power of the State Legislature which had plenary powers of legislation within the ambit of the legislative heads specified in the Lists II & III of the Seventh Schedule to the Constitution could only be imposed by the Constitution itself and not by any obligation which bad been undertaken by either the Dominion Government or the Province of Bombay or even the State of Bombay.
Under Article 246 the State Legislature was invested with the power to legislate on the topics enumerated in Lists II & III of the Seventh Schedule to the Constitution and this power was by virtue of article 245(1) subject to the provisions of the Constitution.
The Constitution itself laid down the fetters 180 or limitations on this power, e.g., in article 303 or article 286(2).
But unless and until the Court came to the conclusion that the Constitution itself had expressly prohibited legislation on the subject either absolutely or conditionally the power of the State Legislature to enact legislation within its legislative competence was plenary.
Once the topic of legislation was comprised within any of the entries in the Lists II & III of the Seventh Schedule to the Constitution the fetter or limitation on such legislative power had to be found within the Constitution itself and if there was no such fetter or limitation to be found there the State Legislature had full competence to enact the impugned Act no matter whether such enactment was contrary to the guarantee given, or the obligation undertaken by the Dominion Government or the Province of Bombay or even the State of Bombay.
The Petitioners would have a legitimate grievance in the matter of the deprivation of their rights of ownership of the jagir lands in so far as the States and their subjects were discriminated against, but they would not be able to have their grievance redressed by this Court for the simple reason that the State Legisla ture was at all events competent to enact the impugned Act not being fettered at all by the terms of clause 5 of the letters of guarantee.
The provisions of article 294(b) of the Constitution which is said to have transferred the obligations of the Government of the Province to the State of Bombay would not by involving the transference of the obligation undertaken by the Dominion Government in clause 5 of the letters of guarantee to the State Government impose a fetter or limitation on the legislative competence of the State Legislature to enact legislation on any of the topics enumerated in Lists II & III of the Seventh Schedule to the Constitution.
The remedy of the Petitioners would be else where and not in this forum.
The learned Judges of the Federal Court gave an answer to a similar complaint of the Taluqdars of Oudh made by them against the United Provinces Tenancy Act XVII of 1939 in Thakur 181 Jagannath Baksh Singh vs The United Provinces(1) at page 87: "We desire, however, to point out that what they are now claiming is that no Legislature in India has any right to alter the arrangements embodied in their sanads nearly a century ago; and, for all we know, they would deny the right of Parliament itself to do so.
We hope that no responsible Legislature or Government would ever treat as of no account solemn pledges given by their predecessors; but the readjustment of rights and duties is an inevitable process, and one of the functions of the Legislature in a modern State is to effect that readjustment, where circumstances have made it necessary, with justice to all concerned.
It is however, not for this 'Court to pronounce upon the wisdom or the justice, in the broader sense, of legislative acts; it can only say whether they were validly enacted. . . . . . . " These observations were quoted with approval by Their Lordships of the Privy Council in Thakur Jagannath Baksh Singh vs The United Provinces(1) at page 122 and we also would observe in the same strain that we are not concerned with the policy of the State Legislature in enacting the impugned Act for abolition of jagirs but we are only concerned with the question whether the impugned Act was validly enacted.
No argument has been advanced before us which would enable us to hold that the impugned Act was ultra vires the State Legislature, the only ground of attack being that it was in contravention of the guarantee given in clause 5 of the letters of guarantee.
But that position is of no avail to the Petitioners.
Considerable argument was addressed before us based on the comparison of the provisions of the various Acts of the Bombay State Legislature enacted during the years 1949 to 1953 in regard to the abolition of the various tenures obtaining within the State of Bombay with the provisions of the impugned Act, with a view to show that the provisions of the impugned Act were discriminatory against the States (1) (2) 1946 F.C.R. III.
182 and their subjects within the meaning of clause 5 of the letters of guarantee.
We have not thought it necessary to refer to the same in view of the conclusion which we have reached above that the impugned Act was intra vires the powers of the State Legislature and the State Legislature was quite competent to enact the same.
Even if it could be demonstrated that the provisions of the impugned Act were confiscatory as well as discriminatory in the manner suggested, the jagirs of the Petitioners (except in the case of the Petitioner in Petition No. 364 of 1954) were all estates within the meaning of the term as defined in Article 31 A(2)(a) of the Constitution and even if the impugned Act provided for the acquisition of the estates or of any rights therein or for the extinguishment or modifica tion of any such rights the impugned Act could not be challenged as void on the ground that it was inconsistent with or took away or abridged any of the fundamental rights conferred by Part 11I of the Constitution.
Any challenge therefore on the ground of the impugned Act violating the fundamental rights of the Petitioners under article 14 or article 19(1)(f) or article 31(2) of the Constitution was not available to the Petitioners.
On the other hand if the grievance was that the impugned Act had brought about dis crimination in breach of clause 5 of the letters of gua rantee then the dispute clearly arose out of the letters of guarantee and would by article 363 be placed beyond the jurisdiction of this Court.
The Petitions of the Petitioners except Petition No. 364 of 1954 which would be dealt with immediately hereafter therefore fail and are liable to be dismissed.
Petition No. 364 of 1954 In addition to the grounds common to all the Petitions which we have already dealt with above the Petitioner in Petition No. 364 of 1954 claims that he is the owner of the 60 villages in the Putta or territory of Moti Moree comprised in the erstwhile State of Idar as the Bhumia or underlord and contends that his holding does not fall within the definition of 183 jagir as given in the impugned Act.
In support of his contention he has traced the history of Moti Moree since 1250 A.D. and in any event since 1800 A.D when the then Chieftain of Moti Moree entered into a treaty with the Maharaja Zalimsinh of Modasa whereby in consideration of payment of Rs. 361 annually the said Zalimsinh agreed to protect Moti Moree against the attacks of the neighboring State of Doongarpur.
He has pointed out that thereafter Modasa was absorbed into the Taluka of Amnagar in 1821 and subsequently in about 1849 it reverted to Idar State and continued with the Idar State until the latter merged into the Province of Bombay in 1948.
He contends that he and his predecessors were enjoying and exercising full sovereign rights over Moti Moree ever since the said treaty of 1800 and their position had remained unchanged, their only liability being to pay Rs. 361 annually for protection.
He further contends that they were enjoying the rights of excise and customs and revenue, that they did not pay any revenue to the State of Idar and enjoyed and continued to enjoy rights over all lands, forests, minerals, river beds, village sites, etc.
and that when the Ruler of Idar wanted that there should be uniform customs levy throughout the State, the said Ruler had to give compensation to the Petitioner and had also similarly negotiated with them and had to pay compensation to them in respect of salt, opium, excise etc.
He has pointed out that Rs. 457 for customs ' Rs. 40 for opium and Rs. 7 for salt were being paid annually by the erstwhile State of Idar and thereafter by the Government of State of Bombay to him by way of compensation for these sovereign rights of his, which amounts were set off against Rs. 361 being the annual payment of protection which he paid as aforesaid to them.
These rights of his recognised by the erstwhile State of Idar and also by the State of Bombay constituted him a Thakur or underlord of Moti Moree and he contends that his estate of Moti Moree is not a jagir within the definition of the term given in the impugned Act.
Our attention has also been drawn in this behalf to 184 Bombay Gazetteer, Vol. 5 (1880), page 398, where Mori (Meghraj) is described as the estate of the original landlords Bhumias otherwise described as petty chiefs and underlords and to page 409 where the underlords (Bhumias) are stated to be the early chiefs who settled in Idar at least not later than the Rathod conquest (about 1250).
The State of Bombay on the other hand has denied the several allegations contained in the petition and contends that in the year 1891 the erstwhile State of Idar had conferred upon the Thakore of Moti Moree the powers of a Third Class Magistrate as an act of "grace", that in 1902 the management of the estate was taken over by the erstwhile State of Idar and one Kamdar Mathurlaji was appointed as Japtidar, that in 1910 the management was lifted as a special case and the arrears of Nazrana were ordered to be recovered in installments by the erstwhile State of Idar that in several documents Moti Moree was described as Bhomia Jagir within the definition of the term Jagir as given in the impugned Act and that the sum of Rs. 361 was still being regularly paid even after merger as "Kichari hak".
It therefore contends that the Thakore of Moti Moree, the Petitioner is a jagirdar and Moti Moree is a jagir within the meaning of the definition thereof given in the impugned Act.
These allegations and counter allegations do not however carry the matter any further.
In order to exclude Moti Moree and the Petitioner from the operation of the impugned Act it will be necessary for the Petitioner to establish satisfactorily that Moti Moree is, not a jagir within the definition thereof given in the impugned Act.
Even though the allegations of the Petitioner go far enough to make it probable that Moti Moree was neither held by the Petitioner and his ancestors under a grant or was not recognised as a grant by the Ruler of the erstwhile State of Idar, that would not be enough to enable us to grant him the relief prayed for by him.
The question requires to be completely thrashed out and adjudicated upon by a Court of law after going into the evidence 185 adduced before it by both the parties.
The learned Attorney General appearing for the State of Bombay has therefore submitted that this question should be enquired into by a proper tribunal and the Petitioner should be referred to a civil suit in order to establish his rights.
We accordingly feel that the Petition No. 364 of 1954 should be adjourned till after the disposal of a civil suit to be filed by the Petitioner in the proper Court for a declaration that Moti Moree is not a jagir within the definition of the term as given in the impugned Act and for consequential reliefs.
The learned Counsel for the Petitioner has given us to understand that a formal notice under Section 80 of the Civil Procedure Code in this behalf has already been served by the Petitioner on the State of Bombay.
We therefore order that the Petitioner do file the necessary suit within 3 months from this date and this petition do stand adjourned till after the hearing and final disposal of that suit.
The stay granted by this Court in this petition will continue in the meanwhile.
We may record here that the learned Attorney General on behalf of the State of Bombay has also given his undertaking not to take any steps against the Petitioner in the meanwhile.
Petitions Nos.337 to 349, 365, 366, 481 and 690 of 1954 will therefore stand dismissed.
Petition No. 364 of 1954 will stand adjourned sine die till after the disposal of the civil suit to be filed by the Petitioner as above indicated.
If no such suit is filed within the aforesaid period this petition will also stand dismissed.
Each party will bear and pay the respective costs of the petitions.
| Under Article 246(2) and (3) of the Constitution, the Legis lature of a State has plenary powers to legislate with respect to matters enumerated in Lists II and III of the Seventh Schedule to the Constitution.
The legislative competence of the State Legisla 165 ture can only be circumscribed by express prohibition contained in the Constitution itself and unless there is any provision in the Constitution expressly prohibiting legislation on a subject either absolutely or conditionally, there is no fetter or limitation on the plenary powers which the State Legislature enjoys to legislate on the topics enumerated in Lists II and III of the Seventh Schedule to the Constitution.
In view of Article 246 of the Constitution, no curtailment of legislative competence can be spelt out of the terms of Clause 5 of the Letters of Guarantee given by the Dominion Government to the Rulers of "States" subsequent to the agreements of Merger, which guaranteed, inter alia, the continuance of Jagirs in the merged "States".
Indeed, Clause 5 of the Letters of Guarantee itself saved the legislative right of the State of Bombay subject to the limitation that enactments of the State shall not be discriminatory in nature.
Attacks on the validity of the said Act on the basis of the rights guaranteed by Articles 14, 19(1)(f), and 32(2) of the Constitution cannot be countenanced in view of Article 31 A(2)(a) of the Constitution, Article 363 (1) of the Constitution barred the jurisdiction of Courts in disputes arising out of any provision of the agreements of merger and the Letters of Guarantee.
Held, that Bombay Act XXXIX of 1954, the impugned Act, was intra vires the State Legislature.
Petitions Nos.
337 to 349, 365, 366, 481 and 690 of 1954 Dis.
missed.
Petition No. 364 of 1954 Adjourned.
Vajesingji vs Secretary of State (51 I.A. 357), Secretary of State vs Sardar Rustam (68 I.A. 109), State of Saraikella vs Union of India ; , Thakur Jagannath vs The United Provinces ([1943] F.C.R. 72), Thakur Jagannath vs The United Provinces ( , referred to.
|
ivil Appeal No. 158 of 1954.
Veda Vyas, (section K. Kapur and Ganpat Rai, with him), for the appellants.
M. C. Setalvad, Attorney General for India (.ill.
N. Phadke and Naunit Lal, with him), for respondent No. 1. 1955.
May 2.
The Judgment of the Court was delivered by JAGANNADHADAS J.
This is an appeal by special leave against the Judgment and order of the Election Tribunal, Akola, Madhya Pradesh, dated the 1st May, 1953, dismissing the election petition filed by the appellants.
It relates to the election for the Akola Constituency of the State Assembly of Madhya Pradesh which was held on the 13th December, 1951, and the result of which was notified in the Gazette on the 4th April, 1952.
The two appellants are the electors of the said constituency.
The first respondent was the successful candidate at the election.
Respondents, Nos. 2, 3 and 4 were the other three candidates who, having been validly nominated went to the polls but were defeated.
The appellants filed the election Petition under section 80 of the Representation of the People Act, 1951 (Act XLIII of 1951) (hereinafter referred to as the Act ' for setting aside the election on various allegations.
The Election Commission admitted the petition after condoning the delay under the proviso to section 85 of the Act and thereupon constituted a Tribunal for the trial of the petition at Akola by notifications dated the 30th July, 1952, and 22nd September 1952.
In due course respondent No. I appeared and filed his written statement on the 6th October, 1952, and the petitioners filed their reply thereto on the 16th October, 1952.
With reference to these pleadings, the Tribunal was of the opinion that it was advisable to frame certain preliminary issues and to dispose of the same before entering on the 431 trial of the case on its merits.
Accordingly, nine pre liminary issues were framed.
(2) Whether there was sufficient cause for presentation of the petition one day out of time.
(3) Whether the petition was defective for non joinder of certain parties as respondents.
(4) Whether the petition is defective for want of proper verification.
(5) Whether the petition was defective for vagueness of the particulars relating to the corrupt practices set out in Schedule A thereto.
The Tribunal found only the first of the above points in favour of the petitioners by a majority.
But in respect of the other four points, it held against the petitioners unanimously.
It is against this dismissal that the appellants have now come up to this Court on obtaining special leave.
Before dealing with the merits of the appeal, it may be mentioned that at an early stage of these proceedings before the Tribunal, an objection was taken to the composition of the Tribunal on the allegation that one of the Members, Shri A. section Athalye was not competent to be a Member thereof on account of his alleged bias in favour of the first respondent.
The bias was sought to be made out by showing that shortly before the election, Shri Athalye had written a letter to the 1st respondent offering to assist him in his election campaign.
On objection being taken, the Tribunal stayed its hands for a preliminary decision of that question.
Meanwhile, the petitioners took proceedings in the High Court for the quashing of the constitution of the Tribunal on the above ground by means of an application under article 226 of the Constitution.
That application was dismissed after hearing both sides.
Thereupon the petitioners moved this Court for special leave against the order of the High Court.
But this Court declined to grant leave.
But this having been already determined against the petitioners in the previous proceedings, we declined to allow the matter to be reopened.
On the other side, the learned Attorney General for the 1st respondent attempted to reopen before us the question as to whether the petition was presented to the Election Commission by an authorised person, which as stated above, was found against him by a majority of the Tribunal.
The ground on which he attempted to reopen this question was that the finding was based on a wrong view as to the burden of proof.
We were not prepared, however, to permit this finding of fact to be reopened in this appeal on special leave, irrespective of the question whether the burden of proof was rightly laid on the petitioners.
The only points, therefore, that have been argued before us are whether the view taken by the Tribunal with reference to the following questions, viz. (1) limitation, (2) joinder of parties, (3) verification, and (4) specification of particulars of corrupt practices in Schedule A attached to the petition, is correct, and if so, whether the same entailed dismissal of the petition.
The questions may be taken up one after the other.
LIMITATION:As stated above, the petition was filed on the 19th April, 1952, admittedly one day beyond time.
On the 28th April, 1952, the petitioners filed also an application for condonation of delay setting out the reasons for the same.
In paragraphs 3, 4 and 5 thereof the circumstances under which the delay is said to have occurred were set out as follows: "3.
The applicants were under the belief that Notice under Rule 113 of the Rules framed under the above Act was published on 5th April, 1952, in the official Gazette of the State of Madhya Pradesh.
They felt therefore that their petition was duly presented within 14 days as prescribed by Rule 119.
Applicants, however, learn that actually the Notice under Rule 113 was published in the Official Gazette of 4th April, 1952.
It therefore appears that there was a delay of 433 one day in the representation of the election petition.
This delay occurred under the following circumstances: 4.
The applicants prepared their election petition on the 17th April, 1952.
They sent the said petition with Shri P. B. Gole, Senior Advocate, Akola, with a written authority to present the petition through any person of his choice at Nagpur on the 18th April.
They also sent with Shri Gole Rs. 1,000 for being deposited in the Government Treasury at Nagpur as required by section 117 of the Act and to obtain Treasury receipt for security of costs to be filed with the petition.
The applicants were under the belief that an officer must have been appointed by the Election Commission under section 81 of the Act to whom election petitions could be represented for the State of Madhya Pradesh at Nagpur.
Accordingly Shri Gole left Akola for Nagpur by the 1 Down Nagpur Mail, reaching Nagpur at about 9 30 A.M. on 18th April, 1952.
Mr. Gole caused the deposit of Rs. 1,000 security for costs to be made in the Government Treasury at Nagpur through Mr. Sidhaye, Advocate, Nagpur, and obtained the necessary Government Treasury receipt on the 18th April, 1952.
He then made enquiries about the officer who may have been appointed to receive the election petitions.
He con sulted R. section Rangole, who was attached to the Election Office at Nagpur.
On enquiries Shri Gole learnt that there was none at Nagpur, who was authorised to receive election petition under the Act.
Under these circumstances Shri Gole booked a seat in the Night Plane for Delhi and flew to Delhi on the 18th and reached there on the morning on 19th April, 1952.
On 19th April Shri Gole caused the petition to be presented to the Secretary to the Election Commission".
The explanation thus furnished was accepted by the Election Commission as appears from the intimation to the petitioners by letter dated the 30th July, 1952.
The Tribunal was of the opinion that notwithstanding the order of the Election Commission condoning the delay and admitting the petition, it was free to 434 reconsider the question by virtue of the powers vested in it under section 90(4) of the Act.
In this view it went into the merits of the explanation furnished and came to the conclusion that the petitioners were negligent and that the delay, even of one day, could not be condoned.
It accordingly held that the petition was liable to be dismissed as barred by time.
Now, apart from the merits of the sufficiency of the cause for delay, the question as to whether, notwithstanding the condonation of the delay by the Election Commission., it was open to a Tribunal to reconsider the matter by virtue of section 90(4) of the Act, is now covered by the decision of this Court reported in Dinabandhu vs Jadumoni(1).
It was therein held that it was not open to the Tribunal to reconsider the matter in such a case.
The conclusion of the Tribunal, therefore, on this point cannot be maintained.
The learned Attorney General attempted to argue that the decision of this Court referred to above was obiter as regards the legal point and required further consideration.
But we were not prepared to permit that question to be reopened.
We were also not satisfied that there was any adequate reason for the Tribunal to interfere with the view taken by the Election Commission condoning the delay of one day on the explanation furnished to it.
This explanation has not been found, even by the Tribunal, to be
JOINDER OF PARTIES: The objection as to joinder of parties arises as follows.
Three persons by name Shri Sohoni, Shri Kulkarni, and Shri Kothkar were nominated as candidates at the election.
Their nominations were found to be in order on scrutiny by the Returning Officer.
But within the time allowed, these three withdrew from the elections under section 37 of the Act.
The petitioners, while they impleaded as respondents the three unsuccessful candidates who went to the polls, did not implead these three persons.
It has been argued before us that this view is erroneous and that persons who filed their nominations and who withdrew from the contest within the prescribed time in spite of their nominations having been found to be in order on scrutiny by the Returning Officer, cannot be said to fall within the category of "candidates duly nominated at the election".
In support of this contention two decisions Sitaram vs Yograjsing(1) and Sheo Kumar vs V. G. Oak(2) have been cited.
These three decisions have treated the decision of the question as depending on a construction of the phrase "at the election" in section 82 of the Act.
The Bombay and Allahabad cases hold that this phrase confines the necessary parties under this section to those who were candidates for the actual poll, while the Patna High Court takes the view that the phrase "at the election" has no such limiting significance.
It appears to us to be unnecessary and academic to go into this judicial controversy having regard to the decision of this Court in Jagan Nath vs Jaswant Singh(4).
If we were called upon to settle this controversy, we would prefer to base the decision not on any meticulous construction of the phrase "at the election" but on a comprehensive consideration of the relevant provisions of the Act and of the rules framed thereunder and of the purpose, if any, of the requirement under section 82 as to the joinder of parties other than the returned candidate.
We are, however, relieved from this, since it has been decided in Jagan Nath vs Jaswant Singh(4) that even if any of the necessary parties other than the returned candidate has not been (1) A.I.R. 1953 Bombay 293.
(3) A.I.R. 1954 Patna 225.
(2) A.I.R. 1953 All. 633.
(4) ; 436 impleaded, the petition is not liable to be dismissed in limine on that sole ground but that it is a matter to be taken into consideration at the appropriate stage with reference to the final result of the case.
In view of this ruling the decision of the Tribunal on this point also cannot be maintained.
The relevant provision in the Civil Procedure Code referred to herein is Order VI, rule 15, clauses (2) and (3), which are as follows: "(2) The person verifying shall specify, by reference to the numbered paragraphs of the pleading, what he verifies of his own knowledge and what he verifies upon information received and believed to be true.
(3) The verification shall be signed by the person making it and shall state the date on which and the place at which it was signed".
In the present case the verification of the petition as well as the schedule of particulars of corrupt practices are each signed by both the petitioners and there is now no dispute about it.
The verification clause in the petition is as follows: "The above named applicants hereby affirm that the contents of the above petition are true to information received from the press reports and several other electors and believed by them to be true.
Signed and verified at Akola on The verification clause relating to the particulars of corrupt practices in Schedule A is as follows: "The above named applicants affirm that the contents in this schedule are true to information received and believed by us to be true.
Signed and verified at Akolo, on 437 In the view of the Tribunal there were two defects in these verifications.
They do not refer to any numbered paragraphs nor do they bear the dates on which they were signed.
In the view of the Tribunal the petition was liable to dismissal for non compliance with the specific provision in the Act in this behalf.
That the verification neither in the petition nor in the schedule of particulars bears any date is not disputed.
But it is contended that the view taken by the Tribunal in so far as it was of the opinion that the verifications do not refer to any numbered para graphs is unsustainable.
It is pointed out that the statements in the verification were clearly meant to convey that the various allegations in the petition and schedule were, in their entirety, based on information and belief.
We agree with this contention.
It is to be noticed that a verified pleading is different from an affidavit which., by virtue of Order XIX, rule 3, is specifically required to be confined to such facts as the deponent is able of his own knowledge to prove (except on interlocutory applications, on which statements of his belief may be admitted, provided that the grounds thereof are stated).
But there is notand in the nature of things there cannot be any such limitation for pleadings.
Hence it became necessary in the verification of a pleading to demarcate clearly between the two.
The allegations in the petition in this case purport to be based only on informa tion.
Since the verification clauses refer to the entirety of the petition and the attached schedule, absence of enumeration of the various paragraphs therein as having been based on information cannot be considered to be a defect.
The verifications are accordingly defective only as regards the requirement of the dates thereof.
The question is whether the petition is liable to dismissal on this ground.
Though there may be cases where the date of the pleading and the verification may be relevant and important, it would be a wrong exercise of discretionary power to dismiss 438 an application on the sole ground of absence of date of verification.
In such a case the applicants should normally be called upon to remove the lacuna by adding a supplementary verification indicating the date of the original verification and the reason for the earlier omission.
PARTICULARS OF CORRUPT PRACTICES: The objection is based on section 83(2) of the Act which is as follows: "The petition shall be accompanied by a list signed and verified in like manner setting forth full particulars of any corrupt or illegal practice which the petitioner alleges, including as full a statement as possible as to the names of the parties alleged to have committed such corrupt or illegal practice and the date and place of the commission of each such practice".
The objection is that the particulars of the instances furnished in Schedule A to the petition are all of them vague and not in compliance with the above provision.
The list of particulars is as follows: " SCHEDULE "A".
List of particulars of instances referred in the accompanying petition.
That in the month of December, 1951, respondent No. 1 has been to the premises of Akola Shree Gurudwara, where the Local Sikh Community had assembled to listen to the recitation of the holy book 'Granth Saheb ' on the 7th day of the death of daughter of one Sardar.
Suratsingb.
At this meeting respondent No. 1 canvassed for votes for himself and paid Rs. 201/ , apparently as donation to the Gurudwara, but really as gift for inducing the Sikh Community in the Akola Constituency in general and the Sikhs assembled in particular to induce them to vote for himself at the ensuing election.
Respondent No. 1 was guilty of bribery within the meaning of that term in section 123 of the Representation of the People Act. ' Similar instances of giving illegal gratifications for securing votes of respective groups are (a) Donation to Hkariharpeth Akhada; 439 (b) Payment to Panch bungalow Committee of Bhangis of Old City.
(c) Donation to Bhaji Bazar Association.
(d) Distribution of blankets and Saries and money to voters.
At the instance of respondent No. I a meeting of workers in Berar Oil Industries a concern of Birla, was called by its manager on the eve of the election and they were threatened to vote for respondent No. 1 on pain of losing their service or suffer pecuniary loss, in case they did not vote for respondent No. 1.
Respondent No. 1 caused groups and sections of castes and communities, such as Bohara, Lohars, Marwaries, Muslims, Rajasthanies, Bhangies, to issue appeals stating that resolutions were passed for voting for respondent No. 1, coercing the voters by threats, etc., to vote for respondent No. 1 and openly canvassing on communal and caste lines and using undue influence.
Issuing pamphlets and handbills without names of printer or publisher.
At the time of counting votes in Polling Station No. 53, several folded bundles amounting to about 20 in number, of ballot papers were found in the ballot box of respondent No. 1, when it was opened for counting votes.
This was noted by the Returning Officer.
Each bundle consisted three or more than three ballot papers, folded together.
Obviously each of the bundle of these ballot papers were put in the ballot box by one person, as the ballot papers put in the ballot box by different voters could not automatically fold themselves into a compact bundle in the ballot box.
The ballot papers issued to voters were not put in the box by the voters themselves, but were illegally brought back by the voters and handed over to persons working for and on behalf of respondent No. I on payment of illegal gratification.
These ballot papers thus collected were bundled together 56 440 and put in the ballot box by persons working for and on behalf of respondent No. 1 by taking illegal gratifications.
This was done on 31st December, 1951, at Chandur by persons with the connivance of respondent No. 1. 6.
False personation of several dead voters and voters absent in Pakistan has taken place in Ward No. 12 and 15. 7.
The respondent No. 1 resorted to false propaganda.
His man announced on loud speakers from place to place that rival candidate Dr. Joglekar was of the caste and party of Godse, the murderer of M. Gandhi and a vote for him was a vote for Gandhi 's Murderer.
Another false propaganda was that Dr. Joglekar was Mishra 's man, supported by Mishra 's money.
Lectures for respondent No. 1 in public meetings, including respondent No. I have freely made these false defamatory and malicious statements against Dr. Joglekar, the rival candidate and thus prejudiced the prospects of Dr. Joglekar 's election.
Personal character and conduct of Dr. Joglekar was also falsely attached, thus prejudicing his prospects of election.
Voters were carried in hired carts at many polling stations, particularly at Kapshi Polling Station.
This was arranged by persons working for and on behalf of respondent No. I at his expense and connivance.
A written objection for police enquiry was given at Kapshi and one in Rifle Range area.
Respondent No. 1 spent lacs of rupees over his election transgressing the prescribed limit of Rs. 6,000.
He has given a totally untrue return of election expenses.
This is in contravention of law.
Mohota Mills released workers and paid them for canvassing work for respondent No. 1 on polling day.
Substitutes for these workers were engaged by the mills and they were also paid.
This was done at the instance of respondent No. I".
There can be no doubt that almost all the instances herein above set out are extremely vague and lack sufficient particulars.
Learned counsel for the appel 441 lants invited our attention to the fact that the Tribunal, while considering the question of vagueness dealt only with the instances of corrupt practices specified in paragraphs I (a),I (b), I (c), I (d), 2, 4, 5, 6, 7 and 8 and not others.
He accordingly contended that, by implication, the Tribunal was not prepared to hold that items mentioned in paragraphs 1, 3, 9 and 10 were vague.
He urged that at least these four items ' must be taken not to be vague and that there is no reason why the petitioners should not have been called upon to amend the schedule by furnishing better particulars as to the rest.
He further urged that, at any rate, they were entitled to a trial in respect of those four items of corrupt practices.
We cannot agree with learned counsel for the appellants that the items set out in paragraphs 3, 9 and 10 are not vague.
There is no specification therein of the requisite details which the Act in terms requires.
Section 83(2) requires not only what may reasonably be considered "full particulars" having regard to the nature of each allegation, but enjoins in terms that the following particulars should also be given.
(2) The date of the commission of each such corrupt or illegal practice.
(3) The place of commission of each such corrupt or illegal practice.
There can be no reasonable doubt that the requirement of "full particulars" is one that has got to be complied with, with sufficient fullness and clarification so as to enable the opposite party fairly to meet them and that they must be such as not to turn the enquiry before the Tribunal into a rambling and roving inquisition.
On a careful scrutiny of the list, in Schedule A we are satisfied that none of the items except that which is set out in paragraph I of item No. I can be said to comply with the requirements of section 83(2).
In this view of the contents of Schedule A, the contention of the learned counsel for the appellants is that even so the Tribunal should have called upon the petitioners to furnish better particulars as regards all the other items, by virtue of the ,powers conferred on it under section 83(3), and in the 442 alternative, it should have at least called upon them to substantiate the allegation in paragraph 1 in item No. 1, which was sufficiently specific and which, if made out, might have resulted in the election being set aside.
On the question whether or not the Tribunal should have called upon the petitioners to amend the schedule by furnishing better particulars, the learned Attorney General for the 1st respondent has invited our attention to the objection taken in the written statement as regards the vagueness of the particulars and to the various orders made by the Tribunal as appears from the order sheet of the case.
In the written statement of the 1st respondent paragraph 9 is as follows: "9.
(a) It is, further, submitted that the petition ought to be dismissed as it does not contain concise statement of material facts on which the petitioners rely.
Similarly the list of particulars given in the schedule or in the petition are not in compliance with section 83(2).
(b) Without prejudice to the generality of this objection, it is further submitted that para V of petition read with para VI(e) will show that the particulars given in Schedule relate to corrupt and illegal practices alleged to have been committed by respondent No. 1 and by his agents and persons working on.
behalf of respondent No. I with his connivance.
Such particulars are bad in law.
The applicants are bound to state the names of the persons who are alleged to have actually committed the corrupt or illegal practice.
(c) Paras 1 and 2 of the petition allege that there was no free election by reason of general bribery and undue influence exercised by and on behalf of respondent No. 1.
Similarly the allegation in para 2 is that the coercion was the result of manipulation by ,or at the instance of respondent No. 1.
Thus these allegations must be supported by giving the necessary particulars regarding the names, date and place of commission of corrupt or illegal practice alleged.
The allegations in paras 1 and 2 of the petition are allegations of corrupt and illegal practice within the mean 443 ing of sections 123, 124 and 125 of the Act, and are not allegations of a general character which do not implicate the candidate personally.
(d) Further by way of example, para I of the schedule, no names, date of the alleged practices are given.
Same is the case with the allegations in paras 2, 3, 4, 5, 6, 7, 8, 9 & 10.
This has not been done and the petition, therefore, ought to be dismissed on this ground".
Now the order sheet of the proceedings before the Tribunal discloses the following.
By order dated the 16th October, 1952, the Tribunal decided that the case was in the first instance to be taken up for decision on the preliminary issues.
In the interests of justice the time is granted. .
The application for amendment and for particulars to be filed five days before the date of hearing and copies thereof be given to the petitioners.
The petitioners shall be ready with their replies on the date of hearing".
The 444 latter has amended his application, to which there was no objection".
In view of the specific objection taken in the written statement and the opportunities which the petitioners had for amending the petition which the above orders disclose, there is considerable force in the contention of the learned Attorney General that the petitioners, for some reasons best known to themselves, have come forward with a somewhat irresponsible petition and that while the Court has undoubtedly the power to permit amendment of the schedule of corrupt practices by permitting the furnishing of better particulars as regards the items therein specified, there was no duty cast upon the Tribunal to direct suo motu the furnishing of better particulars.
It is true that the petitioners in the reply that they filed to the written statement of the 1st respondent and in answer to the objection that the particulars as to the alleged corrupt practices were vague, said as follows: "The petitioners are prepared to give further particulars if the Tribunal is pleased to permit under section 83(3) of the Representation of the People Act,.
This reply was filed on the 16th October, 1952, which is the very date on which the first of the above orders extracted from the order sheet was passed.
It is also, true that the order dated the 17th January, 1953, shows that the respondent No. 1 at one stage, indicated an intention himself to ask for particulars.
But in a matter of this kind the primary responsibility for furnishing full particulars of the alleged corrupt practices and to file a petition in full compliance with section 83(2) of the Act was on the petitioners.
While undoubtedly the Tribunal has, in our opinion, taken all too narrow a view of their function in dealing with the various alleged defects in the petition and in treating them as sufficient for dismissal, the petitioners are not absolved from their duty to 445 comply, of their own accord, with the requirements of section 83(2) of the Act and to remove the defects when opportunity was available.
They cannot take shelter behind the fact that neither the Tribunal nor the respondent No. 1 has, in terms, called upon them to furnish better particulars.
But all the rest were not only extremely vague but no amendment was applied for nor was an opportunity for amendment of pleadings in general, open on two occasions, availed of.
Learned counsel for the appellants urges that however this may be, there was no justification for the Tribunal dismissing the petition in toto and that it was bound to have called upon the petitioners to substantiate the first allegation by evidence after striking out, if need be, the rest of the particulars, under the powers vested in it under Order VI, rule 16, Civil Procedure Code.
On the other hand the learned Attorney General for the respondent No. 1 urges that in such a situation it was open to the Tribunal to consider whether, taking the petition as a whole and in its total effect, there was substantial compliance with the requirements of section 83.
He contends that if, in exercise of its judgment, it thought that there was substantial non compliance, notwithstanding that one out of the various items may have been specific, it was not bound to exercise its discretion in favour of the petitioners by ordering a striking out of the various items and to direct the trial of the petition to be confined to one single item which may be in order.
The learned Attorney General argues that this would be really making out for the petitioners a different petition from what they brought up before the Election Com mission and that in this class of cases the Tribunal had the right and the duty to exercise great strictness 446 in order that the machinery for setting aside elections might not be abused for the purpose of maligning the successful candidate by levelling vague and iriesponsible charges against him.
While there is considerable force in this argument, we think that in a case of this kind the Tribunal when dealing with the matter in the early stages should not have dismissed the application.
It should have exercised its powers and called for better particulars.
On non compliance therewith, it should have ordered a striking out of such of the charges which remained vague and called upon the petitioners to substantiate the allegations in respect of those which were reasonably specific.
We are, therefore, of the opinion that the order of the tribunal in dismissing the petition outright was clearly erroneous.
Notwithstanding this opinion we would, in the normal course, not have felt called upon to interfere in this case under article 136 after this lapse of time and at the instance of persons like the appellants before us who are mere voters having no direct personal interest in the result of the election.
But there is one other circumstance in this case which we have noticed and which we feel we ought not to overlook, though in the course of the arguments the same was not brought to our notice.
Paragraphs 6(a), (b) and (c) of the application for setting aside the election sets out certain grounds of alleged disqualification of the returned candidate to stand for the election.
It is also stated therein that objections in this behalf were taken at the time of scrutiny of the nomination papers but that they were summarily overruled by the Returning Officer without any enquiry and that accordingly the objections to the disqualification have been raised in the application.
The objections are as follows: "6.
The material facts in support of the grounds are as follows: (a) The election of candidate for the Madhya Pradesh State Assembly in the single member Akola Constituency was announced to be held on 31 12 1951.
Nominations were to be filed on or before 15 11 1951, 447 and scrutiny of nomination was due on 17 11 1951.
At this time of scrutiny objection was taken to the nomination paper of respondent No. 1 on several grounds but the material grounds were that respondent No. 1 was disqualified for being chosen as and for being a Member of Madhya Pradesh State Assembly under Chapter III, section 7 (d) of the Representation of the People Act, 1951 (Act XLIII of 1951).
That the respondent No. 1 is disqualified to fill the seat under the Act., because he is the Managing Agent or Managing Director of Rajasthan Printing and Litho Works private limited company under the Indian Companies Act.
He has, as a share holder and director, interest, in contracts for supply of goods, viz. stationery, paper and printing materials, etc., to the State Government of Madhya Pradesh.
He has also interest in contracts for the execution of works or performance of services, such as printing, etc., under taken by the State Government of Madhya Pradesh.
The respondent No. 1 gets a share by way of commission on sales effected by the Limited Company.
He has, therefore, by himself interest in the contracts of the company with the State Government of Madhya Pradesh.
(b)The respondent No. 1 is a partner in the firm Berar 'General Agency.
The said firm has entered into a contract for the performance of cloth distribution on behalf of the State Government to retailers and holds a licence for the same.
The respondent No. 1, therefore, has interest by himself in the said contract for the performance of services undertaken by the Government.
(c)The respondent No. 1 is the proprietor of the monthly Journal "Prawaha" and a by weekly paper "Matru bhumi".
These publications print Government advertisements on contract basis.
The respondent No. 1 has, therefore, interest in the said contract for the performance of services undertaken by the State Government Madhya Pradesh.
The sales and other details of the "Matru bhumi" concern are noted in the private accounts of the respondent No. 1.
The 1st respondent in answer to these allegations states as follows: "It is denied that there was any improper acceptance of the nomination paper of respondent No. 1 and in particular it is denied that any of the allegations made in paragraph 6(a), (b) & (c) of the petition constitute in law a disqualifications of section 7 of the Representation of the People Act.
Without prejudice to this it is submitted that the respondent No. 1 was not suffering from any of these disqualifications in fact on the date of the submission of the nomination paper".
Having regard to the nature of the alleged disqualifi cation, which is substantially to the effect that the returned candidate had interest in contracts with the Government at the relevant dates, it was very necessary that the matters should have been cleared up in the enquiry before the Election Tribunal.
It is not in the interest of purity of elections that such allegations of disqualification should be completely ignored without enquiry and it appears rather surprising that the Tribunal should have ignored them and exercised its power to dismiss the petition.
However reluctant we might be to interfere in a matter like this after the lapse of three years and four months and with only an year and eight months before the general elections, we feel constrained to send this matter back for due enquiry.
But before doing so and in view of the delay and other circumstances that have already happened, 449 we, in exercise of the powers which the Tribunal in the normal course might itself have exercised, direct the striking out of all the items of alleged corrupt practices set out in Schedule A excepting the one covered by paragraph I of item 1, i.e., as follows: "That in the month of December, 1951, respondent No. I had been to the premises of Akola Shree Gurdwara, where the Local Sikh Community had assembled to listen to the recitation of the holy book 'Granth Saheb ' on the 7th day of the death of daughter of one Sardar Suratsingh.
At this meeting respondent No. 1 canvassed for votes for himself and paid Rs. 201, apparently as donation to the Gurudwara, but really as gift for inducing the Sikh Community in the Akola constituency in general and the Sikhs assembled in particular to induce them to vote for himself at the ensuing election.
Respondent No. I was guilty of bribery within the meaning of that term in section 123 of the Representation of the People Act".
The case will, therefore, go back for enquiry and trial with reference only to (1) the allegations in paragraphs 6(a), (b) and (c) of the application for setting aside the election, and (2) the allegations in paragraph 1 of item 1, in Schedule A attached to the application as set out above.
The Election Commissioner will now reconstitute an appropriate Tribunal for the purpose.
The Tribunal when constituted and before proceeding to trial will call upon the petitioners to rectify the lacuna as to dates in the verification clauses in the petition and the schedule.
It is to be hoped that the fresh proceedings before the Tribunal will be disposed of at a very early date.
| The appellants, two of the electors of the Akola Constituency of the Madhya Pradesh State Assembly, filed an Election Petition against Respondent No. 1, the successful candidate in the election held on December 13, 1951, and the three other respondents who having been validly nominated went to the polls but were defeated.
The Election Petition, under Section 80 of the Representation of the People Act of 1951, was admittedly time barred by one day.
The Election Commission condoned the delay under the proviso to Section 85 of the Act and constituted a Tribunal for the trial of the petition.
On pleadings of the parties, nine issues were framed by the Tribunal which are covered by the following questions: (1) Whether the election petition was presented by a properly authorised person.
(2) Whether there was sufficient cause for presentation of the petition one day out of time.
(3) Whether the petition was defective for non joinder of certain parties as respondents.
(4) Whether the petition was defective for want of proper verification.
(5) Whether,the petition was defective for vagueness of the particulars relating to the corrupt practices set out in Schedule A thereto.
The Tribunal found only the first of the above points in favour of the petitioners by a majority.
But in respect of the other four points, it held against the petitioners unanimously.
As a result of the adverse findings on these four points, the petition was dismissed without any trial on the merits.
It is against this dismissal that the appellants have now come up to this Court on obtaining special leave.
When the delay in submitting an election petition is condoned 429 by the Election Commission in exercise of its power under the proviso to Section 85 of the Representation of the People Act (Act XLIII of 1951), it is not open to the Election Tribunal, under Section 90(4) of the Act, to reconsider the question of limitation.
Even if, according to the requirement of Section 82 of the Representation of the People Act, any of the necessary parties other than the returned candidate has not been impleaded, the petition is not liable to be dismissed in limin on that sole ground; but it is a matter to be taken into consideration at the appropriate stage with reference to the final result of the case.
Section 83(1) of the Act provides that an election petition has to be verified in the manner provided for verification of pleadings under the Code of Civil Procedure.
Clauses (2) and (3) of rule 15 in Order VI of the Code lay down the procedure for verification of pleadings.
Apart from those cases where the date of the pleading and the verification may be relevant and important, it would be a wrong exercise of discretionary power to dismiss an application on the sole ground of the absence of the date of verification.
In such a case the applicant should normally be called upon to remove the lacuna by adding a supplementary verification indicating the date of the original verification and the reason for the earlier omission.
The requirement of "full particulars" of corrupt practices in Section 83(2) of the Act, is one that has got to be complied with, with sufficient fullness and clarification, so as to enable the opposite party to meet the allegations against him fairly, and so as to prevent the enquiry from being turned into a rambling and roving inquisition.
The primary responsibility for furnishing full particulars of alleged currupt practices and for filing a petition in full compliance with Section 83 (2) of the Act is that of the petitioners.
If they fail to do so initially it is their duty and responsibility to remove the defects when opportunity is available.
Tribunals, however, should not take an all too narrow view of their function in dealing with the various alleged defects in the petition and dismiss it on the ground of want of particulars.
They should call for better particulars and if that order was not complied with strike out such of the charges as are vague.
The petitioners also alleged that the returned candidate was disqualified to stand because he had interest in contracts with the Government.
But the Tribunal ignored these allegations and without enquiring into their truth dismissed the petition on the ground that the allegations relating to the charge of corrupt practices were vague, Held that it was not in the interest of purity of elections that such allegations of disqualification should be ignored and that it was a matter which called for enquiry.
Case remitted for enquiry with reference to the allegations that the returned candidate was disqualified and the charge of corrupt practice, which was held to be not vague.
Dinabandhu vs Jadumoni ( ; and Jagan Nath vs Joswant ([1954] S.C.R. 892), followed, 430
|
67 of 1955.
Under Article 32 of the Constitution of India for the enforcement of Fundamental Rights.
M. C. Setalvad, Attorney General of India, C. K. Daphtary, Solicitor General of India, G. section Pathak, (J. B. Dadachanji, A. P. Sen, Rameshwar Nath and Rajinder Narain, with them), for the petitioners.
T. L. Shevde, Advocate General of Madhya Pradesh (M. Adhikari and 1, N. Shroff, with him) for the State of Madhya Pradesh. 1955.
September, 20.
The Judgment of the Court was delivered by BHAGWATI J.
The petitioners are a firm carrying on business on a very large scale of making and selling bidis having their head office in Jabalpur in the State of Madhya Pradesh.
They are registered as "dealer" for the purpose of the Central Provinces and Berar Sales Tax Act, 1947.
In the course of their said business, the petitioners import tobacco from the State of Bombay in very large quantities after it is blended in that State by the vendors with various other types of indigenous tobacco by an elaborate process.
This finished tobacco, after its import within the State of Madhya Pradesh is rolled into bidis which are exported to various other States, largely to the State of Uttar Pradesh.
The dealers in the State of Uttar Pradesh 511 and such other States who buy bidis from the petitioners sell the same to various other dealers and consumers in those States.
The Sales Tax authorities in the State of Madhya Pradesh required the petitioners under threat of criminal prosecution to file a statement of return of the total purchases of tobacco made by them out of Madhya Pradesh and delivered to them in Madhya Pradesh with a vie* to assess and levy purchase tax on the transactions of purchases made by the petitioners as above.
The petitioners filed under protest two returns dated the 11th September 1954 and 3rd December 1954 for the periods 3rd May 1954 to 29th July 1954 and 30th July 1954 to 26th October 1954 respectively but without prejudice to their right to challenge the validity of the assessment and levy of the said tax on the aforesaid transactions.
The Sales Tax authorities further called upon the petitioners to deposit the alleged purchase tax which amounts to thousands of rupees in every quarter of the year.
The petitioners thereupon filed this petition under article 32 of the Constitution for a writ of mandamus or any appropriate direction or order seeking to restrain the State of Madhya Pradesh and the Commissioner of Sales Tax, Madhya Pradesh, from enforcing the said Act and its provisions against the petitioners and for consequential reliefs.
The petitioners averred that the imposition of tax on sale or purchase of tobacco rolled into bidis exported out of Madhya Pradesh in the manner described was in contravention of article 286 (1) (a) of the Constitution, that the tobacco purchased by them for the purpose of making bidis exported outside Madhya Pradesh was never intended for use as raw material for the making of bidis for the purpose of consump tion in Madhya Pradesh and section 4, sub section (6) of the Act had no application to the tobacco so used and there was no liability to pay the alleged tax and that to the best of the petitioners ' information tobacco bad not been notified by the State Government in the Gazette for the purpose of section 12(A) of the Act 65 512 and that the Sales Tax authorities, under the Act, were, 0therefore, not entitled to levy any tax on the petitioners.
The petitioners also submitted that the transactions in question had taken place in the course of inter State commerce, that the State of Madhya Pradesh had no authority to impose or to authorise the imposition of such a tax and that the action of the State authorities contravened the provisions of article 286(2) of the Constitution .
The Respondents filed a return denying the contentions of the petitioners and submitted that the petitioners by purchasing tobacco which was entered in their registration certificate as raw material for the manufacture of bidis for sale by actual delivery in Madhya Pradesh for consumption in that State made themselves liable to pay the tax by exporting bidis to other States and thus utilising it for a different purpose under section 4(6) of the Act.
They admitted that the petitioners imported tobacco from the State of Bombay in large quantities but stated that the tobacco, after its arrival in the petitioners ' bidi fac tories, was cleaned, sieved and blended.
A few more facts relevant for the decision of this petition may be stated in this context.
Not only the petitioners but also the dealers in Bombay who sell or supply tobacco to the petitioners are registered as "dealers" for the purpose of the Central Provinces and Berar Sales Tax Act, 1947.
The petitioners are the holders of a certificate of registration, No. LDG/ 53 obtained by them under Rule 8 of the Central Provinces and Berar Sales Tax Rules, 1947.
When making purchases of the tobacco in question they also made declarations in the form required by Rule 26(II) declaring that they had purchased the said goods from Shri Shah Chhaganlal Ugarchand Nipani, a dealer holding registration certificate No. BMY/93/ MP and from Shri Maniklal Chunanlal Baroda, a dealer holding registration certificate No. BMY/341MP on different dates therein mentioned for use as raw material in the manufacture of goods for sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State.
in the return which 513 was filed by the petitioners for the quarter beginning from 3rd May 1954 and ending with 29th July 1954, the petitioners mentioned Rs. 16,47,567 3 3 as the purchase price of goods purchased on declaration as being goods specified in the registration certificate as intended for use as raw material in the manufacture of goods for sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State but utilised for any other purpose.
In the return which was filed by them for the quarter beginning from 27th July 1954 and ending with 26th October 1954, they did not fill in any figure but showed the above item as blank contending that the Sales Tax authorities were not entitled to levy any purchase tax against them in respect of the same.
The learned Attorney General appearing for the petitioners before us contended (1) that the transactions in question were in the course of inter State commerce and were, therefore, within the ban of article 286(2) and the State of Madhya Pradesh had no authority to impose or to authorise imposition of tax on these transactions, (2) that in any event the goods were delivered for consumption in the State of Uttar Pradesh and were not liable to a levy of tax at the instance of the State of Madhya Pradesh, (3) that section 4(6) of the Act was invalid inasmuch as it offended against the provisions of article 286(1) (a), and lastly (4) that even if the above contentions were negatived, section 4(6) of the Act had, on its true construction, no application to the facts of the present case.
He, however, urged that if the Court was with him on his first contention, viz. that the transactions in question took place in the course of interState commerce it was not necessary to go into the other contentions.
We are of the opinion that this contention of the learned Attorney General is sound.
It was in fact admitted by the Respondents in their return that the petitioners imported tobacco from the State of Bombay in large quantities.
The Bombay suppliers processed tobacco in their godowns situated within the State of Bombay and supplied the finished tobacco 514 to the petitioners in Madhya Pradesh.
The petitioners imported this finished tobacco into Madhya Pradesh from these suppliers who were carrying on business in the State of Bombay and there was of necessity, as a result of these transactions, the movement of the goods across the border.
As a result of the transactions entered into by the petitioners with these suppliers the finished tobacco which was supplied to the petitioners moved from the State of Bom bay to the State of Madhya Pradesh and these transactions were, therefore, in the course of inter State trade or commerce.
The only answer which was made by the learned Advocate General of Madhya Pradesh was that Shri Shah Chhaganial Ugarchand Nipani and Shri Maniklal Chunanlal Baroda were themselves dealers holding registration certificates Nos.
BMY/93/MP and BMY/ 341 MP being registered as such under the provisions of the Central Provinces and Berar Sales Tax Act, 1947, and that, therefore.
the transactions were between two registered dealers in the State of Madhya Pradesh and therefore constituted purely internal sales of the goods.
If they were thus internal sales there was no question of their being transactions in the course of inter State trade or commerce and therefore they were not subject to the ban imposed under article 286(2).
This answer suffers from over simplification.
No doubt, the dealers who supplied the finished tobacco to the petitioners were registered dealers under the Central Provinces and Berar Sales Tax Act, 1947, but that fact by itself would not be sufficient to invest the transactions which otherwise were in the course of inter State trade or commerce with the character of intra state transactions or internal sales or purchases.
What one has got to look at is the real nature of the transactions and not the outside form.
A person who carries on business of selling or supplying goods in Madhya Pradesh and who comes within the definition of "dealer" given in section 2(c) of the Act has, under pain of penalty visited upon him under section 24 of the Act, to register himself as a dealer 515 and possess a registration certificate under section 8 (1) of the Act.
Merely because he got himself registered as such to avoid the penalty which would otherwise be visited upon him by the State it cannot be stated that 'Whatever transactions he entered into with other dealers in the State of Madhya Pradesh were all intraState transactions or internal sales or purchases irrespective of the fact that the transactions involved movement of the goods across the border and were clearly transactions of sale of goods in the course of inter State trade or commerce.
We were taken by the learned Attorney General through the several provisions of the Act and we are confirmed in our opinion that these transactions sought to be taxed by the Sales Tax authorities of the State of Madhya Pradesh were transactions in the course of inter State trade or commerce.
The activities of selling or 'supplying goods in Madhya Pradesh if carried on habitually would amount to a carrying on of the business of selling or supplying goods in the State of Madhya Pradesh and even an outside merchant who indulged in such activities may in such event be said to be carrying on business in Madhya Pradesh and would come within the definition of "dealer" given in section 2(c) of the Act.
When we come, however, to section 8 which deals with the registration of dealers, that section requires that a dealer while being liable to pay tax under the Act shall not carry on business as a dealer unless he has been registered as such and pos sesses a registration certificate.
The liability to pay tax under the Act is thus postulated and unless and until a person is liability to pay such tax he need not get himself registered as a dealer.
All the transactions entered into by a registered dealer, however, do not necessarily import a liability to pay tax under the Act because, whenever the question arises in regard to his liability to pay any tax under the Act, such liability would have to be determined in spite of his being a registered dealer with reference, inter alia, to the provisions of section 27 A of the Act which in corporates within its terms the bans which have been imposed on the powers of the State Legislatures to 516 tax under article 286 (1)(a) and (2) of the Constitution.
If, therefore, a dealer who has got himself registered as dealer under the provisions of section 8(1) of the Act is sought to be made liable in respect of transactions of sale effected, by him he could claim exemption from such liability if the transactions of sale or purchase took place in the course of inter State trade or commerce after the 31st March, 1951, except in so far as Parliament may by law otherwise provide.
In the case before us there was no such provision made by Parliament and the transactions in question were all after the 31st March, 1951, with the result that the ban imposed by article 286(2) was in opera tion and if the transactions took place in the course of inter State trade or commerce not only were Shri Chhaganlal Ugarchand Nipani and Shri Maniklal Chunanlal Baroda exempt from the liability to pay the tax on these transactions but the petitioners also were similarly exempt.
No liability, therefore, could be imposed either for Sales Tax or for Purchase Tax within the terms of the Act on these transactions which as above stated took place in the course of interState trade or commerce.
It was, however, urged that the petitioners had made declarations at the time of making the purchases of this finished tobacco that they had purchased the said goods for use as raw materials in the manufacture of goods for sale for actual delivery in Madhya Pradesh for the purpose of consumption in that State and that by virtue of the provisions of section 4(6) of the Act they were liable to pay the purchase tax on the purchase price of goods which had been utilised for any other purpose.
Whatever steps the State of Madhya Pradesh may be able to take in regard to non compliance with the terms of the declarations by the petitioners, we are clearly of opinion that the State of Madhya Pradesh is restrained from imposing any tax on the transactions of purchase or sale which take place in the course of inter State trade or commerce and no question of liability of the petitioners by virtue of such declarations survives because even initially Shri Shah Chhaganlal Ugar 517 chand Nipani and Shri Maniklal Chunanlal Baroda were not liable to pay any tax on these transactions nor could any such liability for tax be transferred to the petitioners by virtue of such declarations.
If, therefore, there was no basis for any such liability, the declarations by themselves cannot create any ' new liability and the petitioners cannot be held liable to tax even by the operation of section 4(6) of the Act, the very basis of the liability sought to be im.
posed therein having disappeared.
The result, therefore, is that the Respondents will be restrained from enforcing the Central Provinces and Berar Sales Tax Act, 1947, and its provisions against the petitioners and from imposing a tax in respect of the transactions in question and in particular from imposing a tax on the purchase price of goods purchased on the declarations under Rule 26 being goods specified in the registration certificate as intended for use as raw material in the manufacture of goods for sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State but utilised for any other purpose tinder the provisions of section 4(6) of the Act.
The Respondents will pay the peti tioners ' costs of this petition.
| The petitioners are carrying on business on a very large scale of making and selling bidis having their head office in Jabalpur in the State of Madhya Pradesh and are registered as "dealer" for the purposes of the Central Provinces and Berar Sales Tax Act, 1947.
In the course of their said business, the petitioners import tobacco from the State of Bombay in very large quantities after it is blended in that State by the vendors with various other types of indigenous tobacco by an elaborate process.
This finished tobacco, after its import within the State of Madhya Pradesh is rolled into bidis which are exported to various other States, largely to the State of Uttar Pradesh.
The dealers in the State of Uttar Pradesh and such other States who buy bidis from the petitioners sell the same to various other dealers and consumers in those States.
The Sales Tax authorities in the State of Madhya Pradesh required the petitioners under threat of criminal prosecution to file a statement of return of the total purchases of tobacco made by them out of Madhya Pradesh and delivered to them in Madhya Pradesh with a view to assess and levy purchase tax on the transactions of purchases made by the petitioners as stated above.
Held, that the State of Madhya Pradesh had no authority to impose or to authorise the imposition of such a tax and that the action of the State authorities contravened the provisions of article 286(2) of the Constitution inasmuch as the transactions in question were in the course of inter State trade or commerce as the finished tobacco which was supplied to the petitioners moved from the State of Bombay to the State of Madhya Pradesh.
510 The contention that not only the petitioners were the registered dealers under Rule 8 of the Central Provinces and Berar Sales Tax Rules, 1947 but the dealers in Bombay who sell or supply tobacco to them were registered as "dealers" for the purpose of the Central Provinces and Berar Sales Tax Act, 1947 and therefore the transactions were between two registered dealers in the State of Madhya Pradesh and thus constituted purely internal sales of the goods was without force because what one has to look at is the real nature of the transactions and not the outside form and as the trans actions in dispute involved movement of the goods across the border they were clearly transactions of sales of goods in the course of interState trade or commerce and were hit by the ban under article 286(2) of the Constitution.
|
ons Nos. 652 of 1954 and 71 to 77 and 85 of 1955.
Under Article 32 of the Constitution for the enforcement of fundamental rights.
G. section Pathak, (P. N. Mehta and G. C. Mathur, with him) for the petitioners in Petition No. 652 of 1.954.
P. N. ~Mehta and G. ~0.
~Mathur, for the petitioners in Petitions Nos.
71 to 77 and 85 of 1955.
227 S.M. Sikri, Advocate Generalfor the State of Punjab (Jindra Lal and P. G. Gokhale, with him) for the respondent in all petitions.
April 12.
The following Judgments were delivered.
PETITION NO. 652 OF 1954.
MUKHERJEA C. J.
This is a petition under article 32 of the Constitution, preferred by six persons, who purport to carry on the business of preparing, printing, publishing and, selling text books for different classes in the schools of Punjab, particularly for the primary and middle classes, under the name and style "Uttar Chand Kapur & Sons".
It is alleged that the Education Department of the Punjab Government has in pursuance of their so called policy of nationalisation of text books, issued a series of notifications since 1950 regarding the printing, publication and sale of these books which have not only placed unwarrantable restrictions upon the rights of the petitioners to carry on their business but have practically ousted them and other fellow traders from the business altogether.
It is said that no restrictions could be imposed upon the petitioners ' right to carry on the trade which is guaranteed under article 19(1)(g) of the Constitution by mere executive orders without proper legislation and that the legislation, if any, must conform to the requirements of clause (6) of article 19 of the Constitution.
Accordingly, the petitioners pray for writs in the nature of mandamus directing the Punjab Government to withdraw the notifications which have affected their rights.
To appreciate the contentions that have been raised by the learned counsel who appeared for the parties before us, it will be necessary to narrate certain relevant facts.
In the State of Punjab, all recognised schools have got to follow the course of studies approved by the Education Department of the Government and the use, by the pupils, of the text books prescribed or authorised by the Department is a con dition precedent to the granting of recognition to a 228 school.
For a long period of time prior to 1950, the method adopted by the Government for selection and approval of text books for recognised schools was commonly known as the alternative method and the procedure followed was shortly this: Books on relevant subjects, in accordance with the principles laid down by the Education Department, were prepared by the publishers with their own money and under their own arrangements and they were submitted for approval of the Government.
The Education Department after proper scrutiny selected books numbering between 3 and 10 or even more on each subject as alternative text books, leaving it to the discretion of the Head Masters of the different schools, to select any one of the alternative books on a particular subject out of the approved list.
The Government fixed the prices as well as the size and contents of the books and when these things were done it was left to the publishers to print, publish and sell the books to the pupils of different schools according to the choice made by their respective Head Masters.
Authors, who were not pub lishers, could also submit books for approval and if any of their books were approved, they had to make arrangements for publishing the same and usually they used to select some one of the publishers already on the line to do the work.
This procedure, which was in vogue since 1905, was altered in material particulars on and from May 1950.
By certain resolutions of the Government passed on or about that time, the whole of the territory of Punjab, as it remained in the Indian Union after partition, was divided into three Zones.
The text books on certain subjects like agriculture, history, social studies, etc.
for all the zones were prepared and published by the Government without inviting them from the publishers.
With respect to the remaining subjects, offers were still invited from "publishers and authors" but the alternative system was given up and only one text book on each subject for each class in a particular zone was selected.
Another change introduced at this time was that the Government charged, as royalty, 5% on the sale price of all the 229 approved text books.
The result therefore was that the Government at this time practically took upon themselves the monopoly of publishing the textbooks on some of the subjects and with regard to the rest also, they reserved for themselves a certain royalty upon the sale proceeds.
Changes of a far more drastic character however were introduced in the year 1952 by a notification of the Education Department issued on the 9th of August 1952 and it is against this notification that the complaints of the petitioners are mainly directed.
This notification omitted the word "publishers" altogether and invited only the "authors and others" to submit books for approval by the Government.
These "authors and others", whose books were selected, bad to enter into agreements in the form prescribed by the Government and the principal terms of the agreement were that the copyright in these books would vest absolutely in the Government and the "authors and others" would only get a royalty at the rate of 5% on the sale of the text books at the price or prices specified in the list.
Thus the publishing, printing and selling of the books were taken by the Government exclusively in their own hands and the private publishers were altogether ousted from this business.
The 5% royalty, in substance, represents the price for the sale of the copyright and it is paid to an author or any other person who, not being the author, is the owner of the copyright and is hence competent in law to transfer the same to the Government.
It is against these notifications of 1950 and 1952 that the present petition under article 32 of the Constitution is directed and the petitioners pray for withdrawal of these notifications on the ground that they contravene the fundamental rights of the petitioners guaranteed under the Constitution.
The contentions raised by Mr. Pathak, who appeared in support of the petitioners, are of a three fold character.
It is contended in the first place that the executive Government of a State is wholly incompetent, without any legislative sanction, to engage in any trade or business activity and that the acts of 230 the Government in carrying out their policy of establishing monopoly in the business of printing and publishing text books for school students is wholly without jurisdiction and illegal.
His second contention is, that assuming that the State could create a monopoly in its favour in respect of a particular trade or business, that could be done not by any executive act but by means of a proper legislation which should conform to the requirements of article 19(6) of the Constitution.
Lastly, it is argued that it was not open to the Government to deprive the petitioners of their interest in any business or undertaking which amounts to property without authority of law and without payment of compensation as is required under article 31 of the Constitution.
The first point raised by Mr. Pathak, in substance, amounts to this, that the Government has no power in law to carry on the business of printing or selling text books for the use of school students in competition with private agencies without the sanction of the legislature.
It is not argued that the functions of a modern State like the police States of old are confined to mere collection of taxes or maintenance of laws and protection of the realm from external or internal enemies.
A modern State is certainly expected to engage in all activities necessary for the promotion of the social and economic welfare of the community.
What Mr. Pathak says, however, is, that as our Constitution clearly recognises a division of governmental functions into three categories, viz., the legislative, the judicial and the executive, the function of the executive cannot but be to execute the laws passed by the legislature or to supervise the enforcement of the same.
The legislature must first enact a measure which the executive can then carry out.
The learned counsel has, in support of this contention, placed considerable reliance upon articles 73 and 162 of our Constitution and also upon certain decided authorities of the Australian High Court to which we shall presently refer.
Article 73 of the Constitution relates to the executive powers of the Union, while the corresponding 231 provision in regard to the executive powers of a State is contained in article 162.
The provisions of these articles are analogous to those of sections 8 and 49 (2) respectively of the Government of India Act, 1935 and lay down the rule of distribution of executive powers between the Union and the States, following, the same analogy as is provided in regard to the distribution of legislative powers between them.
Article 162, with which we are directly concerned in this case, lays down: "Subject to the provisions of this Constitution, the executive power of a State shall extend to the matters with respect to which the Legislature of the State has power to make laws: Provided that in any matter with respect to which the Legislature of a State and Parliament have power to make laws, the executive power of the State shall be subject to, and limited by, the executive power expressly conferred by this Constitution or by any law made by Parliament upon the Union or authorities thereof".
Thus under this article the executive authority of the State is exclusive in respect to matters enumerated in List II of Seventh Schedule.
The authority also extends to the Concurrent List except as provided in the Constitution itself or in any law passed by the Parliament.
Similarly, article 73 provides that the executive powers of the Union shall extend to matters with respect to which the Parliament has power to make laws and to the exercise of such rights, authority and jurisdiction as are exercisable by the Govern ment of India by virtue of any treaty or any agreement.
The proviso engrafted on clause (1) further lays down that although with regard to the matters in the Concurrent List the executive authority shall be ordinarily left to the State it would be open to the Parliament to provide that in exceptional cases the executive power of the Union shall extend to these matters also.
Neither of these articles contain any definition as to what the executive function is and what activities would legitimately come within its scope.
They are concerned primarily with the distri 232 bution of the executive power between the Union on the one hand and the States on the other.
They do not mean, as Mr. Pathak seems to suggest, that it is only when the Parliament or the State Legislature has legislated on certain items appertaining to their respective lists, that the Union or the State executive, as the case may be, can proceed to function in respect to them.
On the other hand, the language of article 162 clearly indicates that the powers of the State executive do extend to matters upon which the State Legislature is competent to legislate and are not con fined to matters over which legislation has been passed already.
The same principle underlies article 73 of the Constitution.
These provisions of the Constitution therefore do not lend any support to Mr. Pathak 's contention.
The Australian cases upon which reliance has been placed by the learned counsel do not, in our opinion, appear to be of much help either.
In the first(1) of these cases, the executive Government of the Commonwealth during the continuance of the war, entered into a number of agreements with a company which was engaged in the manufacture and sale of wool tops.
The agreements were of different types.
By one class of agreements, the Commonwealth Government gave consent to the sale of wool tops by the company in return for a share of the profits of the transactions (called by the parties "a licence fee").
Another class provided that the business of manufacturing wool tops should be carried on by the company as agents for the Commonwealth in consideration of the company receiving an annual sum from the Commonwealth.
The rest of the agreements were a combination of these two varieties.
It was held by a Full Bench of the High Court that apart from any authority conferred by an Act of Parliament or by regulations thereunder, the executive Government of the Commonwealth had no power to make or ratify any of these agreements.
The decision, it may be noticed, was based substantially upon the provision of section 61 of the Australian Constitution which is worded as follows: (1) The Commtmonwwealth and the Central Wool Committee vs The Colonial Combining, Spinning and Weaving Co. Ltd., ; 233 "The executive power of the Commonwealth is vested in the Queen and is exercised by the Governor General as the Queen 's representative and extends to the execution and maintenance of the Constitution and of the laws of the Commonwealth", In addition to this, the King could assign other functions and powers to the Governor General under section 2 but in this particular case no assignment of any additional powers was alleged or proved.
The court held that the agreements were not directly authorised by the Parliament or under the provisions of any statute and as they were not for the execution and maintenance of the Constitution they must be held to be void.
Isacs, J., in his judgment, dealt elabo rately with the two types of agreements and held that the agreements, so far as they purported to bind the company to pay to the Government money, as the price of consents, amounted to the imposition of a tax and were void without the authority of Parliament.
The other kind of agreements which purported to bind the Government to pay to the company a remuneration for manufacturing wool tops was held to be an appropriation of public revenue and being without legislative authority was also void.
It will be apparent that none of the principles indicated above could have any application to the circumstances of the present case.
There is no provision in our Constitution corresponding to section 61 of the Australian Act.
The Government has not imposed anything like taxation or licence fee in the present case nor have we been told that the appropriation of public revenue involved in the so called business in text books carried on by the Government has not been sanctioned by the legislature by proper Appropriation Acts.
The other case(1) is of an altogether different character and arose in the following way.
The Commonwealth Government had established a clothing factory in Melbourne for the purpose of making naval and military uniforms for the defence forces and (1) Vide Attorney General for Victoria vs The Commonwealth ; 30 234 postal employees.
In times of peace the operations of the factory included the supply of uniforms for other departments of the Commonwealth and for employees in various public utility services.
The Governor General deemed such peace time operations of the factory necessary for the efficient defence of the Commonwealth inasmuch as the maintenance intact of the trained complement of the factory would assist in meeting wartime demands.
A question arose as to whether operations of the factory for such purposes in peace: time were authorised by the Defence Act.
The majority of the court answered the question in the affirmative.
Starke, J. delivered a dissenting opinion upon which Mr. Pathak mainly relied.
The learned Judge laid stress on section 61 of the Constitution Act according to which the executive power of the Commonwealth extended to the maintenance of the Constitution and of the laws of the Commonwealth and held that there was nothing in the Constitution or any law of the Commonwealth which enabled the Commonwealth to establish and maintain clothing factories for other than Commonwealth purposes.
The opinion, whether right or wrong, turns upon the particular facts of the case and upon the provision of section 61 of the Australian Act and it cannot and does not throw any light on the question that requires decision in the present case.
A question very similar to that in the present case did arise for consideration before a Full Bench of the Allahabad High Court in Motilal vs The Government of the State of Uttar Pradesh(1).
The point canvassed there was whether the Government of a State has power under the Constitution to carry on the trade or business of running a bus service in the absence of a legislative enactment authorising the State Government to do so.
Different views were expressed by different Judges on this question.
Chief Justice Malik was of opinion that in a written Constitution like ours the executive power may be such as is given to the executive or is implied, ancillary or inherent.
(1) A.I.R. 1951 Allahabad 257. 235 It must include all powers that may be needed to carry into effect the aims and objects of the Constitution.
It must mean more than merely executing the laws.
According to the Chief Justice the State has a right to hold and manage its own property and carry on such trade or business as a citizen has the right to carry on, so long as such activity does not encroach upon the rights of others or is not contrary to law.
The running of a transport business there fore was not per se outside the ambit of the executive authority of the State.
Sapru, J. held that the power to run a Government bus service was incidental to the power of acquiring property which was expressly conferred by article 298 of the Constitution.
Mootham and Wanchoo, JJ., who delivered a common judgment, were also of the opinion that there was no need for a specific legislative enactment to enable a State Government to run a bus service.
In the opinion of these learned Judges an act would be within the executive power of the State if it is not an act which has been assigned by the Constitution of India to other authorities or bodies and is not contrary to the provisions of any law and does not encroach upon the legal rights of any member of the public.
Agarwala, J. dissented from the majority view and held that the State Government had no power to run a bus service in the absence of an Act of the legislature authorising the State to do so.
The opinion of Agarwala J. undoubtedly supports the contention of Mr. Pathak but it appears to us to be too narrow and unsupportable.
It may not be possible to frame an exhaustive definition of what executive function means and implies.
Ordinarily the executive power connotes the residue of governmental functions that remain after legislative and judicial functions are taken away.
The Indian Constitution has not indeed recognised the doctrine of separation of powers in its absolute rigidity but the functions of the different parts or branches of the Government have been sufficiently differentiated and consequently it can very well be said that our Constitution does not contemplate 236 assumption, by one organ or part of the State, of functions that essentially belong to another.
The executive indeed can exercise the powers of departmental or subordinate legislation when such powers are delegated to it by the legislature.
It can also, when so empowered, exercise judicial functions in a limited way.
The executive Government, however, can never go against the provisions of the Constitution or of any law.
This is clear from the provisions of article 154 of the Constitution but, as we have already stated, it does not follow from this that in order to enable the executive to function there must be a law already in existence and that the powers of the executive are limited merely to the carrying out of these laws.
The limits within which the executive Government can function under the Indian Constitution can be ascertained without much difficulty by reference to the form of the executive which our Constitution has set up.
Our Constitution, though federal in its structure, is modelled on the British Parliamentary system where the executive is deemed to have the primary responsibility for the formulation of governmental policy and its transmission into law though the condition precedent to the exercise of this responsibility is its retaining the confidence of the legislative branch of the State.
The executive function comprises both the determination of the policy as well as carrying it into execution.
This evidently includes the initiation of legislation, the maintenance of order, the promotion of social and economic welfare, the direction of foreign policy, in fact the carrying on or supervision of the general administration of the State.
In India, as in England, the executive has to act subject to the control of the legislature; but in what way is this control exercised by the legislature? Under article 53(1) of our Constitution, the executive power of the Union is vested in the President but under article 75 there is to be a Council of Ministers with the Prime Minister at the head to aid and advise the President in the exercise of his functions.
The President has thus been made a formal or constitutional 237 head of the executive and the real executive powers are vested in the Ministers or the Cabinet.
The same provisions obtain in regard to the Government of States; the Governor or the Rajpramukh, as the case may be, occupies the position of the head of the executive in the State but it is virtually the council of Ministers in each State that carries on the executive Government.
In the Indian Constitution, therefore, we have the same system of parliamentary executive as in England and the council of Ministers consisting, as it does, of the members of the legislature is, like the British Cabinet, "a hyphen which joins, a buckle which fastens the legislative part of the State to the executive part".
The Cabinet enjoying, as it does, a majority in the legislature concentrates in itself the virtual control of both legislative and executive func tions; and as the 'Ministers constituting the Cabinet are presumably agreed on fundamentals and act on the principle of collective responsibility, the most important questions of policy are all formulated by them.
Suppose now that the Ministry or the executive Government of a State formulates a particular policy in furtherance of which they want to start a trade or business.
Is it necessary that there must be a specific legislation legalising such trade activities before they could be embarked upon? We cannot say that such legislation is always necessary.
If the trade or business involves expenditure of funds, it is certainly required that Parliament should authorise such expenditure either directly or under the provisions of a statute.
What is generally done in such cases is, that the sums required for carrying on the business are entered in the annual financial statement which the Ministry has to lay before the House or Houses of Legislature in respect of every financial year under article 202 of the Constitution.
So much of the esti mates as relate to expenditure other than those charged on the consolidated fund are submitted in the form of demands for grants to the legislature and the legislature has the power to assent or refuse to assent to any such demand or assent to a demand subject to reduc 238 tion of the amount (article 203).
After the grant is sanctioned, an Appropriation Bill is introduced to provide for the appropriation out of the consolidated fund of the State of all moneys required to meet the grants thus made by the Assembly (article 204).
As soon as the Appropriation Act is passed, the expenditure made under the heads covered by it would be deemed to be properly authorised by law under article 266(3) of the Constitution.
It may be, as Mr. Pathak contends, that the Appropriation Acts are no substitute for specific legislation and that they validate only the expenses out of the consolidated funds for the particular years for which they are passed; but nothing more than that may be necessary for carrying on of the trade or business.
Under article 266(3) of the Constitution no moneys out of the consolidated funds of India or the consolidated fund of a State shall be appropriated except in accordance with law and for the purposes and in the manner provided in this Constitution.
The expression "law" here obviously includes the Appro priation Acts.
It is true that the Appropriation Acts cannot be said to give a direct legislative sanction to the trade activities themselves.
But SO long as the trade activities are carried on in pursuance of the policy which the executive Government has formulated with the tacit support of the majority in, the legislature, no objection on the score of their not being sanctioned by specific legislative provision can possibly be raised.
Objections could be raised only in regard to the expenditure of public funds for carrying on of the trade or business and to these the Appropriation Acts would afford a complete answer.
Specific legislation may indeed be necessary if the Government require certain powers in addition to what they possess under ordinary law in order to carry on the particular trade or business.
Thus when it is necessary to encroach upon private rights in order to enable the Government to carry on their business, a specific legislation sanctioning such course would have to be passed.
239 In the present case it is not disputed that the entire expenses necessary for carrying on the business of printing and publishing the text books for recognised schools in Punjab were estimated and shown in the annual financial statement and that the demands for grants, which were made under different heads, were sanctioned by the State Legislature and due Appropriation Acts were passed.
For the purpose of carrying on the business the Government do not require any additional powers and whatever is necessary for their purpose, they can have by entering into contracts with authors and other people.
This power of contract is expressly vested in the Government under article 298 of the Constitution.
In these circumstances, we are unable to agree with Mr. Pathak that the carrying on of the business of printing and publishing text books was beyond the competence of the executive Government without a specific legislation sanctioning such course.
These discussions however are to some extent academic and are not sufficient by themselves to dispose of the petitioners ' case.
As we have said already, the executive Government are bound to conform not only to the law of the land but also to the provisions of the Constitution.
The Indian Constitution is a written Constitution and even the legislature cannot override the fundamental rights guaranteed by it to the citizens.
Consequently, even if the acts of the executive are deemed to be sanctioned by the legislature, yet they can be declared to be void and inoperative if they infringe any of the fundamental rights of the petitioners guaranteed under Part III of the Consti tution.
On the other hand, even if the acts of the executive are illegal in the sense that they are not warranted by law, but no fundamental rights of the petitioners have been infringed thereby, the latter would obviously have no right to complain under article 32 of the Constitution though they may have remedies elsewhere if other heads of rights are infringed.
The material question for consideration therefore is: What fundamental rights of the petitioners, if any, have been violated by the notifications 240 and acts of the executive Government of Punjab undertaken by them in furtherance of their policy of nationalisation of the text books for the school students? The petitioners claim fundamental right under article 19(1)(g) of the Constitution which guarantees, inter alia, to all persons the right to carry on any trade or business.
The business which the petitioners have been carrying on is that of printing and publishing books for sale including text books used in the primary and middle classes of the schools in Punjab.
Ordinarily it is for the school authorities to prescribe the text books that are to be used by the students and if these text books are available in the market the pupils can purchase them from any book seller they like.
There is no fundamental right in the publishers that any of the books printed and published by them should be prescribed as text books by the school authorities or if they are once accepted as text books they cannot be stopped or discontinued in future.
With regard to the schools which are recognised by the Government the position of the pub lishers is still worse.
The recognised schools receive aids of various kinds from the Government including grants for the maintenance of the institutions, for equipment, furniture, scholarships and other things and the pupils of the recognised schools are admitted to the school final examinations at lower rates of fees than those demanded from the students of non recognised schools.
Under the school code, one of the main conditions upon which recognition is granted by Government is that the school authorities must use as text books only those which are prescribed or autho rised by the Government.
So far therefore as the recognised schools are concerned and we are concerned only with these schools in the present case the choice of text books rests entirely with the Government and it is for the Government to decide in which way the selection of these text books is to be made.
The procedure hitherto followed was that the Government used to invite publishers and authors to submit their books for examination and approval by 241 the Education Department and after selection was made by the Government, the size, contents as well as the prices of the books were fixed and it was left to the publishers or authors to print and publish them and offer them for sale to the pupils.
So long as this system was in vogue the only right which publishers, like the petitioners had, was to offer their books for inspection and approval by the Govern ment.
They had no right to insist on any of their books being accepted as text books.
So the utmost that could be said is that there was merely a chance or prospect of any or some of their books being approved as text books by the Government.
Such chances are incidental to all trades and businesses and there is no fundamental right guaranteeing them.
A trader might be lucky in securing a particular market for his goods but if he loses that field because the particular customers for some reason or other do not choose to buy goods from him, it is not open to him to say that it was his fundamental right to have his old customers for ever.
On the one hand, therefore, there was nothing but a chance or prospect which the publishers had of having their books approved by the Government, on the other hand the Government had the undisputed right to adopt any method of selection they liked and if they ultimately decided that after approving the text books they would purchase the copyright in them from the authors and others provided the latter were willing to transfer the same to the Government on certain terms, we fail to see what right of the publishers to carry on their trade or business is affected by it.
Nobody is taking away the publishers ' right to print and publish any books they like and to offer them for sale but if they have no right that their books should be approved as text books by the Government it is immaterial so far as they are concerned whether the Government approves of text books submitted by other persons who are willing to sell their copyrights in the books to them, or choose to engage authors for the purpose of preparing the text books which they take up on themselves to print 31 242 and publish.
We are unable to appreciate the argument of Mr. Pathak that the Government while exercising their undoubted right of approval cannot attach to it a condition which has no bearing on the purpose for which the approval is made.
We fail to see how the petitioners ' position is in any way improved thereby.
The action of the Government may be good or bad.
It may be criticised and condemned in the Houses of the Legislature or outside but this does not amount to an infraction of the fundamental right guaranteed by article 19 (1) (g) of the Constitution.
As in our view the petitioners have no fundamental right in the present case which can be said to have been infringed by the action of the Government, the petition is bound to fail on that ground.
This being the position, the other two points raised by Mr. Pathak do not require consideration at all.
As the petitioners have no fundamental right under article 19 (1) (g) of the Constitution, the question whether the Government could establish a monopoly without any legislation under article 19(6) of the Constitution is altogether immaterial.
Again a mere chance or prospect of having particular customers cannot be said to be a right to property or to any interest in an undertaking within the meaning of article 31(2) of the Constitution and no question of payment of compensation can arise because the petitioners have been deprived of the same.
The result is that the petition is dismissed with costs.
PETITIONS NOS.
71 TO 77 AND 85 OF 1955.
MUKHERJEA C. J.
These 8 petitions under article 32 of the Constitution raise identically the same points for consideration as are involved in Petition No. 652 of 1954 just disposed of.
The petitioners in these cases also purport to be printers, publishers and sellers of text books for various classes in the schools of Punjab and they complain of infraction of their fundamental rights under article 19 (1) (g) of the Constitution by reason of the various notifications issued by the State of Punjab in pursuance of their policy 243 of nationalisation of text books.
The learned counsel appearing in these cases have adopted in their entirety the arguments that have been advanced by Mr. Pathak in Petition No. 652 of 1954 and no fresh or additional argument has been put forward by any one of them.
This being the position the decision in Petition No. 652 of 1954 will govern these petitions also and they will stand dismissed but we would make no order as to costs.
| For a long period of time prior to 1950 the text books for recognised schools in the State of Punjab were prepared by private publishers with their own money and under their own arrangements and they were submitted for the approval of the Government.
The Government approved some books on each subject as alternative text books, leaving it to the discretion of the Head Masters of different schools to select any alternative book on each subject.
In May 1950 books on certain subjects (like agriculture, history, social studies, etc.) were prepared and published by the Government themselves without inviting offers from private publishers.
With respect to other subjects, offers were invited from "publishers and authors".
The alternative method was given up and only one text book on ,each subject was selected.
The Government charged as royalty 5% on the sale price of all the approved text books.
In 1952 a notification was issued by the Government which omitted the word "Publishers" altogether and invited only "authors and others" to submit books for approval by the Government.
The "authors and others" whose books were approved, had to enter into an agreement in the form prescribed by the Government the principal term of the agreement was that the copyright in these books would vest absolutely in Government and the authors and others" would get a royalty of 5% on the sale price of the text books.
It was contended that the publishing, printing and selling of text books was thus taken by the Government exclusively into its own hands and the private publishers were altogether ousted from the business.
The petitioners, who purport to carry on the business of preparing, printing, publishing and selling text books for recognised schools in the Punjab, pro29 226 ferred the present petition under article 32 of the Constitution praying for writs of mandamus directing the Punjab Government to withdraw the notifications of 1950 and 1952 on the ground that they contravened the fundamental rights of the petitioners guaranteed under the Constitution.
Held that the action of the Government, whether it was good or bad, does not amount to an infraction of the fundamental right guaranteed by article 19(1)(g) of the Constitution.
In the present case no fundamental rights of the petitioners were violated by the notifications and the acts of the executive Government of the Punjab done by them in furtherance of their policy of nationalisation of the text books for the school students.
A more chance or prospect of having particular customers cannot be said to be a right to property or to any interest or undertaking within the meaning of article 31(2) of the Constitution and no question of payment of compensation can arise because the petitioners have been deprived of the same.
Articles 73 and 162 of the Constitution do not contain any definition as to what the executive function is and what activities would legitimately come within its scope.
They are concerned primarily with the distribution of executive power between the Union on the one hand and the component States on the other.
They do not mean that it is only when Parliament or the State Legislature has legislated on certain items appertaining to their respective lists that the Union executive or the State executive, as the case may be,can proceed to function in respect of them.
On the other hand, the language of article 162 Clearly indicates that the powers of the State executive do extend to matters upon which the State Legislature is competent to legislate and are not confined to matters over which legislation has been passed already.
The same principle underlies article 73 of the Constitution.
The Commonwealth and the Central Wool Committee vs The Colonial Combing, Spinning and Weaving Co. Ltd. (31 C.L.R. 421), Attorney General for Victoria vs The Commonwealth, ; and Motilal 1.
The Government of the State of Uttar Pradesh (A.I.R. 1951 Allahabad 257), referred to.
|
ivil Appeals Nos. 132, 133 and 137 of 1955 and Petition No. 567 of 1954.
Appeals under Article 132(1) of the Constitution of India from the Judgment and Order dated the 18th October 1954 of the Nagpur High Court in Misc.
Peti 486 tions Nos. 265, 348 and 275 of 1953 respectively and Petition under Article 32 of the Constitution for the enforcement of fundamental rights.
M. C. Setalvad, Attorney General of India R. M. Hajarnavis and G. C. Mathur, with him) for the appellant in C.A. No. 132 of 1955.
N. C. Chatterji, (R. M. Hajarnavis and G. C. Mathur, with him) for Intervener No. 1 in C. A. No. 132 of 1955.
R. M. Hajarnavis and G. C. Mathur, for Intervener No. 2 in C. A. No. 132 of 1955.
R. M. Hajarnavis and G. C. Mathur, for the appellant in C. A. No. 133 of 1955.
R. M. Hajarnavis and G. C. Mathur, for the appellant in C.A. No. 137 of 1955.
M. Adhikari, Deputy Advocate General of Madhya Pradesh and I. N. Shroff, for respondents in allappeals.
M. C. Setalvad, Attorney General of India and C. K. Daphtary, Solicitor General of India (A. P. Sen, J. B. Dadachanji and Rajinder Narain, with them) for the petitioner in Petition No. 567 of 1954.
T. L. Shevde, Advocate General of Madhya Pradesh (M. Adhikari, Deputy Advocate General of Madhya Pradesh and I. N. Shroff, with him) for respondents.
J. B. Dadachanji, R. M. Hajarnavis and Rajinder Narain, for the Intervener. 1955.
September 20.
The judgment.
of section R. Das,.
Acting Chief Justice, Bhagwati, Jafer Imam and Chandrasekhara Aiyar JJ. was delivered by Bhagwati J. Jagannadhadas J. delivered a separate judgment.
Civil Appeals Nos. 132, 133 and 137 of 1955 BHAGWATI J.
These 3 appeals with certificate under article 132(1) of the Constitution involve the interpretation of the proviso to article 286(2) and raise a common question as to whether that proviso also saves 487 the transactions of sale or purchase covered by the Explanation to article 286(1) (a) from the ban imposed therein.
The Appellants in Civil Appeal No. 132 of 1955 are Messrs Ramnarain Sons Ltd., a firm registered as a As. "dealer" under the Central Provinces and Berar Sales Tax Act, 1947, and carrying on business at Amravati and at other places in Madhya Pradesh.
After the Cotton Control Order, 1949, came into force on the 12th September, 1949, the Appellants entered into agreements with several mills situated outside Madhya Pradesh by which they undertook to purchase kapas in the various markets in Madhya Pradesh as their agents on their account and on their behalf The kapas after purchase was to be ginned and pressed into bales and sent to the mills.
All the expenses involved in the process were to be borne by the mills which were also to be credited with the sale proceeds of the cotton seeds and the Appellants were only entitled to commission on a percentage basis.
The Ap pellants worked as such agents for the period 1st October, 1949 to 30th September, 1950.
By his order dated the 30th June, 1953 the Assistant Commissioner of Sales Tax, Amravati, Respondent No. 1, included the transactions valued at Rs. 72,86,454 5 10 with the said mills in the Appellants ' turnover and ordered the Appellants to pay Rs. 1,13,850 13 6 as sales tax on the said transactions.
The Appellants filed an appeal to the Commissioner of Sales Tax, Madhya Pradesh, Respondent No. 2, on the 30th July, 1953.
The appeal was, however, entertained by the Deputy Commissioner of Sales Tax, Madhya Pradesh, Respondent No. 3, who ordered the Appellants to pay Rs. 25,000/ by the 31st August., 1953.
The Appellants thereupon filed a petition under Article 226, being Misc. Petition No. 265 of 1953, in the High Court of Judicature at Nagpur, asking inter alia for the quashing of the order of 30th June, 1953, passed by Respondent No. I and for consequential reliefs.
The Respondents filed a return denying the contentions of the Appellants and praying for the dismissal of the petition with costs.
62 488 The Appellants in Civil Appeal No. 133 of 1955 are the Eastern Cotton Company, a firm registered as a "dealer" under the Central Provinces and Berar Sales Tax Act, 1947, and carrying on business at Amravati and at other places in Madhya Pradesh.
They also, during the period 1st October, 1949 to 30th September, 1950, worked as agents of certain mills situated outside Madhya Pradesh, procured kapas for them in Madhya Pradesh and sent it to the mills for consumption outside the State.
By his order dated the 9th September, 1953, the Respondent No.
I included the transactions valued at Rs. 33,47,405 5 6 with the said mills in the Appellants ' turn over and ordered the Appellants to pay Rs. 52,303 4 0 as tax on the said transactions.
These Appellants also filed a petition under article 226, being Misc.
Petition No. 348 of 1953, in the High Court of Judicature at Nagpur for quashing the order dated the 9th September, 1953, passed by Respondent No. 1 and for con sequential reliefs.
The Respondents filed a return denying their contentions.
The Appellants in Civil Appeal No. 137 of 1955 are the firm, Ramdas Khimji Brothers, Bombay, registered as a "dealer" under the Central Provinces and Berar Sales Tax Act., 1947 and carrying on business as cotton dealers in Madhya Pradesh.
During the period 1st October, 1950 to 30th September, 1951, the Appellants sold cotton worth Rs. 6,01,949 1 9 to various persons outside Madhya Pradesh.
The cotton was delivered to the buyers for consumption outside Madhya Pradesh as a direct result of such sales.
By his order dated the 29th December, 1952, the Sales Tax Officer, Amravati, in the assessment of the Appellants for the same period, included the said transactions in the Appellants ' turn over and assessed sales tax thereon.
The Appellants filed an appeal to Respondent No. I but the same was dismissed by an order dated the 10th July, 1953.
The Appellants filed on 22nd August, 1953, a revision before the Commissioner of Sales Tax, Madhya Pradesh.
The Appellants also filed a petition under Article 226, being Misc.Petition No. 274 of 1953, in the High Court of Judicature at 489 Nagpur, asking for a writ of certiorari quashing the order of Respondent No. I passed by him in Sales Tax Appeal No. 13 A dated the 10th July, 1953, and for consequential reliefs.
The Respondents filed a return denying the contentions of the Appellants and A asking that the petition be dismissed with costs.
These petitions came up for hearing and final disposal before the High Court of Judicature at Nagpur along with Misc.Petitions No. 288 of 1953 and No. 132 of 1954.
A considered judgment was delivered in Miscellaneous Petition No. 132 of 1954 and the reasoning contained therein governed the decision in the connected Petitions Nos. 265, 274 and 348 of 1953.
The High Court held that the Explanation II to section 2(g) of the Central Provinces and Berar Sales Tax Act, 1947, as amended by the Central Provinces and Berar Act XVI of 1949 having been declared invalid from its inception by the High Court in Messrs Shriram Gulabdas vs Board of Revenue (I.L.R. 1953 Nagpur 332) and by this Court in ; , the original Explanation remained in force until the 1st April, 1951, when it was amended by the Madhya Pradesh Act IV of 1951.
Explanation II originally enacted was in the terms following: "Notwithstanding anything to the contrary in the Indian , the sale of any goods which are actually in the Central Provinces and Berar at the time when the contract of sale as defined in that Act in respect thereof is made, shall wherever the said contract of sale is made, be deemed for the purpose of this Act to have taken place in the Central Provinces and Berar".
The Appellants contended that this Explanation offended article 286(1) (a) read with the Explanation to the same and the State of Madhya Pradesh was, therefore, not entitled to tax the transactions of sale in which goods had actually been delivered as a direct result of such sale for the purpose of consumption outside Madhya Pradesh.
The Respondents, on the other hand, contended that the said Explanation was protected until the 31st March, 1951, by the Sales Tax Continuation Order No. 7 of 1950 issued by the 490 President on ' the 26th January, 1950, under the proviso to article 286(2).
The High Court was of the opinion that the original Explanation was validly enacted as the assent of the Governor General to the enactment was given on the 23rd May, 1,947, and that under that Explanation the tax prior to the commencement of the Constitution was lawfully levied on the sales of goods wherever the contracts of sale took place if the goods were actually in the State at the time the contracts of sale were made.
This power could be exercised by the State even if the sales took place during the course of inter State trade or commerce and the goods were delivered as a direct result of the sales for the purpose of consumption outside the State.
This was because the situs of the goods constituted a sufficient nexus between the transactions and the taxing State which was the foundation for taxation prior to the commencement of the Constitution.
This position continued until the com mencement of the Constitution and on the 26th January, 1950, the President issued the Sales Tax Continuation Order No. 7 of 1950 in exercise of the powers conferred by the proviso to article 286(2).
The sales in question had taken place in the course of inter State trade or commerce and accordingly they were covered by article 286(2) and would, therefore, be liable to tax even after the commencement of the Constitution by virtue of the President 's order.
Reliance was further placed on the majority judgment of this Court in The State of Bombay vs The United Motors (India) Ltd. ; where it was held that the transaction vis a vis the delivery State lost its inter State character if it fell within the Explanation to article 286(1) (a) and was accordingly made liable to taxation by the delivery State.
So far, however, as the exporting State was concerned, it retained its character of an inter State transaction and would not, therefore, be liable to taxation by that State, vide article 286(2).
The President 's order, however, removed this ban and.
the exporting State was entitled to tax the transaction by virtue of the power derived by it from the same.
On a construction of 491 the relevant provisions of article 286(1) and article 286(2) the High Court was of the opinion that it would be making the proviso to article 286(2) nugatory if it was held that article 286(1) overrides it and takes away the taxing power of all States in inter State trade or commerce except the delivery State.
The High Court accordingly dismissed the petitions with costs.
The learned Attorney General appearing for the Appellants before us contended that so far as the post Constitution period is concerned, the position is governed by our judgment in The Bengal Immunity Co. Ltd. vs The State of Bihar delivered on the 6th September, 1955.
He urged that the bans imposed on the powers of the State Legislatures to levy taxes on the sale or purchase of goods in the several clauses of article 286 are independent and separate and that the transactions of sale or purchase referred to in the various clauses must be looked at from different viewpoints.
Even if a transaction might fall within the category of inter State sale or purchase and the President 's order under the proviso to article 286(2) might enable the State to levy any tax on such sale or purchase which was being lawfully levied by the State immediately before the commencement of the Constitution, such transaction had also to surmount the ban imposed under article 286(1) (a) and the Explanation thereto so that, if, as a direct result of such sale, the goods were actually delivered for the purpose of consumption in another State, the exporting State ,(to use the phraseology of the Nagpur High Court) or the title State (to use the phraseology adopted in some of the judgments in The Bengal Immunity Co. 's Appeal) would not be entitled to levy a tax on such sale the transaction being fictionally outside the State by reason of the Explanation and therefore coming within the ban of article 286(1)(a).
It was, however, urged on behalf of the State of Madhya Pradesh that the President 's order not only saved the transactions from the ban of article 286(2) but also from the ban of article 286 (1) (a), because the transactions covered by the Explanation to article 492 286(1)(a) were of the same category as transactions covered by article 286(2) and were all in the course of inter State trade or commerce.
It was further urged that if the transactions covered by the Expla nation to article 286 (1) (a) were not saved from the ban by the President 's order, the whole intention of the Constitution makers in maintaining the status quo qua the taxes on sales or purchases of goods which were being lawfully levied by the State immediately before the commencement of the Constitu tion would be frustrated, because the transactions covered by the Explanation to article 286(1) (a) being necessarily in the course of inter State trade or commerce the President 's order would be rendered nugatory and the exporting State or the title State would ' be restrained from levying tax on such transactions in spite of the ban having been lifted by the President 's order.
We are unable to accept this contention.
As held by the majority Judges in The Bengal Immunity Co. 's Appeal, the bans imposed by article 286 on the taxing powers of the States are independent and separate and each one of them has to be got over before a State Legislature can impose tax on transactions of sale or purchase of goods.
These bans have been imposed from different view points, and, even though the transactions of sale or purchase may in conceivable cases overlap so far as these different viewpoints are concerned, each of those bans is operative and has to be enforced.
So far as article 286(1) (a) is concerned, the Explanation determines by the legal fiction created therein the situs of the sale in the case of transactions coming within that category and when a transaction is thus determined to be inside a particular State it necessarily becomes a transaction outside all other States.
The only relevant enquiry for the purposes of article 286(1) (a), therefore, is whether a transaction is outside the State and once it is determined by the application of the Explanation that it is outside the State it follows as a matter of course that the State with reference to which the transac tion can thus be predicated to be outside it can never 493 tax the transaction.
This ban is effective independently of the fact that the, transaction may also have taken place in the course of inter State trade or commerce or with reference to goods as have been declared by Parliament by law to be essential for the life of the community.
The ban imposed under article 286(2) is an independent and separate one and looks at the transactions entirely from the point of view of their having taken place in the course of inter State trade or commerce.
Even if such transactions may also fall within the category of transactions covered by article 286 (1)(a) and the Explanation thereto or article 286(3), the moment article 286(2) is attracted by reason of the transactions being in the course of interState trade or commerce, the ban under article 286 (2) operates and such transactions can never be subjected to tax at the instance of a State Legislature except in so far as Parliament by law may otherwise provide or such power of taxation is saved by the President 's order contemplated in the proviso.
The ban under article 286(2) may be saved by the President 's order but that does not affect or lift the ban under article 286 (1 (a) read with the Explanation.
Apart from the construction thus, put upon the several clauses of article 286 by the majority of the Judges in The Bengal Immunity Co. 's Appeal as above, the terms of the proviso itself make it abundantly clear that the proviso is meant only to lift the ban under article 286 (2) and no other.
It is a cardinal rule of interpretation that a proviso to a particular provision of a statute only embraces the field which is covered by the main provision.
It carves out an exception to the main provision to which it has been enacted as ' a proviso and to no other.
Even if the non ' obstante clause: "Notwithstanding that the imposition of such tax is contrary to the provisions of this clause": had not been enacted in the proviso, the proviso could only have been construed as operating upon the field enacted in article 286(2) and could not be extended to any of the other provisions of article 286.
The non obstante clause, however, makes it abundantly and further clear and states in 494 explicit terms that it is enacted only with reference to "this clause", i.e., article 286(2).
The President 's order may direct that any tax on the sale or purchase of goods which was being lawfully levied by the Government of any State immediately before the commencement of the Constitution was to continue to be levied until 31st March, 1951, but the effect of that order was to raise the ban in so far as it was imposed by the provisions of "this clause".
The President 's order therefore, only lifted the ban in so far as the transactions took place in the course of inter State trade or commerce and could not be projected into the sphere of any other clause of article 286.
It bad, therefore ' not the effect of lifting the ban which was imposed by article 286(1)(a) and the Explanation thereto, even though the transactions covered by the Explanation to article 286(1) (a) by and large fell within the category of transactions which took place in the course of inter State trade or commerce.
The ban imposed by article 286(1) (a) was independent and separate and could not be lifted by the President 's order which had operation only in regard to the interState character of the transactions.
The moment it was determined that the transactions were outside the State by virtue of the Explanation to article 286(1)(a) the ban imposed by article 286(1)(a) attached to the same and could not be lifted by the President 's order which operated only on the interState character of the transactions and saved only those inter State transactions which did not come within the Explanation.
If the contention urged on behalf of the State of Madhya Pradesh is accepted it would mean that we should re write, or amend the proviso to article 286(2) in, order to effectuate the supposed intention of the Constitution makers.
The supposed intention of the Constitution makers was alleged to be to preserve to the States all the taxes on sale or purchase of goods which were being lawfully levied by them immediately before the commencement of the Constitution by having resort to the territorial connection or nexus theory.
We have no evidence before us of this 495 supposed intention of the Constitution makers, Whatever their intention was can only be gathered from the language which they have used and where the language is plain there is no scope whatever for speculation in that behalf When the Constitution , makers themselves used the words "Notwithstanding that the imposition of such a tax is contrary to the provisions Of this clause" it would not be legitimate for us to go behind the plain words and try to read into the proviso something which would involve either a deletion of the non obstante clause 'or a re writing thereof as suggested.
Whatever be the effect of our judgment on the treasuries of the exporting or title States we cannot assist them by reading something into the proviso which is not warranted by any canon of construction.
The proviso has reference only to article 286(2) and cannot be projected into any other clause of article 286.
The untenability of the contentions of the Respondents will be clear from the following illustration:Suppose the goods are in the State of Madhya Pradesh at the time the contracts of sale of those goods are made in, say, the State of Bombay.
Suppose further that the property in the goods has by reason of such sales passed in the State of Bombay but the goods as a direct result of such sales have been delivered for consumption in the State of Madras.
According to the Respondents, the President 's order made under the proviso to article 286(2) saves the transactions from the ban of article 286 (1) (a) read with the Explanation.
Then the State of Madras will be able to tax by virtue of article 286(1) (a) read with the Explanation or on the nexus theory by reason of the goods being delivered there for consumption; the State of Bombay will be able to tax because the title to the goods passed there; and the State of Madhya Pradesh will also be able to tax under the Explanation 11 to section 2(g) of the Act because the goods were in the State of Madhya Pradesh at the time when the contracts of sale were made in the State of Bombay.
Nobody will say that the Constitution makers intended to perpetuate multiple taxation of 63 496 this kind and yet that will be the result if we were to accede to the arguments advanced by the Respondents.
The result, therefore, is that so far as the post Con stitution period is concerned the ban which is imposed by article 286 (1) (a) and the Explanation thereto cannot be removed by the President 's order which was issued under the proviso to article 286(2) and the High Court was in error when it construed the proviso to article 286(2) as projecting into the field of article 286 (1) (a) and lifting the ban imposed therein.
On the above reasoning, Civil Appeal No. 137 of 1955 filed by the firm of Ramdas Khimji Brothers, Bombay, which relates only to the post Constitution period will be allowed and the order of assessment dated the 29th December, 1952, will be, set aside.
The Respondents will pay the costs of the Appellants here as well as in the Court below.
As regards Civil Appeals Nos. 132 of 1955,and 133 of 1955, however, the assessments therein relate not only to the post Constitution period but also the preConstitution period to which different considerations would apply.
The validity of the assessment in regard to the same would have to be canvassed having regard to the various contentions of law and fact which could be urged against the same by the Appel lants.
There are two outstanding questions which have been mooted before us by the learned AttorneyGeneral in regard to this period, viz., (1) a question of fact, as to whether the Appellants were agents of the various mills in regard to the transactions which were the subject matter of the assessment, and (2) a question of law, whether the law under which the tax was levied, viz., Explanation II to section 2(g) of the Act was validly,, enacted.
Both these contentions, though they are also relevant to the post Constitution period were not specifically pressed before us because the argument based on the proviso to article 286 (2) was considered sufficient to set aside the assessment for that period.
They would, however, appropriately arise and be urged by the appellants when the liability to assessment for the pre Constitution 497 period is to be determined and if we were to determine that liability we would have to deal with the same.
The necessity for doing so is, however, obviated by reason of the fact that the assessment is one composite whole relating to the pre Constitution as well as the post Constitution periods and is invalid in toto.
There is authority for the proposition that when an assessment consists of a single undivided sum in respect of the totality of the property treated as assessable, the wrongful inclusion in it of certain items of property which by virtue of a provision of law were expressly exempted from taxation renders the assessment.
invalid in toto. '.The
Privy Council have observed in Bennett & White (Calgary) Ld.
And Municipal District of Sugar City No. 5 (1951 Appeal Cases, 786 at page 816): "When an assessment is not for an entire sum, but for separate sums, dissected and earmarked each of them 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 (,he assessment is bad wholly.
That matter is covered by authority.
in Montreal Light, Heat & Power Consolidated V. City of Westmount ( 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".
It was, therefore, urged that on the facts of this case the assessment was invalid in toto and that it should be set aside.
The learned Deputy Advocate General of Madhya Pradesh did not seriously contest this position and the result, therefore, is that the order of assessment dated the 30th June, 1953, in Civil Appeal No. 132 of 1955 and the order of assessment dated the 498 9th September, 1953, in Civil Appeal No. 133 of 1955 are liable to be set aside.
The appeals will therefore be allowed, the orders of assessment will be set aside and the matters will go back to the Assessment Officer for re assessment of the Appellants in accordance with law.
The Appellants will be at liberty to urge before the Assessment Officer the contentions of law and fact available to them in the fresh assessment proceedings including those adverted to above.
The Respondents will pay the costs of these Appellants here as well as in the Court below.
Petition No. 567 of 1954.
BHAGWATI J.
This petition under article 32 of the Constitution also involves the interpretation of the proviso to article 286(2) and raises the same question as to the meaning, scope and operation of the proviso as was raised in the Civil Appeals Nos. 132, 133 and 137 of 1955 just disposed of The facts giving rise to this Petition may be shortly stated.
The petitioners are a partnership firm carrying on business of manufacturing bidis at Jabalpur and registered as a "dealer" under the Central Provinces and Berar Sales Tax Act, 1947.
The petitioners had their branches at Lucknow, Kanpur, Faizabad, Agra, Bombay and Bhopal.
They had also their selling agents at various places in Uttar Pradesh and elsewhere outside the Stae of Madhya Pradesh.
They also entered into transactions direct with merchants in Uttar Pradesh.
The transactions in.
question which were the subject matter of assessment at the instance of the Sales Tax authorities were for the period of assessment 21st October, 1949 to 9th November, 1950., and spread over two periods, viz., (1) the period between 21st October, 1949 to 25th January, 1950, which may be called the pre Constitution period, and (2) the period subsequent to the inauguration of the Constitution on the 26th January, 1950, up to the 9th November., 1950, which may be called the postConstitution period.
The petitioners ' gross turn over was determined to be Rs. 49,40,140 6 9 and the 499 amount of Sales Tax assessed on the transactions was Rs. 1,51,291 13 0 as per the order of the Deputy Commissioner, Sales Tax, Madhya Pradesh, Respondent No. 3, dated the 14th July, 1954, in Sales Tax Appeal No. 6/A 1.6.54.
The petitioners preferred_a second appeal to the Respondent No. 2 against the said order.
The Respondent No. 2, however, refused to admit or register the appeal unless the amount of tax assessed was paid up.
The petitioners paid about Rs. 91,000/ towards the amount of tax assessed but finding it difficult to pay the balance filed this Petition against the State of Madhya Pradesh, Respondent No, 1, the Commissioner of Sales Tax, Madhya Pradesh, Respondent No. 2, and the Deputy Commissioner of Sales Tax, Madhya Pradesh, Respondent No. 3, for a writ of certiorari quashing the said order dated the 14th July, 1954, made by Respondent No. 3 and for consequential reliefs.
The Respondents filed a return denying the contentions of the petitioners and maintaining that the Sales Tax was lawfully assessed by them against the petitioners.
The position as regards the petitioners ' turn over for the period of assessment was as stated below: Nature of the Parties.
Sales Prices of goods.
(a) Direct to selling agents on orders. . . . 6,15,236 3 0 (b) Direct to merchants on orders.
3,99,450 2 0 (c) Direct to destinations other than branches or depots but accounted for against branchesand depots.
6,20,996 14 0 (d) Direct to Stations or destinations having branches or depots owned by the proprietors of this registered firm Kanpur, Bombay, Lucknow and Faizabad. . . 31,06,739 13 0 500 The Sales Tax authorities treated all these transactions as transactions of sale coming within the definition contained in Explanation II to section 2(g) of the Act and assessed the petitioners to sales tax in respect of the same, negativing the contentions of the petitioners that they were in any event sales effected by them outside the State of Madhya Pradesh and that the State of Madhya Pradesh was, therefore, not entitled to impose a tax on those tran sactions by virtue of the provisions of article 286(1) (a) and the Explanation thereto.
The learned Attorney General who appeared for the petitioners contended that the bidis manufactured by the petitioners were all actually delivered as a direct result of the transactions of sale for the purpose of consumption in the State of Uttar Pradesh and that after the inauguration of the Constitution on the 26th January, 1950, it was only the State of Uttar Pradesh which was the delivery State that alone had the right to impose the tax on these transactions notwithstanding the fact that under the general law relating to the sale of goods the property in the goods might have passed in the State of Madhya Pradesh.
He, therefore, urged that these transactions were sales outside the State of Madhya Pradesh and that the State of Madhya Pradesh was not entitled to impose a tax on such sales.
The learned Advocate General of Madhya Pradesh on the other hand contended that these were purely intra state transactions entered into by the petitioners within the State of Madhya Pradesh and that the Explanation to article 286(1)(a) did not come into play at all because the goods were not actually delivered as a direct result of such sales for the purpose of consumption in the State of Uttar Pradesh.
He, therefore, maintained that even for the post Constitution period there was no ban on the State of Madhya Pradesh imposing the sales tax on what were purely "inside sales".
It is necessary in view of these rival contentions to ascertain the true nature of the transactions in question.
In paragraph 15 of the Petition,, the petitioners 501 had averred that the bidis manufactured by the firm were all delivered in the State of Uttar Pradesh for consumption in that State and that after the 26th January, 1950, the delivery State, viz., the State of Uttar Pradesh, had alone the right to impose tax on the sales of the commodity.
They had further submitted that the State of Madhya Pradesh where the bidis were manufactured and from where they were sent could not any more exercise its right to levy a tax on such transactions of sale taking place elsewhere by reason of the inhibition contained in article 286.
In the return filed by the Respondents, they did not deny the allegation made by the petitioners in their Petition that the bidis manufactured by the firm were all delivered, in the State of 'Uttar Pradesh for consumption in that State.
In substance, they contended that in spite of the State of Uttar Pradesh being the delivery State within the meaning of the Explanation to article 286 (1) (a), the liability of these transactions to sales tax at the instance of the State of Madhya Pradesh was saved by the President 's order made under the proviso to article 286(2) and that the imposition of such tax at the instance of the State of Madhya Pradesh was lawful and did not contravene the provisions of article 286(1)(a) read with the Explanation thereto.
Both the order which was made by the Assistant Commissioner of Sales Tax, Jabalpur, in the original assessment case No. 16 of 1950 51, dated the 7th August, 1953, and the order which was made in Sales Tax Appeal No. 6/A 1.6.54 by the Deputy Commissioner of Sales Tax, Madhya Pradesh, Respondent No. 3, dated the 14th July, 1954, proceeded on the basis that even though the transactions in question were transactions of sale where the goods had actually been delivered as a direct result of such sales for the purpose of consumption in the State of Uttar Pradesh, the President 's order made under the proviso to article 286 (2) saved the transactions also from the ban of article 286(1) (a) and the Explanation thereto and that the State of Madhya Pradesh was, therefore, entitled to impose a tax on the same.
It was never.
502 contended before either of them that the sales were purely "inside sales" and that the Explanation to article 286(1)(a) did not come into play at all under the circumstances of the case.
The facts as found by the Sales Tax authorities also emphasized that these transactions fell within the definition of sale contained in the Explanation 11 to section 2(g) of the Act and that so far as the post Constitution period was concerned they were saved from the ban of article 286 (1) (a) and the Explanation thereto by the President 's order made under the proviso to article 286(2).
It was, however, urged by the learned Advocate General of Madhya Pradesh that the transactions were pure "inside sales" entered into by the petitioners in Madhya Pradesh on orders received by them from outside the State.
These orders were accepted by the petitioners in the State of Madhya Pradesh and goods were appropriated to the contracts and the property in the goods passed within the State of Madhya Pradesh and that, therefore, they were pure intraState sales or "inside sales" which it was within the competence of the State of Madhya Pradesh to tax.
This contention of the learned Advocate General of Madhya Pradesh is untenable.
So far as direct supplies to selling agents on orders and direct supplies to merchants on orders covered by items (a) and (b) above are concerned, it was found that these supplies were made to the merchants buying the goods on commission basis or profit on their previous orders, instructions or indents which were either in printed forms or in ordinary letters and the sale prices were realised by sending bills and railway receipts through some scheduled banks.
The very fact that the bills and the railway receipts were sent through the scheduled banks went to show that the petitioners reserved the right of disposal of goods covered by those railway receipts and the property in the goods passed in the State of Uttar Pradesh only after the relative bills were either accepted or honoured by the purchasers and the railway receipts delivered by the scheduled banks to them.
It is clear, therefore, that 503 in those cases the sales were completed in the State of Uttar Pradesh and were not intra State sales or "inside sales" qua the State of Madhya Pradesh.
As regards the direct supplies to destinations other than branches or depots but accounted for against the branches or depots being item (c) above, it was found that the petitioners despatched the goods and billed them to depot managers who were responsible for the collection of the orders and then the railway receipts and bills were sent there.
The managers prepared other bills adding incidental or other charges and delivered the railway receipts to the customers to whom the goods were sent from the State of Madhya Pradesh.
Here also the despatches of the goods were made from the State of Madhya Pradesh by the petitioners to their depot managers and it was the depot managers who in their turn prepared and submitted their own bills and handed over the railway receipts to the respective customers appropriating the goods themselves to the contracts of sale which had been entered into by them with the latter and completing the sales in the State of Uttar Pradesh.
These transactions also were, therefore, sales effected in the State of Uttar Pradesh and did not fall within the category of intra state sales or "inside sales" qua the State of Madhya Pradesh.
The direct supplies to Stations or destinations having branches or depots owned by the proprietors of the firm, Kanpur, Bombay, Lucknow and Faizabad being item (d) above, also were outside sales qua the State of Madhya Pradesh inasmuch as the branch managers asked the petitioners to send stocks of goods to execute the orders which they had obtained from the customers to make their own supplies to them.
As a matter of fact it was found that several consolidated indents were placed by the depot managers with the petitioners in respect of the previous orders which had been collected by them and the petitioners supplied the goods to the depots or branches in pursuance of such indents.
If this was the true position qua these supplies, these sales also were completed in 64 504 the State of Uttar Pradesh by the depots or branches supplying the goods in their turn to several customers.
There could be no sales as such between the petitioners on the one hand and their depots or branches on the other hand and the State of Madhya Pradesh could certainly not be at all in a position to tax the same.
The whole theory, therefore, of "inside sales" falls to the ground and the only thing which we are left with is that these transactions were inter State transactions in which as a direct result of such sales the goods were actually delivered for the purpose of consumption in the State of Uttar Pradesh.
The Explanation to article 286(1)(a) determined the State of Uttar Pradesh to be the State in which the sales took place and which alone was entitled to tax these transactions, the State of Madhya Pradesh becoming an "outside" State for the purpose.
Apart from the ban imposed on the State of Madhya Pradesh under article 286(1) (a) and the Explanation thereto, these transactions were also in the course of inter State trade or commerce and were hit by the ban of article 286(2).
The President 's order no doubt lifted that ban but was not competent to lift the ban under article 286 (1) (a) and the Explanation thereto with the result that in spite of that order the State of Madhya Pradesh was not in a position to impose a tax on these transactions during the post Constitu tion period.
The assessment of these transactions to tax for the post Constitution period, therefore, is invalid and cannot be sustained.
The assessment, moreover, is a composite one covering the pre Constitution period as well.
The case, therefore, falls within our judgment in Civil Appeals Nos. 132, 133 and 137 of 1955 just delivered, and following the reasoning contained therein, we are of the opinion that the order dated the 14th July, 1954, made by the Deputy Commissioner, Sales Tax, Madhya Pradesh, Respondent No. 3, in Sales Tax Appeal No. 6/A 1.6.54 should be set aside.
We accordingly allow the Petition, set aside the 505 said order dated the 14th July, 1954, and the matter will go back to the Assessment Officer for re assessment of the petitioners in accordance with law.
The petitioners will be at liberty to urge before the Assessment Officer the contentions of law and fact available to them in the fresh assessment proceedings.
The Respondents will pay the costs of the petition.
JAGANNADHADAS J. I regret I feel constrained to differ from the view taken by my learned brothers as regards the construction of proviso to article 286(2) and the effect of the Presidential order issued there, under.
There is no dispute that the proviso has to be construed as part of article 286(2).
It is meant to empower the President to keep the ban arising thereunder in temporary abeyance so that the States may continue to levy taxes on sales by virtue of their preConstitution sales tax laws (if then lawful) for a limited period.
It is urged, however, that the proviso (meaning thereby also the Presidential order thereunder) is effective to lift only the ban under article 286(2) and that the ban under article 286(1)(a) is operative nonetheless.
Now, it may be correct to say that these two bans are imposed from different angles and are in that sense independent.
But there can be no doubt that they are substantially overlapping in operation.
A transaction which brings about an outside sale is also an inter State transaction (barring, if at all, a few ingeniously conceived and illustrated cases).
The effect of each of the bans under article 286 is to demarcate the fields within which the taxing power of the States on sales cannot operate.
If, as I conceive, the two bans under articles 286(1) (a) and 286(2), are overlapping, the fact that they are imposed from different angles cannot obscure the result, viz., that they bring about the demarcation of the same or substantially the same field of no taxation.
It appears to me that it is in this light that the proviso and the Presidential order issued thereunder have to be construed.
Now, the proviso (with the Presidential order) declares the field covered by sales in the course 506 of inter State trade and commerce as taxable for a limited period by stating positively and emphatically that "any tax on the sale or purchase of goods which was being lawfully levied by the Government of any State, immediately before the commencement of the Constitution.
shall continue to be levied until the 31st day of March, 1951".
There is no doubt the non obstante clause which will be dealt with presently, and which only emphasises the fact that this is a proviso to article 286(2).
But there is no mistaking the positive and mandatory terms of the proviso.
The effect of this is clearly and unequivocally to make the whole field of inter State trade and commerce temporarily taxable in respect of the sales which take place in the course thereof.
If this be so, it appears to me to be implicit therein that no other ban on such taxation can operate, for the time being, within that very field.
To construe the two bans as independently and cumulatively operative is to impute to them some kind of Picturesque potency and is to miss the reality, viz., that all the bans under article 286 are meant to serve the same purpose, viz., that of imposing restrictions and thereby demarcating the fields of no taxation.
The bans and the proviso are parts of the same article and have to be harmoniously construed.
The un equivocal and positive language of one part, cannot be taken to have been obliterated by the negative language of the other part so as to rsult in futility.
A similar situation as that contemplated by the proviso would also arise with reference to the saving clause in article 286(2).
If the proviso is to be construed in the way suggested by the learned AttorneyGeneral, it would seem to follow that when and as the Parliament lifts the ban under article 286(2), the lifting of that ban would equally become futile by virtue of article 286(1)(a).
The Parliament has not in terms Veen given the power to lift the latter ban.
This, therefore, will lead to the extraordinary result that though the Constitution has in terms provided that the ban on taxation of sales in the course of inter State trade and commerce can be lifted, by the Parliament generally, and by the President for a 507 limited period, the exercise of both these powers would become ineffective and still born by virtue of article 286(1)(a).
It appears to me unreasonable to impute any such intention as inevitably arising from the language used.
It appears to me, with great respect, that, whether it is by parliamentary legislation or by the Presidential action that the ban on taxing sales in the course of inter State trade and commerce is lifted, the principle of harmonious construction of article 286 taken as an integral whole, requires that the lifting of the ban is to be construed as laying open for taxation the entire field covered by article 286(2) and to carry with it the implication that no other overlapping ban will be operative.
No doubt, it has been suggested that so far as lifting of the ban under article 286(2) by the Parliament is concerned, the same would be at least partly operative by virtue of article 286(1) (a) taken with the Explanation under which the consumption delivery State may well be free to tax.
This was the view expressed by the learned dissenting Judge in the case in The State of Bombay vs The United Motors (India) Ltd.(1).
But the majority in the recent decision in the Bengal Immunity Co. Ltd. vs State of Bihar(2) including the said learned Judge, have left that question open.
It is problematical whether having regard to the inevitable extra territorial operation of the levy of such a tax and the consequent harassment to the business community which looms large, the Explanation will receive that construction again and not receive the strict construction preferred in the dissenting judgment in the case in State of Travancore Cochin vs Shanmugha Vilas Cashew Nut Factory(3).
The result, therefore, of construing the proviso and by parity of reasoning the saving clause, as merely removing the ban of a particular nature leaving another overlapping ban to operate, would be to render both the saving clause in, and the proviso to, article 286(2) virtually nugatory.
(1) ; (2) Supreme Court Judgment in Civil Appeal No. 159 of 1958, (3) ; 508 The argument based on the non obstante clause in the proviso, viz. "Notwithstanding that the imposition of such tax is contrary to the provisions of this clause" remains to be considered.
It is urged that this clause clearly indicates the intention that the operation of the proviso is to be confined to the sole purpose of lifting the ban arising under article 286(2).
With respect, I am unable to agree.
The non obstante clause undoubtedly affirms the fact that the 'proviso is operative in respect of article 286(2).
But it does not purport to limit the effect of the proviso, which a reasonable construction thereof may justify.
A non obstante clause does not normally add to or subtract from the main provision of which it is a part.
It is often enough inserted by way of extra caution.
But it does not have the effect of limiting the operation of the main provision.
(See Aswini Kumar Ghosh vs Arabinda Bose(1) and The Dominion of India vs Shrinbai A. Irani(2)).
The suggestion that the Presidential action lifts the ban only as regards the inter State sales would be to read the phrase "notwithstanding that" as meaning "in so far as".
I can see no warrant for any such reading.
In my view, therefore, the pre Constitution salestax laws, if then lawful, are not hit by article 286(1) (a) at least to the extent that the ban under article 286(1) (a) overlaps with that under article 286(2). 'In this 'view, the orders of assessment in these cases cannot be set aside and the validity of the relevant preConstitution laws will have to be considered and the further facts gone into.
But it is now not necessary to do so in these cases in the view taken by my learned brothers and the order proposed by them will govern these cases.
(1) ; , 21 and 24.
(2) ; , 213.
| Held, per section B. DAs ACTING CHIEF JUSTICE, BHGWATI,JAFER IMAM and CHANDRASEKHARA AIYAR JJ.
(JAGANNADHADAS J. 484 dissenting).
The bans imposed by Article 286 of the Constitution on the taxing powers of the States are independent and separate and each one of them has to be got over before a State Legislature can impose tax on transactions of sale or purchase of goods.
The Explanation to Article 286(1)(a) determines by the legal fiction created therein the situs of the sale in the case of transactions coming within that category and once it is determined by the application of the Explanation that a transaction is outside the State it follows as a matter of course that the State, with reference to which the transaction can thus be predicated to be outside it, can never tax the transaction.
The ban under Article 286(1)(a) read with the Explanation is effective independently of the fact that the transaction may have taken place in the course of inter State trade or commerce or with reference to goods as have been declared by Parliament by law to be essential for the life of the community.
The ban imposed under Article 286(2) is an independent and separate one and looks at the transactions entirely from the point of view of their having taken place in the course of inter State trade or commerce.
, Even if such transactions may also fall within the category of transactions covered by Article 286(1)(a) and the Explanation thereto or Article 286(3) the moment Article 286(2) is attracted by reason of the transactions being in the course of inter State trade or commerce, the ban under Article 286(2) operates and such transactions can never be subjected to tax at the instance of a State Legislature except in so far as Parliament by law may otherwise provide or such power of taxation is saved by the President 's order contemplated in the proviso.
The ban under Article 286(2) may be saved by the President 's order but that does not affect or lift the ban under Article 286(1)(a) read with the Explanation.
Apart from the aforesaid construction put upon the several clauses of Article 286 in The Bengal Immunity Co. case the terms of the proviso to Article 286(2) itself make it abundantly clear that the proviso is meant only to lift the ban under Article 286(2) and no other.
It is a cardinal rule of interpretation that a proviso carves out an exception to the main provision to which it is enacted as a proviso and to no other.
This is made further clear by the nonobstante clause which states in express terms that it is enacted only with reference to "this clause" i.e. Article 286(2).
The proviso cannot be extended to any of the other provisions of Article 286 and it has.
therefore, not the effect of lifting the ban which is imposed by Article 286(1)(a) and the Explanation thereto.
Therefore, so far as the post Constitution period is concerned the ban imposed by Article 286(1)(a) and the Explanation thereto could not be removed by the President 's order which was issued under the proviso to Article 286(2) in the present case.
Explanation 11 to Section 2(g) of the Central Provinces and Berar Sales Tax Act, 1947 offended Article 286(1)(a) road with the 485 Explanation to the same and the State of Madhya Pradesh was therefore, not entitled to tax the transactions of sale in which goods had actually been delivered as a direct result of such sale for purposes of consumption outside Madhya Pradesh and the said Explanation was riot protected by the President 's order issued under the proviso to Article 286(2).
Where an assessment consists of a single undivided sum in respect of the totality of the property treated as assessable, the wrongful inclusion in it of certain items of property which by virtue of a provision of law were expressly exempted from taxation, renders the assessment invalid in toto.
Bennett & White (Calgary) Ltd. and Municipal District of Sugar City No. 5 (1951 Appeal Cases 786 at p. 816), referred to.
JAGANNADHADAS J. (Dissenting) 'The two bans under Articles 286(1)(a) and 286(2) are overlapping and the fact that they are imposed from different angles cannot obscure the result, viz., that the bring about the demareation of the same or substantially the same field of no taxation.
To construe the two bans as independently and cumulatively operative is to impute to them some kind of picturesque potency and is to miss the reality, viz., that all the bans under Article 286 are meant to serve the same purpose, viz., that of imposing restrictions and thereby demarcating the fields of no taxation.
The bans and the proviso are part& of the same Article and have to be harmoniously construed.
The unequivocal and positive language of one part, cannot be taken to have been obliterated by the negative language of ,the other part so as to result in futility.
The result of construing the proviso and by parity of reasoning the saving clause, as merely removing the ban of a particular nature leaving another overlapping ban to operate, would be to reuder both the saving clause in,.
and the proviso to, Article 286(2) virtually nugatory.
A non obstante clause does not normally add to or subtract from the main provision of which it is a part, It is often enough inserted by way of extra caution.
But it does not have the effect of limiting the operation of the main provision, The suggestion that the Presidential action lifts the ban only as regards the inter State sales would be to read the phrase "notwithstanding that" as meaning "in so far".
There is no warrant for any such reading.
|
minal Appeal No. 20 of 1954.
Appeal from the Judgment and Order dated the 26th August, 1953, of the Bombay High Court in Criminal Revision Application No. 51 8 of 1953 arising out of the Judgment and Order dated the 9th December, 1952, of the Court of Presidency Magistrate, Bombay, in Case No. 3442/P of 1952.
section P. Verma, for the appellant.
M. C. Setalvad, Attorney General for India (Porus A. Mehta and P. G. Gokhale, with him), for the respondent.
97 1955.
March 25.
The following Judgments were delivered.
DAS J.
The appellant before us was on the 9th December, 1952 convicted by the Presidency Magistrate, 13th Court, Bombay, of an offence under section 66(b) of the Bombay Prohibition Act (Act XXV of 1949) and sentenced to undergo imprisonment till the rising of the Court and to pay a fine of Rs. 250 or to undergo rigorous imprisonment for one month.
The appellant preferred an appeal to the High Court of Judicature at Bombay but his appeal was summarily dismissed by a Bench of that Court on the 19th January 1953.
After the dismissal of that appeal the State of Bombay made a Criminal Revision application to the High Court for enhancement of the sentence.
Notice having been issued to the appellant under section 439(2) of the Code of Criminal Procedure, learned counsel for the appellant claimed the appellant 's right under section 439(6) to show cause against his conviction.
This the High Court did not permit him to do.
The High Court, however, did not think fit to make any order for enhancement of sentence.
On an application made on behalf of the appellant the High Court of Bombay has given leave to the appellant to appeal to this Court and granted a certificate of fitness under article 134(1) (c) of the Constitution of India.
The question for our consideration in this appeal is whether the summary dismissal of the appeal preferred by the appellant precluded him from taking advantage of the provisions of section 439(6) of the Code of Criminal Procedure when he was subsequently called upon to show cause why the sentence imposed upon him should not be enhanced.
The question depends for its answer upon a true construction of section 439.
That section, so far as it is material for our present purpose, reads as follows: "439.
(1) In the case of any proceeding the record of which has been called for by itself or which has been reported for orders, or which otherwise comes to its knowledge, the High Court may, in its discre 13 98 tion, exercise any of the powers conferred on a Court of Appeal by sections 423, 426) 427 and 428 or on a Court by section 338, and may enhance the sentence; and when the Judges composing the Court of Revision are equally divided in opinion, the case shall be disposed of in the manner provided by section 429.
(2) No order under this section shall be made to the prejudice of the accused unless he has had an opportunity of being heard either personally or by pleader in his own defence.
(3). . . . . . . . . . . . . (4). . . . . . . . . . . . . (5) Where under this Code an appeal lies and no appeal is brought, no proceedings by way of revision shall be entertained at the instance of the party who could have appealed.
(6)Notwithstanding anything contained in this section,any convicted person to whom an opportunity has been given under sub section (2) of showing cause why his sentence should not be enhanced shall, in showing cause, be entitled also to show cause against his conviction".
For a correct appreciation of the real meaning, import and scope of the provisions of sub section (6) of section 439 it will be necessary to bear in mind its historical background.
In England there is no provision for an appeal by the Crown either against an order of acquittal or for the enhancement of sentence.
There the person convicted has a right of appeal both against his conviction and the sentence imposed upon him.
Under the English criminal procedure, therefore, the question of enhancement of sentence only comes before the Court of Criminal Appeal when there is an appeal by the convicted accused.
In this country the provisions relating to the Court 's power of enhancement of sentence have undergone radical changes from time to time.
Section 407 of the Code of Criminal Procedure, 1861 prohibited any appeal from acquittal.
Express power was given to the appellate Court to reduce the sentence (sections 425 and 426) and like power was given to the Sudder Court as a Court of revision (sections 405 and 406).
I find no provision 99 in that Code authorising the Sudder Court to enhance the sentence.
The Code of Criminal Procedure of 1872, however, by section 272 permitted the Government to file an appeal from acquittal.
This was repeated in section 417 of the Code of 1882 which corresponds to section 417 of the present Code.
Section 280 of the Code of 1872 expressly authorised all appellate Courts to enhance the sentence.
This power of enhancement, however, was taken away from the appellate Courts by section 423 of the Code of 1882 now reproduced in section 423 of the present Code and was vested in the High Court under section 439 of the Code of 1882 to be applied in exercise of its revisional power.
This has been continued in our present section 439.
This shows that the Legislature thought that this extraordinary power should be exercised only by the High Court and no other Court.
A practice, how ever, appears to have grown up that in cases coming up before it for enhancement of sentence the High Court accepted the conviction as conclusive and proceeded to consider the question of enhancement of sentence on that basis.
(See Emperor vs Chinto Bhairava (1)).
Then came Act XVIII of 1923 which, by section 119, amended section 439 by adding the present sub section (6) and also amended section 369 by substituting the words "save as otherwise provided by this Code or by any other law for the time being in force, or, in the case of a High Court established by Royal Charter, by the Letters Patent of such High Court, no Court" for the words "No Court other than a High Court" with which the section formerly opened.
The results of these amendments were (i) to make the judgment or order of the High Court passed in exercise of its original criminal jurisdiction final which it was not under section 369 as it originally stood and to make this finality subject to the other provisions of the Code or of the Letters Patent of the High Court and (ii) to nullify the practice referred to above and to give a statutory right to an accused person who was threatened with the risk of having the sentence imposed on him by the trial Court or the lower appel (1) Bom.
100 late Court enhanced by the High Court in exercise of its revisional jurisdiction suo motu or at the instance of the State or in exceptional cases even of any other interested person.
Sub section (6), therefore, confers a new and a very valuable right on the subject which is designed to be a safeguard against the State or other interested person making frivolous revision application for enhancement of sentence.
The State or the person interested must, if they ask for an enhancement of sentence, be prepared to face the risk of the accused being altogether acquitted.
It is the price or quid pro quo which the State or other interested person must be prepared to pay for the right or privilege of making an application for enhancement of sentence.
The language used in sub section (6) does not, in terms, place any fetter on the right conferred by it on the accused.
This new right is not expressed to be conditioned or controlled by anything that may have happened prior to the revision application under sub section (1) for enhancement of sentence.
The section quite clearly says that whenever there is an application for enhancement of sentence a notice must issue under sub section (2) to the accused person to show cause and whenever such notice is issued the accused person must, under sub section (6), be given an opportunity, in showing cause against enhancement, also to show cause against his conviction.
The sub section does not say that he will have this right to show cause against his conviction only if he has not already done so.
If the accused person appealed against his conviction and sentence to an appellate Court not being a High Court and lost that appeal after a full hearing in the presence of his opponent it must be conceded that he has had an opportunity to show cause against his conviction but nobody will contend that that circumstance will prevent him from having another opportunity of showing cause against his conviction and sentence either by a substantive application initiated by himself under sub section (1) or by way of defending himself when the State or other interested person applies to the High Court in revision under section 439(1) for enhancement of 101 sentence and a notice is issued on him under section 439(2).
(See Kala vs Emperor(1)).
Enhancement of sentence is undoubtedly an encroachment upon the liberty of the subject and a very serious matter for an accused person and the Legislature may quite properly have thought that whenever an accused person is sought to be laid open to the risk of having his sentence enhanced, the question of the legality and propriety of his conviction should be reexamined by the High Court in the context of this new jeopardy, irrespective of anything that might have happened prior to the application for enhancement of sentence and the issuing of the notice on the accused to show cause.
Indeed, there is, in sub section (6) itself, an indication in that behalf.
This sub section is to operate "notwithstanding anything contained in this section".
In some of the decisions (e.g. Emperor vs Jorabhai(2), Crown vs Dhanna Lal(3), Emperor vs Inderchand(4) and King vs Nga Ba Saing(5)) it has been said that the non obstante clause refers only to sub section (5).
I find it difficult to accept this limited construction as correct.
Sub section (5) only says that where an appeal lies and no appeal is brought, no proceedings by way of revision shall be entertained at the instance of the party who could have appealed.
The idea is that if a person has a right of appeal he must first pursue that remedy.
In other words, sub section (5) is a disabling provision.
By providing that no proceedings by way of revision shall be entertained at the instance of a person who, having a right of appeal, does not avail himself of it, the sub section precludes such a person from initiating proceedings by way of revision.
When the accused person under sub section (6) shows cause against his conviction he himself initiates no proceedings but only exercises the right to show cause against his conviction which is given to him because somebody else has taken proceedings against him for enhance ment and a notice has been issued on him under subsection (2).
In such a situation the accused person (1) A.I.R. 1929 Lah. 584.
(2) Bom.
(3) Lah.
(4) A.I.R. 1934 Bom.
(5) A.I.R. 1939 Rang.
392, 102 is on the defensive and the act of showing cause against proceedings initiated against him cannot properly be said to be, proceedings "at his instance" which the High Court, by sub section (5), is enjoined not to entertain.
Strictly speaking sub section (6) needs no exemption from sub section (5).
In any event and assuming that the act of showing cause against his conviction under sub section (6) is tanta mount to an application in revision initiated by him and such application is saved from the operation of sub section (5) by the non obstante clause of sub section (6) 1 do not see any reason for holding that the non obstante clause of sub section (6) is concerned only with sub section (5).
Although in showing cause against his conviction under sub section (6) the accused person can urge all that he could do in an appeal, if not more, this act of showing cause is, nevertheless, in form at least, a continuation and indeed an integral part of the proceedings in revision initiated by the Court suo motu or by the State or any other interested party.
The general rule is that the exercise of revisional power is entirely a matter of discretion which is to be exercised by the High Court not capriciously but on sound judicial principles.
Indeed, sub section (1) itself lays stress on this aspect of the matter by the use therein of the words "in its discretion".
The non obstante clause may well have been designed to emphasise that the new right conferred by sub section (6) is a matter of right and does not rest entirely on mere discretion of the Court.
Further the non obstante clause has a special significance even in a case where the accused person has already had an opportunity, by means of an appeal or revision filed by him in the High Court, to show cause against his conviction.
Under sub section (1) there can be a revision only of the judgment or order of Criminal Courts inferior to the High Court and it does not sanction any revision of the judgment or order of the High Court itself.
Therefore, where the accused person has unsuccessfully challenged the legality or propriety of his conviction in an appeal or revision application made by him before the High 103 Court he cannot again initiate a substantive application before the High Court under section 439(1) of the Code to re examine his conviction or sentence, for that will be to ask the Court to revise its own previous judgment or order, which the High Court cannot do under section 439(1).
But suppose that the dismissal of the appeal or revision application made by the accused takes place in such circumstances that it still leaves it open to the State or other interested person to apply in revision for enhancement of the sentence and proceedings are initiated by the Court or the State for enhancement of sentence under section 439(1) and notice is issued on the accused under section 439(2), there is nothing in subsection (6) which, in terms, prevents the accused, in that situation, to again show cause against his conviction and sentence.
The only argument that may, in those circumstances, be advanced with some semblance of plausibility is that to let the accused person to again challenge his conviction or sentence under sub section (6) is to cut across the provisions of sub section (1) and in effect to permit the accused to ask the High Court to revise its previous order, although no substantive application could be initiated by him under sub section (I).
It may well be that the non obstante clause in sub section (6) was also designed to negative such an argument.
Although ordinarily no substantive application can be initiated by an accused person, whose appeal or revision application has once been dismissed by the High Court.
for revision or review of that order of dismissal, I can find no difficulty in construing and reading section 439(6) as giving to the accused person, who is faced with the risk of having his sentence enhanced, a second opportunity to do what he had previously failed to do.
In other words, I see no incongruity in the Legislature giving a new right of revision to the accused person as a weapon of defence in the context of a new offensive taken by the State against him.
Even if the act of showing cause under sub section (6) is to be regarded as a revision, there was nothing to prevent the Legislature, in the interest of the liberty of the 104 subject, to provide for a limited right of revision of the judgment or decision or order of the High Court itself.
In my judgment that is what the Legislature has done by adding sub section (6) to section 439 and the non obstante clause is intended to meet and repel the objection that may possibly have been taken on the score that, under sub section (1), there can be no revision by the High Court of its own order.
In my opinion, so long as proceedings may be taken against the accused person for enhancement of his sentence and so long as notice may be issued on him to show cause against enhancement, so long must he have, in showing cause against enhancement of sentence, the right, under sub section (6), to show cause against his conviction, irrespective of anything that may have happened previously.
That is how I read the sub section.
Indeed, in Emperor vs Mangal Naran(1) McLeod, C. J., went further and expressed the view that if, after an appeal had been heard on its merits and dismissed, a notice to enhance sentence was issued, the accused would still have the right to show cause against his conviction although any attempt to set aside his conviction would not have much chance of success.
For reasons to be stated hereafter I would rather say that in such a situation no application for enhancement would lie at all and that consequently no question would arise of the accused person exercising his right under sub section (6).
This aspect of the matter that I am trying to indicate and emphasise does not appear to have been sufficiently adverted to in the subsequent decisions of the different High Courts in India except in one decision of a Full Bench of the Lahore High Court.
It will be convenient at this stage to refer to those decisions.
In Emperor vs Jorabhai (supra) the accused person was convicted by the Sessions Judge.
He preferred an appeal to the High Court and a Bench of the High Court dismissed the appeal on merits after full hearing of both sides after notice of appeal had been served on the State.
After the delivery of the judgment an oral application was made to the Bench by (1) Bom.
105 the Government pleader for the enhancement of the sentence.
Notice was issued to the accused under section 439(2) of the Code.
The accused claimed the right, under sub section (6) to challenge his conviction.
It was held by Fawcett and Madgavkar, JJ., that section 439(6) did not justify what would be tantamount to a rehearing of the appeal on merits.
In the case of Ramlakhan Chaudhury vs Emperor(1) the accused 's appeal had been previously dismissed after a full hearing and following the decision in Emperor vs Jorabhai (supra) it was held that the accused could not, under section 439(6), challenge the correctness of his conviction for the second time while showing cause against enhancement of sentence.
The same principle has been extended to cases where the appeal of the accused person had been previously dismissed by the High Court summarily but after hearing the accused or his advocate.
(See Emperor vs Batubai(2), Emperor vs Haji Khanhamoo(3), King vs Nga Ba Saing (supra), Emperor vs Naubat(4) ), to cases where the jail appeal of the accused had previously been dismissed summarily without hearing the accused or his advocate (see Emperor vs Koya Partab(5), Emperor vs Abdul Qayum(6), Ramchand vs Hiralal(7) and State vs Bhavani Shankar(8)) and to cases of dismissal of revision petition filed by the accused after hearing the advocate (see In re Saiyed Anif Sahib(1), Emperor vs Sher Singh("), Crown vs Dhanna Lal (supra) ) and also to the case of an accused whose revision petition has been summarily dismissed (see Emperor vs Inderchand (supra)).
It has been held that for the purposes of section 439(6) it makes no difference whether the judgment or order of dismissal was made by the High Court in appeal or in revision, or whether the appeal or revision was dismissed summarily or after a full hearing on notice to the State or other interested party and that any dismissal of the appeal or (1) Pat. 872.(6) A.I.R. 1933 All. 485.
(2) A.I.R. 1927 Bom.
666.(7) A.I.R. 1942 All. 339.
(3) A.I.R. 1936 Sind 233.(8) I.L.R. (4) I.L.R [1945] All. 527.
(9) A.I.A. (5) Bom.
822.(10) Lah.
521, 14 106 revision prevents the accused person from availing himself of the benefit of section 439(6).
In two cases Emperor vs Lukman(1) and Emperor vs Shidoo(2) the Sind Court took up an intermediate position that the accused person whose appeal had been dismissed summarily or after full hearing could not challenge his conviction for the second time except to the extent that the conviction was not founded on legal evidence or was manifestly erroneous.
In other words, lie could only go up to what was ordinarily permitted in a revision.
These two decisions appear to me, with respect,to be illogical and I need say no more about them.
In the other cases noted above it has been quite definitely held that the accused person whose appeal or revision application has been previously dismissed, summarily or after a full hearing, is not entitled, when called upon to show cause why the sentence should not be enhanced, to question the correctness of his conviction for the second time.
In other words, the previous dismissal, according to these decisions.
, is an adjudication by the High Court of the correctness of his conviction and on the principle of finality of judgment embodied in sections 369 and 430 of the Code of Criminal Procedure that adjudication cannot be called in question under section 439(6).
It has been pointed out in several cases (Crown vs Dhanna Lal (supra), Emperor vs Inderchand (supra) and King vs Nga Ba Saing (supra)) that subsection (6) opens with the words "notwithstanding anything contained in this section" and not with the words "notwithstanding anything contained in this Code" and from this the inference has been drawn that while the sub section is to operate notwithstanding the provisions of sub section (5) it cannot override the other provisions of the Code, and, therefore, the operation of sub section (6) is conditioned or control led by the principle of finality of judgment embodied in section 369 and section 430.
Some learned Judges have expressed the view (see In re Saiyed Anif Sahib (supra), Crown vs Dhanna Lal (supra)) that the words ( 'unless he has already done so" are to be read in sec (1) A.I.R. 1927 Sind 39.
(2) A.I.R. 1929 Sind 26.
107 tion 439(6), for this is to be implied from the presumption of finality.
In some cases (see Emperor vs Sher Singh (supra) and Ram Lakhan vs Emperor (supra)) the decision has been placed also oil the ground of the inherent incapacity of one Judge of the High Court to reconsider the decision of another Judge of that Court.
It is necessary to examine these grounds a little closely to ascertain their validity.
In order to appreciate the true meaning and exact scope of sections 369 and 430 on which the argument of finality of judgment is founded it is necessary to keep in view the general scheme of the Code.
Part VI of the Code deals with "Proceedings in Prosecutions".
Chapter XV lays down the jurisdiction of the Criminal Courts in Inquiries and Trials.
I pass over Chapters XVI to XVIII.
Chapter XIX prescribes rules for the framing and joinder of charges.
Chapters XX to XXIII deal with different kinds of trials, e.g., trial of summons cases, warrant cases, summary trials and trials before High Courts and Courts of Session.
Chapter XXIV contains general provisions as to Inquiries and Trials.
Mode of taking and recording evidence is prescribed by the sections grouped together in Chapter XXV.
then comes Chapter XXVI which is headed "Of the Judgment".
Section 369 is one of the sections included in this chapter.
Chapter XXVII provides for the submission of death sentences for the confirmation of the High Court.
Rules relating to the execution, suspension, remission and commutations of the sentences are to be found in Chapters XXVIII and XXIX.
Part VI ends with Chapter XXX which is not material for our present purpose.
Part VII deals with "Appeal, Reference and Revision".
Chapter XXXI is concerned with Appeals and we find section 430 in this chapter.
Chapter XXXII provides for reference and revision, section 439 being one of the sections included in this chapter.
In view of the scheme summarised above there can be no manner of doubt that the provisions of the sections collected in Chapter XXVI are concerned with judgments pronounced by the trial Court.
This conclusion is certainly reinforced by the language of some 108 of these sections.
Thus section 366 which is the very first section in this chapter refers to "The judgment in every trial in any Criminal Court of original jurisdiction".
Section 367 provides what must be contained in "every such judgment", that is to say judgment in an original trial.
Section 369 runs as follows: "369.
Court not to alter Judgment.
Save as otherwise provided by this Code or by any other law for the time being in force or, "in the case of a High Court by the Letters Patent or other instrument constituting such High Court", no Court, when it has signed its judgment, shall alter or review the same, except to correct a clerical error".
The opening words "save as otherwise provided by this Code. . constituting such High Court" were added by section 119 of the Amending Act XVIII of 1923 and were further adapted by Adaptation of Laws Order, 1950.
There can be no question that the finality embodied in this section is only in relation to the Court which pronounces the judgment, for it forbids the Court, after it has signed its judgment, to alter or review the same.
In other words, after pronouncing the judgment the Court that pronounces it becomes functus officio.
There is indication in the Code itself that the purpose of section 369 is not to prescribe a general rule of finality of all judgments of all Criminal Courts but is only to prescribe finality for the judgment of the trial Court so far as the trial Court is concerned.
That this section does not,.
by itself, apply to the judgment of an appellate Court is quite obvious, because if it did, there would have been no necessity for enacting section 424 specifically making the rules contained in Chapter XXVI, which includes section 369, applicable to the judgment of any appellate Court other than High Court, nor for again prescribing by section 430 a rule of finality for judgments and orders passed by an appellate Court.
It, therefore, follows that while, subject to the other provi sions of the Code or any other law and of the Letters Patent, the finality of section 369 attaches to the judgments pronounced by all trial Courts including the High Court in the exercise of its original criminal 109 jurisdiction it certainly has no bearing on the question of finality of appellate judgments which is specifically provided by section 430 of the Code.
Again, the rule of finality embodied in section 369 cannot, in terms, apply to the orders made by the High Court in exercise of its revisional jurisdiction, for section 442 of the Code which requires the result of the revision proceedings to be certified to the Court by which the finding, sentence or order revised was recorded or passed refers to it as its "decision or order" and not "judgment".
It is significant that section 425 which requires the result of appeal to be certified to the lower Court refers to it as its "judgment or order".
All these considerations herein alluded to quite clearly establish that section 369 cannot in any manner con trol section 439(6).
In any case, section 369 is "subject to the other provisions of the Code" and I see no reason why section 439(6) should not be regarded as one of such other provisions.
It cannot be overlooked that the words "subject to the other provisions of the Code, etc." were introduced into section 369 at the same time as sub section (6) was added to section 439.
As I read the new sub section, it is a substantive statutory right conferred on the subject and full effect should be given to it unless there is any in superable difficulty in the way of doing so.
If section 369 were susceptible of as wide a meaning as is read into it,, namely, that it applies to all judgments of all Courts, original, appellate or revisional, I would, in that case, bold that that meaning must be taken as cut down, by reason of the words "subject to the other provisions of the Code, etc.
" by the mandatory provision& of section 439(6).
In other words, section 439(6) must be read as controlling section 369 rather than the other way about.
Finally, section 369 being subject to the other provisions of the Code must be read as subject to section 430 and as the finality enshrined in the latter section does not attach to decisions or orders made in revision by reason of Chapter XXXII being expressly excepted from its operation, the rule of finality embodied in section 369, even if it be as wide as it is contended to be, 110 cannot affect cases provided for in Chapter XXXII.
I now pass on to section 430 which is also relied on as furnishing a principle of finality which is supposed to control the operation of section 439 6).
Section 430, in terms, applies to "judgments and orders" passed by an appellate Court.
It has no application to "decisions or orders" made by the High Court in revision.
It has been contended that the exception made in section 430 in respect of cases provided for in Chapter XXXII only exempts the judgments or orders of an appellate Court other than a High Court from the rule of finality embodied in section 430, because they are made revisable by the High Court under section 439(1).
Section 439(1) does not contemplate or permit judgments or orders made by the High Court in exercise of its original or appellate criminal jurisdiction to be revised by the High Court.
As, therefore, the appellate judgments or orders of the High Court cannot, under section 439(1), be made the subject matter of any revision application, such appellate judgments or orders did not fall within the exception made in section 430 and were accordingly left subject to the rule of finality embodied therein.
Two answers occur to me.
If the effect of the new subsection (6), as I have already explained, is to confer a new right on an accused person notwithstanding anything contained in section 439(1), that is to say, if sub section (6) is read, as I think it should be, as a statutory provision expressly making the judgment or decision or order of the High Court passed in exercise of its appellate or revisional jurisdiction subject, for the purpose of the protection of an accused person whose appeal or revision had been previously dismissed, to re examination by the High Court only as and when he is subsequently faced with an application for enhancement of sentence, then such judgment, decision or order of the High Court does, as a result of section 439(6), become the subject matter of a case provided for in Chapter XXXII of the Code.
In other words, the scope of Chapter XXXII having been enlarged by the addition of sub section (6) to section 439, the scope of the exception to sec 111 tion 430 must also stand enlarged so as to include within the exception whatever, after the amendment of section 439, may come within Chapter XXXII and, therefore, cases now coming within that Chapter must stand free from the rule finality embodied in section 430.
The other answer is to be found in two of the decisions of the Allahabad High Court, namely Emperor vs Abdul Qayum (supra) and Ram Chand Hiralal(1) where it has been field that section 430 by V. its own terms saves the revisional power of the High Court to enhance the sentence.
In each of these cases the jail appeal filed by the accused had been dismissed by the High Court summarily.
If the rule of finality of appellate judgments does not attach to the summary dismissal of the jail appeal by the High Court so as to prevent the State from invoking its revisional power to enhance the sentence, surely the accused 's right to show cause against his conviction under section 439 (6), which is consequential and arises only upon a rule for enhancement being issued under section 439(2) and is, therefore, a part of the revisional proceedings for enhancement of sentence, must, on a parity of reasoning be also free from the same principle of finality.
It, therefore, follows that section 434(6) is not, in terms, controlled by section 369 or section 430.
Whether the sub section is controlled by the general principle of finality of judgments and if so to what extent are different questions which will be discussed later.
The second ground on which some of the decisions rest, namely, the inherent incapacity of one Judge of the High Court to reconsider the decision of another Judge of the High Court may easily be disposed of The theory of inherent incapacity must give way to the statutory capacity conferred by section 439(6).
If on a true construction a statute states, expressly or by necessary intendment, that one Judge or one Bench shall have jurisdiction and power to decide something, the theory of inherent incapacity of such Judge or Bench cannot be invoked to prevent the exercise of such jurisdiction and power merely on (1) A.I.R. 1942 All.
112 the ground that the decision which may be arrived at in exercise of this new jurisdiction or power may run counter to the previous decision arrived at by another Judge or Bench in exercise of another jurisdiction or power.
I see no reason why section 439(6) may not be read as a provision which, by necessary implication, enables the High Court to re examine its own previous order on the happening of certain contingencies, namely, upon the accused person, whose appeal or revision has been dismissed, being faced with the risk of having his sentence enhanced and a notice being issued to him for enhancement.
To reinforce the argument that section 439(6) is controlled by sections 369 and 430 reference has been made to section 423(2) and it has been contended, on the authority of various decisions, that the right given by section 439(6) is not absolute but is controlled by the provisions of section 423(2) which lay down some limitations in the matter of appeal from convictions in a jury trial.
Even on that topic some learned Judges have taken divergent views.
It is not necessary, on this occasion, to express any opinion on that question and I reserve my right to examine the position as and when an occasion may arise in future.
Even if section 439(6) is controlled by section 423(2), that circumstance certainly does not indicate when and under what circumstances the right under section 439(6) may be availed of.
In any case, that consideration has no bearing on the argument of finality of judgments sought to be founded on sections 369 and 430.
It will be convenient at this stage to refer to the decision of a Full Bench of the Lahore High Court in Emperor vs Atta Mohammad(1) and to deal with the argument founded on and developed from some of the reasonings adopted by the learned Judges constituting that Full Bench.
In that case the revision application of the accused had been dismissed in limine by the High Court.
Subsequently the Crown applied for enhancement of sentence.
Notice having been issued under sub section (2) of section 439 the accused (1) Lah.
113 person claimed the right, under sub section(6), to show cause against his conviction in spite of the fact that his revision application had been dismissed.
The Advocate for the Crown relied on the cases referred to above and contended that the order of dismissal of the revision application by the High Court was final as regards the correctness of the conviction, that that order could not again be revised by the High Court, that the accused was no longer entitled to challenge his conviction and that it made no difference that his revision petition had been dismissed in limine.
The Full Bench overruled the earlier decision of the Court in Crown vs Dhanna Lal (supra) and held that the accused was, in the circumstances of the case, entitled to show cause against his conviction, notwithstanding the fact that his application for revision had been dismissed in limine.
The reasoning adopted by Blacker, J., was shortly as follows: That an order dismissing a revision petition in limine is an order made under section 435 and not under section 439; that such an order is not a judgment and, therefore, the principle of finality embodied in section 369 does not apply to such an order, because such a dismissal only meant that the Judge saw no adequate grounds disclosed in the petition or on the face of the judgment for proceeding any further; that, in the picturesque language of the learned Judge, in such a dismissal "there is no finding or decision unless it can be called a decision to decide to come to no decision"; that the jurisdiction exercised by the Court under section 439(6) was appellate jurisdiction and that an order of acquittal thereunder did not amount to a review of an order of dismissal under section 435; and finally that if the order under section 435 was a judgment or if an order of acquittal under section 439(6) was a review of such judgment, such review was not barred by section 369, because of the saving provisions with which the section begins.
Mahajan, J., as he then was, put in the forefront of his judgment the view that section 439(6) which was introduced by amendment in 1923 gave a new and unlimited right 15 114 to the subject; that the Judge hearing the application for enhancement was bound to go into the facts to satisfy himself as to the correctness of the conviction; that the exercise of revisional jurisdiction was a mere matter of favour and a dismissal in limine of such application amounted only to a refusal to look into the record and was in no sense a judgment.
Ram Lall, J., did not deliver any separate judgment but concurred generally with the other learned Judges.
It will be noticed that this decision of the Lahore High Court rests mainly on two grounds, namely, (1) that in a dismissal of a revision application in limine there is no finding or decision at all and that it is nothing more than a refusal to send for the records or to look into the matter and is, therefore, not a judgment.
, and (2) that, in any case, section 439(6) gives a new statutory right to the accused person to challenge the legality or propriety of his conviction, although his previous application for revision of the order of the lower Court had been dismissed in limine and that such a review of that dismissal order is not barred by section 369 because of the saving provision at the beginning of that section.
The Full Bench expressly declined to express any opinion as to the effect of dismissal of an appeal on the right given by sub section (6).
The principle of the first ground of the Lahore Full Bench decision has, however, been extended by the Rajasthan High Court in ' The State vs Bhawani Shankar (supra) to a case where the respondent 's jail appeal had been summarily dismissed.
According to Wanchoo, C.J., the accused, whose jail appeal had been dismissed summarily, was in the same position as the accused, whose revision petition had been dismissed in limine, for he too could not be said to have had an opportunity of showing cause against his conviction.
The learned Chief Justice, however, did not desire to go further and expressed the view that if an appeal were dismissed summarily but after hearing the party or his pleader the accused could not claim to have a second opportunity to challenge his conviction under section 439(6), because in that case he had been heard and, therefore, had had an oppor 115 tunity to show cause against his conviction when his appeal had been summarily dismissed.
It will be recalled that in Emperor vs Jorabhai supra) and the other cases which followed it it was said that for the purposes of determining the applicability of section 439(6) it made no difference in principle whether the proceeding filed by the accused which had been dismissed was an appeal or a revision or whether the dismissal was summary or after a full hearing and that in none of such cases could the accused person claim a second opportunity to question the legality or propriety of his Conviction when he was subsequently called upon to show cause why the sentence passed on him should not be enhanced.
In the Lahore Full Bench case and the Rajasthan case referred to above a distinction has, however, been made between a summary dismissal and a dismissal after a full hearing of the appeal or revision filed by the accused.
In my judgment there is a substantial distinction between these two kinds of dis missals as regards their effect on the rights of accused persons as I shall presently indicate.
I am, however, unable to accept the argument adopted by the Lahore Full Bench that a summary dismissal of a revision application filed by the accused must be regarded as an order made under section 435 and not one under section 439, that such a summary dismissal is nothing more than a refusal on the part of the High Court to go further or to look into the application and that in such a dismissal there is no finding or decision at all.
Far less am I able to accede to the proposition that a summary dismissal of a jail appeal also stands on the same footing.
Sections 421, 435 and 439 undoubtedly vest a very wide discretion in the Court.
Discretion, as Lord Halsbury, L.C., said, in Sharp vs Wakefield(1), means sound discretion guided by law.
It must be governed by rules of reason and justice and not according to private opinion; according to law and not by humour or caprice.
It must not be arbitrary, vague and fanciful but must be legal and regular.
This discretion is given to the (1) at p. 179.
116 High Court for the purpose of dealing with and disposing of the proceeding brought before it and not for not deciding it.
The primary and paramount duty of the Court is to decide the appeal or revision and it is to exercise its discretion in so deciding it.
In deciding the appeal or revision the High Court may choose which of its powers it will exercise if the circumstances of the case call for such exercise.
In a clear case, apparent on the grounds of appeal or revision or on the face of the judgment appealed from or sought to be revised it may come to the conclusion that the case has no merit and does not call for the exercise of any of its powers in which case it may dismiss it summarily.
If, however, it has any doubt, it may call for the record or may admit it and issue notice to the respondent and decide it after a full hearing in the presence of all parties.
But decide it must at one stage or the other.
The discretion conferred on the High Court does not authorise it to say that it will not look at the appeal or the revision.
The court 's bounden duty is to look into the appeal or revision and decide it, although in the process of arriving at its decision it has very wide discretion.
When the Court summarily dismisses an appeal whether without hearing the accused or his pleader as in the case of a jail appeal or after hearing the accused or his pleader but before issuing any notice to the respondent as in an appeal presented by the accused or his pleader, the Court does decide the appeal.
It is indeed a very serious thing to say that sections 421, 435 or 439 give the Court a discretion not to decide the appeal or revision brought before it and I, for one, am not prepared to countenance and much less encourage such an idea.
In my judgment a summary dismissal of an appeal or revision does involve an ad judication by the High Court just as a dismissal after a full hearing does.
The only difference, as we shall presently see, is as to the respective, nature, scope and effect of the two adjudications.
It has been said that when an appeal or revision is dismissed after a full hearing by the High Court the judgment of the lower Court merges in the High Court 117 judgment and the High Court judgment replaces the judgment of the lower Court and becomes the only operative judgment but that when the appeal or revision is summarily dismissed by the High Court there is, in such a dismissal, no finding or decision which can replace the judgment of the lower Court.
it is, therefore, said that there can be no showing cause against his conviction under sub section (6) in the first case, for it will involve a revision of the High Court 's decision but the position will be otherwise in the second case where the dismissal was summary.
This argument appears to me to be untenable and fallacious.
Section 425 of the Code requires that whenever a case is decided on appeal by the High Court under Chapter XXXI it must certify its judgment or order to the Court by which the finding, sentence or order appealed against was recorded or passed and that that Court shall thereupon make such orders as are conformable to the judgment or order of the High Court and that,, if necessary, the record shall be amended in accordance therewith.
Likewise, section 442 requires that when a case is revised under Chapter XXXII by the High Court, it shall, in the manner provided by section 425, certify its decision or order to the Court by which the finding, sentence or order revised was recorded or passed and that that Court shall thereupon make such orders as are conformable to the decision so certified and that, if necessary, the record shall be amended in accordance therewith.
This certificate is sent in every case, whether the appeal or revision is disposed of summarily or after a full hearing.
Where an appeal or revision is disposed of after a full hearing on notice to the respondent and allowed wholly or in part it becomes ex facie obvious that the judgment appealed against or sought to be revised has been altered by the judgment or decision of the High Court on appeal or revision and a note is made in the record of this alteration.
But when an appeal or revision is dismissed after full hearing and the sentence is maintained there is outwardly no change in the record when the certificate is sent by the High Court but nevertheless there is an adjudica 118 tion by the High Court.
In the first case it is judgment of acquittal or reduction of sentence and in the second case it is a judgment of conviction.
Likewise, when an appeal or revision is summarily dismissed, such dismissal maintains the judgment or order of the lower Court and a note is made of such dismissal in the record and in the eye of the law it is the judgment of the High Court that prevails.
To the uninstructed mind the change may be more easily noticeable in the first case than in the other two cases but on principle there is no difference.
I can see no reason for holding that there is a merger or replacement of judgment only in the first two cases and not in the last one.
In my opinion, it makes no difference whether the dismissal is summary or otherwise, and there is a judgment of the High Court in all the three cases.
It is, at once urged that if the summary dismissal of an appeal or revision is also a judgment then the rule of finality prescribed by sections 369 and 430 will at once apply to it and a cunning accused may by putting up an obviously untenable appeal or revision and procuring an order of summary dismissal of it, prevent the State or any other interested party from making an application for enhancement of the sentence.
The apprehension, to my mind, is unfounded for reasons more than one.
When an appeal or revision is filed by an accused person he sets out his grounds in detail, challenging both his conviction and sentence.
From the very nature of things he does not raise any question of enhancement of the sentence.
At that stage no notice or rule having been issued the respondent is not before the Court to raise the issue of enhancement.
So the summary dismissal only confirms the conviction and decides that the Court sees no ground for reducing the sentence.
It is in no sense a decision that the sentence should not be enhanced for that issue was not before the Court at all and so it has been said, I think rightly, in several cases, [e.g. In re Syed Anif Sahib (supra)], Emperor vs Jorabhai (supra) and Emperor vs Inderchand (supra)].
The fact the High Court simply dismisses the appeal or revision summarily without issuing the notice on 119 the accused under section 439(2) for showing cause against enhancement is a clear indication that the High Court has not considered the question of enhancement.
It is true that the rule of finality prescribed by section 430 applies to the appellate judgment of the High Court, subject to the exception regarding cases falling within Chapter XXXII.
It is also true that although the revisional power is not expressly or in terms controlled either by section 369 or section 430, the general principle of finality of judgments attaches to the decision or order of the High Court passed in exercise of its revisional powers.
But this finality, statutory or general, extends only to what is actually decided by the High Court and no further.
When an appeal or revision by the accused is allowed after a full hearing on notice to the respondent the conviction and sentence must be regarded as having been put in issue and finally decided.
When the accused person in the presence of the State claims an acquittal or reduction of his sentence, the State ought then and there to apply for enhancement of sentence and its failure to do so cannot but be regarded as abandonment of the claim.
The acceptance by the High Court of the appeal or revision on notice to the respondent and after a full hearing is, therefore, nothing less than a judgment of acquittal or a judgment for reduction of sentence.
On the other hand, the dismissal by the High Court of an appeal or revision after such a full hearing amounts to a judgment of conviction.
In both cases the judgment is final as regards both the accused and the respondent as regards the conviction as well as the sentence in all its aspects, namely, reduction or enhancement.
In that situation no further question of revision can arise at the instance of either party.
There can be no further application by the accused challenging his conviction or sentence.
Nor can there be any further application by the State for enhancement of the sentence, for that question could have been and should have been raised when the accused person in the presence of the respondent prayed for acquittal or reduction of sentence and not having then been raised it cannot be raised 120 subsequently and consequently no question can arise for the exercise of right by the accused under section 439(6).
This result is brought about not by any technical doctrine of constructive res judicata which has no application to criminal cases but on the general principle of finality of judgments.
The summary dismissal of an appeal or revision by the accused, with or without bearing him or his pleader but without issuing notice to the respondent is, so far as the accused is concerned, a judgment of conviction and confirmation of his sentence and he can no longer initiate revision petition against his conviction or sentence.
The judgment or decision is a final judgment qua the accused person, for otherwise he could go on making successive appeals or revision applications which obviously he cannot be permitted to do.
But the State or other interested person who has not been served with any notice of the appeal or revision cannot be precluded, by the summary dismissal of the accused 's appeal or revision, from asking for enhancement, for in that situation the State or the complainant not being present the question of enhancement was not in issue before the Court and the summary dismissal cannot be regarded as an adjudication on the question of enhancement.
That question not having been put in issue and not having been decided by the High Court, the finality attaching to the summary dismissal as against the accused does not affect the position.
This, I apprehend, is the true distinction between a summary dismissal of an appeal or revision and a dismissal of it after a full bearing.
The cases of Emperor vs Jorabhai (supra) and the other cases following it overlooked this vital distinction as also its effect on the new statutory right conferred on the accused person by section 439(6) and they cannot be accepted as correct decisions.
In those cases where the appeal or revision filed by the accused had been dismissed after a full hearing in the presence of the State and where there was no application by the State or other interested party for enhancement of sentence during the pendency of that appeal or revision it should have 121 been held that the dismissal must be regarded as a judgment which was final as against both parties on both points, conviction and sentence and there could be no further application for the enhancement of sentence and consequently no question of the accused having a further opportunity of showing cause against his conviction could arise.
In the cases where the appeal or revision filed by the accused had been summarily dismissed without notice to the respondent, it should have been held that although such dismissal was final as against the accused it did not preclude the State or the complainant, who was not a party to the dismissal, from applying for enhancement of sentence and that as soon as an application for enhancement was made subsequently and a notice was issued to the accused, the latter, faced with the risk of having his sentence enhanced, at once became entitled, under section 439(6), in showing cause against the enhancement of sentence, also to show cause against his conviction.
The Lahore Full Bench case has decided, inter alia that while the dismissal of the accused 's revision application in limine does not prevent the State from subsequently applying for enhancement of the sentence, section 439(6) gives the accused a fresh right to challenge his conviction when a notice for enhancement is issued to him.
That part of the decision may well be sustained on this ground as explained above but, with great respect, I do not agree with their view that the accused in that case had the second right because the summary dismissal of his revision was not a judgment at all or was not final even as regards him.
The Rajasthan High Court 's decision in so far as it extended the principle to the dismissal of a jail appeal without hearing the accused or his pleader under section 421 may also be supported on the ground I have mentioned.
A Bench of the Lahore High Court in The Crown vs Ghulam Muhammad(1) has held that where the accused 's revision application bad been dismissed on notice to the respondent and after a full hearing and the State sub.
(1) Pak.
16 122 sequently applied for enhancement of sentence, the accused person could again show cause against his conviction.
With great respect I think that the better reasoning would have been to say that such a dismissal of the revision after a full hearing, was a judgment final against both parties on both points of conviction and sentence and that as the State did not, during the pendency of that revision, apply for revision it had.
, after that dismissal which became a final judgment, no right subsequently to apply for enhancement of sentence and consequently no notice under section 439(2) could issue and no question could arise for the accused person asserting his right under section 439(6).
For reasons discussed above I have to hold that the summary dismissal of the appeal filed by the appellant in the High Court was a judgment of conviction by the High Court and was final so far as the appellant was concerned and he could not initiate any further revision application either against his conviction or for reduction of sentence after that dismissal but that it was not final so far as the State was concerned and the State was entitled to apply in revision for enhancement of sentence.
For reasons already stated I must further hold that as soon as the State applied for enhancement and a notice was issued on the appellant he became entitled under section 439(6) to again challenge his conviction.
As I have said this sub section gives a new and valuable weapon of defence to an accused person who is placed in fresh jeopardy by reason of an enhancement application having been filed against him and a notice to show cause having been issued to him.
I find nothing in sections 369 and 430 to cut down that right.
The previous dismissal of his appeal had no bearing on the new situation created by the enhancement application which the Legislature, in enacting section 439(6), may well and properly have thought to be sufficiently serious to deserve and require a thorough re examination by the High Court of the conviction itself in this new context.
There is nothing in principle that I can see which should prevent that sub sec 123 tion from giving a fresh right to the accused whose appeal or revision has been summarily dismissed to defend himself by challenging his conviction when a notice for enhancement is issued to him.
In my judgment, for the reasons stated above, this appeal should be allowed and the matter should go back to the High Court so that the State 's application for enhancement may be dealt with according to law after giving the appellant an opportunity to show cause against his conviction.
BHAGWATI J. delivered the Judgment of Bhagwati and Imam, JJ.
This appeal on certificate under article 134(1)(c) of the Constitution raises an important question as to the right of a convicted person to show cause against his conviction while showing cause why his sentence should not be enhanced under section 439(6) of the Criminal Procedure Code.
The appellant was charged before the Presidency Magistrate, 13th Court, Bombay with having committed an offence punishable under section 66(b) of the Bombay Act XXV of 1949 inasmuch as he was found in possession of one bottle of Mac Naughtons Canadian Whisky (Foreign) containing 8 drams valued at Rs. 20.
He was convicted by the learned Presidency Magistrate and was sentenced to imprisonment till the rising of the Court and a fine of Rs. 250 in default rigorous imprisonment for one month.
He presented his petition of appeal to the High Court of Judicature at Bombay through his advocate.
This petition of appeal was however summarily dismissed by the High Court after hearing the advocate on the 19th January 1953.
On the 18th May 1953 a criminal revision application for enhancement of sentence was filed by the State and a rule was granted by the Vaca tion Judge on the 12th June 1953.
This rule came for hearing and final disposal before a Division Bench of the High Court on the 26th August 1953.
After hearing the Government Pleader in support of the rule the Court was not satisfied that there was a case for enhancement of sentence.
The learned counsel for the Appellant then wanted to argue for an acquittal 124 relying upon the provisions of section 439(6) of the Criminal Procedure Code.
Relying however upon the decisions of the Bombay High Court in Emperor vs Jorabhai(1), and Emperor vs Koya Partab (2) , as also Emperor vs Inderchand(3), the Court did not allow the learned counsel to argue that the order of conviction itself could not be sustained.
The application for enhancement of sentence was thereupon dismissed and the rule was discharged.
The appellant applied for leave to appeal to this Court on the 15th October 1953.
The Division Bench of the High Court, hearing the application stated the point which arose for determination as under: "Whether a summary dismissal of an appeal preferred by an accused person precludes him from taking advantage of the provisions of section 439(6) of the Criminal Procedure Code, when he is subsequently called upon to show cause why the sentence imposed upon him should not be enhanced".
It pointed out that the consistent view taken by the Bombay High Court in this matter had been accepted by the Allahabad and the Patna High Courts in Emperor vs Naubat(4) and Ramlakhan Chaudhury vs Emperor(1) but the view taken by the Lahore High Court in Emperor vs Atta Muhammad(1), though not directly in point prima facie lent support to the contention urged by the learned counsel for the Appellant.
A certificate was therefore granted to the Appellant that it was a fit case for appeal to this Court.
It will be convenient at this stage to briefly indicate the relevant sections of the Criminal Procedure Code which will fall to be considered.
Section 417 provides for an appeal on behalf of the State Government to the High Court from an original or appellate order of acquittal passed by any Court other than a High Court.
Sections 419, 420, 421, 422 and 423 prescribe the procedure in cases of appeals.
Section 419 deals with petitions of appeal presented by the appellant or his pleader and section 420 with petitions of appeal (1) Bom.
(2) (3) (4) I.L.R. 1945 Allahabad 527.
(5) Patna 872.
(6) Lahore 391 (F.B 125 presented when the appellant is in jail.
Section 421 provides for summary dismissal of these appeals if the Appellate Court considers that there is no sufficient ground for interfering, save that no appeal presented by the appellant or his pleader is to be dismissed unless the appellant or his pleader has had a reasonable opportunity of being heard in support of the same, and the Court might also before dismissing an appeal summarily call for the record of the case though not bound to do so.
If the Appellate Court does not dismiss the appeal summarily, notice of appeal is to be given to the appellant or his pleader or to such officer as the State Government may appoint in this behalf, under section 422 and the powers of the Appellate Court in dismissing the appeal are laid down in section 423, the only relevant provision for the present purpose being that in an appeal from a conviction the Appellate Court might with or without the reduction in sentence and with or without altering the finding alter the nature of the sentence but. . . . . not so as to enhance the same.
Section 430 incorporates the rule as to the finality of the Judgments and orders passed by an Appellate Court upon appeal except in cases provided for in section 417 which relates to appeals on behalf of the Government in cases of acquittal and Chapter XXXII which relates to reference and revision.
Section 435 deals with the exercise of the revisional powers inter alia by the High Court to call for the records of the inferior criminal courts for the purpose of satisfying itself as to the correctness, legality or propriety of any finding, sentence or order recorded or passed and as to the regularity of any proceedings of such inferior Courts.
Section 438 provides for a reference by the lower Appellate Court to the High Court recommending that a sentence which has been imposed on a convicted person be reversed or altered.
Section 439 with which we are immediately concerned is couched in the following terms: (1)In the case of any proceeding the record of which has been called for by itself or which has been reported for orders, or which otherwise comes to its 126 knowledge the High Court may, in its discretion, exercise any of the powers conferred on a Court of Appeal by sections 423, 426, 427 and 428 or on a Court by section 338, and may enhance the sentence; and when the Judges composing the Court of Revision are equally divided in opinion, the case shall be disposed of in manner provided by section 429.
(2)No order under this section shall be made to the prejudice of the accused unless he has had an opportunity of being heard either personally or by pleader in his own defence.
(5)Where under this Code an appeal lies and no appeal is brought, no proceedings by way of revision shall be entertained at the instance of the party who could have appealed.
(6)Notwithstanding anything contained in this section, any convicted person to whom an opportunity has been given under sub section (2) of showing cause why his sentence should not be enhanced shall, in showing cause, be entitled also to show cause against his conviction.
Section 440 lays down that no party has any right to be heard either personally or by pleader before any Court when exercising its powers of revision provided however that the Court may if it thinks fit, when exercising such powers hear any party either personally or by pleader and nothing in that section shall be deemed to affect section 439(2) above.
A person convicted of an offence may file in the High Court a petition of appeal or an application for revision challenging his conviction and the sentence passed upon him.
The petition of appeal may be presented by him from jail or may be presented by him to the High Court in person or through his pleader.
An application for revision also may be similarly presented by him to the High Court.
A petition of appeal presented by him from jail or presented by him in person or through his pleader as aforesaid may be summarily dismissed by the High Court after perusing the same if it considers that there is no sufficient ground for interfering, the latter after giving him or 127 his pleader a reasonable opportunity of being heard in support of the same and in appropriate cases after calling for the record of the case.
A notice of appeal may issue only if the High Court does not dismiss the appeal summarily and in that event only there would be a full hearing of the appeal in the presence of both the parties.
In the case of an application for revision also the same may be dismissed summarily and without even hearing the party personally or by pleader.
If however the Court deems fit to issue notice to the opposite party there would be a full hearing in the presence of both the parties.
These proceedings would normally be concerned with the question whether the conviction can be sustained and the sentence passed upon the convicted person be set aside or reduced.
There would be no question here of the enhancement of the sentence.
The question of enhancement of the sentence would only arise when the High Court in exercise of its revisional jurisdiction.
under section 439(1) thought it necessary to issue a notice for enhancement of sentence to the convicted person.
Even though the Court exercising its powers of revision would not be bound to bear any party personally or by pleader no order under section 439(1) enhancing the sentence could be made to the prejudice of the accused unless he has had an opportunity of being heard either personally or by pleader in his own defence.
In that event simultaneously with the opportunity given to him under sub section (2) of showing cause why his sentence should not be enhanced he would be entitled in showing cause also to show cause against his conviction by virtue of the provision of section 439(6).
The exercise of this right of also showing cause against his conviction may arise in 4 different types of cases: (1) Where his petition of appeal has been summarily dismissed either without hearing him or after hearing him or his pleader as the case may be; (2) When his appeal has been dismissed after a full hearing following upon the notice of appeal being issued to the opposite party; 128 (3)When his application for revision has been summarily dismissed either without hearing, him or after hearing him or his pleader as the case may be; and (4)Where his application for revision has been dismissed after a full beating following upon a notice issued to the opposite party.
When the High Court issues a notice for enhancement of sentence it is exercising its revisional jurisdiction and the question that arises for consideration is whether in one or more of the cases above referred to the High Court has jurisdiction to issue the notice of enhancement of sentence and the convicted person is entitled while showing cause why his sentence should not be enhanced also to show cause against his conviction.
The view taken by the Bombay High Court in the cases noted above has been that in all the four cases mentioned above the accused has had an opportunity of showing cause against his conviction and that he is not entitled to a further or second opportunity of doing so while showing cause why his sentence should not be enhanced.
It has not made any dis tinction between the exercise of appellate or revisional jurisdiction by the High Court nor between appeals or revision applications dismissed summarily or in limine and appeals or revision applications dismissed after a full hearing in the presence of both the parties.
It has also extended the same principle to a reference made under section 438 and an order passed by the High Court thereupon "No order on reference", without even issuing notice to the applicant at whose instance the Sessions Judge made the reference.
(Vide Emperor vs Nandlal Chunilal Bodiwala(1)).
The Allahabad and the Patna High Courts have followed this view of the Bombay High Court in the decisions above referred to and the Lahore High Court in Emperor vs Dhanalal(2) also followed the same.
But this decision of the Lahore High Court was overruled by a Special Bench of that Court in Emperor vs Atta (1) [1945] 48 Bombay L.R. 41 (F.B.).
(2) Lahore 241.
129 Mohammad(1).
The Special Bench held that the exercise of revisional jurisdiction by the High Court is entirely discretionary, that an application for revision is entertained as a matter of favour, that no party is entitled to be beard either himself or by pleader when the Court in, Exercising its revisional jurisdiction and that therefore a dismissal of an application for revision in limine tantamounts to a refusal by the Court to exercise its revisional jurisdiction and the convicted person under those circumstances is at all events entitled while showing cause why his sentence should not be enhanced also to show cause against his conviction.
It went to the length of holding that section 439(6) confers upon the convicted person an unfettered and unlimited right of showing cause against his conviction, which right cannot be taken away unless there is a judgment in rem which only would operate as a bar to the decision of the same matter when it arises in the exercise of what is in effect the exercise of the ordinary appellate jurisdiction.
The Rajasthan High Court in State vs Bhawani Shankar(2) has drawn a distinction between cases where the accused has not been heard at all and given no opportunity to show cause against his conviction his jail appeal having been dismissed under section 421 or his revision application having been dismissed without hearing him and cases where he has already been heard and given an opportunity to show cause against his conviction whether it be in appeal or in revision and whether his dismissal is summary or on the merits and held that in the former cases he is entitled to ask the Court to hear him and thus allow him to show cause against his conviction under section 439(6) if a notice of enhancement is issued to him.
The principle as to the finality of criminal judgments has also been invoked while considering this question.
This principle has been recognised by this Court in Janardan Reddy & Others vs The State of (1) Lah.
391 (F.B.).
(2) I.L.R. 17 130 Hyderabad & Others(1) at page 367 where Fazl Ali, J. observed: "It is true that there is no such thing as the principle of constructive res judicata in a criminal case, but there is such a principle as finality of judgments, which applies to criminal as well as civil cases and is implicit in every system, wherein provisions are to be found for correcting errors in appeal or in revision.
Section 430, Criminal Procedure Code. . . . . . . has given express recognition to this principle of finality by providing that "Judgments and orders passed by an Appellate Court upon appeal shall be final, except in cases provided for in section 417 and Chapter XXXII" Section 417 relates to appeals on behalf of Government in cases of acquittal by any Court other than a High Court and Chapter XXXII relates to reference and revision which also are powers exercised by the High Court over the judgments or orders of inferior Courts, thus excluding from the purview of this exception all judgments and orders passed by the High Court as an Appellate Court.
Section 430 does not in terms give finality to the judgments of the High Court passed in exercise of its revisional jurisdiction, but the same principle would apply whether the High Court is exercising its appellate jurisdiction or its revisional jurisdiction, because in either case the High Court which is the highest Court of Appeal in the State would have pronounced its judgment,which judgment would replace the judgment of the lower Court and would be final.
Even while exercising its revisional powers under section 439 the High Court exercises any of the powers conferred on a Court of Appeal by sections 423, 426, 427 and 428 and it is in effect an exercise of the appellate jurisdiction though exercised in the manner indicated therein.
This principle of finality of criminal judgments therefore would equally apply when the High Court is exercising its revisional jurisdiction.
Once such a judgment has been pronounced by the High Court either in the exercise of its appellate or its revisional jurisdiction no review or (1) ; 131 revision can be entertained against that judgment and there is no provision in the Criminal Procedure Code which would enable even the High Court to review the same or to exercise revisional jurisdiction over the same.
The judgment of the High Court would replace that of the lower Court which would no longer be subsisting but would be replaced by the High Court judgment and thus it is only the High Court judgment which would be final and would have to be executed in accordance with law by the Courts below.
Section 425 requires that whenever a case is decided on appeal by the High Court it should certify its judgment or order to the Court by which the finding, sentence or order appealed against was recorded or passed and the Court to which the High Court certifies its judgment or order shall thereupon make such orders as are conformable to the judgment or order of the High Court and, if necessary, the record shall be amended in accordance therewith.
Section 442 similarly pro vides that when a case is revised under Chapter XXXII by the High Court it shall in the same manner certify its decision or order to the Court by which the finding, sentence or order revised was recorded or passed and the Court to which the decision or order is so certified shall thereupon make such orders as are conformable to the decision so certified and, if necessary, the record shall be amended in accordance therewith.
These provisions are enacted because the High Court itself does not execute or carry into effect the sentences or orders passed against the convicted persons but the work of such execution has necessarily to be done in conformity with the sentences or orders passed by the High Court by the Courts which originally passed the same.
Nevertheless the latter Courts execute or carry into effect the sentences or orders which are ultimately passed by the High Court and are invested with finality.
In these cases there is no occasion at all for the exercise of the revisional powers by the High Court under section 439(1) of the Criminal Procedure Code.
That jurisdiction can only be exercised by the High Court when the record of the proceedings of Subordinate Courts has been called for 132 by itself or the case has been reported to it for orders or has otherwise come to its knowledge and the High Court suo Motu on the application of the party interested thinks it fit to issue a notice for enhancement of sentence.
This is a clear exercise of the revisional jurisdiction of the High Court and can be exercised by it only qua the judgments of the lower Courts and certainly not qua its own judgments which have replaced those of the lower Courts.
The Criminal Procedure Code unlike the Civil Procedure Code does not define "judgment" but there are observations to be found in a Full Bench decision of the Madras High Court in Emperor vs Chinna Kaliappa Gounden and another(1), discussing the provisions of section 366 and section 367 of the Criminal Procedure Code and laying down that an order of dismissal under section 203 is not a judgment within the meaning of section 369.
The principle of autrefois acquit also was held not to apply as there was no trial when the complaint was dismissed under section 203 with the result that the dismissal of a complaint under section 203 was held not to operate as a bar to the rehearing of the complaint by the same Magistrate even when such order of dismissal had not been set aside by a competent authority.
Section 366 lays down what the language and contents of a judgment are to be and section 367 provides that the judgment is to contain the decision and the reasons for the decision and unless and until the judgment pronounced by the Court complied with these requirements it would not amount to a judgment and such a judgment when signed would not be liable to be altered or reviewed except to correct a clerical error by virtue of the provisions of section 369 save as therein provided.
These observations of the Madras High Court were quoted with approval by Sulaiman, J. in Dr. Hori Ram Singh vs Emperor(").
He observed that the Criminal Procedure Code did not define a judgment but various sections of the Code suggested what it meant.
He then discussed those sections and concluded that "judgment" in the Code meant a judg (1) Mad.
(2) A.I.R. 1939 Federal Court 43.
133 ment of conviction or acquittal.
Reference was then made to the observations of Sri Arnold White, C. J. in Emperor vs Chinna Kaliappa Gounden & another(1) which were followed by another Division Bench of the Madras High Court in Emperor vs Maheshwara Kondaya (2) and it was held that an order of discharge was not a judgment as "a judgment is intended to indicate the final order in a trial terminating in either the conviction or acquittal of the accused".
A Full Bench of the Bombay High Court in Emperor vs Nandlal Chunilal Bodiwala(3) pronounced that a judgment is the expression of the opinion of the Court arrived at after dueconsideration of the evidence and all the arguments.
It was pointed out that sections 366 and 367 applied to the judgments of the trial Court and section 424 dealing with the judgments of the Appellate Courts provided that the rules relating to the judgments of a Trial Court shall apply so far as may " be practicable to the judgment of any Appellate Court other than a High Court.
It followed therefore that there was no definite rule as to what the judgment of a High Court acting in its appellate as well as its revisional jurisdiction should contain.
It was quite natural because the judgment of the High Court in its criminal jurisdiction was ordinarily final and did not therefore require the statement of any reasons whether the High Court was exercising its appellate or revisional jurisdiction.
The judgment howsoever pronounced was however the expression of the opinion of the Court arrived at after due consideration of the evidence and all the arguments and would therefore either be a judgment of conviction or acquittal and where it would not be possible to predicate of the pronouncement that it was such an expression of opinion the pronouncement could certainly not be taken as the judgment of the High Court.
A judgment pronounced by the High Court in the exercise of its appellate or revisional jurisdiction after issue of a notice and a full hearing in the presence of both the parties would certainly be arrived at after (1) Mad.
(2) Madras 543.
(3) 134 due consideration of the evidence and all the arguments and would therefore be a judgment and such judgment when pronounced would replace the judgment of the lower Court, thus constituting the judgment of the High Court the only final judgment to be executed in accordance with law by the Court below.
When however a petition of appeal presented by a convicted person from jail is summarily dismissed under section 421 or a revision application made by him is dismissed summarily or in liming without hearing him or his pleader what the High Court does is to refuse to entertain the petition of appeal or the criminal revision and the order passed by the High Court "dismissed or rejected" cannot be said to be the expression of the opinion of the Court arrived at after due consideration of the evidence and all the arguments.
It is a refusal to admit the appeal or the criminal revision so that notice be issued to the opposite party and the matter be decided after a full hearing in the presence of both the parties.
It would be only after the appeal or the criminal revision was admitted that such a notice would issue and the mere refusal by the High Court to entertain the appeal or the criminal revision would certainly not amount to a judgment.
The same would be the position when a reference was made by the lower Court to the High Court under section 438 and the High Court on perusing the reference made an order "no order on the reference" as the High Court on a consideration of the terms of the reference must have come to the conclusion that no prima facie case has been made out to warrant an interference on its part.
If the High Court thought that it was a prima facie case for its interference it would certainly entertain the reference and issue a notice to the parties concerned to show cause why the judgment and order passed by the lower Court should not be revised.
When a petition of appeal is presented to the High Court by the convicted person or his pleader section 421 provides that no such appeal should be dismissed unless the appellant or his pleader has had a reasonable opportunity of being heard in support of 135 the same and the High Court might before dismissing an appeal under that section, call for the record of the case but would not be bound to do so.
Even in such a case the hearing accorded to the appellant or his pleader would be with a view to determine whether there was a prima ' facie case made out to warrant its interference in appeal.
The appellant or his pleader would be heard in support of that position and if he satisfied the High Court that there was a prima facie case for its interference the High Court would admit the appeal and order a notice to issue to the opposite party in which event the appeal would be.
decided after a full hearing in the presence of both the parties.
The calling for the records of the case also though not compulsory but discretionary with the Court would be for this very purpose, viz., to determine whether a prima facie case for its interference was made out.
The whole purpose of the hearing accorded to the appellant or his pleader even after calling for the records of the case would be to determine whether a prima facie case for its interference was made out and it would not be within the province of the Court at that stage to fully consider the evidence on the record and hear arguments from the appellant or his pleader with a view to determine whether the conviction could be sustained or the sentence passed upon the accused could be reduced.
The setting aside of the conviction and the reduction, if any, in the sentence could only be determined by the Court after notice was issued to the opposite party and a full hearing took place in the presence of both the parties.
Even in the case of a summary dismissal of a petition of appeal under these circumstances the position would certainly not be any different from that which obtains in the. case of a summary dismissal of the petition of appeal presented by the convicted person from jail or the summary dismissal of an application for criminal revision made by him or on his behalf to the High Court.
In all these cases there will be no judgment of the High Court replacing the judgment of the lower Court and the action of the High Court would only amount to a refusal by the High Court to admit the 136 petition of appeal or the criminal revision and issue notice to the opposite party with a view to the final determination of the questions &rising in the appeal or the revision.
The order dismissing the appeal or criminal revision summarily or in liming would no doubt be a final order of the High Court not subject to review or revision even by the High Court itself but would not tantamount to a judgment replacing that of the lower Court.
The convicted person would be bound by that order and would not be able to present another petition of appeal or application for criminal revision challenging the conviction or the sentence passed upon him by the lower Court.
But such order would not have the effect of replacing the judgment or order of the lower Court which would in that event be subject to the exercise of revisional jurisdiction by the High Court under section 439 of the Criminal Procedure Code at the instance of the State or an interested party.
In the cases (1) & (3) noted above therefore there being no judgment of the High Court replacing the judgment of the lower Court section 439 (1) would operate and the High Court in exercise of its revisional jurisdiction either Suo motu or on the application of the interested party would be in a position to issue the notice of enhancement of sentence which would require to be served on the accused under section 439(2) so that he would have an opportunity of being heard either personally or by pleader in his own defence.
In that event the convicted person in showing cause why his sentence should not be enhanced would also be entitled to show cause against his conviction.
It follows therefore that in the case of a summary dismissal or a dismissal in limine of petitions of appeal or applications for criminal revision even if the convicted person or his pleader has been heard by the High Court with a view to determine if there is a prima facie case for its interference, the convicted person to whom an opportunity has been given under section 439(2) of showing cause why his sentence should not be enhanced would in showing cause be entitled also to show cause against his conviction.
The 137 same would also be the position when a reference made by the lower Court to the High Court under section 438 of the Criminal Procedure Code is rejected by the High Court without issuing notice to the parties concerned by merely ordering "no order on the reference".
In cases where the petition of appeal or the application for criminal revision is admitted by the High Court and a notice is issued to the opposite party and the High Court maintains the conviction with or without reducing the sentence passed upon the accused the judgment of the High Court in the exercise of its appellate or revisional jurisdiction would replace the judgment of the lower Court and there would be no occasion at all for the exercise by the High Court of its revisional powers under section 439(1) which can only be exercised qua the judgments of the lower Courts and certainly not qua its own judgments.
The cases (2) & (4) noted above would therefore be outside the purview of section 439(1).
If that is so there would be no question accused an opportunity of being heart sonally or by pleader in his defence 439(2) act the provisions of section 439(6) would certainly not come into operation at all.
If no notice of enhancement of sentence could issue under these circumstances no question at all could arise of the convicted person showing cause why his sentence should not be enhanced and being entitled in showing cause also to show cause against his conviction.
It follows by way of a necessary corollary that no notice for enhancement of sentence can be issued by the High Court when a judgment is pronounced by it after a full hearing in the presence of both the parties either in exercise of its appellate or its revisional jurisdiction.
Such notice for enhancement of sentence can be issued by it either suo motu or at the instance of an interested party when the judgment of the lower Court subsists and is not replaced by its own judgment in the exercise of its appellate or its revisional jurisdiction.
When the judgment of the lower Court has been under its scrutiny on notice being issued to 18 18 138 the opposite party and on a full hearing accorded to both the parties notice for enhancement of sentence can only be issued by it before it pronounces its judgment replacing that of the lower Court.
When such hearing is in progress it is incumbent upon the High Court or the opposite party to make up its mind before such judgment is pronounced whether a notice for enhancement of sentence should issue to the accused.
There would be ample time for the opposite party to make up its mind whether it should apply for a notice of enhancement of the sentence.
The High Court also on a perusal of the record and after hearing the arguments addressed to it by both the parties would be in a position to make up its mind whether it should issue such notice to the accused.
But if neither the opposite party nor the High Court does so before the hearing is concluded and the judg ment is pronounced it will certainly not be open to either of them to issue such notice for enhancement of sentence to the accused, because then the judgment of the High Court in the exercise of its appellate or revisional jurisdiction would replace that of the lower Court and section 439(1) would have no operation at all.
Even in the case of a reference by the lower Court under section 438 of the Criminal Procedure Code the High Court if it did not summarily reject such a reference would issue notice to the parties concerned and then there would be occasion for it either suo motu or on the application of an interested party to issue a notice of enhancement of sentence before the hearing was concluded and a judgment was pronounced by it.
The procedure obtaining in the several High Courts to the effect that notice for enhancement of sentence can issue even after the appeal or the application for criminal revision is disposed of by the High Court and judgment pronounced thereupon is not correct and is contrary to the true position laid down above.
It was contended that the non obstante clause in section 439(6), viz. "notwithstanding anything contained in this section" was meant to confer upon the convicted person a right to show cause against his 139 conviction in those cases where a notice to show cause why his sentence should not be enhanced was issued against him, whatever be the circumstances under which it might have been issued.
Once you had a notice for enhancement of sentence issued against the convicted person this right of showing cause against his conviction also accrued to him and that right could be exercised by him even though he had on an earlier occasion unsuccessfully agitated the maintainability of his conviction either on appeal or in revision.
This non obstante clause could not in our opinion, override the requirements of section 439(1) which provides for the exercise of revisional powers by the High Court only qua the judgments of the lower Courts.
Section 439(6) would not come into operation unless a notice for enhancement was issued under section 439(2) and a notice for enhancement of sentence under section 439(2) could not be issued unless and until the High Court thought it fit to exercise its revisional powers under section 439(1) qua the judgments of the lower Courts.
The High Court has no jurisdiction to exercise any revisional powers qua its own judgments or orders, the same being invested with finality and otherwise being outside the purview of the exercise of its revisional jurisdiction, and the only purpose of the non obstante clause in section 439(6) can be to allow the convicted person also to show cause against his conviction when he is showing cause why his sentence should not be enhanced in spite of the prohibition contained in section 439(5).
Where an appeal lies under the Code and no appeal is brought no proceedings by way of revision can be entertained at the instance of the party who could have appealed.
If the convicted person could have 'filed an appeal but had failed to do so he could certainly not approach the High Court in revision and ask the High Court to set aside his conviction.
If he could not file any application in revision he could not show cause against his conviction under section 439 (1) of the Criminal Procedure Code and it was in order to remove this disability that the non obstante clause in section 439(6) was enacted so that when the High 140 Court was exercising its revisional jurisdiction the convicted person could show cause against his conviction in spite of the fact that otherwise he could not have been able to do so, be not having appealed when an appeal lay and therefore not being entitled to file an application in criminal revision and challenge the validity or maintainability of his conviction.
Section 439(6) therefore confers on the convicted person a right which he can exercise in the event of a notice for enhancement of sentence being issued against him in the exercise of the revisional jurisdiction by the High Court in spite of the fact that he was not entitled to question the validity or maintainability of his conviction in a substantive applica tion for criminal revision filed by him for the purpose and this right is available to him only if the High Court exercising its revisional jurisdiction under section 439(1) thinks it fit to issue a notice of enhancement of sentence against him under section 439(2) and in that event he has the right also to show cause against his conviction when showing cause why his sentence should not be enhanced.
We shall now review the decisions of the various High Courts to which our attention has been drawn by the learned counsel appearing before us.
Turning first to the decisions of the Bombay High Court we were referred to Emperor vs Chinto Bhairava (1), a decision given in the year 1908 which recognised the invariable practice of that Court for over 25 years according to which the accused in showing cause why the sentence should not be enhanced was not allowed to dis cuss the evidence and satisfy the Court that he had been wrongly convicted.
The practice of the Court in such cases was to accept the conviction as conclusive and to consider the question of enhancement of sentence on that basis.
It was open to the accused to apply for revision of the conviction, but having failed to avail himself of that, he could not be permitted to assail the conviction in a proceeding where the sole question was whether the sentence passed by the lower Court was adequate or not.
It may be (1) Bom.
141 noted that this decision was in the year 1908 long before the amendment of section 439 of the Criminal Procedure Code by Act XVIII of 1923 by adding subsection (6) thereto.
The next decision to which we were referred was Emperor vs Mangal Naran(1).
In that case simultaneously with the admission of an appeal filed by the accused the Court issued a notice for enhancement of sentence.
When the appeal and the notice came for hearing together before the Division Bench the Court observed that such a practice was not desirable.
It was likely to produce an impression on the mind of an illiterate accused in jail that it was proposed to enhance the sentence because he had appealed.
MacLeod, C.J. there expressed an opinion that if after an appeal had been heard on its merits and dismissed a notice to enhance the sentence was issued, the accused had still the right to show cause against his conviction, though any attempt to set aside the conviction would not have much chance of success.
He however expressed his preference in favour of the old practice, viz. first to deal with the appeal and then to consider whether a notice to enhance should issue.
No ques tion had arisen for consideration of the Court in that case as to the true construction of the provision of section 439(6) of the Criminal Procedure Code and the only question considered by the Court there was what should be the proper procedure to be adopted when issuing a notice for enhancement of sentence, whether it should be issued simultaneously with the admission of the appeal or after the appeal was finally heard and disposed of.
This opinion expressed by MacLeod, C.J. was therefore treated as obiter in Emperor vs Jorabhai Kisanbhai(2).
The question that arose for consideration of the Court in that case was whether after an appeal of an accused person against his conviction and sentence had been dismissed by a Division Bench of the High Court and a notice to enhance the sentence was issued on an application on behalf of the Government the application for enhancement of sentence could be (1) (2) Bom.
142 heard on its merits by another Division Bench of the High Court treating the conviction as correct or the accused was under such circumstances not entitled under section 439(6) to be re heard on the merits of his conviction.
The appeal filed by the accused against his conviction and sentence had been dismissed on the 7th April, 1926.
After judgment was delivered by the Court, the Government Pleader applied orally for issue of a notice for enhancement and that application was granted.
The application was heard on the 17th June 1926 and it was urged on behalf of the accused that the only proper procedure was to issue a notice for enhancement of sentence before the appeal had been actually disposed of and that once the appeal was disposed of by the Court there was no legal power to enhance the sentence under section 439 of the Criminal Procedure Code.
That contention was negatived the Court observing that so far as the point of procedure was concerned there was no hard and fast rule as to the appropriate time for the issue of notice of enhancement of sentence by the High Court and resorting, to the principle of the finality of judgments as regards the accused being concluded by the judgment of the High Court dismissing his appeal and confirming the sentence passed upon him.
The judgment there was interpreted as confirming the conviction and rejecting the appeal as to the sentence in the sense that it saw no reason to reduce it and that was not treated as a decision that the sentence should not be enhanced if a proper procedure was taken such as the Code allowed for the purpose and therefore so far as the judgment went there was nothing which in any way tied the hands of the Court.
Sections 369 and 430 of the Criminal Procedure Code were referred to and the Court held that the observations of MacLeod, C.J. in Emperor vs Mangal Naran(1) above referred to were obiter dicta not binding upon them and the application must be heard on the merits treating the conviction as correct in view of the dismissal of the appeal.
It is no doubt true as observed by Madgavkar, J. (1) 143 in regard to the practice as to the proper time for issuing of the notice of enhancement that the question of adequacy of punishment is, in the first instance, a matter for the Government and for the District Magistrate.
From the time when the sentence is passed, and at all events up to the time when anappeal is admitted and notice is received, it is open to Government to consider the sufficiency of a sentence and before hearing of the appeal, to apply to the High Court for enhancement of the sentence if they are so advised.
In that event the appeal as well as the notice of enhancement would be heard together and the Court hearing the appeal would apply its mind not only to the question whether the conviction should be confirmed but also to the question whether the sentence should be reduced or enhanced as the case may be ' It is only in rare instances that the High Court considers for itself the question of enhancement of sentence and only if no action has been taken by the Government and if the High Court thinks that the interests of justice imperatively demand it.
In such a case it would be a matter for consideration by the High Court whether it should issue notice at the very time of the admission or whether it should do so while disposing of the appeal on the merits as to the conviction.
The observations of the learned Judge however in so far as they seem to suggest that the appeal should be disposed of first and the question of enhancement of sentence should be considered by the same Bench immediately afterwards or that the notice for enhancement could be issued by the Court after the disposal of the appeal on the merits as to conviction do not take into account the fact that after the judgment is pronounced and the conviction is confirmed involving as a necessary corollary thereof the confirming of the sentence passed upon the accused also if the same is not reduced, the judgment of the High Court replaces that of the lower Court and the exercise of any revisional powers by the High Court by way of enhancement of the sentence is necessarily eschewed.
These revisional powers could only be exercised by the High Court qua the judg 144 ment of the lower Court and once that judgment is replaced by the judgment of the High Court, the High Court has no further powers to review or revise its own judgment and enhance the sentence which is thus passed by it upon the accused.
The principle as to the finality of judgments applied by the Court by virtue of the provisions of section 369 and section 430 of the Criminal Procedure Code should not have been confined merely to the question of confirming the conviction but also should have been extended to the confirming of the sentence in so far as the High Court did not see any reason to reduce the sentence already passed by the lower Court upon the accused.
When the High Court hears the appeal on its merits it does not apply its mind only to the question whether the conviction should be confirmed but also applies its mind to the adequacy of the sentence passed upon the accused by the lower Court.
In thus applying its mind to the question of sentence it also considers whether the sentence passed upon the accused by the lower Court is adequate in the sense that it is either such as should be reduced or is such as should be enhanced.
The questions of the reduction of the sentence or enhancement of the sentence are not to be viewed as if they fall into water tight compartments and the mind of the Court hearing the appeal on merits is directed to the consideration of the matter in all its aspects including the confirming of the conviction and the reduction or enhancement of the sentence as the case may be.
The principle of finality of judgments should therefore be extended not only to the question of the confirming of the conviction but also to the question as to the adequacy of the sentence, whether the sentence which is passed upon the accused by the lower Court should be reduced, confirmed or enhanced.
Once therefore the judgment of the High Court replaces that of the lower Court there is no question which can ever arise of the exercise by the High Court of its revisional powers under section 469(1) of the Criminal Procedure Code and the proper procedure therefore if the High Court thought it fit either suo motu or on the application of the interested party 145 to issue the notice of enhancement of sentence, is to issue the said notice before the hearing of the appeal is concluded and the judgment of the High Court in appeal is pronounced.
We are therefore of the opinion that the decision reached by the High Court of Bombay in Emperor vs Jorabhai(1) was not correct in so far as it held that the notice of enhancement could be issued by the High Court at the instance of the Government after the dismissal of the appeal on merits.
The notice for enhancement issued in that case was not competent and should not have been issued at all by the High Court.
The decision in Emperor vs Jorabhai(1) was followed in Emperor vs Koya Partab(2) which extended the same principle to an appeal which had been presented from jail and was summarily dismissed under section 421 of the Criminal Procedure Code.
While dismissing the same the Court issued a notice for enhancement.
When the notice came for hearing the accused contended that he was entitled to be heard on the merits as to whether he should have been convicted or not relying upon the provisions of section 439(6).
Beau mont, C.J. relied upon the provisions of section 430 and observed that the accused was not at liberty to be heard on the merits.
The judgment of the Court of Appeal dismissing the appeal on the 9th June 1930 was a final order which the Court was not at liberty to differ from and the non obstante clause in section 439(6) did not entitle the accused to go behind section 430 and to show cause against his conviction after his appeal had been dismissed.
The learned Chief Justice followed the decision in Emperor vs Jorabhai (1) and observed that the only distinction between that case and the one before him was that case had been heard on the merits and not summarily dismissed.
But in his view that distinction was not one of principle.
We are of the opinion that the order which had been pronounced by the Court of Appeal on the 9th June 1930 was not a judgment of the High Court which replaced that of the lower Court and (1) Bom.
(2) 19 146 even though it might come within the description of an order within the meaning of section 430 it was not a judgment within the meaning of the term set out above and not being a judgment was no bar to the accused showing cause also against his conviction when showing cause against the notice for enhancement.
The matter was one falling within the category of case No. I noted above and it was open to the accused even though his petition of appeal from jail was summarily dismissed under section 421 to urge while showing cause against the notice of enhancement of sentence also to show cause against his conviction.
This decision was therefore in our opinion incorrect and the accused ought to have been heard on the merits as to whether he should have been convicted or not.
Emperor vs Ramchandra Shankarshet Uravane(1) was a case where the High Court admitted the appeal and at the same time issued a notice to the accused for enhancement of sentence.
The observations of MacLeod, J. in Emperor vs Mangal Naran(2) were followed in spite of the fact that they bad been held obiter by the Division Bench of the Court in Emperor vs Jorabhai (3).
Emperor vs Jorabhai (3) was also referred to and it was held that it was neither necessary nor desirable for the High Court to issue a notice, for enhancement of sentence at the time of admission of the appeal.
It was however observed that it was open to consider the question of enhancement of sentence after the appeal had been heard.
If those observations were meant to convey that the question of enhancement of sentence could be considered after the appeal had been disposed of and judgment was pronounced by the High Court we do not agree with the same.
But if they were meant to convey that the High Court could hear the accused on the question of enhancement of the sentence at the same time when his appeal was heard, before pronouncement of the judgment on the question of the conviction and the (1) (2) (3) Bom.
147 sentence passed upon him, they were perfectly in order.
The decision in Emperor vs Inderchand(1) extended the principle enunciated in Emperor vs Jorabhai further by applying it to a case where an application for revision by the accused against his conviction and sentence had been dismissed by the High Court.
In that case the accused had filed an application for revision which was summarily dismissed by the Vacation Judge on the 30th April, 1954.
After such summary dismissal of the application the Government filed the criminal revision application for enhancement of sentence.
The Division Bench held that the criminal revision application of the accused having been fully disposed of by the learned Vacation Judge there was a valid order of dismissal, that section 430 debarred the accused from having that order of dismissal reviewed by the High Court that the right conferred by section 439(6) could not give an accused person a right to be heard against his conviction if such a right was in conflict with the other provisions of the Code, that under section 369 the Court had no power to alter the decision of the learned Vacation Judge dismissing the revision petition filed by the accused and that if the accused bad already unsuccessfully exercised his right of appeal or revision to the High Court he was not entitled in a subsequent application by the Government for enhancement of sentence to ask the High Court to go once more into the merits of the case and to set aside the conviction which the same Court had previously confirmed either in appeal or on a revision application.
Divatia, J. was conscious of the somewhat anomalous position so far as the accused was concerned and referred to the observations of the Court in Emperor vs Babu Pandurang Mhaske(3) where it was stated and rightly that where the High Court itself wanted to enhance the sentence, in order that the accused might have the right to challenge his conviction before the same bench which was hearing either the appeal or the (1) (2) (1926] I.L.R. (3) 148 application for enhancement, it was proper that the application for enhancement should be heard before the appeal was finally decided, so that the accused might be heard at the very time when the question of enhancement was before the Court.
While approving of these observations the learned Judge however observed that it was possible only in a case where the High Court itself wanted to enhance the sentence and gave notice to the accused and not so in a case where Government approached the High Court by way of a revisional application as it was entitled to do under section 439(1).
Government might approach the High Court in revision under section 439(1) at any time within six months after the decision of the lower Court and in the meanwhile the accused might have come to the High Court and his application might have been rejected.
That might result in this that the conviction might be confirmed by one Bench or a single Judge as might happen in a particular case and the application for enhancement might be heard by another Bench.
But, so far as the provisions of the section were concerned, whatever might be the anomaly in this procedure, the learned Judge did not think that the inconvenience or hardship to the accused should lead the Court to construe section 439 of the Criminal Procedure Code in a manner which, according to the view of the learned Judge, was not intended by the Legislature.
These observations however did not take count of the fact that if a petition of appeal or a criminal revision application filed by the accused was dismissed summarily or in limine there was no question of a judgment of the High Court replacing that of the lower Court and the order of the High Court merely amounted to a refusal by it to interfere either in the exercise of its appellate or revisional jurisdiction which order though final and not being susceptible of review or revision by the High Court itself, did not amount to a judgment of the High Court barring the application of section 439(1) of the Criminal Procedure Code.
In that event the judgment of the lower Court not being replaced by a 149 judgment of the High Court it could be the subjectmatter of criminal revision at the instance of the Government in the matter of the enhancement of the sentence and all the provisions of section 439 would then come into operation.
The High Court would be bound then under section 439(2) to give an opportunity to the accused to be heard in his defence before the sentence passed upon him by the lower Court was enhanced and the accused would under section 439(6) be entitled in showing cause against the notice of enhancement also to show cause against his conviction.
This decision of the High Court therefore was incorrect and the accused ought to have been allowed in spite of the summary dismissal of his application in revision to show cause against his conviction while showing cause against the notice for enhancement.
One more decision of the Bombay High Court may be referred to and that is Emperor vs Nandlal Chunilal Bodiwala(1).
That was a case where the Sessions Judge of Ahmedabad had at the instance of the petitioner made a reference to the High Court recommending that the Additional Magistrate had no jurisdiction, power or authority to pass the order complained against and that the High Court should quash the same.
On the reference coming before the High Court the following order was passed without issuing notice: "no order on this reference".
The petitioner thereupon filed a criminal revision application to the High Court praying that the order of the Additional District Magistrate be quashed.
This revision application came for hearing before a Division Bench and the Court requested the Chief Justice to constitute a Full Bench to consider the following point: "When on a reference made by the Sessions Judge under section 438 of the Criminal Procedure Code, a Division Bench of this Court passes an order without issuing notice, viz., 'No order on this reference ', whether the applicant at whose instance the Sessions Judge made the reference is entitled to make an application in revision to this Court in the same (1) 150 matter, in view of the provisions of section 369 of the Criminal Procedure Code?" The application was heard by a Full Bench and it was contended on behalf of the petitioner that when the High Court without issuing notice to the applicant disposed of the reference made by the Sessions Judge by stating "no order on the reference" there was no judgment given on the merits.
The order of the Court only meant that the Court would not allow the matter to be brought before it on the recommendation of the Sessions Judge and merely disposed of it on that view.
If a mere order of disposal of a reference or revision application amounted to a judgment the party in whose favour a reference was made by the Sessions Judge would be deprived of the right he had of approaching the High Court in revision against the order, if the Court disposed of the matter in the manner it had done in that case.
This argument was repelled by the Full Bench.
It held that section 369 of the Criminal Procedure Code debarred the petitioner from making the criminal revision application, that the order of the High Court passed upon the reference amounted to a judgment within the meaning of that term in section 369 of the Criminal Procedure Code and after it was signed it could not be altered or reviewed in a subsequent application for revision and that even though the Division Bench of the High Court passed the order "no order on this reference" without issuing notice to the applicant, the applicant whose favour the Sessions Judge made a reference was not entitled to make an application in revision to the High Court in the same matter.
Even though this conclusion was reached by the Full Bench they observed that they were not unaware that the applicant had a grievance that his position had been worsened and not improved by the Sessions Judge being in his favour, because if the recommendation of the Sessions Judge was turned down without hearing the petitioner, as had happened in that case he was worse off, while if the Sessions Judge would have been against him he could have still applied to the High Court in revision 151 and got an opportunity to put his case before the High Court.
This was recognised no doubt as an anomaly but it was caused by the provision of rule 26 of the Appellate Side Rules of the Bombay High Court which compelled a party to apply to a lower revisional Court before applying in revision to the High Court.
This disability which the petitioner suffered from was emphasised in that if the Sessions Judge had dismissed his application he could then have applied to and argued his case before the High Court, but because the Sessions Judge was in his favour and had therefore got to make a reference to the High Court recommending it to set aside the order and because the High Court was not satisfied with the reasons for the recommendation, and disposed of it without issuing a rule, the petitioner was debarred from urging his arguments before the High Court.
It might be that the reasons given by the Sessions Judge for the recommendation might be weak or might be insufficient, whereas the petitioner, if he appeared might be able to urge cogent and sufficient reasons for setting aside the original order.
In spite of pointing out this disability the only recommendation which was made by the Full Bench was that the Rule 26 of the Appellate Side Rules should be properly amended so as to issue notice to all the parties concerned when a reference was made by a Sessions Judge recommending the setting aside of an order of the Trial Court.
We are of the opinion that the Full Bench should not have stopped short at pointing out this disability which the applicant suffered from but should have gone further and held that the order passed by the High Court on the reference, though final under section 430 of the Criminal Procedure Code was not a judgment within the meaning of that term and therefore did not debar the applicant from making the criminal revision application which he did under section 439(1) of the Criminal Procedure Code.
Such an order did not amount to a judgment within the definition thereof given by the Full Bench itself which was: "a judgment is the expression of the opinion of the Court arrived at after due consideration of the 152 evidence and of the arguments" as pointed out earlier in the course of this judgment.
We are of the opinion that this decision of the Bombay High Court was also incorrect.
Emperor vs Jorabhai (1) was followed by the Lahore High Court in Emperor vs Dhanalal(2).
In that case a revision petition filed on a behalf of the convicted person was dismissed after hearing counsel.
Subsequently a report of the Sessions Judge was received and the learned Judge who had dismissed the revision petition issued a notice for enhancement of sentence and the Court held that section 439(6) was meant to give an accused person to whom a notice for enhancement was issued and who had not appealed or if no appeal lay had not applied for revision of his conviction an opportunity to question the correctness of his conviction if it was proposed to enhance his sentence.
But if a petition for revision against his conviction by a convict had been rejected by a Judge of the High Court and a notice had subsequently been issued to him to show cause why his sentence should not be enhanced the convict was barred from showing cause against his conviction and the fact that the previous order dismissing the revision was passed without issuing notice to the opposite party made no difference to the position.
The Court also invoked the principle of the finality of judgments and further held that the words "unless he had already done so" though not occurring at the end of the sub section were to be presumed to be implied from the ordinary presumption as to the finality of orders in criminal revision proceedings.
In arriving at this conclusion Addison, J. observed: "In the present case there has been a judgment of this Court on the very full revision application brought by the convict.
By that judgment the petition was dismissed and the conviction confirmed.
Under section 369, Criminal Procedure Code that judgment cannot be reviewed.
It is a final judgment of this Court, and in my opinion the provisions of sub (1) Bom.
(2) Lah.
153 section (6), section 439, do not give the convict another opportunity in these circumstances to be heard as regards his conviction".
There was no justification whatsoever for reading the words "unless he had already done so" in the section and the reasoning adopted by the learned Judge in our opinion wrongly invested the order passed by the High Court in the exercise of its revisional jurisdiction dismissing the application without issuing a notice to the opposite party with the character of a judgment which could only be enjoyed by it if it had been pronounced after a full hearing in the presence of both the parties after notice issued to the opposite party.
Then the pronouncement of the High Court would have been a judgment replacing the judgment of the lower Court and not subject to the exercise of any revisional jurisdiction under section 439(1) of the Criminal Procedure Code.
Where the petition for revision against his conviction presented by the convict had been rejected by the High Court in limine the order passed by the High Court did not tantamount to a judgment which would debar the convict from showing cause against the conviction when showing cause against a subsequent notice for enhancement of sentence issued by the High Court.
The learned Judge further observed: "There appears to be no distinction between dismissing a revision petition in limine or after notice.
The judgment is in either case an effective and final judgment of the Court.
In this respect there is no difference between a revision petition and a memorandum of appeal. . . .
In these circumstances I can see no force in the argument that an, order dismissing a revision petition without issuing notice is different from an order after the issue of notice, or that there is any distinction between a judgment of this Court passed on the revision side and one on the appellate side".
While agreeing with the observations of the learned Judge that for the purposes of section 439(1) there was no distinction between a judgment of 20 154 the High Court passed on the revision side and one on the appellate side we are of the opinion that there is a real distinction between orders dismissing a revision petition or a petition of appeal in limine without issuing notice to the opposite party and judgments pronounced by the High Court in the exercise of its appellate or revisional jurisdiction after a full hearing in the presence of both the parties after the issue of notice.
The latter are judgments in the true sense of the term which debar the exercise of revisional jurisdiction by the High Court under section 439 (1) of the Criminal Procedure Code.
This decision of the Lahore High Court was however overruled by a Special Bench of that Court in Emperor vs Atta Mohammad(1).
A criminal revision application had been dismissed in limine and thereafter a notice for enhancement of sentence was issued by the High Court.
The decision of that Court in Emperor vs Dhanalal(1) following Emperor vs Jorabhai(3) was cited as debarring the accused from showing cause against his conviction and Blacker, J. before whom the matter was argued in the first instance recommended a reference to a larger Bench and the reference came up for hearing and final disposal before a Special Bench of the Court.
It was held that the accused was entitled to show cause against his conviction notwithstanding the fact that his petition for revision of the order by which he was convicted had already been dismissed in limine under section 435 of the Criminal Procedure Code.
The question whether an order under section 435 was a judgment was discussed by Blacker, J. while pronouncing the judgment of the Special Bench.
He referred to the case of Dr. Hori Ram Singh vs Emperor(1) above referred to and quoted with approval the observations of Sulaiman, J. that every order in a criminal matter was not a judgment and that 'judgment ' in the Crimi nal Procedure Code meant a judgment of conviction or acquittal.
Applying this definition the learned Judge observed: (1) Lah.
391 (F.B.).
(2) Lahore 241.
(3) Bom.
(4) A.I.R. 1939 F.C. 43. 155 "It will be seen that an order under section 435 can with difficulty be called a judgment.
All that a Judge does at this preliminary stage is either to send for the records of the lower Court with a view to examining them under section 439(1) or to refuse to do so.
It is difficult to see how the latter can possibly be called a judgment of conviction.
When such an order consists of the one word 'Dismissed ' can it necessarily be taken as a judicial pronouncement that in the opinion of the Judge the respondent was rightly convicted upon the evidence? It seems to me that all that it means is that the Judge sees no adequate ground disclosed in the petition or on the face of the judgment for proceeding further".
This reasoning in our opinion was quite sound.
But the learned Judge proceeded further to make a distinction between the summary dismissal of a petition of appeal under section 421 and the summary dismissal of a criminal revision application under section 435 stating that the reasons for which the High Court would summarily dismiss an appeal were very different from those for which it would refuse to interfere in revision, and in the case of appeal it would only do so when the material before it was sufficient to satisfy it beyond any doubt of the accused 's guilt, whereas, on revision the High Court would not interfere merely because it did not agree on every point with the Court below,, as long as the Courts below have come to a reasonable decision on the evidence.
This distinction in our opinion does not affect the position that the order pronounced by the High Court dismissing the petition of appeal or a criminal revision application in limine without issuing notice to the opposite party is merely an order dismissing the same on the ground that there is no prima facie case for interference of the High Court and does not amount to a judgment pronounced by the High Court after full hearing in the presence of both the parties which only can debar the High Court from exercising its revisional jurisdiction under section 439(1).
Mr. Justice Mahajan as he then was delivered a concurring judgment but went a step further and observed that 156 the true interpretation of section 439(6) was that it gave an unlimited right to the accused to whom a notice of enhancement was issued under section 439(2) to show cause against his conviction and the Judge was bound to go into the evidence with a view to find for himself whether the conviction could be sustained.
This right accrued to the convict on service of notice of enhancement of sentence and could not be negatived by anything that had preceded the issue of that notice.
It was the Judge hearing the en hancement petition who had to give an opportunity to the convict to challenge his conviction before him and to satisfy him that the conviction was unsustainable.
That Judge could not substitute for his satisfaction the satisfaction of some other Judge in the matter.
It was a condition precedent to the passing of a prejudicial order against an accused person that he had another opportunity of establishing his innocence, even if he had failed to do so before.
The learned Judge rightly observed that an order made in the exercise of an extraordinary discretionary jurisdiction, unless it be a judgment in rem, could not in any way operate as a bar to the decision of the same matter when it arose in the exercise of ordinary appellate jurisdiction, and that therefore an order dismissing a criminal revision application in limine could not amount to a judgment of the High Court.
The learned Judge then invoked the principle of the finality of judgments and observed: "On the other band if the view be correct that all orders passed in exercise of revisional jurisdiction whether they be of dismissal of the petition in limine, or otherwise take away the right of the convict to challenge his conviction in view of section 369, Criminal Procedure Code as in such cases a decision given already cannot be altered or reviewed, then I do not see how for purposes of enhancement of the sentence, the previous decision can be altered.
Any Judge deciding a petition for revision under section 439(1) must consider the propriety of the sentence as well as the propriety and legality of the conviction, and in my opinion he must be presumed to 157 have done so.
If a previous decision on the question of conviction bars the applicability of section 439(6), it also bars the power to enhance the sentence.
Once it has been held that the sentence was proper, it cannot be enhanced.
I have not been able to see the ratio decidendi of the decisions which take the view, that the question of enhancement of the sentence is something distinct and separate from that of conviction, and that the question of the adequacy and propriety of sentence which comes before the court on a petition for revision presented by the accused is a matter different from the matter of enhancement.
, The Judge has to see if a proper sentence has been passed before he decides the case, and the question whether a sentence passed is adequate or inadequate cannot be split up in two different compartments.
The question is only one of the quantum of punishment and such a question can only be decided but once.
Therefore in my view either there is no power of re revision in the High Court, in that case there is no power to enhance the sentence on a separate petition made for the purpose; or there is such a power in that case it is available to the Crown as well as to the accused".
This reasoning again was in our opinion sound but led only to the conclusion that there was no power of re revision in the High, Court and in that case there was no power to enhance the sentence on a separate petition made for the purpose.
The learned Judge therefore ought to have held that if the order dismissing the criminal revision petition in limine tantamount to a judgment pronounced by the High Court it was not open to the High Court to issue a notice for enhancement of sentence subsequently under section 439(1) of the Criminal Procedure Code. 'Having held however that the order dismissing the criminal revision application in limine was merely an order and not a judgment pronounced by the High Court and also having held that the High Court was entitled to issue a notice for enhancement of sentence under section 439(1), under those circumstances the only logical conclusion to which the Court could come 158 was that under section 439 (6) the accused while showing cause against the enhancement of sentence was entitled also to show cause against his conviction.
Mr. Justice Mahajan confined his decision only to the case of a dismissal of a criminal revision application in limine and left open the question whether a decision on the Appellate Side of the High Court would bar the exercise of the right under section 439 (6) inasmuch as no arguments were heard on the point.
The principle of this judgment in our opinion is not con fined merely to cases where a criminal revision application has been dismissed in limine but also extends to cases where a petition of appeal whether presented from jail or presented to the Court by the appellant or his pleader has been similarly dismissed summarily or in limine without issuing notice to the opposite party and also to cases of references made by the lower Courts to the High Court where the High Court has merely passed an order without issuing notices, to any of the parties concerned "no order on this reference".
The Patna High Court in Ramlakhan Chaudhry vs The King Emperor(1) followed both these decisions Emperor vs Jorabhai(2) and Empeeror vs Dhanalal(3) in holding that the dismissal of an appeal by the High Court did not debar it from subsequently enhancing the sentence in the exercise of revisional jurisdiction after issuing notice to the accused.
In that case an appeal had.
been dismissed after full hearing by the High Court.
At the hearing of the appeal however the Court asked the counsel for the accused to show cause why the sentence passed upon them should not be directed to run consecutively thus in effect issuing a notice for enhancement of the sentence.
When the matter came on for hearing it was contended on behalf of the accused that with the disposal of the appeal the Bench and indeed the High Court was functus officio and had no jurisdiction to hear the matter at all.
This contention was repelled by observing that the appellate judgment was not concerned with the (1) Patna 872.
(2) Bom.
(3) Lahore 241.
159 question of enhancement of the sentence which only arose in the exercise of the revisional jurisdiction and the sentence to be revised and enhanced was the sentence passed not by the High Court but by the Court of Sessions.
These observations run counter to the observations of Mr. Justice Mahajan which we have quoted above and ignores the fact that once the High Court pronounced its judgment in the appeal after full hearing in the presence of both the parties the judgment of the High Court replaced that of the lower Court and the High Court had thereafter no power to issue a notice of enhancement of sentence purporting to exercise the revisional powers vested in it under section 439 (1) of the Criminal Procedure Code which could be exercised only qua the judgments of the lower Courts and not its own judgments.
The Allahabad High Court also in Emperor vs Naubat(1) followed the decisions of that Court which had approved of and followed Emperor vs Jorabhai(2) and repelled the contention which had been urged on behalf of the accused that the application in revision filed by the Government for enhancement of their sentence was incompetent, because their appeal from their convictions had been dismissed by the Court and it was not open to them again to show cause against their convictions.
The decisions above referred to were held by the Court to be an authority for the proposi tion that the Court could under the circumstances proceed to consider whether the sentence imposed upon the accused should be enhanced, even though it was not open to the accused to show cause against their conviction.
This decision was in our opinion not correct for the simple reason that once the judgment of the Appellate Court replaced that of the lower Court it was not competent to the High Court to issue a notice for enhancement of sentence in the exercise of its revisional jurisdiction under section 439(1) and no question could therefore arise of the accused being called upon to show cause why their sentence should not be enhanced.
(1) I.L.R. 1945 Allahabad, 527.
(2) Bom.
160 The High Court of Rajasthan in The Stafe, vs Bhawani Shankar(1) tried to reconcile the various points of view above noted by laying stress on the aspect of the accused having had an opportunity to show cause against his conviction and it observed that where an accused person had already been beard and thus given an opportunity to show cause against his conviction, whether it be in appeal or in revision and whether the dismissal was summary or on the merits, he could not be heard against his conviction a second time under section 439(6) as the principle of finality of orders in criminal proceedings would apply.
But if the accused had not been heard at all and given no opportunity to show cause against his conviction and his jail appeal had been dismissed under section 421 of the Criminal Procedure Code, or his revision had been dismissed without hearing, he was entitled to ask the Court to hear him and thus allow him to show cause against his conviction under section 439(6), if a notice of enhancement was issued to him.
The real question however in our opinion is not whether an opportunity has been given to the accused to show cause against his conviction at any time but whether the High Court is entitled to exercise its revisional powers under section 439(1) and issue a notice of enhancement of sentence upon the accused.
If the accused had an opportunity of showing cause against his conviction either in an appeal or a criminal revision application filed by him or on his behalf and the conviction was confirmed on a full hearing in the presence of both the parties after the issue of the reqiuisite notice by the Court to the opposite party the judgment of the High Court would replace that of the lower Court which judgment could not be reviewed or revised by the High Court at all in exercise of its revisional powers under section 439(1).
If however an order dismissing the petition of appeal or criminal revision application or even a reference made by the lower Court was made dismissing the same summarily or in limine without issuing notice to the opposite party or the parties concerned it would tanta (1) I.L.R. 161 mount to the High Court not entertaining any of these proceedings on the ground that no prima facie case had been made out for the interference of the Court.
If such a prima facie case had been made out the High Court would admit the appeal or the revision application or entertain the reference and hear the matter fully in the presence of both the parties, ultimately pronouncing its judgment which would take the place of the judgment of the lower Court which would certainly not be subject to the exercise of revisional jurisdiction under section 439 (1) of the Criminal Procedure Code.
We are of the opinion that the conclusion reached by the High Court of Rajasthan was correct and the accused in that case was rightly allowed by it to show cause against his conviction in spite of his petition of appeal from jail having been dismissed by it summarily, though we differ from the reasoning adopted by the Court in reaching that con clusion.
Section 439(6) gives the accused a right to show cause against his conviction.
It does not merely give him an opportunity to show cause against the same.
The opportunity is given to him to show cause against the enhancement of sentence under section 439(2) of the Criminal Procedure Code and once be has got that opportunity, while showing cause against the enhancement of his sentence he has a right to show cause against his conviction which right he can ,exercise whether he had on an earlier occasion an opportunity of doing so or not; The real test is not whether the accused has had an opportunity of showing 'cause against his conviction but whether a judgment of the High Court pronounced after a full hearing in the presence of both the parties after notice issued in that behalf has replaced the judgment of the lower Court.
If the judgment of the lower Court is so replaced there is no occasion at all for the exercise of the revisional powers under section 439(1) of the Criminal Procedure Code.
If however no such judgment has replaced that of the lower Court the High Court has got the power to issue a notice for enhancement of the sentence and the accused has, in 21 162 spite of whatever has happened in the past, while showing cause against the notice of enhancement also the right to show cause against his conviction.
The right which is thus conferred upon the accused under section 439(6) cannot be taken away by having resort to the principle of finality of judgments incorporated in section 369 of the Criminal Procedure Code.
As we have observed above that principle comes into operation when once a judgment of the High Court has replaced that of the lower Court and in those cases the High Court would not be compe tent to review or revise its own judgment.
The High Court would also not be then entitled to issue any notice for enhancement of sentence in the exercise of its revisional powers under section 439 (1) of the Criminal Procedure Code.
Where however the High Court in exercise of its revisional power over the judgments of the lower Courts under section 439(1) issues a notice for enhancement of sentence and gives an opportunity to the accused of being heard either personally or by pleader in his own defence under section 439(2) the right which is given by section 439(6) to him also to show cause against his conviction comes into exist ence and this right of his cannot be ' negatived by having resort to the provisions of either section 369 or section 430 of the Criminal Procedure Code.
Section 369 in terms provides, "save as otherwise provided in this Code" and section 439(6) would be an otherwise provision which is saved by this non obstante clause appearing in section 369.
It is significant to note that both these amendments, the one in section 369 and the other in section 439 were enacted by section 119 of Act XVIII of 1923 and the very purpose of these simultaneous amendments would appear to be to effectuate the right given to the accused to show cause against his conviction as enacted in section 439(6) of the Criminal Procedure Code.
It may also be noted that the right which is thus conferred on the accused under section 439(6) is not ,an unlimited or unfettered right as observed by Mr. Justice Mahajan in Emperor vs Atta Mohammad(1).
(1) Lah.
391 (F.B.).
163 In the case of trials by jury where an accused person has been convicted on the verdict of a jury and is called upon under section 439(2) of the Criminal Procedure Code to show cause why his sentence should not be enhanced he is entitled under section 439(6) to show cause against his conviction, but only so far as section 423(2) of the Code allows and has not an unlimited right of impugning the conviction on the evidence.
It has been held by the Allahabad High Court in Emperor vs Bhishwanath (1) that the combined effect of sections 439 (6) and 423 (2) is to entitle the accused to question the conviction by showing only that the Judge misdirected the jury or that the jury misunderstood the law laid down by the Judge in his charge.
A similar conclusion was reached by the majority of the Judges in The Superintendent and Remembrancer of Legal Affairs, Bengal vs Jnanendra Nath Ghose & Another(1), where it was held that a person who had been convicted on his own plea of "guilty" under section 271(2) of the Criminal Procedure Code, in showing cause against a notice for enhancement of sentence, could only while showing cause against his conviction attack the propriety or legality of sentence but could not withdraw the plea of 'guilty ' or go behind such a plea as a confession of the facts charged.
There are no doubt two other judgments, one of the Bombay High Court in Emperor vs Ramchandra Shankarshet Uravane (3) and the other of the Rangoon High Court in Nga Ywa and another vs King Emperor which appear to run counter to the ratio decidendi of these decisions of the Allahabad and the Calcutta High Courts respectively but we are not called upon to resolve that conflict, if any.
Suffice it so say that the right which is conferred on the accused of showing cause against his conviction under section 439(6) of the Criminal Procedure Code is a right which accrues to him on a notice for enhancement of sentence being served upon him and he is entitled to exercise the same irrespective of what has happened in the past unless and until there is a judgment of the (1) I.L.R. 1937 Allahabad 308.
(2) (3) (4) Rangoon 616.
164 High Court already pronounced against his conviction after a full hearing in the presence of both the parties on notice being issued by the High Court in that behalf.
This right of his is not curtailed by anything contained in the earlier provisions of section 439 nor by anything contained in either section 369 or section 430 of the Criminal Procedure Code.
We are therefore of the opinion that the decision reached by the High Court of Bombay in the case under appeal was wrong and must be reversed.
We accordingly allow the appeal and remand the matter back to the High Court of Judicature at Bombay with a direction that it shall allow the Appellant to show cause against his conviction and dispose of the same according to law.
BY THE COURT.
The appeal is allowed and the order of the High Court of Bombay is set aside, and the matter is sent back to the High Court with a direction that it shall allow the appellant an opportunity to show cause ' against his conviction and dispose of the matter according to law.
| The appellant in this appeal was convicted by the Presidency Magistrate, Bombay, of an offence under section 66(b) of the Bombay Prohibition Act (Act XXV of 1949) and sentenced to undergo imprisonment till the rising of the court and to pay a fine of Rs., 250 or in default to undergo rigorous imprisonment for one month.
He preferred an appeal to the High Court at Bombay, which was summarily dismissed.
After the dismissal of that appeal, the State of Bombay made a revision application to the High Court praying for enhancement of the sentence.
Notice was issued to the appellant under section 439(2) of the Code of Criminal Procedure to show cause against enhancement.
95 Held that the summary dismissal of the appeal preferred by the appellant did not preclude him from taking advantage of the provisions of section 439(6) of the Code of Criminal Procedure and showing cause against his conviction when he was subsequently called upon to show cause why the sentence imposed on him should not be enhanced.
Per DAS J. Sub section (6) of section 439 of the Code of Criminal Procedure confers a new and a valuable right on the accused.
The language used in sub section (6) does not, in terms, place any fetter on the right conferred by it on the accused.
This new right is not expressed to be conditioned or controlled by anything that may have happened prior to the revision application under sub section (1) for enhancement of sentence.
Therefore, whenever there is an application for enhancement of sentence, a notice must issue under sub section (2) to the accused person to show cause and whenever such notice is issued, the accused person must, under sub section (6), be given an opportunity, in showing cause against enhancement, also to show cause against his conviction.
It is not correct to say that sections 421, 435 & 439 of the Code give the court a discretion not to decide the appeal or revision brought before it.
The discretion conferred on the High Court does not authorise it to say that it will not look at the appeal or revision.
The Court 's bounden duty is to look into the appeal or revision and decide it, although in the process of arriving at its decision it has a very wide discretion.
There is no reason for holding that there is a merger or replacement of the Judgment of the trial Court into or by the Judgment of the High Court only when the appeal or revision is heard on notice to the respondent and either allowed wholly or partially or dismissed but not when it is heard without notice to the respondent and dismissed summarily; for this purpose it makes no difference whether the dismissal is summary or otherwise, and there is a judgment of the High Court in all the three cases.
The only difference in substance is that in the first two cases the judgment is final qua both parties while in the third case, i.e., when an appeal or revision by the accused is summarily dismissed without issuing notice to the State, the judgment is final only qua the accused who preferred the appeal or revision.
This is based not on any technical doctrine of res judicata, for there is none in criminal cases, but on the general principle of finality of judgment.
In the first two cases there can, after the judgment, be no further application by the State for enhancement of sentence and therefore no question of the application of section 439(6) can arise.
In the last case, i.e., in case of summary dismissal the Judgment not being final qua the State, the State may apply for enhancement of sentence and if it does the accused becomes entitled again to show cause against his conviction also by reason of the special provisions of section 439(6).
Per BHAGWATI and IMAM JJ.
A Judgment pronounced by the High Court in the exercise of its appellate or revisional 96 jurisdiction after issue of a notice and a full hearing in the presence of both the parties would certainly be arrived at after due consideration of the evidence and all arguments and would therefore be a final judgment and such judgment when pronounced would replace the judgment of the lower court, thus constituting the only final judgment to be executed in accordance with law by the court below.
When however a petition of appeal presented by a convicted person from jail is summarily dismissed under section 421 or a revision application made by him is dismissed summarily or in limine without hearing him or his pleader what the High Court does in such a case is to refuse to entertain the petition of appeal or the revision application and the order passed by the High Court dismissed or rejected" cannot be said to be an expression of the opinion of the court arrived at after due consideration of the evidence and all the arguments.
No notice for enhancement of sentence can be issued by the High Court when a judgment is pronounced by it after a full hearing in the presence of both the parties either in exercise of its appellate or its revisional jurisdiction.
Such notice for enhancement of sentence can be issued by it either suo motu or at the instance of an interested party when the judgment of the lower court subsists and is not replaced by its own judgment given in the exercise of its appellate or revisional jurisdiction.
When the Judgment of the lower court has been under its scrutiny on notice being issued to the opposite party and on a full hearing accorded to both the parties notice for enhancement of sentence can only be issued by it before it pronounces its judgment replacing that of the lower court.
When such hearing is in progress it is incumbent upon the High Court or the opposite party to make up its mind before the judgment is pronounced whether a notice for enhancement of sentence should issue to the accused.
Case law discussed.
|
Criminal Appeal No. 88 of 1954.
Appeal by Special Leave from the Judgment and Order dated the 7th January, 1954 of the Allahabad High Court in Criminal Appeal No. 377 of 1953 connected with Criminal Revision No. 461 of 1953 arising out of the Judgment and Order dated the, 17th November, 1952 of the Court of Additional Sessions Judge at Meerut in Session Trial No. 113 of 1952.
B.B. Tawakley, (K. P. Gupta, with him), for the appellant.
K.B. Asthana and C. P. Lal, for the respondent.
September 28.
The Judgment of the Court was delivered by BOSE J.
The only.
question here is about sen. tence.
74 584 The appellant Bed Raj and another, Sri Chand, were jointly charged with the murder of one Pheru.
The Sessions Judge convicted Bed Raj under section 304, Indian Penal Code, and sentenced him to three years ' rigorous imprisonment.
He acquitted Sri Chand.
I Bed Raj appealed to the High, Court and that Court, on admitting the appeal for hearing, issued notice to the appellant to show cause why the sentence should not be enhanced.
The appeal and the revision were heard together.
The appeal was dismissed and the High Court enhanced the sentence to ten years.
Now, though no limitation has been placed on the High Court 's power to enhance it is nevertheless a judicial act and, like all judicial acts involving an exercise of discretion, must be exercised along, well known judicial lines.
The only question before us is whether those lines have been observed in the present case.
The facts that have been found by the Sessions Judge and accepted by the High Court are to be found in the opening paragraph of the learned Sessions Judge 's judgment.
They are as follows: "Roop Chand, the son of Bed Raj accused, was removing the dung.
of the bullocks of Pheru deceased from an open space near his cattle shed.
Pheru protested to, the boy and turned down the basket in which the boy had put the dung.
The two accused who are brothers then came to the scene from their own cattle shed which was near by and there was an exchange of abuses between them and Pheru.
The accused Sri Chand then caught hold of Pheru by the waist and Bed Raj accused took out a knife and stabbed him in 3 or 4 places.
The knife was then left sticking in the neck of the deceased and the accused ran away".
The assault occurred about 8 o 'clock on the morning of the 23rd February 1952.
Pheru was removed to the hospital and the Medical Officer Dr. Fateh Singh examined him and found that he was suffering from shock.
He found three injuries on his person: 585 all "simple".
He gave the following description of them: right side lower part.
(2) Incised wound: 1 " x 1/3" X1/3" right deltoid region frontal and lower part above downward.
(3) Incised wound 1/2" X 1/6" X 1/4"Epigastric region".
He said "When Pheru was admitted in the hospital he was under shock but his condition was not dangerous.
When Pheru came he could speak.
He was not unconscious.
As he was under shock no report was made for recording his dying declaration.
I cannot give the definite cause of death.
I cannot tell if sucH an InjurY can cause death.
There was no Haemorrhage from Pheru 's neck after his arrival in my hospital.
Speaking:of the inJurieis, the doctor said "Injuries 2 and 3 on the person of Pheru which were incised wounds were not punctured.
It was not possible to inflict them from a sharp pointed weapon".
The appellant was also examined by the doctor and a slight simple injury, which could have; been caused by a simple blunt weapon, was discovered.
This indicates that there was a scuffle between the appellant and the deceased, in which the appellant was hit over the nose and, up to a point, bears out what the appellant says in his defence, namely that Pheru was beating the appellant 's son Rup Chand; he went there and tried to extricate Rup Chand; Pheru started beating him (the appellant) and he, the appellant, received a flat blow on the nose.
The depth of the injury on Pheru 's neck was I of an inch.
In this connection the doctor says "A knife can penetrate 1 1/2 or 2 inches in a case of deliberate stabbing".
Pheru died about 12 45 A.M. on the 24th February 1952, that is to say, about 16 or 17 hours after the assault.
The post mortem was conducted by another doctor, Dr. J. K. Dwivedi.
Describing the injury on the neck the only one we need consider as the other two were slight he said that clotted blood was present all round injury No, 1, and, that 586 "the:right side dome of pleura is punctured under injury No. 1 and clotted blood present all round it.
Upper lobe of right lung (appex) is punctured for 1/4" X 1/4" X 1/2".
Clotted blood present over the lung surface all round the punctured area.
A branch of the external jugular vein was divided in right side neck under injury No. I. Death was due to shock, and haemorrhage as a result of injury to neck".
In cross examination he said "It was possible and impossible also that the bleeding could be stopped.
Such injury as injury No. I are more likely to cause death".
After reviewing the evidence 'the learned Sessions Judge held "It is evident that the whole scene took just a few moments.
Both of the accused must have been in a moment of heat and before either of them could think of doing any act, the whole thing was over. .
That the injuries with the knife were likely to cause death is clear but they were caused at a time when the parties were in a heat and there was a sudden fight and no room for premeditation".
Because of this, and seeing that there was no reason to infer pre concert, he acquitted the other accused, and by reason of those circumstances he considered that three years would be sufficient punishment and sentenced the appellant accordingly.
This was on 17 11 1952.
The appellant filed an appeal to the High Court on 1.8 12 1952 and that Court thereupon issued notice to him to show cause why the sentence I should not be enhanced.
The High Court directed enhancement on 7 1 1954.
On the same day the State Government ordered the release of the appellant on probation, under section 2 of the U.P. Prisoners ' Release on Probation Act, 1938, for the full term of the sentence imposed by the Sessions Court.
We are not concerned with the State Government 's order except in so far ' as it indicates the view that that Government took of the antecedents and conduct in prison of the appellant, matters that are also relevant for consideration by a Court 587 when determining a, question of sentence ' a prisoner can only be released on probation under that Act if the State Government is satisfied "from his antecedents and his conduct in the prison that he is likely to abstain from crime and lead a peaceable life, if he is released from prison".
These facts were not known to the High Court when it made its order of enhancement ' but it is a matter relevant for our consideration now that the appeal is before us.
Now the High Court accept the findings of the Sessions Judge about the circumstances in which the offence took place.
They agree that the attack was not premeditated and that there was a sudden quarrel and that the blows were inflicted in the heat of passion,.
They also say that there was counter abuse and they notice the abrasion on the appellant 's nose.
Despite this they hold that ' "it is possible that this injury was received by the appellant in the attempt of the deceased to resist the attack made by the appellant.
There was therefore no fight '.
This is a very half hearted finding and ignores the fact that the benefit of all doubts must be given to the accused.
If it was only "possible" that the injury was due to Pheru 's attempt to ward off an attack by the appellant, then it must be equally "possible" that it was received in the course of a, scuffle.
The appellant very definitely says in his examination that there was a fight and the abrasion on his nose which the doctor says was caused by a blunt weapon, bears out his version that Pheru struck him with his fist.
The circumstances also indicate that there must have been a scuffle.
Why else should it be necessary for the second accused to come and hold him down by the waist? When villagers or any man for that matter, come to blows after hot words and an interchange of abuse, there is nearly always resistance to the initial attack.
Very rarely does a man "turn the other cheek".
It must also be remembered that the incident started with the use of force by Pheru.
It was he who took hold of the basket of cow dung and 588 overturned it.
That occasioned the quarrel, and the finding is that there was abuse and counter abuse.
It was then that the second accused rushed in and caught Pheru by the waist.
That accused was acquitted because there was nothing to suggest that that was done in aid of the appellant 's intention to assault Pheru and he was absolved of all intention to assault on his own account; and the finding is that even the appellant had no such intention till the last moment.
If that was the case, then why should the second accused rush in and hold Pheru by the waist? If he had no intention to assault on his own account and none to assist the appellant in his assault, the only other reasonable conclusion is that he tried to stop a fight.
It would be fair in the circumstances to reach that conclusion, for the accused is as much entitled to the benefit of any doubt when a co accused is acquitted as in any other case.
In any case, it was incumbent on the High Court to reach a more definite finding than the one given before deciding to enhance the sentence.
The only reason that the learned Judges give is that Pheru was unarmed and as the attack was made with a knife it cannot be said that the appellant did not act in a cruel or unusual manner.
Nevertheless, they uphold the finding that the offence falls under section 304, Indian Penal Code, and not under section 302.
A question of a sentence is a matter of discretion and it is well settled that when discretion has been properly exercised along accepted judicial lines, an appellate court should not interfere to the detriment of an accused person except for very strong reasons which must be disclosed on the face of the judgment; see for example the observations in Dalip Singh vs State of Punjab(1) and Nar Singh vs State of Uttar Pradesh (2).
In a matter of enhancement there should not be interference when the sentence passed imposes substantial punishment.
Interference is only called for when it is manifestly inadequate.
In our opinion, these principles have not been observed.
It is (1) ; , 156.
(2) ; , 241, 589 impossible to hold in 'the circumstances described that the Sessions Judge did not impose a substantial, sentence, and no adequate reason has been assigned by the learned High Court Judges for considering the sentence, manifestly inadequate.
In the circumstances, bearing all the considerations of this case in mind, we are of opinion that the appeal (which is limited to the question of sentence) should be allowed and that the sentence imposed by the High Court should be set aside and that of the Sessions Court restored.
Ordered accordingly.
| A question of sentence is a matter of discretion and it is well settled that when discretion has been properly exercised along accepted judicial lines, an appellate court should not interfere to the detriment of an accused person except for very strong reasons which must be disclosed on the face of the judgment.
In a matter of enhancement there should not be interference when the sentence passed imposes substantial punishment.
Interference is only called for when it is manifestly inadequate.
In the circumstances and bearing all the considerations of the present case in mind it was impossible to hold that the Sessions Judge did not impose a substantial sentence.
The Supreme Court set aside the sentence imposed by the Court and restored that of the Sessions Judge as no adequate reason bad been assigned by the High Court for considering the sentence passed by the Sessions Judge as manifestly inadequate.
Dalip Singh vs State of Punjab ([1954] S.C.R. 145) and Nar Singh vs State of Uttar Pradesh ([1956] 1 S.C.R. 238), referred to.
|
Nos. 186 & 195 of 1954.
Under Article 32 of the Constitution of India for the enforcement of Fundamental Rights.
S.C. Isaacs, (Mohan Behari Lal and P. K. Ghosh, with him) for the petitioners in both petitions.
M. C. Setalvad, Attorney General of India (Porus A.Mehta and P. G. Gokhale, with him) for the respondents.
September 22.
The Judgment of the Court was delivered by IMAM J.
These petitions under article 32 of the Constitution of India question the validity of the notifications issued under section 52 A of the Insurance Act of 1938 (hereinafter referred to as the Act) and the appointment of an Administrator.
In the case of the Tropical Insurance Company Ltd. an Administrator was appointed, under notification dated the 14th of July, 1951 and in the case of the Jupiter General Insurance Company Ltd. another Administrator was appointed under notification dated the 10th of July, 519 1951.
These two insurance companies do insurance business of life insurance and general insurance.
Admittedly previous to the appointment of the Administrators the Controller issued notices under section 52 A to the petitioners and the Finance Ministry of the Central Government sent letters to them pointing out the allegations in the report of the Controller to which they replied.
The learned Counsel for the petitioners has candidly stated that he could not raise any constitutional point after the fourth amendment to the Constitution of India.
He assumed; therefore, that the provisions of sections 52 A to 52 G of the Act were constitutional but he urged that the notifications under section 52 A and the taking over of the management of the affairs of the companies were invalid inasmuch as they were in excess of the powers conferred by section 52 A of the Act and that the notifications appointing the Administrators do not fix the period of management as required by law.
He further urged that the provisions of the section 52 B of the Act had not been complied with and in consequence the management by the Administrator had been excessively prolonged and thus had become unlawful.
There has, therefore, been a violation of the fundamental rights of the petitioners.
Finally it was urged that there was no authority either under the provisions of the Act or of any other law by which the Government was empowered to take over management of the affairs of the company with respect to its general insurance business.
The power of the Government under section 52 A was restricted exclusively to life insurance business.
As to the first two contentions, they were urged in Petitions Nos. 94 of 1954 and 183 of 1954, but were not allowed to be put forward by this Court as these questions had not been specifically raised in the petitions under article 32 of the Constitution and they were accordingly dismissed.
The position is similar in this respect so far as the present applications are concerned and consequently it must be held that the petitioners cannot be allowed now to urge grounds which they had not taken in their petitions.
66 520 There remains, however, to consider the last contention urged on behalf of the petitioners.
It was pointed out by Mr. Isaacs that the petitioners are insurance companies doing both life insurance business and general insurance business.
He contends that a section 52 A of the Act, on a true interpretation of its provisions, applies only to the life insurance business carried on by an insurer and not to the general insurance business done by him.
The Administrator appointed under section 52 A of the Act could therefore take over management only of the life insurance business done by the insurer.
The notifications authorising him to take over the management of the insurance business of the insurer including his general insurance business were thus beyond the powers conferred on Government under section 52 A of the Act and such taking over of the management of the general insurance business of the petitioners by the Administrator was, therefore, without lawful authority.
In view of the submission made by the learned Counsel, it is necessary to set out the relevant provisions of the section 52 A. Sub section (1) of that section states: "If at any time the Controller has reason to believe that an insurer carrying on life insurance business is acting in a manner likely to be prejudicial to the interests of holders of life insurance policies, he may, after giving such opportunity to the insurer to be heard as he thinks fit, make a report thereon to the Central Government".
Sub section (2) states: "The Central Government, if it is of opinion after considering the report that it is necessary or proper to do so, may appoint an Administrator to manage the affairs of the insurer under the direction and control of the Controller".
Sub section (4) states: "The management of the business of the insurer shall as on and after the date of appointment of the Administrator vest in such Administrator, but except with the leave of the Controller, the Administrator shall not issue any further policies" 521 Section 52 B of the Act is concerned with the powers and duties of the Administrator.
Under this section, the Administrator shall conduct the management of the business of the insurer with the greatest economy ' compatible with efficiency and shall, as soon as may be possible, file with the Controller a report stating what specified courses under the section should be taken which would be most advantageous to the general interest of the holders of life policies.
One of the courses specified is the winding up of the business of the insurer.
Section 52 D of the Act is concerned with termination of the appointment of the Administrator.
Section 53 of the Act is concerned with the winding up by the Court and it enables the Controller to apply to the Court for winding up of an insurance company on certain grounds, one of them being that the continuance of the company would be prejudicial to the interests of the policy holders.
Mr. Isaacs urged that the Act made a clear distinction between life insurance business and general insurance business of an insurer.
He referred to various sections of the Act with reference to Registration, Separation of Accounts and Funds and Balance Sheets.
It was also pointed out by him that the Act defines "general insurance business" and "life insurance business" and these two kinds of businesses are quite distinct.
There could be little doubt that the Act does regard "life insurance business" as something distinct from "general insurance business".
It seems to us, however, that while keeping this distinction in mind, we have to give to the words used in section 52 A(1) their ordinary and natural meaning.
"Insurer" has been defined in section 2 of the Act.
The definition speaks of an insurer carrying on an insurance business.
This business may be either a life insurance business or a general insurance business or both.
Under section 7 of the Act deposits have to be made by every insurer other than an insurer specified in sub clause (c) of clause (9) of section 2.
The section specifies the amount of deposit to be made where the business done is life insurance only.
Similarly it specifies the deposit to be made in the case of business 522 done which comes within the description of general insurance business only.
It also contemplates a combination of life insurance business and general insurance business and specifies the deposit to be made in such event.
It is clear that section 52 A(1) does not apply to an insurer doing only general insurance business.
The question for decision is does it apply to him when he 'also does along with such business insurance business? Section 52_A(1) speaks of "an insurer carrying on life insurance business".
It does not speak of "only life insurance business".
It is permissible for an insurer to combine in his insurance business both life and general insurance business.
If he acts in a manner which is likely to be prejudicial to the interests of the holders of the life insurance policies with him, he makes himself amenable to the provisions of the section 52 A of the Act and the Controller is authorised to make a report to the Central Government.
The Central Government, after con sidering the report, may appoint an Administrator to manage "the affairs" of the insurer and the management of "the business" of the insurer shall vest in the Administrator.
The words "the affairs" and "the business" of the insurer are wide enough to empower the Central Government to take over the management of the entire business of the insurer including his general insurance business.
To hold otherwise would be to give an unnaturalmeaning to the words used in section 52 A of the Act.
In the present case the insurers are public limitedcompanies and it is difficult to conceive that the Act intended to vest in the Administrator the management of only the life insurance business while the insurers would be free to manage the general insurance business, because under section 52 B the Administrator may suggest to the Controller for the winding up of the company after managing its insurance business economically and efficiently.
Under section 53 a Court may order a winding up of an insurance company if on an appli cation by the Controller, it is satisfied that the con tinuance of the company is prejudicial to the interests of the policy holders.
The winding up of the com 523 pany would be concerned with its entire insurance business ,including life and general insurance business, because there could be no partial winding up of a company.
It is not difficult to imagine that the affairs of the company with reference to its general insurance business may be in such a hopeless state that winding up may be the only course to be taken to protect the interests of the life policy holders.
When the provisions of the Act are closely examined, it will be noticed that its main policy has been to safeguard the interests of life policy holders, who are deeply affected by the manner in which the insurance business of an insurer is carried on.
We have no difficulty in interpreting section 52 A(1) to mean that where an insurer is carrying on insurance business of various kinds which includes life insurance business, he becomes amenable to the provisions of section 52 A if he is acting in a manner prejudicial to the interests of the holders of life policies and he would have to suffer the consequences following the report made by the Controller and the appointment of an Administrator by the Government.
The provisions in the Act making a distinction between life insurance business and general insurance business, the keeping of separate accounts and balance sheets have been enacted for the safeguard of the holders of life insurance policies and they provide an over all picture of the business done by the insurer showing the exact state of affairs concerning the life insurance business of the insurer.
These provisions cannot and do not affect the provisions of of section 52 A of the Act.
These petitions are accordingly dismissed with costs to be paid by Petitioners 2, 3 and 4 in Petition No. 186 of 1954 and Petitioners 2 and 3 in Petition No. 195 of 1954.
| The petitioners, two Insurance Companies, carrying on business both in life insurance and general insurance, questioned the validity of notifications issued against them under section 52 A of the Insurance Act for appointment of Administrators to take over management of their affairs on the ground, inter alia, that section 52 A was exclusively restricted to life insurance business and the Government had no power to take oyer management of general insurance busi ness.
Held, that the Insurance Act of 1938 no doubt makes a distinction between life insurance business and general insurance business, but its main concern is to protect life insurance policy holders.
Although section 52 A of the Act has no application to an insurer who carries on business in general insurance alone, it undoubtedly applies to an insurer who combines both and gives the Central Government the power, on the report of the Controller, to appoint an Administrator to take over the management of the entire business of the insurer including general insurance business when such insurer is found to act in a manner prejudicial to the interests of the life policy holders.
That grounds not specifically taken in petitions under article 32 cannot be urged at the time of the hearing.
|
iminal Appeal No. 9 of 1955.
Appeal by special leave from the Judgment and Order dated the 26th September, 1951, of the Hyderabad High Court in Criminal Confirmation No. 638/6 of 1951 and Criminal Appeal No. 770 of 1951, arising out of the Judgment and Order dated the 27th June, 1951, of the Court of the Sessions Judge, Osmanabad, in Criminal Case No. 12/8 of 1951.
525 R. Patnaik for the appellant.
Porus A. Mehta and P. G. Gokhale for the respondent.
September 27.
The Judgment of the.
Court was delivered by BOSE J. This is another of those cases in which Courts are compelled to acquit because Magistrates and Sessions Judges fail to appreciate the importance of section 342 of the Criminal Procedure Code and fail to carry out the duty that is cast upon them of questioning the accused properly and fairly, bringing home to his mind in clear and simple language the exact case he has to meet and each material point that is sought to be made against him, and of afford ing him a chance to explain them if he can and so desires.
Had the Sessions Judge done that in this case it is possible that we would not have been obliged to acquit.
The facts are simple.
The appellant Machander was charged with the murder of one Manmatb.
Machander 's brother Gona was also challaned but as he absconded he could not be tried.
The appellant and the deceased and Gona reside in the same village.
There was some ill feeling between the appellant and the deceased and it can be accepted that Gona shared his brother 's sentiments because, so far as the latest cause for enmity goes, Gona is equally concerned; and this also applies to Pandu, the appellants father, and Bhima, another brother.
The causes for enmity are the following.
In or about the year 1947 the appellant appears to have stolen a pair of bullocks and a cart belonoing to the deceased.
The deceased prosecuted him for the theft and also instituted a civil suit for the price of the cart 'and bullocks.
He succeeded in both cases.
The appellant was convicted of the theft and sent to jail.
A decree was also passed against him for Rs. 520 and that decree was duly executed.
We now come to the events immediately preceding the murder.
The appellant and his family took forcible possession of some land belonging to the 526 deceased 's sister Parubai.
She sued the whole family for possession of this land, that is to say, she impleaded the appellant 's father Pandu, the appellant and his two brothers Bhima and Gona.
The last hearing was on 15 12 1950 and the decision was announced on 16 12 1950.
It was in Parubai 's favour.
The deceased conducted this litigation on behalf of his sister.
He was present in Court on the 15th and was present at Parenda, where the Court is situate, up to 3 P.m.
on the 16th, the day the decision was announced.
That was the last that was seen of him.
These facts are said to be the cause of the ill feeling.
But, as the facts themselves indicate, a similar cause for enmity (though not to the same degree) could be assigned to the father and the other brothers; equally, they had similar opportunities.
The movements of the appellant have been traced to Parenda and back but not the movements of the rest of the family.
So it is not shown that they had no similar opportunity to murder.
It can however be accepted that cause for enmity on the appellant 's part is established.
It is proved that the deceased went to Parenda on the 15th for the last hearing of the case and that he was also there on the 16th up to 3 p.m.
It is also proved that the appellant was in Court on the 15th and that he was in Parenda on the following day.
It can be accepted that both the deceased and the appellant were present in Court at the same time on the 15th and that therefore the appellant knew that the deceased had attended the Court that day.
But there is no proof that the two met each other or that either knew about the movements of the other on the 16th.
All we know is that both went to see their respective pleaders at different places and times and learned the result of the case.
Four or five days after the case, the appellant came home but not the deceased.
The deceased 's son Shantiling (P.W. 10), who knew that the appellant bad also gone to Parenda for the case, asked him where his father was.
The appellant said that the father had not attended court.
This made the son 527 anxious, 'so he went to Parenda to make enquiries.
The pleaders there told him that his father had attended court on the 15th and that he was in Parenda till,3 P.m. on the 16th.
Shantiling (P.W. 10) immediately informed the police that his father was missing and gave them a description of him and also a list of the things he was wearing and a description of the horse he was riding.
This was on the 26th.
Three days later, on the 29th, he lodged a regular complaint and said that he was afraid his father had been murdered and said that he suspected the appellant and his brother Gona.
The appellant was arrested the same day and after his arrest he led the police and Panchas to a place where blood stained earth and grass were found and a bloo dstained stone, also some of the articles which Shantiling (P.W. 10) had described to the police on the 26th, namely pieces of a silver linga, two silver kadas, a silver spike and a white gilt button.
All except the kadas were found to be stained with human blood.
About 25 paces from here the appellant pointed out another place where the corpse of the deceased was found to be buried.
Pearl ear rings and a kardoda of yarn with three iron keys were still on the body.
They were all stained with human blood and are proved to have belonged to the deceased.
On the 1st of January 1951 the appellant took the police and the Panchas to a place where two saddle straps and two iron stirrups were buried.
One of the stirrups was stained with human blood.
On the 3rd the reins of the horse and the horse itself were discovered but this discovery was not at the instance of the appellant.
Except for the confession, which has been excluded, this is all there is against the appellant.
The question is whether that is enough to bring guilt home to him.
Stated briefly, the circumstances are 1.
That the appellant knew that the deceased had attended the Court at Parenda on the 16th and that he had seen him there but when questioned about it he told a lie.
67 528 In passing it is to be observed that this is not the .lass of case in which an accused person is last seen with a murdered man within a few hours of the murder.
Though the deceased and the appellant were both in Court at the same time, they were not there "together" and in view of the ill will between them and in view of the fact that the deceased went on a horse it is unlikely that they travelled together either going or coming; and the appellant was not with the deceased when he was last seen at 3 P.m. on the 16th.
But it is clear that the appellant wanted to hide something.
2.That thirteen days after the murder he knew that Manmath had been murdered.
He also knew where the murder had been committed and where the body and certain articles belonging to the deceased were hidden.
3.That there was ill will between them, but an ill will that other members of the appellants family might be expected to share.
4.That he had full opportunity to commit the crime, but the same kind of opportunity that the other members of his family also had.
The question is whether these four circumstances, regarded in the background of this case, are sufficient to warrant a conclusion of murder by the appellant.
In our opinion, they are not because the same circumstances could be said to point with equal suspicion at other members of the appellant 's family.
It has to be remembered that the brother Gona was also suspected and that he absconded and could not be traced.
We do not say that he was the murderer and it would be wrong to suggest that in his absence, but if he was, then the appellant 's knowledge of the murder and of the concealment, thirteen days later, might have been derived from Gona, or it might even be that he saw his brother commit the crime and hide the corpse and the articles.
Those are hypotheses that are not unreasonable on the facts of this particular case and they have not been reasonably excluded.
Consequently, we are unable to bold that mere knowledge thirteen days later, coupled with a motive which three others 529 share, and a lie about the deceased 's movements told four or five days after the murder, are enough; and, as that is all that the High Court has based on, the conviction must be set aside.
We have assumed throughout that the identity of the corpse that was discovered on the 29th and the fact of murder have been established.
Those facts were not admitted before us but we need not discuss the point.
It is enough to say that, in our opinion, both facts are satisfactorily proved.
We referred, earlier in our judgment, to a confession which the High Court has excluded.
This was excluded from evidence because the appellant was not questioned about it under section 342, Criminal Procedure Code.
We gather that the High Court thought that that occasioned prejudice though the learned Judges do not say so in so many words.
The appellant was arrested on the 29th and he made many discoveries on the 29th December 1950 and on the 1st, 2nd and 3rd January 1951 but did not confess till the 6th.
Much might have happened in the eight days between his arrest and the 6th, so the High Court was not unjustified in refusing to take that into consideration without bearing the appellant 's side of the story.
We were asked to reopen the question and, if necessary, to remand the case.
But we decline to do that.
Judges and magistrates must realise the importance of the examination under section 342 of the Criminal Procedure Code and this Court has repeatedly warned them of the consequences that might ensue in certain cases.
The appellant was arrested in December 1950 and has been on his trial one way and another ever since, that is to say, for over 4 1/2 years.
We are not prepared to keep persons who are on trial for their lives under indefinite suspense because trial judges omit to do their duty.
Justice is not one sided.
It has many facets and we have to draw a nice balance between conflicting rights and duties.
While it is incumbent on us to see that the guilty do not escape it is even more necessary to see that persons accused 530 of crime are not indefinitely harassed.
They must be given a fair and impartial trial and while every reasonable latitude must be given to those concerned with the detection of crime and entrusted with the administration of justice, limits must be placed on the lengths to which they may go.
Except in clear cases of guilt, where the error is purely technical, the forces that are arrayed against the accused should no more be permitted in special appeal to repair the effects of their bungling than an accused should be permitted to repair gaps in his defence which he could and ought to have made good in the lower courts.
The scales of justice must be kept on an even balance whether for the accused or against him, whether in favour of the State or not; and one broad rule must apply in all cases.
The error here is not a mere technicality.
The appellant appears to have been ready to disclose all on the 29th and make a clean breast of everything and yet the police waited eight days before getting a confession judicially recorded.
That may be capable of explanation but the difficulty of asking an accused person to establish facts of this kind in his favour four and a half years later is obvious.
Without therefore attempting to lay down any general rule, we are not prepared to order a retrial in this case because of the facts that appear here.
The appeal is allowed.
The conviction and sentence are set aside and the appellant is acquitted.
| The appellant was put up on his trial on a charge of murder.
The trial continued for 41/2 years.
His brother who was a co accused absconded.
The evidence against the appellant was circumstantial.
His confession, made 8 days after his arrest, led to certain discoveries but he was never questioned about it by the trial court under section 342 of the Code of Criminal Procedure.
The High Court excluded the confession from the evidence, upheld the conviction but altered the death sentence to one of rigorous imprisonment for life.
The Supreme Court took the view that the High Court was right in excluding the confession from the evidence and the conviction was unsustainable on the evidence on record.
Held, that in the particular facts of the case the omission to examine the accused under section 342 of the Code was no more technicality and it would be unjust to the accused to remand the case for a retrial and the order of conviction and sentence passed on him must be set aside.
That while it is no doubt incumbent on the court to see that no guilty person escapes, it is still more its duty to see that justice is not delayed and accused persons indefinitely harassed.
The scales must be held even between the prosecution and the accused.
That it is imperative that Magistrates and Sessions Judges should remember the duty that section 342 of the Code of Criminal Procedure imposes on them of questioning the accused person fairly and properly telling him in clear and simple language the case he has to meet and the material points made against him so that he can, if he so desires, explain and meet them.
|
os. 621, 655 and 678 of 1955.
Under Article 32 of the Constitution for the en forcement of fundamental rights.
N.C. Chatterjee (section K. Kapur and Ganpat Rai, with him) for the petitioners.
533 M. C. Setalvad, Attorney General for India (Kan Singh and P. G. Gokhale, with him) for respondent No. 1.
K.R. Chowdhury, for Goma, Ghisa and Rama, respondents in Petition No. 655 and Dhira, respondent in petition No.678.
September 27.
The judgment of the Court was delivered by VENKATARAMA AYYAR J.
These are applications under article 32 of the Constitution by certain jagir dars of Marwar, challenging the constitutionality of sections 81 to 86 of the Marwar Land Revenue Act No. XL of 1949 (hereinafter referred to as the Act) on the ground that they infringe the fundamental rights of the petitioners under article 14, article 19(1) (f) and article 31(2) of the Constitution.
These sections provide for fixing fair and equitable rent payable by the tenants and prescribe the procedure to be followed therefor.
Section 81 of the Act provides that when any local area has been brought under settlement operations by a notification under section 64, the Settlement Officer or an Assistant Settlement Officer shall inspect every village in the local area, divide it into soil classes and assessment circles, select rentrates for the area and publish them in such manner as may be prescribed.
If objections to these proposals are received, he has to consider them, and submit his report to the Board of Revenue.
The Board has the power to sanction the proposals with or without any modifications, and it has also the power to direct further enquiry into the matters.
With a view to arriving at fair and equitable rates, the Settlement Officer is required under section 82 to have regard to the collection of rent and cesses in the nature of rent during the ten years preceding the settlement excluding such years as the Government may, by notification in the Official Gazette, declare to be abnormal the average of the prices of agricultural produce during the same period, the nature of the crops grown and the quantity of the produce and their value.
Section 82(2) provides that the rent rates shall not 534 exceed one third of, the value of the produce of unirrigated lands and one fourth of the value of the produce of irrigated lands.
Under section 84, the Settlement Officer shall determine rents whether by way of abatement, enhancement or commutation payable for all holdings in the occupation of tenants on the basis of the rates sanctioned by the Board of Revenue.
Section 86 enacts that any rent fixed by order of the Settlement Officer shall be payable from the first day of July next following the date of such order, "unless the Settlement Officer thinks fit for any reasons to direct that it shall be payable from some earlier date".
Acting under section 81 of the Act, the Settlement Officer formulated certain proposals with reference to the rent rates in the villages comprised in the jagirs of the petitioners, and they were published in the Gazette on 12th December 1953.
Objections to those rates were filed by the petitioners on the 12th January, 1954.
On 13th October 1954 the Additional Settlement Commissioner submitted his final proposals to the Settlement Officer, who forwarded the same to the Board of Revenue for sanction.
After making further enquiry, the Board passed an order on 4 12 1954 determining the rent rates payable.
Subsequent to this, an order was also passed under section 86 of the Act bringing the sanctioned rate into operation from 1 7 1954.
This order is not itself the subject of attack in these proceedings, and it cannot be, seeing that Petition No. 621 of 1954 was filed on 24th November 1954 before that order was passed, and Petitions Nos. 655 and 678 of 1954 merely repeat verbatim the allegations in Petition No. 621 of 1954.
Before us, the petitioners conceded that they were not impugning the correctness of the order passed under section 86 in so far as it gave operation to the rates of rent from 1st July, on its merits, but that they were attacking the section as bad only as a step in establishing that the scheme of the Act, of which section 86 is an integral part is, taken as a whole, an infringement of their fundamental rights under articles 14, 19 and 31(2).
We have now to consider 535 whether sections 81 to 86 of the Act are bad as infringing the above provisions of the Constitution.
The contention that sections 81 to 86 of the Act are void as being repugnant to article 14 is sought to be made out on two grounds.
It is stated firstly that the Act applies ' only to what was prior to its merger the State of Marwar, that the present State of Rajasthan comprises Marwar and 17 other States which have merged in it, and that as the Act, as it stands, is directed against the jagirdars in one area of the State and not the whole of it, it has become discriminatory and void.
This contention is clearly untenable.
What article 14 prohibits is the unequal treatment of persons similarly situated, and therefore before the petitioners can claim the protection of that article, it is incumbent on them to establish that the conditions which prevail in other areas in the State of Rajasthan are similar to those which obtain in Marwar.
But of this, there has been neither allegation nor proof.
On the contrary, it is stated by the respondents in para 10 of their statement that the tenants in the jagirs of Marwar were paying much more by way of rent and cesses than those in the Khalsa area of the State, that with a view to remove the inequality between the two classes of tenants within the State, a law was passed in 1943 providing for settlement of rent, and that again on 10 1 1947 another law was passed abolishing all cesses (lags) and fixing the maximum share of rent payable in kind.
These special features, it is argued, form sufficient justification for a separate legislation for this area, It is also stated that the other States had their own rent laws suited to their conditions.
There are no materials on which we could hold that the impugned Act is discriminatory in character, and we cannot strike it down merely on the ground that it does not apply to the whole of the State of Rajasthan.
A similar question arose for decision in Bowman vs Lewis(1).
There, some of the areas in the State of Missouri were governed by a judicial procedure diff (1) ; 68 536 erent from that which prevailed in others.
Repelling the contention that this differentiation offended the equal protection clauses of the Fourteenth Amendment, the Court observed: "Each State has the right to make political subdivisions, of its territory for municipal purposes, and to regulate their local government.
As respects the administration of justice, it may establish one system of courts for cities and another for rural districts; one system for one portion of its territory and another system for another portion.
Convenience, if not necessity, often requires this to be done, and it would seriously interfere with the power of a State to regulate its internal affairs to deny to it this right If a Mexican State should be acquired by a treaty and added to an adjoining State or part of a State in the United States, and the two should be erected into a new State, it cannot be doubted that such new State might allow the Mexican laws and judicature to continue unchanged in the one portion and the common law and its corresponding judicature in the other portion.
Such an arrangement would not be prohibited in any fair construction of the Fourteenth Amend ment.
It would not be based on any respect of persons or classes, but on municipal considerations alone and a regard to the welfare of all classes within the particular territory or jurisdiction".
This Court has also repeatedly held that classification might properly be made on territorial basis if that was germane to the purposes of the enactment.
Having regard to the fact that the conditions of tenants vary from locality to locality, we have no hesitation in holding that a tenancy legislation restricted to a portion of a State cannot be held on this ground alone to contravene article 14.
The second ground urged in support of the contention that article 14 has been infringed is that discrimination must result from the settlement of rent being taken up only with reference to portions of the 537 area to which the Act applies and not to the whole of it, because the rent rate is to be fixed on the basis of the average of the ten years preceding the settlement; and if the proceedings are started for different areas on different dates, that might result in different rates being fixed, and that would make for inequality such as is prohibited by article 14.
We are unable to agree with this,.contention.
Settlement operations can be conducted only by a specialised staff having technical knowledge and administrative experience, and it might be beyond the capacity of the State to undertake them for the whole area at one and the same time.
To accede to the contention of the petitioners would, in effect, be to prevent the States from carrying on settlement operations.
It was held by this Court in Biswambhar Singh vs The State of Orissa and other8(1) and in Thakur Amar Singhji vs State of Rajasthan(2) that a provision authorising the taking over of estates on different dates was not repugnant to article 14, and the principle of those decisions would apply to the present case as well.
The contention that the impugned provisions are in contravention of article 14 must, therefore, be rejected.
It is then contended that the provisions in question are repugnant to article 19(1) (f) of the Constitution, because they deprive landlords of their right to realise rents from the tenants freely and without hindrance, and are an encroahment on their right to hold property.
The provision in section 82 that the Settlement Officer should, in determining the average collection for the previous ten years,exclude from consideration abnormal years as notified by the Government was particularly attacked as a. device to reduce the rent payable to the landlord and an invasion of his rights to the property.
We are unable to agree with this contention.
The fundamental right which a citizen has to hold and enjoy property imports only a right to recover reasonable rent when the lands are cultivated by a tenant, and therefore a legislation whose object is to fix fair and equitable (1) ; , 845.
(2) ; , 538 rent cannot be said to invade that right.
The contention that the provision in section 82(1) (a) that abnormal years as notified in the Gazette should be excluded in determining average collections is calculated to reduce the rent, and is therefore unreasonable is unfounded, because a declaration that a year is abnormal is made not only when there are bumper crops but also when the yield is very low, and the provision is intended equally for the benefit of the tenant and of the landlord.
A provision of this kind is usual in all tenancy legislation, and there is nothing unreasonable or unfair about it.
It was next contended and this was the contention most pressed on us that section 86 is bad as it confers on the Settlement Officer a power to bring the rent rates into operation from a date earlier than ' the succeeding year and even retrospectively from a date prior to the settlement, and that such a power was repugnant to both article 19(1)(f) and article 31(2).
The argument with reference to Article 19(1)(f) is that section 86 is an encroachment on the rights of a person to hold property, and can be valid only if it falls within article 19(5), that it is only a law of 'a regulatory character that is protected by article 19 (5), that there could be regulation only with reference to rights to be exercised in future,.
and that a law giving retrospective operation is consequently outside article 19(5).
This contention rests on an assumption for which there is no basis.
The question whether a law is valid under.
Article 19 (5) can arise only when there is a violation of the fundamental right declared in article 19 (1) (f), and if the right to hold property imports, as we have held it does, only a fight to recover reasonable rent from cultivating tenants, that right cannot be held to have been invaded by a law fixing reasonable rent, even when it is retrospective in operation.
If the rent fixed is reasonable with reference to a period subsequent to the settlement, it must be reasonable for the period prior to it as well, and if the settlement is not an encroachment on the rights of the holder as regards the future and that is conceded it cannot be an encroachment as regards 539 the past.
A consideration, therefore, of the question whether a law under article 19(5) should be regulatory ' and whether a law with retrospective operation could be said to be regulatory would be wholly irrelevant for the purpose of the present controversy.
The argument in support of the contention that section 86 is repugnant to article 31(2) is that to the extent that it gives retrospective operation, it deprives the landlord of the right to rent which had accrued prior to the settlement, and that is taking property without payment of compensation.
But it is well settled that a law which regulates the relation of landlord with his tenant is not one which takes property within article 31(2), even though it has the effect of reducing his rights.
In Thakur Jagannath Baksh Singh vs United Provinces(1), the question arose for decision whether the provisions of Act XVII of 1939, United Provinces, under which the rent payable to a landlord became diminished were obnoxious to section 299(2) of the Government of India Act, 1935.
It was held by the Federal Court that they were not, and in affirming this decision on appeal, the Privy Council in Thakur Jagannath Baksh Singh vs United Provinces(2) observed: "The appellant relies on certain express provisions of the Government of India Act.
Thus he relies on section 299 of the Act, which provides that no person, shall be deprived of his property in British India save by authority of law, and that neither the Federal nor a Provincial Legislature shall have power to make any law authorising the compulsory acquisition of 'land for public purposes save on the basis of providing for the payment of compensation.
But in the present case there is no question of confiscatory legislation.
To regulate the relations of landlord and tenant and thereby diminish rights, hitherto exercised by the landlord in connection with his land, is different from compulsory acquisition of the land".
It was finally urged that section 86 in so far as it (1) [1948] 6 F.L. J. 55; A.I.R. 1948 F.C. 29.
(2) [1946] L.R. 73 I.A. 123.
540 conferred authority on the Settlement Officer to give retrospective operation to the rent rates was bad, because the exercise of that authority was left to his arbitrary and uncontrolled discretion, that the Act laid down no rules and prescribed no conditions under which the discretion had to be exercised, and that the power conferred in those terms must be held to be unconstitutional.
The decision in Thakur Raghubir Singh vs Court of Wards, Ajmer and another(1) was relied on, in support of this contention.
There, the question was as to the validity of a power conferred on the Court of Wards to take over the management of an estate "if a landlord habitually infringes the right of a. tenant".
Under the Act, the decision whether the condition aforesaid was satisfied depended on the subjective satisfaction of the Chief Commissioner., and that was final and not liable to be questioned in civil courts.
It was held that a power which could be exercised at the absolute discretion of the authority was an encroachment on the rights of a citizen to hold property under article 19(1)(f), and that it was not saved by article 19(5).
But, in the present case, section 86 of the Act expressly lays down that if a Settlement Officer decides to bring rates into operation from a date earlier than the following 1st of July, it must be for reasons.
There is no force in the contention that section 86 does not lay down under what circumstances such an order could be passed, because the very nature of the thing requires that a large discretion should be left to the authority.
Discretion which is wide is not necessarily arbitrary.
It was said that under section 233 of the Act the civil courts are debarred from enquiring into the reasonableness of the order; but that is because matters concerning revenue and settlement are within the exclusive jurisdiction of revenue courts, and under section 62 of the Act, the Board of Revenue has revisional jurisdiction over all orders passed in connection with settlement.
We think that the power conferred on the Settlement Officer to fix an earlier date for giving operation to the rent rate is reasonable and valid, (1) ; 541 and that it invades no fundamental rights of the landlord.
For the reasons given above, we must hold that the scheme embodied in sections 81 to 86 of the Act does not transgress any of the Constitutional limitations, and is valid.
In the result, the petitions are dismissed but in the circumstances, without costs.
| The petitioners, who are jagirdars of Marwar, sought to impugn the constitutional validity of sections 81 to 86 of the Marwar Land Revenue Act which embody a scheme for fixing fair and equitable rents payable by cultivating tenants on the ground that they infringed their fundamental rights under articles 14, 19(1)(f) and 31(2) of the Constitution.
Their contentions were that after the merger of Marwar in the State of Rajasthan the Act had become discriminatory as it applied only to the jagirdars of Marwar and not to the entire body of jagirdars of the State of Rajasthan, that settlement of rents made with reference to different areas on different dates on the basis of previous ten years ' average of collections might result in different rates of rent and lead to inequality such as is prohibited by article 14, that the Act deprived the landlords of their right to realise rents from the tenants freely and without hindrance and invaded their right to hold property guaranteed by article 19(1)(f) of the Constitution, that the power conferred on the Settlement Officer by section 86 of the Act to enforce the rates of rent retrospectively is an invasion of their right to hold property and amounts to acquisition of property without compensation and that it confers absolute and uncontrolled discretion on the Settlement Officer and is an encroachment on the right to hold property.
Held, repelling these contentions, that article 14 only prohibits unequal treatment of persons similarly situated and a classification might properly be made on territorial basis, if that was germane to the purposes of the enactment and no tenancy legislation can be held to contravene the article solely on the ground that it does not apply to the entire State.
Before the petitioners could succeed it was 532 incumbent on them to show that conditions obtaining in other parts of the State were similar to those in Marwar and this they had failed to do.
Bowman vs Lewis ; , referred to.
That the provision in the Act for assessment of rents with reference to a portion of the area to which the Act applies is not a contravention of article 14.
To hold otherwise would be to make it impossible for any State to carry on its settlement operation.
Biswambhar Singh vs The State of Orissa and others; , , and Thakur Amar Singhji vs State of Rajasthan, ; , applied.
That the fundamental right to hold property in the case of a, landlord in respect of his tenanted lands is no more than the right to receive reasonable rents and no legislation which has for its object the settlement of fair and equitable rents can contravene article 19 (1)(f) of the Constitution even though it may give such rents retros pective operation.
That the provision in section 86 of the Act empowering the Settlement Officer to give retrospective operation to the rates of rent does not contravene article 19(1)(f) and, therefore, no question as to whether such a provision is not of a regulatory character and as such prohibited by article 19(5) can at all arise.
That it is well settled that a law which regulates the relation of a landlord with his tenant is not one which takes property within the meaning of article 31(2) even though it has the effect of reducing his rights.
Consequently, there is no contravention of article 31(2) of the Constitution.
Thakur Jagannath Baksh Singh vs United Provinces, [1943] 6 F.L.J. 55: A.I.R. 1943 F.C. 29 and Thakur Jagannath Buksh vs United Provinces, L.R. 73 I.A. 123, relied on.
That section 86 of the Act does not confer an absolute and uncon trolled discretion on the Settlement Officer and such power as it gives does not constitute an encroachment on the right to hold property within the meaning of article 19(1)(f) of the Constitution.
Thakur Baghubir Singh vs Court of Wards, Ajmer and another; , , explained and distinguished.
|
riminal Appeal No. 19 of 1955.
Appeal by Special Leave from the Judgment and Order dated the llth May 1954 of the Patna High Court in Death Reference No. 8 of 1954 with Criminal Appeal No. 142 of 1954 arising out of the Judgment 571 and Order dated the 12th March 1954 in Sesssions Trial No. 2 of 1954.
B. P. Maheshwari, for the appellant.
M. M. Sinha, for the respondent.
September 28.
The appellant Deonandan Mishra (Deonandan Missir) who was a stenographer to the Inspecting Assistant Commissioner of Income tax , Patna, has been convicted under section 302 of the Indian Penal Code for having committed the murder of his second wife, Mst.
Parbati Devi, on the night of the 3rd/4th September, 1953 and sentenced to transportation for life.
The deceased was married to the appellant in or about the year 1941 and was his second wife.
As appears from the subsequent events, she was considered to be a woman of loose morals.
She appears to have been forsaken by her husband as also by her father in or about the year 1945 and to have sought shelter in the Anath Ashram at Gaya.
Through the intervention of the Secretary of the Ashram and with the consent of both the husband and the father, she got re married to one Nand Lail of Punjab in December, 1945.
After a stay of about an year and a half with Nand Lall in Punjab, she appears to have left him on account of alleged ill treatment.
She came back to the Anath Ashram at Gaya in June, 1947, but left it again in October, 1947.
What happened thereafter is not clear from the evidence and her whereabouts between October, 1947 and August, 1953, are not known and do not seem to have been traced, All that appears is that for some time prior to the date of the murder she was found going up and down in places near about Gaya and that particularly on the 2nd and 3rd September, 1953, i.e., two days prior to her murder she was found going between Gaya and Patna and a place Chakand in between these two places.
Early morning at about 7 A.M. on the 4th September, 1953, P.W. 10, Havildar, found a naked dead body of a 572 female lying in the Kabristhan at the outskirts of Gaya about a mile and a half from the police thana.
It was lying on the western verandah of the bungalow of the Kabristhan with a number of cut injuries on the neck and on other parts of the body.
Report of this was carried to the police and the body was subsequently identified to be that of Parbati Devi, the second wife of the appellant, Investigation followed and the appellant was arrested on the 6th September, 1953, and put up for trial in due course.
There is no eye witness to the murder and the case against the appellant depends entirely on circumstantial evidence.
The standard of proof required to convict a person on such evidence is well established by a series of decisions of this Court, of which it is sufficient to mention Hanumant vs The State of Madhya Pradesh(1).
This standard requires that the circumstances relied upon must be fully established and that the chain of evidence furnished by these circumstances should be so far complete as not to leave any reasonable ground for a conclusion consistent with the innocence of the accused.
The learned counsel for the appellant has, therefore, strenuously contended before us that the circumstances relied on have not been fully established and that in any case they are not enough to bring the offence home to the accused.
The various circumstances relied upon have, therefore, to be briefly noticed.
The appellant belongs to a place called Chakanddih about a mile and a half from a railway station called Chakand, which is in between Patna and Gaya and which is about five miles from Gaya.
It is in evidence that the deceased woman was seen alighting at the Chakand railway station on the night of the 2nd September, 1953, at about 10 15 P.m. from a train proceeding from Gaya to Patna and that after so alighting she was found proceeding to the village Chakand dih.
It is also in evidence that she took the train again early next morning at Chakand for Patna.
The evidence further shows that on the 3rd morning at about 10 o 'clock, she presented herself at the (1) [1952] S.C.R. 1091.
573 Income tax office at Patna, and made enquiries about the appellant from a peon of the office, P.W. 12, and that the appellant was informed about this by him.
On receiving this information the appellant came out and on seeing the woman told the peon that she was his wife and asked him to make some arrangement to keep her for the day so that he might meet her in the evening after he was free from the office work.
The peon accordingly made arrangements for her stay till the evening in the quarters of the Chowkidar, P.W. 22, who lived in the compound of the office.
In the evening of that day, i.e., 3rd September, at about 7 P.m.
the appellant came to his quarters and took away this woman in a rickshaw.
These facts are spoken to by the peon, P.W. 12, and the Chowkidar, P.W. 22.
It is further in evidence that after midday on the 3rd September, 1953, the appellant filed an application for casual leave for one day, i.e., 4th September and that leave was granted.
That the appellant did apply for leave and got it is not disputed.
The next evidence against the appellant is that he was seen that night, travelling with the deceased Parbati Devi in a compartment of the train which left Patna at about 8 P.m. that night for Gaya.
This evidence is that of three witnesses, P.W. 1, a daffadar and P. Ws. 3 and 4, two chowkidars, all of whom were on duty at Chakand railway station that night.
All of them speak to their having seen the appellant along with the deceased woman in a third class compartment at about 11 or 11 30 P.m. that night in the train from Patna to Gaya when it stopped at Chakand railway station for a few minutes.
It is their evidence that they knew both these persons well and that these persons did not get down at that station but proceeded in the train towards Gaya.
This evidence, if accepted as it has been by both the courts below undoubtedly is a strong circumstance against the appellant inasmuch as it makes out that the appellant was last seen with the murdered woman a few hours before the time when the murder must have taken place.
This evidence has been strongly challenged.
The appellant admitted that the murdered 574 woman met him at his office at Patna in the first week of September, but his case before the Sessions Judge was that this was not on the 3rd but on the 2nd.
In answer to questions under section 342, Criminal Procedure Code by the learned Sessions Judge, he admitted that the deceased came to the Income tax Office at Patna, to see him and that he met her there and that he made her stay in the house of the Chowkidar and that he took her from the lodging of the chowkidar in the evening on a rickshaw.
But he maintained that all this happened on the 2nd and not on the 3rd and said that after taking her from the lodgings of the chowkidar, at Patna on a rickshaw, he got down at the crossing and gave her money and sent her away.
He also added that once formerly she had come to his office to demand money.
His case that be met the deceased woman at Patna on the 2nd and not on the 3rd was not accepted by both the courts below.
Not only was there the evidence of the peon, P.W. 12, and the chowkidar, P.W. 22, in support of the prosecution case as to the date being the 3rd but a responsible and, educated person like the Inspector of Income tax, against whom nothing has been alleged, has also spoken to the same from his personal knowledge.
It is also significant that the appellant when he was questioned under section 342, Criminal Procedure Code in the court of the Committing Magistrate did not specifically put forward his case that it was on the 2nd and not on the 3rd, that he met the woman at his office in Patna.
His answer,% in that court were bare denials when he was asked whether he saw Parbati Devi at the Patna Incometax Office on the 3rd and whether he asked the chowkidar to allow her to remain in his house for the whole of the day.
His present case that he met the deceased at Patna on the 2nd and not on the 3rd appears to be an afterthought.
In the circumstances, the following facts, viz., that the appellant met the deceased at Patna Income tax Office on the 3rd, that he took charge of her that evening from the quarters of the chowkidar of the office by taking her in a rickshaw, that he was found travelling with her by 575 the night train at about 11 or 11 30 p.m. at the Chakand railway station and proceeding towards Gaya, must be taken to have been fully and clearly established, as found by both the courts below.
, The next important circumstance alleged against him is the existence of a strong motive.
That the relations between both of them were completely strained, and that the marital tie was virtually (though not legally) snapped, is admitted and is clearly borne out on the record by the Thyagpatra which he gave to the Secretary, Anath Ashram, in 1945 authorising him to get her married to an ' other person.
It is also admitted that the appellant had married a third wife some time before this murder.
The suggestion for the prosecution is that in, all these circumstances and having regard to the bad reputation which this woman had gathered round her, as the evidence clearly shows, and in view of the fact that she started troubling him by visits at his office, the appellant had a strong motive to commit the, murder.
It is urged for the defence that this woman must have had a number of persons with whom she must have been carrying on love intrigues and that she must have provoked strong jealousies of various persons in and around the place where she was admittedly moving for at least some time prior to her murder and that any one of such persons might have had much stronger motives to commit the crime.
Now, while it is perfectly true that there is no clear evidence about the life and movements of this woman from about October, 1947 to August, 1953, there can be no doubt that on the material before the Court, the existence of a strong motive on the part of the appellant is clearly indicated.
As has been already stated this woman left the appellant in the year 1945 and took shelter in the Anath Ashram, Gaya.
exhibit 2 (a), a Thyagpatra executed by the appellant on the 12th October., 1945, shows that he purported to give up all rights over this woman as a husband and authorised the Ashram to arrange to get her married according to her choice.
Simultaneously with this Thyagpatra, he also sent a letter to the Secretary, 73 576 Anath Ashram, exhibit 2 A(1), which is as follows: "It is submitted that I have duly filled the tyagpatra (divorce form) in connection with my wife Parbati Devi and submitted the same to the Ashram.
Besides this, I pray to the Ashram Samiti and the Bibah Samiti, with my folded hands that they should keep in mind to get Parbati Devi married at a very distant place in any other State, because she is Woman of such a loose character that if she is married to a place near about it will bring ill fame to the Ashram and to me.
As I am an employee in the Police department, it shall adversely affect my service.
I pray you not to refuse my prayer".
The state of mind of the appellant as disclosed in this letter furnishes a clue as to how his mind would have reacted when in spite of her having been married away at a distant place, she came back and was virtually knocking about from place to place between Patna and Gaya and went so far as to meet him in the very office where he was working to demand money.
It is strongly urged that this letter only shows the state of his mind about eight years prior to the murder.
But in view of his own admission that she started troubling him again by visiting him at his office, and demanding money at least on two occasions including that on the 3rd September, the courts below were perfectly justified in considering that a strong present motive on the part of the appellant has been made out.
Learned counsel for the appellant urges that the existence of the motive and the evidence as to the appellant having been last seen travelling in the train with this woman on the night of the 3rd September a few hours prior to the time of the murder, even if believed are, at best circumstances which may create a strong suspicion but that they are not enough by themselves to make out the guilt of the accused.
It s pointed out that there is no evidence that the ap pellant and the deceased woman were found getting down at the Gaya station or that they were both fond proceeding towards Kabristhan after so getting down.
Undoubtedly there is some gap in the evidence 577 at this point.
But their getting down at Gaya or proceeding towards Kabristhan must have taken place at or after midnight.
It is in evidence that Kabristhan was on the out skirts of Gaya about a mile and a half from the Gaya police station, on the bank of the river Phalgu and that there was no human habitation within about 100 yards of the place.
The absence of any specific evidence, therefore, as to the appellant having been seen with the murdered woman going towards Kabristhan or near about Kabristban is intelligible.
It cannot be denied, however, that if the circumstances against the appellant stopped short at this point, there may be room for hesitation.
There are however further circumstances relied upon by the courts below and they require to be noticed and considered.
These further circumstances are (1) the finding of a blood stained knife (pen knife) near the dead body, and (2) the existence of certain injuries upon the person of the appellant when he was arrested on the 6th.
The evidence of P.W. 23, the officer in charge of Kotwali police station, Gaya, who proceeded to investigate this offence on getting information thereof at 7 A.M. on the 4th September shows that he then found the dead body of the woman, in a pool of blood underneath and near the neck, and that there was found at the time a blood stained knife near the head.
This knife was seized and marked as exhibit 1.
The prosecution has given evidence of three witnesses, P.Ws. 11) 13 and 18, who are respectively the Daftari, the Chaprasi and the Inspector attach to the Income tax Office, Patna, in which the appellant was working, that they had seen with the appellant a knife similar to the one which was shown to them in Court, as having been found by the side of the dead body.
Out of these P. W. 18, the Income tax Inspector says in cross examination that he had never seen such a knife "before".
The appellant, while in his examination under section 342, Criminal Procedure Code admitted that he used to keep a knife for mending pencil, denied that the knife, produced in court as being the one which was found by the side of the dead body, was 578 his or was like the one he kept.
It was strongly urged on behalf of the defence that there was no proof that this was the very knife which the appellant used to have.
The learned Judges of the High Court met this criticism as follows: " 'Of course no witness could have possibly deposed that this was the knife which was in possession of the appellant.
They say that the knife which they had seen with the appellant prior to the occurrence was a knife similar to the one which was found in a blood stained condition near the dead body.
We have examined that knife for ourselves and it has a peculiarity of its own.
The knife has an ivory handle.
It has a cork screw and a bottle opener all combined.
A knife of this description, therefore, can be identified and it is not one of the kind which can be said to be an ordinary one".
In view of the above observation by the learned Judges and having regard to the evidence of P.W. 18, who, though he did not speak of these peculiar features, has categorically said that be had never seen such a knife before, there is no reason to disagree with the finding of the High Court that the find of this knife near the dead body is a strong circumstance against the appellant.
The next, circumstance found against the appellant is the presence of injuries on his body at the time of his arrest on the 6th.
P.W. 24, a Civil Assistant Surgeon of Gaya who examined him at 6 P.m. on the 6th of September, found the following four simple injuries on his person.
(1) One wound on the left ring finger, (2) one wound on the back of left hand near thumb, (3) two abrasions in front of right knee, and (4) one small abrasion in front of left knee.
In his opinion, the injuries were all about three days old.
Numbers 1 and 2 might have been caused by a sharpedged weapon such as a penknife and injuries 3 and 4 by some hard and rough substance such as friction against the ground.
According to him.
the nature and position of the injuries were such that "if the victim is lying on the ground and if the assailant is over on the chest of the victim and he is holding the victim 579 by his left hand and if he is inflicting, injuries near about his left hand the victim is struggling making the assailant unsteady, then injuries Nos. 1 and 2 may be caused by his own weapon and injuries Nos. 3 and 4 may be caused due to friction against the ground".
This answer indicates the possibility of the injuries having been received by a person while making a murderous attack on the victim with a pen knife.
The appellant when asked about these injuries in his examination under section 342, Criminal Procedure Code stated in the Sessions Court (as well as in the committal court) that he fell down at Jehanabad platform on the 3rd due to Dhoti getting entangled, and sustained injuries.
In support of his explanation he relied on an application for extension of leave sent first by telegram on the morning of the 5th of September to the Commissioner of Income tax, Patna asking for extension of leave followed by a letter of that very date to the same effect.
The letter was addressed to the Inspecting Assistant Commissioner of Income tax, Northern Range, Patna, and runs as follows: "I beg to state that I started from home from Patna in the night train of 3rd September 1953.
When the train stopped at Jehanabad I wanted to come out of the train for taking a stand on the platform due to unbearable heat in the train.
At the gate of the compartment as soon as I wanted to come out my one leg entangled with the lower part of my dhoti resulting instantaneous fell down from the train.
Due to this accident I got injuries at both the knees and the cut marks in the back of my left palm.
I therefore request you to kindly extend my leave up to 10th September, '53".
When questioned under section 342, Criminal Procedure Code before the Sessions Court about the extension of his leave, he said "I was a stenographer.
How can have I typed when my left hand was injured.
Hence I wanted to extend the leave".
It appears to us, however, very doubtful, having regard to the nature of the injuries, whether this can be the real reason for his extending the leave, He does not 580 say so specifically in his application for leave.
Nor, does it appear so likely from the.
medical evidence how injuries Nos. 1 and 2 could have been caused by the alleged fall on the railway platform.
In the crossexamination of the Doctor it was suggested that if there is a broken glass piece lying on the ground and if during the fall the hand came in violent contact with that piece of glass, then such injuries may be caused.
But the appellant in his explanation and in the application for leave does not say anything which indicates that he received the injuries on the band from a piece of glass.
In this state of the evidence, it cannot be said that the courts below were not justified in coming to the conclusion which they did, viz., that the explanation of the appellant for the injuries was false and that the injuries may well have been received on the occasion of the murder.
Summing up, the various facts, which formed the links in the chain of circumstantial evidence in this case, may be stated to be as follows: 1.
There was a fairly strong motive for the ap pellantto commit the murder in question.
He took charge of the murdered woman on the evening of the 3rd September by taking her out from the quarters of the chowkidar of the Incometax Office, Patna, and leaving the place with her in a rickshaw.
3.He was found travelling with her by a train which was proceeding to Gaya that night, at Chakand railway station and this was at about 11 or 11 30 P.M., i.e., a few hours prior to the time when she must have been murdered.
4.The knife, which looked like the one which he was known to be using in his office and which was not of a common pattern, was found just by the side of the head of the murdered woman stained with blood.
5.When he was arrested two and a half days after the murder, he bad simple injuries on his hand and the knees which might well have been received, according to the medical evidence, in an assault on the murdered woman with the knife above mentioned.
581 These circumstances taken together, advance the case against the appellant very much beyond suspicion and reasonably and definitely point to the appellant as the ' person who committed the murder.
In such a situation the fact that he has no explanation to offer as to how, after having taken charge of this woman on the evening of the 3rd at Patna and after having travelled with her in the train that very night towards Gaya, he left the woman, where and how he parted company with her and what became of her so far as he knows, goes a long way against him.
The fact that on the other hand he tries to dissociate himself from her company at the relevant time by putting forward for the first time in the Sessions Court, the story of having met her at Patna on the 2nd September and of his having parted company with her that evening at some crossing after giving her some money, which is patently false, is very significant.
The further fact that the explanation for his injuries appears to be false is also significant.
These false explanations are telling circumstances which, in a case depending on circumstantial evidence taken with the other facts such as those in this case, are enough to bring the guilt home to the accused.
To combat this conclusion learned counsel for the appellant drew our attention to the nature and position of the injuries on the body of the deceased woman as disclosed by the medical evidence of the Doctor, P.W. 17, who conducted the postmortem examination, as also the various indications at the site of the Occurrence., as found and spoken to by the police officer, P. W. 23, who was the first officer to go to the scene by about 7 A.M. on the 4th on receiving information, He also drew our attention to the fact that according to the report of the Serologist and Chemical Examiner, no human blood appeared to have been found on the saree and the bodice found lying near about the place where the dead body was lying and that neither the saree nor the bodice showed any indication of having been torn or tampered with and that on the other hand the body was found lying absolutely naked with face upwards.
These features 582 have all been pressed into service for a strong argument that the murder must have been the act of more than one person and probably having its source in sex jealousy.
We have very closely and anxiously gone into this aspect of the matter by carefully scrutinising the entire evidence in this behalf.
It is unnecessary to recapitulate the same.
Whatever may have been.
the actual situation on the spot and the method by which the murder was in fact committed a matter for mere speculation we are satisfied that the murder could have been committed by a single individual in the position of the appellant.
Sitting in an appeal by way of special leave, we are not prepared to say that the medical evidence and other concomitant circumstances were such as to compel a conclusion contrary to that arrived at by the Courts below.
It is true that in a case of circumstantial evidence not only should the various links in the chain of evidence be clearly established, but the completed chain must be such as to rule out a reasonable likelihood of the innocence of the accused.
But in a case like this where the various links as stated above have been satisfactorily made out and the circumstances point to the appellant as the probable assailant, with reasonable definiteness and in proximity to the deceased as regards time and situation, and he offers no explanation, which if accepted, though not proved, would afford a reasonable basis for a conclusion on the entire case consistent with his innocence, such absence of explanation or false explanation would itself be an addi tional link which completes the chain.
We are, therefore, of the opinion that this is a case which satisfies the standards requisite for conviction on the basis of circumstantial evidence.
I We find, therefore, no sufficient reason to differ from the view taken by the lower courts and this appeal must accordingly be dismissed.
| The standard of proof required to convict a person on circumstantial evidence is well established by a series of decisions of the Supreme Court.
According to that standard the circumstances relied upon in support of the conviction must be fully established and the chain of evidence furnished by those circumstances must be so far complete as not to leave any reasonable ground for a conclusion con sistent with the innocence of the accused.
The appellant was convicted under section 302 of the Indian Penal Code and sentenced to transportation for life.
There were no eyewitnesses to the murder and the conviction of the appellant rested solely on the circumstantial evidence which was relied on by the courts below.
The various facts which formed the links in the chain of circumstantial evidence in the present case taken together advanced the case against the appellant very much beyond suspicion and reasonably and definitely pointed to the appellant as the person who committed the murder.
In a case like the present when the various links in the chain had been satisfactorily made out and the circumstances pointed to the appellant as the probable assailant with reasonable definiteness and in proximity to the deceased as regards time and situation, and be offered no explanation, which if accepted, though not proved, would afford a reasonable basis for a conclusion on the entire case consistent with his innocence, such absence of explanation or false explanation would itself be an additional link which completed the chain.
Hanumant vs The State of Madhya Pradesh ([1952] S.C.R. 1091), referred to.
|
Appeal No. 95 of 1953.
On appeal from the Judgment and decree dated the 29th day of June 1951 of the Bombay High Court in Appeal No. 93 of 1949 arising out of the order dated the 16th September 1949 of the Court of Bombay City Civil Court at Bombay in Award No. 45 of 1949.
M.C. Setalvad, Attorney General of India (H. J. Umrigar, Sri Narain Andley, Rameshwar Nath and Rajinder Narain, with him), for the appellant.
H.R. Mehervaid and R. N. Sachthey, for the respondent.
October 4.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
The appellant is a share broker carrying on business in the City of Bombay, and a member of the Native Share and Stock Brokers ' Association, Bombay.
The respondent, Mrs. Goolbai Hormusji, employed him for effecting sales and purchases of shares on her behalf, and on 6 8 1947 there was due from her to the appellant on account of these dealings a sum of Rs. 6,321 12 0.
On that date, the respondent had outstanding for the next clearance, sales of 25 shares of Tata Deferred and 350 shares of Swadeshi Mills.
On 11 8 1947, the appellant effected purchases of 25 shares of Tata Deferred and 350 shares of Swadeshi Mills to square the outstanding sales of the respondent, and sent the relative contract notes therefor Nos. 2438 and 2439 (Exhibit A) to her.
She sent a reply repudiating the contracts on the ground that the appellant had not been authorised to close the transactions on 11 8 1947, and instructed him to square them on 14 8 1947.
The appellant, however, declined to do so, maintaining that the transactions had been closed on 11 8 1947 under the 109 860 instructions of the respondent.
After some correspondence which it is needless to refer to, the appellant applied on 21 8 1947 to the Native Share, and Stock Brokers Association, Bombay for arbitration in pursuance of a clause in the contract notes, which runs as follows: "In event of any dispute arising between you and me/us of this transaction the matter shall be referred to arbitration as provided by the Rules and Regulations of the Native Share and Stock Brokers ' Association".
The Association gave notice of arbitration to the respondent, and called upon her to nominate her arbitrator, to which she replied that the contract notes were void, and that in consequence, no arbitration proceedings could be taken thereunder.
The arbitrators, however, fixed a day for the hearing of the dispute, and gave notice thereof to her, but she declined to take any part in the proceedings.
On 10 10 1947 they made an award in which, on the basis of the purchases made by the appellant on 11 8 1947 which were accepted by them, they gave credit to the respondent for Rs. 1,847, and directed her to pay him the balance of Rs. 4,474 12 0.
The respondent then filed the application out of which the present appeal arises, for setting aside the award on the ground, inter alia, that the contracts in question were forward contracts which were void under section 6 of the Bombay Securities Contracts Control Act VIII of 1925, that consequently the arbitration clause was also void and inoperative, and that the proceedings before the arbitrators were accordingly without jurisdiction and the award a nullity.
Section 6 of the Act is as follows: "Every contract for the purchase or sale of securities, other than a ready delivery contract, entered into after a date to be notified in this behalf by the Provincial Government shall be void, unless the same is made subject to and in accordance with the rules duly sanctioned under section 5 and every such contract shall be void unless the same is made between members or through a member of a recognised stock 861 exchange; and no claim shall be allowed in any Civil Court for the recovery of any commission, brokerage, fee or reward in respect of any such contract".
Section 3(1) defines 'securities ' as including shares, and therefore, contracts for the sale or purchase of shares would be void under, section 6, unless they were made in accordance with the rules sanctioned by the Provincial Government under section 5.
The appellant sought to avoid the application of section 6 on the ground that the contracts in question were 'ready delivery contracts ', and fell outside the operation of that section.
Section 3(4) of Act VIII of 1925 defines 'ready delivery contract ' as meaning "a contract for the purchase or sale of securities for performance of which no time is specified and which is to be performed immediately or within a reasonable time", and there is an Explanation that "the question what is a reasonable time is in each particular case a question of fact".
The contention of the appellant was that contracts Nos.
2438 and 2439 were ready delivery contracts as defined in section 3(4), as no time was specified therein for performance.
The learned City Civil Judge, who heard the application agreed with this contention, and holding that the contracts were not void under section 6 of Act VIII of 1925, dismissed the application.
The respondent took the matter in appeal to the High Court of Bombay, and that was beard by Chagla, C.J. and Tendolkar, J. They were of the opinion that the con ' tracts in question were not ready delivery contracts as defined in section 3(4) of the Act, because though no time for performance was specified therein, they had to be performed within the period specified in the Rules and Regulations of the Association, which were incorporated therein by reference, and not "immediately or within a reasonable time" as provided in section 3(4), that they were accordingly void under section 6, and that consequently, the arbitration clause and the proceedings taken thereunder culminating in the award were also void.
They accordingly set aside the award as invalid and without jurisdiction.
Against this judgment, the appellant has preferred this appeal 862 on a certificate under article 133(1) (c).
It was argued by the learned Attorney General in support of the appeal that even apart from the question whether the contracts in question were for ready delivery or not, they would be outside the purview of section 6, because they were not contracts for sale and purchase of securities.
This contention was not raised in the courts below, and learned counsel for the respondent objects to its being entertained for the first time in this Court, as that would involve investigation of facts, which has not been made.
But in view of the terms of the contract notes and the admission of the respondent in her petition, we are of opinion that the point is open to the appellant, and having heard counsel on both sides, we think that the appeal should succeed on that point.
The dispute between the parties is as to whether the appellant was acting within the scope of his authority when he purchased 25 shares of Tata Deferred and 350 shares of Swadeshi Mills on 11 8 1947.
If he was acting within his authority, then the respondent was entitled only to a credit of Rs. 1,847 on the basis of the said purchases. ' But if these purchases were unauthorised, the appellant was liable to the respondent in damages.
In either case, the dispute was one which arose out of the contract of employment of the Appellant by the respondent as broker and not out of any contract of sale or purchase of securities.
The question of sale or purchase would arise between the respondent and the seller or purchaser, as the case may be, with reference to the contract brought about by the appellant.
But the relationship between the respondent and the appellant was one of principal and agent and not that of seller and purchaser.
The contract of employment is no doubt connected, and intimately, with sales and purchases of securities; but it is not itself a contract of sale or purchase.
It is collateral to it, and does not become ipso facto void, even if the contract of purchase and sale with which it is connected is void.
Vide the decision of this Court in Kishan Lal and another vs Bhanwar Lal(1) The legis (1) (1955] 1 S.C.R. 439.
863 lature might, of course, enact that not merely the contract of sale or purchase but even contracts collateral thereto shall be void, in which case the contracts of employment with reference to those contracts would also be void.
But that is not what Act VIII of 1925 has done.
Section 6 expressly provides that no claim shall be maintained in a civil court for the recovery of any commission, brokerage, fee or reward in respect of any contract for the purchase or sale of securities.
That is to say, the bar is to the broker claiming remuneration in any form for having brought about the contract.
But the contract of employment is not itself declared void, and a claim for indemnity will not be within the prohibition.
The question whether contract notes sent by brokers to their constituents are contracts for the sale and purchase of securities within section 6 of Act VIII of 1925, came up for consideration before the Bombay High Court in Promatha Nath vs Batliwalla & Karani (1) and it was held therein that they were not themselves contracts for sale or purchase but only intimations by the broker to the constituent that such contracts had been entered into on his behalf.
We agree with this decision.
It may be argued that if the contract note is only intimation of a sale or purchase on behalf of the con stituent, then it is not a contract of employment, and that in consequence, there is no agreement in writing for arbitration as required by the Arbitration Act.
But it is settled law that to constitute an arbitration agreement in writing it is not necessary that it should be signed by the parties, and that it is sufficient if the terms are reduced to writing and the agreement of the parties thereto is established.
Though the respondent alleged in her petition that she had not accepted the contract notes, Exhibit A, she raised no contention based thereon either before the City Civil Judge or before the High Court, and even in this Court the position taken up by her counsel was that Exhibit A constituted the sole repository of the contracts, and as they were void, there was no arbi (1) I.L.R. [1942] Bom. 655; A.I.R. 1942 Bom.
864 tration clause in force between the parties.
We accordingly hold that the contract notes contained an agreement in writing to refer disputes arising out of the employment of the appellant as broker to arbitration, and that they fell outside the scope of section 6 of Act VIII of 1925, that the arbitration proceedings are accordingly competent, and that the award made therein is not open to objection on the ground that Exhibit A is void.
It was next contended for the respondent that the contract notes were void under Rule 167 of the Native Share and Stock Brokers ' Association, and that on that ground also, the arbitration proceedings and the award were void.
Rule 167 so far as it is material is as follows: "167.
(a) Members shall render contract notes to non Members in respect of every bargain made for such non Member 's account, stating the price at which the bargain has been made.
Such contract notes shall contain a charge for brokerage at rates not less than the scale prescribed in Appendix G annexed to these Rules, or as modified by the provisions of rules 168 and 170(b).
Such contract notes shall show brokerage separately and shall be in Form A prescribed in Appendix annexed to these Rules.
. . . . . . . . (c) No contract note not in one of the printed Forms in Appendix H shall be deemed to be valid.
. . . . . . . . (g) A contract note referred to in this rule or any other rule for the time being in force shall be deemed to mean and include a contract and shall have the same significance as a contract".
Form A in Appendix H referred to in Rule 167(a) contains two columns, one showing the rate at which the securities are purchased or sold and the other, the brokerage.
The contract notes sent to the respondent are not in this form.
They are in accordance with Form A in Appendix A, and show the rates at which the securities are sold or purchased, the brokerage not being separately shown.
At the foot of the document, there is the following note; 865 "This is net contract.
Brokerage is included in the price".
The contention of the respondent is that the contract notes are not in accordance with Form A in Appendix H, as the price and brokerage are not separately shown, and that therefore they are void under Rule 167(c).
Now, Rule 167 applies only to forward contracts, and the basis of the contention of the respondent is that inasmuch as the contract notes, Exhibit A, have been held by the learned Judges of the High Court not to be ready delivery contracts but forward contracts, they would be void under Rule 167(c), even if they were not hit by section 6 of Act VIII of 1925.
The assumption underlying this argument is that what is not a ready delivery contract under the definition in section 3(4) of Act VIII of 1925 must necessarily be a forward contract for purposes of Rule 167.
But that is not correct.
The definition of a ready delivery contract in section 3(4) is only for the purpose of the Act, and will apply only when the question is whether the contract is void under section 6 of that Act.
But when the question is whether the contract is void under Rule 167, what has to be seen is whether it is a forward contract as defined or contemplated by the Rules.
The definition in section 3(4) of Act VIII of 1925 would be wholly irrelevant for determining whether the contract is a forward contract for purposes of Rule 167, the decision of which question must depend entirely on the construction of the Rules.
The relevant Rules are Nos. 359 to 363.
Rule 359 provides that "contracts other than ready delivery contracts shall not be made or transacted within or without the ring".
Rule 361 confers on the Board power to specify which securities shall be settled by the system of Clearance Sheets and which, by the process of Tickets.
Rules 362 and 363 prescribe the modus operandi to be followed in effecting the settlement.
It was with reference to these rules which under the contract notes were to be read as part of the con tract, that the learned Judges held that the contracts were not ready delivery contracts as defined in sec 866 tion 3(4) of Act VIII of 1925.
But reading the above Rules with Rule 359, there can be no doubt that the contract notes, Exhibit A, would for the purpose of the Rules be ready delivery contracts.
Indeed, the form of the contract notes, Exhibit A, is the one provided under the Rules for ready delivery contracts, whereas Form A in Appendix H is, as already stated, for forward contracts.
Thus, contracts which are regulated by Rules 359 to 363 cannot be forward contracts contemplated by Rule 167, and they cannot be held to be void under that Rule.
The error in the argument of the respondent is in mixing up two different provisions enacted by two different authorities and reading the one into the other.
The rules framed by the Association form a code complete in itself, and any question arising with reference to those rules must be determined on their construction, and it would be a mistake to read into them the statutory provisions enacted in Act VIII of 1925.
In this view, the contract notes, Exhibit A, cannot be held to be void under rule 167.
In the result, we must hold, differing from the learned Judges of the court below, that the arbitration proceedings are not incompetent and that the award made therein is not void on the ground that the contracts containing the agreement are void.
The respondent contested the validity of the award on several other grounds.
They were rejected by the City Civil Judge and in the view taken by the learned Judges of the High Court that the contract notes were void under section 6 of Act VIII of 1925, they did not deal with them.
Now that we have held that the contracts are not void, it is necessary that the appeal should be heard on those points.
We accordingly set aside the order of the court below, and direct that the appeal be reheard in the light of the observations contained herein.
As the appeal succeeds on a point not taken in the courts below, the parties will bear their own costs throughout.
The costs of the further hearing after remand will be dealt with by the High Court.
| The appellants share broker carrying on business in the City of Bombay and a member of the Native Share and Stock Brokers ' 858 Association was employed by the respondent for effecting sales and purchases of shares on her behalf.
The appellant effected purchases of 25 shares of Tata Deferred and 350 shares of Swadeshi Mills to square the outstanding sales of the same number of shares standing in her name and sent the relative contract notes therefor to her.
She repudiated the contracts on the ground that the appellant had not been authorised to close the transactions on the date mentioned by him and asked him to square them at a later date.
The appellant maintained that the transactions had been closed in accordance with her instructions.
The appellant referred the dispute for arbitration to the Native Share and Stock Brokers ' Association in pursuance of an arbitration clause in the contract notes.
The respondent refused to submit to arbitration of the association on the ground that the contract notes were void and therefore no arbitration proceedings could be taken thereunder.
The arbitrators made an award in favour of the appellant in the absence of the respondent who declined to take part in the proceedings.
The respondent filed an application for setting aside the award.
The Bombay High Court held that the contracts in question were not ready delivery contracts as defined in section 3(4) of the Bombay Securities Contracts Control Act VIII of 1925 and that they were accordingly void under section 6 of the Act and therefore the arbitration clause and the proceeding taken thereunder culminating in the award were also void.
Held that apart from the question whether the contracts in question were for ready delivery or not, they were outside the purview of section 6 of Bombay Act VIII of 1925 because they were not contracts for sale and purchase of securities.
The dispute between the parties was as to whether the appellant was acting within the scope of his authority when he purchased the shares.
If he was acting within his authority, the respondent was liable to him.
If those purchases were unauthorised, the appellant was liable to the respondent for damages.
In either case the dispute was one which arose out of the contract of employment of the appellant by the respondent as a broker and not out of any contract of sale or purchase of securities.
The relationship between the respondent and the appellant was that of principal and agent, and not that of seller and purchaser.
The contract notes sent by brokers to their constituents are not themselves contracts for sale or purchase of securities within section 6 of the Bombay Act VIII of 1925 but only intimations by the broker to the constituent that such contracts had been entered into on his behalf.
It is settled law that to constitute an arbitration agreement in writing it is not necessary that it should be signed by the parties, and that it is sufficient if the terms are reduced to writing and the agreement of the parties thereto is established.
The Rules framed by the Native Share and Stock Brokers ' Association, Bombay form a code complete in itself and any question 859 arising with reference to those Rules must be determined on their construction and it would be a mistake to read into them the statutory provisions enacted in the Bombay Act VIII of 1925 and therefore the contract notes cannot be held to be void under Rule 167.
|
Nos. 189 to 193 of 1955.
Petitions under Article 32 of the Constitution of India for the enforcement of Fundamental Rights.
G. section Pathak, (Rameshwar Nath and Rajinder Narain, with him) for the petitioners in Petition No. 189 of 1955.
Rameshwar Nath and Rajinder Narain, for petitioners in Petition No. 190 of 1955.
Sri Narain Andley and Rajinder Narain, for petitioners in Petitions Nos.
191 to 193 of 1955.
T. L. Shevde, Advocate General of Madhya Pradesh (I. N. Shroff, with him), for respondents in all petitions.
September 29.
This judgment will dispose of all the five petitions (Nos. 189 to 193 of 1955) which have been heard together and which raise the same question as to the constitutional validity of the C.P. & Berar Motor Vehicles (Amendment) Act, 1947 (Act III of 1948).
The facts are short and simple.
Each of the petitioners has been 'carrying on business as stage carriage operator for a considerable number of years under permits granted under section 58 of the (Central Act IV of 1939) as amended by the C.P. & Berar Motor Vehicles (Amendment) Act.$ 1947 (Act III of 1948).
Prior to the amendment section 58 of the Motor tVehicles Act, 1939 was in the following terms: "58(1).
A permit other than a temporary permit issued under section 62 shall be effective without renewal for such period, not less than three years and not more than five years, as the Regional Transport Authority, may in its discretion specify in the permit.
Provided that in the case of a permit issued or renewed within two years of the commencement of this Act, the permit shall be effective without renewal 75 for such period of less than three years as the Provincial Government may prescribe.
(2) A permit may be renewed on an application made and disposed of as if it were an application for a permit: Provided that, other conditions being equal, an application for renewal shall be given preference over new applications for permits".
It will be noticed that under the section as it originally stood the permit granted thereunder was for a period of not less than 3 years and not more than 5 years and a permit holder applying for renewal of the permit had, other things being equal, preference over new applicants for permit over the same route and would ordinarily get such renewal.
Very far reaching amendments were introduced by the C.P. & Berar Motor.
Vehicles (Amendment) Act, 1947 into the in its application to Central Provinces and Berar.
By section 3 of the amending Act, item (ii) of subsection (1) of section 43 of the Central Act was replaced by the following items: " (ii) fix maximum, minimum or specified, fares or freights for stage carriages and public carriers to be applicable throughout the province or within any area or any route within the province, or (iii)notwithstanding anything contained in section 58 or section 60 cancel any permit granted under the Act in respect, of a transport vehicle or class of such permits either generally or in any area specified in the notification: Provided that no such notification shall be issued before the expiry of a period of three months from the date of a notification declaring its intention to do so: Provided further that when any such permit has been cancelled, the permit holder shall be entitled to Such compensation as may be provided in the rules; or (iv)declare that it will engage in the business o road transport service either generally or in any area specified in the notification".
593 The following subsection (3) was added after subsection (2) of section 58 of the Central Act by section 8 of the amending Act, namely: "(3) Notwithstanding anything contained in subsection (1), the Provincial Government may order a Regional Transport Authority or the Provincial Transport Authority to limit the period for which any permit or class of permits is issued to any period less than the minimum specified in the Act".
Section 9 of the amending Act added after section 58 a new section reading as follows: "58 A. Notwithstanding.
anything herein before contained the Provincial Government may by order direct any Regional Transport Authority or the Provincial Transport Authority to grant a stage carriage permit to the Provincial Government or any undertaking in which the Provincial Government is financially interested or a permit holder whose permit has been cancelled under section 43 or any local authority specified in the order".
The result of these amendments was that power was given to the Government (i) to fix fares or freights throughout the Province or for any area or for any route, (ii) to cancel any permit after the expiry of three months from the date of notification declaring its intention to do so and on payment of such compensation as might be provided by the Rules, (iii) to declare its intention to engage in the business of road transport generally or in any area specified in the notification, (iv) to limit the period of the license to a period less than the minimum specified in the Act and (v) to direct the specified Transport Authority to grant a permit, inter alia, to the Government or any undertaking in which Government was financially interested.
It may be mentioned here that in the State of Madhya Pradesh there are two motor transport companies known as C. P. Transport Services Ltd., and Provincial Transport Co. Ltd., in which, at the date of these writ petitions, the State of Madhya Pradesh and the Union of India held about 85 per cent.
of the share capital.
Indeed, since the filing of these petitions the entire undertakings of these 594 companies have been purchased by the State of Madhya Pradesh and the latter are now running the services.
on some routes for which permits had been granted to them.
A cursory perusal of the new provisions introduced by, the amending Act will show that very extensive powers were conferred on the Provincial Government and the latter were authorised, in exercise of these powers, not only to regulate or control the fares or freights but also to take up the entire motor transport business in the province and run it in competition with and even to the exclusion of all motor transport operators.
It was in exercise of the powers under the newly added sub section (3) of section 58 that the period of the permit was limited to four months at a time.
It was in exercise of powers conferred on it by the new section 43 (1) (iv) that the Notification hereinafter mentioned declaring the intention of the Government to take up certain routes was issued.
It is obvious that these extensive powers were given to the Provincial Government to carry out and implement the policy of nationalisation of the road transport business adopted by the Government.
At the date of the passing of the amending Act (III of 1948) there was no such thing as fundamental rights of the citizens and it was well within the legislative competency of the Provincial Legislature to enact that law.
It has been conceded that the amending Act was, at the date of its passing, a perfectly valid piece of legislation.
Then came our Constitution on the 26th January 1950.
Part III of the Constitution is headed "Fundamental Rights" and consists of articles 12 to 35.
By article 19(1) the Constitution guarantees to all citizens the right to freedom under seven heads.
Although in article 19(1) all these rights are expressed in unqualified language, none of them, however, is absolute, for each of them is cut down or limited by whichever of the several clauses (2) to (6) of that article is applicable to the particular right.
Thus the right to practise any profession or to carry on any occupation, trade or business conferred by article 19(1)(g) was 595 controlled by clause (6) which, prior to its amendment to which reference will presently be made, ran as follows: "(6) Nothing in sub clause (g) of the said clause shall affect the operation of any existing law in so far as it imposes, or prevent the State from making any law imposing, in the interests of the general public, reasonable restrictions on the exercise of the right conferred by the said sub clause, and, in particular, nothing in the said sub clause shall affect the operation of any existing law in so far as it prescribes or empowers any authority to prescribe, or prevent the State from making any law prescribing or empowering any authority to prescribe, the professional or technical qualifications necessary for practising any profession or carrying on any occupation, trade or business".
The fundamental rights conferred by articles 14 to 35 are protected by the provisions of article 13 the relevant portions of which are as follows: "13.
(1) All laws in force in the territory of India immediately before the commencement of this "Constitution, in so far as they are inconsistent with the provisions of this Part, shall, to the extent of such inconsistency, be void.
(2)The State shall not make any law which takes away or abridges the rights conferred by this Part and any law made in contravention of this clause shall, to the extent of the contravention, be void" The amending Act (III of 1948) was, at the commencement of the Constitution, an existing law.
The new provisions introduced by the Act authorised the Provincial Government to exclude all private motor transport operators from the field of transport business.
Prima facie, therefore, it was an infraction of the provisions of article 19 (1) (g) of the Constitution and would be void under article 13(1), unless this invasion by the Provincial Legislature of the funda mental right could be justified under the provisions of clause (6) of article 19 on the ground that it imposed reasonable restrictions on the exercise of the right under article 19(1)(g) in the interests of the general 596 public.
In Shagir Ahmad vs The State of U.P. & Others(1) it was held by this Court that if the word "restriction" was taken and read in the sense of limitation and not extinction then clearly the law there under review which, like the amending Act now before us, sanctioned the imposition of total prohibition on the right to carry on the business of a motor transport operator could not be justified under article 19(6).
It was further held in that case that if the word "restriction" in clause (6) of article 19 of the Constitution, as in other clauses of that article, were to be taken in certain circumstances to include prohibition as well, even then, having regard to the nature of the trade which was perfectly innocuous and to the number of persons who depended upon business of this kind for their livelihood, the impugned law could not be justifled as reasonable.
In this view of the matter, there is no escape from the conclusion that the amending Act, in so far as it was inconsistent with article 19 (1) (g) read with clause (6) of that article, became, under article 13(1), void "to the extent of such inconsistency" and if there were nothing else in the case the matter would have been completely covered by the decision of this Court in that case.
On the 18th June 1951 however, was passed the Constitution (First Amendment) Act, 1951.
By section 3(1) of that Act for clause (2) of article,19 a new sub clause was substituted which was expressly made retrospective.
Clause (6) of article 19 was also amended.
That clause, so amended, now reads as follows: "(6) Nothing in sub clause (g) of the said clause shall affect the operation of any existing law in so far as it imposes, or prevent the State from making any law imposing, in the interests of, the general public, reasonable restrictions on the exercise of the right conferred by the said sub clause, and, in particular, nothing in the said sub clause shall affect the operation of any existing law in so far as it relates to, or prevent the State from making any law relating to, (1) ; 597 (i) the professional or technical qualifications necessary for practising any profession or carrying on any occupation, trade or business, or (ii) the carrying on by the State, or by a corporation owned or controlled by the State, of any trade, business, industry or service, whether to the exclusion, complete or partial, of citizens or otherwise".
It will be noticed that clause (6), as amended, was not made retrospective as the amended clause (2) had been made.
The contention of the respondents before us is that although the amending Act, on the authority of our decision in Shagir Ahmad 's case (supra), became on and from the 26th January 1950 void as against the citizens to the extent of its inconsistency with the provisions of article 19(1)(g), nevertheless, after the 18th June 1951 when clause (6) was amended by the Constitution (First Amendment) Act, 1951 the amending Act ceased to be inconsistent with the fundamental right guaranteed by article 19(1) (g) read with the amended clause (6) of that article, because that clause, as it now stands, permits the creation by law of State monopoly in respect, inter alia, of motor transport business and it became operative again even as against the citizens.
The petitioners, on the other hand, contend that the law having become void for unconstitutionality was dead and could not be vitalised by a subsequent amendment of the Constitution removing the constitutional objection, unless it was re enacted, and reference is made to Prof. Cooley 's work on Constitutional Limitations, Vol.
I, p. 384 Note referred to in our judgment in Shagir Ahmad 's case (supra) and to similar other authorities.
The question thus raised by the respondents, however, was not raised by the learned Advocate General in that case, although the notification was published by the U. P. Government on the 25th March 1953 and the proposed scheme was published on the 7th April, 1953, i.e., long after the Constitution (First Amendment) Act, 1951 had been passed.
This question was not considered by this Court in Shagir Ahmad 's case, for it was there conceded (see p. 720 of the report) that the validity of the U. P. Act which, in this res 598 pect, was similar to the C. P. '& Berar Act now under consideration.
, was not to be decided by applying the provisions of the amendea clause (6).
Nor was this problem raised before or considered by this Court in Behram Khurshed Pesikaka vs The State of Bombay(1) We, therefore, conceive it to be open to us to go into the new question that has now been mooted before us and to consider what effect the amended clause (6) has on the impugned Act.
This involves a question of construction of article 13 of the Constitution.
The meaning to be given to the word "void" in article 13 is no longer res integra, for the matter stands concluded by the majority decision of this Court in Keshavan Madhava Menon vs The State of Bombay(1).
We have to apply the ratio decidendi in that case to the facts of the present case.
The impugned Act was an existing law at the time when the Constitution came into force.
That existing law imposed on the exercise of the right guaranteed to the citizens of India by article 19 (1) (g) restrictions which could not be justified as reasonable under clause (6) as it then stood and consequently under article 13 (1) that existing law became void "to the extent of such inconsistency".
As explained in Keshavan Madhava Menon 'section case (supra) the law became void not in toto or for all purposes or for all times or for all persons but only "to the extent of such inconsiatency", that is to say, to the extent it became inconsistent with the provisions of Part III which conferred the fundamental rights on the citizens.
It did not become void independently of the existence of the rights guaranteed by Part III.
In other words, on and after the commencement of the Constitution the existing law, as a result of its becoming inconsistent with the provisions of article 19(1)(g) read with clause (6) as it then stood, could not be permitted to stand in the. way of the exercise of that fundamental right.
Article 13(1) by reason of its language cannot be read as having obliterated the entire operation of the inconsistent law or having wiped it out altogether from (1) (1955] 1 S.C.R. 613.
(2) ; 599 the statute, book.
Such law existed for all past tran sactions and for enforcement of rights and liabilities accrued before the date of the Constitution, as was held in Keghavan Madhava Menon 's case.
The law continued in force, even after the commencement of the Constitution, with respect to persons who were not citizens and could riot claim the fundamental right.
In short, article 13(1) had the effect of nullifying or rendering the existing law which had become inconsistent with article 19(1) (g) read with clause (6) as it then stood ineffectual, nugatory and devoid of any legal force or binding effect only with respect to the exercise of the fundamental right on and after the date of the commencement of the Constitution.
Therefore, between the 26th January 1950 and the 18th June 1951 the impugned Act could not stand in the way of the exercise of the fundamental right of a citizen under article 190(1) (g).
The true position,is that the impugned law became, as it were, eclipsed, for the time being, by the fundamental right.
The effect of the Constitution (First Amendment) Act 1951 was to remove I the shadow and to make the impugned Act free from all blemish or infirmity.
If that were not SO.
, then it is not intelligible what "existing law" could have been sought to be saved from the operation of article 19(1)(g) by the amended clause (6) in so far,as it sanctioned the creation of State monopoly, for, ex hypothesi, all existing laws creating such monopoly had already become void at the date of the commencement of the Constitution in view of clause (6) as it then stood.
The American authorities refer only.
to post Constitution laws, which were inconsit tent with the provisions of the Constitution.
Such laws never came to life but were still born as it were The American authorities, therefore, cannot full apply to pre Constitution laws which were perfectly valid before the Constitution.
But apart from this distinction between re Constitution and post Constitution laws on which, however, we need not rest on decision, it.
must, be held that these American authorities can have no application to our Constitution All laws, existing or future, which are inconsistent 76 with the provision s of Part III of our Constitution are by the express provision of article 13, rendered void "to the extent of such, inconsistency".
Such 'laws were not dead for all purposes.
They existed for the purposes of pre Constitution tights and liabilities and they remained operative, even after the Constitution, as against non citizens.
It is only as against the citizens that they remained in a dormant or moribund condition.
In our judgment, after the amendment of clause (6) of article 19 on the 18th June 1951, the impugned Act ceased to be unconstitutional and became revivified and enforceable against citizens as well as against non citizens.
It is true that as the amended clause (6) was not made retrospective the impugned Act could have no operation as against citizens between the 26th January 1950 and the 18th June 1951 and no rights ' and obligations could be founded on the provisions of the impugned Act during the said period whereas the amended clause (2) by reason of its being expressly made retrospective had effect even during that period.
But after the amendment of clause (6) the impugned Act immediately became fully operative even as against the citizens.
The; notification declaring the intention of the State to take over the bus routes to the exclusion of all other motor transport operators was published on the 4th February 1955 when it was perfectly constitutional for the State to, do so.
In our judgment the contentions put forward by the respondents as to the effect of the Constitution (First Amendment) Act, 1951 are well, founded and the objections urged against them by the petitioners are untenable and must be negatived.
The petitioners then contend that assuming that one impugned Act cannot be questioned on the ground of infringement of their fundamental right under article 19(1)(g) read with clause (6) of that article, there has been another infraction of their fundamental right in that they have been deprived of their property ' namely, the right to ply motor vehicle ' s for gain which is an interest in a commercial undertaking and, therefore, the impugned Act does Conflict with the provisions of article 31 (2) of the Constitution and 601 again they rely on our decision in Shagir Ahmad 's case.
Here, too if there were nothing else in the case this contention may have been unanswerable.
But unfortunately for the petitioners there is the Constitution (Fourth Amendment) Act, 1955 which ' came into farce on the 27th April 1955, By section 2 of that Act article 31 of the Constitution was amended and for clause (2) of that article the following clauses were substituted: "(2) No property shall be compulsorily acquired or requisitioned save for a public purpose and save by authority of a law which provides for compensation for the property so acquired or requisitioned and either fixes the amount of the compensation or specifies the principles on which, and the mariner in which the compensation is to be determined and given; and no such law shall be called in question in any :court on the ground that the compensation provided by that law is not adequate.
(2 A) Where a, law does not provide for the transfer of the ownership or right to possession of any property to the State or to a 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 his property".
Article 31 A of the Constitution was also amended.
There can be no question that the amended provisions, if they apply, save the impugned law, for it does not provide for the transfer of the ownership or right to possession of any property and cannot, there, fore, be deemed to, provide for the compulsory acquisition or requisitioning of any property.
But the petitioners contend, as they did with regard to the Constitution (First Amendment) Act, 1951, that these amendments which came into force on the 27th April 1955 are not retrospective and can have no application to the present case.
It is quite true that the impugned AN became inconsistent with article 31 as soon as the Constitution came into force on the 26th January 1950 as held by this Court in Shagir Ahamad 's case (supra) and continued to be so inconsistent right 602 up to the 27th April 1955 and therefore, under article, 13(1) became void "to the extent of such inconsistency ".
Nevertheless, that inconsistency was removed on and from the 27th April 1955 by the Constitution (Fourth Amendment) Act, 1955.
The present writ petitions were filed on the 27th May 1955, exactly a month after the Constitution (Fourth Amendment) Act.
1955 came into force, and, on a parity of reasoning here in before mentioned, the petitioners cannot be permitted to challenge the constitutionality of the impugned Act on and from the 27th April 1955 and this objection also cannot prevail.
Learned counsel for the petitioners sought to raise the question as to the invalidity of the impugned Act even before the advent of the Constitution.
Prior to the Constitution, when there were no fundamental rights, section 299 of the Government of India Act, 1935 which corresponds to article 31 had been construed by the Federal Court in Rao Bahadur Kunwar Lal Singh vs The Central Provinces and Berar(1) and in other cases referred to in Rajah of Bobbili vs The State of Madras(2) and it was held by the Federal Court that the word "acquisition" occurring in section 299 had the limited meaning of actual transference of ownership and not the wide meaning of deprivation of any kind that has been given by this Court in Subodh Gopal Bose 's case(3) to that word acquisition appearing in article 31(2) in the light of the other provisions of the Constitution. ' It is, therefore, not clear at all that the impugned Act was in conflict With section 299 of the Government of India Act,1935.
Besides, this objection was not taken or even hinted at in the petitions and cannot be permitted to be raised at this stage.
The result, therefore, is that these petitions must be dismissed.
In the circumstances of this case we make no order as to costs.
(1) [1944]F.C.R. 284.
(2) , 193 194".
| The petitioners who carried on their business as stage carriage operators of Madhya Pradesh for a considerable number of years challenged the constitutional validity of the C.P. & Berar Motor Vehicles (Amendment) Act, 1947 (Act III of 1948) which amended the (Central Act IV of 1939) and conferred extensive powers on the Provincial Government including the power to create a monopoly of the motor transport business in its favour to the exclusion of all motor transport operators.
In exercise of the powers conferred by new section 43(1)(iv) a notification was issued on the 4th of February, 1955, declaring the intention of the Government to take up certain routes.
The case of the petitioners was that the passing of the Constitution and the grant of fundamental rights rendered the Act void under article 13(1) being inconsistent with the provisions of articles 19(1)(g) and 31(2), and reliance was placed on the decision.
of the Supreme Court in Shagir Ahmad vs The State of U.P. & others.
On behalf of the respondents it was contended that although as a result of the said decision the impugned Act was rendered void, the Constitution (First 'Amendment) Act, 1951, and the Constitution (Fourth Amendment) Act, 1955, bad the effect of removing the inconsistency and the Amending Act (III of 1948) became operative again.
It was, however, contended on behalf of the petitioners that the impugned Act being void under article 13(1) was dead and could not be revivified by any subsequent amendment of the Constitution.
It must be re enacted.
Held that Shagir Ahmad 's case had no application and the contentions put forward by the respondents were well founded and must be accepted.
That it is well settled: that the word 'void ' In article 13 means void to the extent of the inconsistency with a fundamental right and the language of the article makes it clear that the entire operation of an inconsistent Act is not wiped out.
It applies to past transactions and the rights and liabilities accruing therefrom and continues even after the commencement of the Constitution to apply to non citizens.
Keshavan Madhava Menon vs The State of Bombay [1961] S.C.R. 288, relied on.
The true effect of article 13(1) is to render an Act, inconsistent with a fundamental right, inoperative to the extent of the 'inconsistency.
It is overshadowed by the fundamental right ' and remains dormant but is not dead.
With the amendment made in cl.
(6) of article 19 by the first Amendment Act the provisions of the impugned Act were no longer inconsistent therewith and the result was that the impugned Act began to operate once again from the date of such amendment with this difference that, unlike amended clause (2) of article 19 which was expressly made retrospective, no rights and obligations could be founded on the provisions of the impugned Act from the date of the Commencement of the Constitution till the date of the amendment.
The notification declaring the intention of the State to take over the bus routes to the exclusion of all other motor transport operators was, therefore, perfectly valid.
Shagir Ahmad vs The State of U.P. & Others, ; and Behram Khurshed Pesikaka vs The State of Bombay, [1965] 1 S.C.R. 613, distinguished and held inapplicable.
American authorities held inapplicable.
Nor can the impugned Act, on a parity of reasoning be held to infringe, any longer the fundamental rights of the petitioners under article 31(2) in view of the amendment effectd there in by the Constituation (Fourth Amendment) Act of 1956 which came into force on the 27th April, 1955, these petitions having been filed thereafter, and the petitioners could not be allowed to challenge the validity of the impugned Act on that ground.
Semble.
It is not clear at all that the impugned Act was in conflict with section 299 of the Government of India Act, 1935, before the advent of the Constitution.
|
Appeal No. 229 of 1953.
Appeal under Article 132(1) of the Constitution of India from the Judgment and Order dated the 16th December 1952 of the Bombay High Court in Appeal No. 110 of 1952.
M. C. Setalvad, Attorney General of India (Porus 110 868 A. Mehta and R. H. Dhebar, with him) for the appellant.
Rajinder Narain for the respondent.
October 4.
The Judgment of the Court was delivered by CHANDRASEKHARA AIYAR J.
Was the Government of Bombay entitled, under ' clause (a) of sub section (4) of section 6 of the Bombay Land Requisition Act, 1948 (Bombay Act XXXIII of 1948), to requisition , as for a public purpose, certain premises for "housing a member of the staff of a foreign consulate"?, is the question we have to consider in this appeal, which has arisen out of a writ petition filed under article 226 of the Constitution by the respondent in the Bombay High Court to restrain the State of Bombay from taking such action.
On the bearing of the petition before Tendolkar, J. the State succeeded on the ground that the purpose for which the requisition was made was a "public purpose" within, the meaning of the Act.
But, on appeal, it was held that though the requisition was for a public purpose, the requisition order was invalid, 'as the public purpose must be either a purpose of the Union, or a purpose of the State and in this particular case the accommodation being required for housing a member of a foreign Consular staff was a Union purpose, which was outside the scope of the powers of the State.
Clause (a) of sub section (4) of section 6, omitting portions unnecessary for our present purposes, runs, in these terms: "The State Government may, by order in writing, requistition the premises for the purpose of a State or any other public purpose, and may use or deal with the premises for any such purpose in such manner as may appear to it to be expedient".
The validity of the Act is not questioned as un constitutional or as beyond the scope of the legislative competence of the State.
As the premises were required for housing a member of the staff of a Con 869 sulate, there can be no doubt that it was wanted for a public purpose.
The ultimate source of authority to requisition or acquire property is be found in arcticle 31 of the Constitution.
The requisition or acquisition must be for a public purpose and there must be compensation.
This article applies with equal force to Union legislation and State legislation.
Items 33 and 36 of List I & List II of the Seventh Schedule to the Constitution empower respectively Parliament and the State Legislatures to enact laws with respect to them.
The reasoning by which the learned appellate Judges of the Bombay High Court reached their conclusion is shortly this There can be no public purpose, which is not a purpose of the Union or a purpose of the State.
There are only these two categories to consider under the statute, as the words "any other purpose" in the particular context should be read ejusdem generis with "the purpose of the State".
The provision of accommodation for a member of the foreian consulate staff is a "purpose of the Union" and not a "purpose of the State".
We are unable to uphold this view as regards both the standpoints.
Item 33 in the Union Legislative List (List I)refers to "acquisition or requisitioning of property for the purposes of the Union".
Item 36 in the State List (List II) relates to "acquisition or requisitioning of property, except for the purposes of the Union, subject to the provisions of entry 42 of List III".
Item 42 of the Concurrent Legislative List (List III) speaks of "the purpose of the Union or of a State or for any other public purpose".
Reading the three items together, it is fairly obvious that the categories of "purpose" contemplated are three in number, namely, Union purpose, State purpose, and any other public purpose.
Though every state purpose or Union purpose must be a public purpose, it is easy to think of cases where the purpose of the acquesition or requisition, is neither the one nor the other but a public purpose.
Acquisition of sites for the building of hospitals or educational institutions by private benefactors will be a 'Public purpose, 870 though it will not strictly be a State or Union purpose.
When we speak of a State purpose or a Union purpose, we think of duties and obligations cast on the State or the Union to do particular things for the benefit of the public or a section of the public.
Cases where the State acquires or requisitions property to facilitate the coming into existence of utilitarian institutions, or schemes having public welfare at 'heart, will fall within the third category above.mentioned.
With great respect, we are constrained to say that the ejusdem generis rule of construction, which found favour in the court below for reaching the result that the words "any other public purpose" 'are restricted to a public purpose which is also a purpose of the State., has scarcely any application.
A part from the fact that the rule must be confined within narrow limits, and general or comprehensive words should receive their full and natural meaning unless they are clearly restrictive in their intendment, it is requisite that there must be a distinct genus, which must comprise more than one species, before the rule can be applie If the words "any other public purpose" in the Statute in question have been used only to mean a State purpose, they would become mere surplusage; Courts should lean against such a construction as far as possible.
Even if it is conceded that the law contemplates only two purposes, namely, State purpose and Union purpose, it is difficult to see how finding accommodation for the staff of a foreign consulate is a Union purpose and not a State purpose.
Item I 1 in the Union list specifies "diplomatic, consular and trade representation" as one of the subjects within the legislative competence of Parliament, and under article 73 of the Constitution, the executive power of the Union shall extend to all such matters.
It can hardly be said that securing a room for a member of the staff of a foreign consulate amounts to providing for consular representation, and that therefore it is a purpose of the Union for which the State cannot legislate.
It was conceded by Mr. Rajinder Narain, Counsel for 871 the Respondent, that there is no duty cast upon the Union to provide accommodation for the consulate staff, and this must be so, when we remember that the routine duties of a Consul in modern times are to protect the interests and promote the commercial affairs of the State which he represents, and that his powers, privileges and immunities are not analogous to those of an ambassador.
The trade and commerce of the State which appoints him with the State in which he is located are his primary concern.
The State of Bombay is primarily interested in its own trade and commerce and in the efficient discharge of his duties by the foreign consul functioning within the State.
We are inclined to regard the purpose for which the requisition was made in this case more as a State purpose than as a Union purpose.
In any event, as already pointed out, "other public purpose" is a distinct category for which the State of Bombay can legislate, as the acquisition or requisitioning of property except for the purposes of the Union, is within its competence under item 36 of the State List.
There is another way of looking at the question involved.
An undertaking may have three different facets or aspects, and may serve the purpose of a State, the purpose of the Union and a general public purpose.
Even if one may regard the requisition of a room for the accommodation of a member of a Consulate as one appertaining to a Union purpose, it does not necessarily cease to be a State purpose or a gene ral public purpose.
In this view also, the requisition in this case must be held to have been validly made.
For the reasons given above, the appeal is allowed and the order of Tendolkar J. is restored with costs payable to the appellant by the respondent throughout.
| Held, that the Government of Bombay was entitled, under clause (a) of sub section (4) of section 6 of the Bombay Land Requisition Act, 1948 (Bombay Act XXXIII of 1948) to requisition as for a public purpose, certain premises for 'housing a member of the staff of a foreign consulate '.
The purpose for which the requisition was made was a "public purpose" within the meaning of the Act; and the requisition was made in this case more as a State purpose than as a Union purpose.
In any event "other public purpose", is a category distinct from "Union purpose" and "State purpose" and the acquisition or requisitioning of property by the State except for the purpose of the Union, is within its competence under item 36 of the State List.
An undertaking may have three different facets or aspects and may serve the purpose of a State, the purpose of the Union and a general public purpose.
Even if one may regard the requisition of a room for the accommodation of a member of a consulate as one appertaining to a Union purpose, it does not necessarily cease to be a State purpose or a general public purpose.
Therefore on this view also, the requisition in the present case must be held to have been validly made.
Courts should lean against a construction which would render words in a statute mere surplusage.
|
286 of 1955.
Under Article 32 of the Constitution for the enforcement of Fundamental Rights.
H.Mahapatra and G. C. Mathur, for the petitioners.
C. K. Daphtary, Solicitor Generalfor India, (Porus A. Mehta and P. G. Gokhale, with him), for respondent No. 1. 921 1955.
October 27.
The Judgment of the Court was delivered by BOSE J.
This judgment will also govern Petitions Nos. 287, 288, 289 and 304 of 1955.
We will set out the facts in Petition No. 286 of 1955.
The others follow the same pattern.
The dispute is about fishery rights in the Chilka lake which is situate in what was once the estate of the Raja of Parikud.
This estate vested in the State of Orissa under the Orissa Estates Abolition Act, 1951 (Orissa Act I of 1952) on 24 9 1953 and has now ceased to exist in its original form.
The Act came into force on 9 2 1952.
The further facts are set out in paragraphs 2 and 3 of the petition in the following terms: "That the petitioners carry on the business of catching and selling fish particularly.
from fisheries within the said lake.
That long before the vesting of the estate the petitioners had entered into contracts with the exproprietor and had obtained from the latter, on payment of heavy sums, licences for catching and appropriating all the fish from the fisheries detailed in the schedule given in the accompanying affidavit and had ,obtained receipts on payment in accordance with the prevailing practice".
The lake is divided into sections and this petition is concerned with four of them.
The licenses relating to them were purchased as follows: I On 30 7 50 for rights in Gerasar Prawn for 1955 56 2.
On 2 8 50 for rights in Jayamal Prawn for 1955 56 3.
On 18 9 51 for rights in Solakudi Prawn for 1955 56 4.
On 6 5 52 for rights in Jayamal Chungudi for (1956 57 (1957 58 (1958 59 It will be seen that though the licenses were acquired before the estate vested in the State of Orissa they 922 were for future years, all after the date of vesting.
The State of Orissa refused to recognise these licenses and were about to re auction the rights when the petitioners filed the present petition seeking writs under article 32 on the ground that their fundamental rights under articles 19(1)(f) and 31 (I) were, or were about to be, infringed.
The first question that we have to determine is whether the petitioners acquired any rights or interests in "property" by their several "purchases", as articles 19(1)(f) and 31(1) are dependent on that.
In their petition the petitioners claim that the transactions were sales of future goods, namely of the ,fish in these sections of the lake, and that as fish is moveable property Orissa Act I of 1952 is not attracted as that, Act is confined to immoveable I property.
,We agree with the learned Solicitor General that if this is the basis of their right, then their petition under article 32 is misconceived because until any fish is actually caught the petitioners would not acquire any property in it.
There can be no doubt that the lake is immoveable property and that it formed part of the Raja 's estate.
As such it vested in the State of Orissa when the notification was issued under the Act and with it vested the right that all owners of land have, to bar access to their land and the right to regulate, control and sell the fisheries on it.
If the petitioners ' rights are no more than the right to obtain future goods under the Sale of Goods Act, then that is a purely personal right arising out of a contract to which the State of Orissa is not a party and in, any event a refusal to perform the contract that gives rise to that right may amount to a breach of contract but cannot be regarded as a breach of any fundamental right.
But though that is how the matter is put in the petition we do not think that is a proper approach to this case.
The facts disclosed in paragraph 3 of the petition make it clear that what was sold was the right to catch and carry away fish in specific sections of the lake over a specified future period.
That amounts to 923 a license to enter on the land coupled with a grant to catch and carry away the fish, that is to say, it is a profit a prendre: see 11 Halsbury 's Laws of England, (Hailsham Edition), pages 382 and 383.
In England this is regarded as an interest in land (11 Halsbury 's Laws of England, page 387) because it is a right to take some profit of the soil for the use of the owner of the right (page 382).
In India it is regarded as a benefit that arises out of the land and as such is immoveable property.
Section 3 (26) of the General Clauses Act defines "immoveable property" as including benefits that arise out of the land.
The Transfer of Property Act does not define the term except to say that immoveable property does not include standing timber, growing crops or grass.
As fish do not come under that category the definition in the General Clauses Act applies and as a profit a prendre is regarded as a benefit arising out of land it follows that it is immoveable property within the meaning of the Transfer of Property Act.
Now a "sale" is defined as a transfer of ownership in exchange for a price paid or promised.
As a profit a prendre is immoveable property and as in this case it was purchased for a price that was paid it requires writing and registration because of section 54 of the Transfer of Property Act.
If a profit a prendre is regarded as tangible immoveable property, then the "property" in this case was over Rs. 100 in value.
If it is intangible, then a registered instrument would be necessary whatever the value.
The "sales" in this case were oral: there was neither writing nor registration.
That being the case, the transactions passed no title or interest and accordingly the petitioners have no fundamental right that they can enforce.
It is necessary to advert to Firm Chhotabhai Jethabai Patel & Co. vs The State of Madhya Pradesh(1) and explain it because it was held there that a right to "pluck, collect and carry away" tendu leaves does not give the owner of the right any proprietary interest in the land and so that sort of right was not an "en (1) 117 924 cumbrance" within the meaning of the Madhya Pradesh Abolition of Proprietary Rights Act.
But the contract there was to "pluck, collect and carry away" the leaves.
The only kind of leaves that can be "plucked" are those that are growing on trees and it is evident that there must be a fresh crop of leaves at periodic intervals.
That would make it a growing crop and a growing crop is expressly exempted from the definition of "immoveable property" in the Transfer of Property Act.
That case is distinguishable and does not apply here.
It was then argued that a contract is "property ' within the meaning of articles 19(1)(f) and 31(1).
Again, we need not decide this because even if it be assumed that it is that kind of property the State of Orissa has not taken the petitioners ' contract away I from them or prevented them from "acquiring, holding or disposing" of it.
They are free to sue on it or to assign it if they want.
The State merely says, as any other person might say: "I was not a party to that contract.
Neither its rights nor its liabilities have devolved on me and I refuse to recognise it or to assume the obligations of either contracting party".
If the State is wrong in its attitude that may give rise to a suit against it for damages for breach of contract or possibly, (though we do not say it would), to a right to sue for specific performance; but no question under articles 19(1)(f) and 31(1) can arise because the State has not confiscated or acquired or taken possession of the contract as such.
If it had it would have claimed the benefits under it.
It would have taken the money that the petitioners paid to the Raja from the Raja or demanded it over again from the petitioners.
But it is not doing that.
It simply refuses to recognise the existence of the contract.
The petition fails and is dismissed with costs.
| The petitioners obtained oral licenses for catching and appropriating fish from specified sections of the Chilka Lake from its proprietor, the Raja of Parikud, on payment of heavy sums and obtained receipts in accordance with the prevailing practice.
This was before the passing of the Orissa Estates Abolition Act of 1951 by which ownership of the estate vested in the State of Orissa.
The licenses, however, were in respect of years subsequent to such vesting.
The State of Orissa refused to recognise them and was seeking to reaction the rights of fishery.
The petitioners contended that it had thereby infringed or was about to infringe their fundamental rights under articles 19(1)(f) and 31(1) of the Constitution and claimed that the transactions being sales of future goods, namely, the fish, the Act which was confined to immovable property had no application.
Held, that the right sought to be acquired by the petitioners by their several purchases was not in respect of any future goods as claimed by them but was a license to enter on the land coupled with a grant to catch and carry away the fish, in other words, a profit a prendre which is immovable property within the meaning of the Transfer of Property Act read with section 3(25) of the General Clauses Act.
Accordingly section 54 of the former Act applies.
That as the sale of the profit a prendre in the present cage was valued at more than one hundred rupees and was effected without writing and registration it contravened section 54 of the Transfer of Property Act, and so no title or interest therein passed to the petitioners and consequently, they bad no fundamental rights to enforce.
Firm Chhotabhai Jethabai Patel & Co. vs The State of Madhya Pradesh, ([1953] S.C.R. 476), distinguished and held inapplicable.
That it was not necessary in the present case to decide whether the contract was property within the meaning of articles 19(1)(f) and 31(1), but assuming it to be so, the State has not taken such property away from the petitioners or prevented them from acquiring, holding or disposing of it.
The State merely refuses to recognise the contract and refuses to consider itself bound by it.
That may give a cause of action for a suit on the contract but no fundamental right arises as the State has not confiscated or acquired or taken possession of the contract as such by claiming any benefits under it.
|
Appeal No. 92 of 1953.
Appeal under section 110 of the Civil Procedure Code from the Judgment and Decree dated the 8th November 1949 of the Bombay High Court in Appeal from Original Decree No. 195 of 1947 arising out of the Judgment and Decree dated 20th December 1946 of the Court of Civil Judge, Senior Division, Sholapur in Special Suit No. 78 of 1945.
C.K. Daphtary, Solicitor General of India (R. A. Govind, with him) for the appellants.
J.B. Dadachanji, Sri Narain Andley and Rajinder Narain, for respondents.
October 11.
The Judgment of the Court was delivered by CHANDRASEKHARA AIYAR J.
This appeal is from a reversing decree of the Bombay High Court in a suit for the possession of certain immovable properties which was dismissed by the Civil Judge, Senior Division, Sholapur.
The value of the properties has been found to be over Rs. 10.000.
The original decree was on 20 12 1946.
The decree of the High Court allowing the plaintiff 's claim was on 8 11 1949.
The defendants applied for leave to appeal to the Federal Court on 6 1 1950.
The High Court directed the trial court to find the value of the property which was the subject matter of the suit at the time of the suit and on the date of the passing of the decree in appeal.
On 22 1 1951 the lower court ascertained the value as stated above. 'The High Court thereafter granted leave to appeal on 1 10 1951, overruling the objections raised by the plaintiff to the grant of such leave.
The maintainability of this appeal has been questioned before us by Mr. Dadachanji, learned counsel for the respondents, in a somewhat lengthy argument.
His main contention was that article 133 of the 874 Constitution applies to the case, and as the value is below Rs. 20,000, no appeal can be entertained.
It is the correctness of this argument that we have to consider.
On the date of the decree of the High Court, the defendants had a vested right of appeal to the Federal Court, as the properties were of the requisite value, and on 6 1 1950 they sought a certificate of leave to appeal, which was bound to be granted.
The Constitution establishing the Supreme Court as the final appellate authority for India came into force on 26 1 1950.
Did the vested right become extinguished with the abolition of the Federal Court? If the court to which an appeal lies is altogether abolished without any forum substituted in its place for the disposal of pending matters or for the lodgment of appeals, the vested right perishes no doubt.
We have therefore.
to examine whether the Constitution which brought the Supreme Court into being makes any provision for an appeal from a reversing decree of the High Court prior to the date of the Constitution respecting properties of the value of Rs. 10,000 and more being entertained and heard by the Supreme Court.
Article 135 is in these terms: "Until Parliament by law otherwise provides, the Supreme Court shall also have jurisdiction and powers with respect to any matter to which the provisions of article 133 or article 134 do not apply if jurisdiction and powers in relation to that matter were exercisable by the Federal Court immediately before the commencement of this Constitution under any existing law".
Article 133 runs as follows: "(1) An appeal shall lie to the Supreme Court from any judgment, decree or final order in a civil proceeding of a High Court in the territory of India if the High Court certifies (a) that the amount or value of the subject matter of the dispute in the court of first instance and still in dispute on appeal was and is not less than twenty thousand rupees or such other sum as may be specified in that behalf by Parliament by law; or 875 (b)that the judgment, decree or final order involves directly or indirectly some claim or question respecting property of the like amount or value; or (c) that the case is a fit one for appeal to the Supreme Court; and, where the judgment, decree or final order appealed from affirms the decision of the court immediately below in any case other than a case referred to in sub clause (c), if the High Court further certifies that the appeal involves some substantial question of law. . . " It is reasonably clear that article 133 does not apply to this "matter".
The language is prospective, and the judgment, decree or final order from which the appeal is to be taken is that of a High Court in the territory of India that is a High Court established under the Constitution.
The territory of India comprises the territory of the States.
Article 214 says that there shall be a High Court for each State, and clause (2) thereof provides that "the High Court exercising jurisdiction in relation to any Province immediately before the commencement of this Consti tution shall be deemed to be the High Court for the corresponding State".
We can compendiously speak of the High Court prior to the Constitution and the High Court after the Constitution as the Provincial High Court and the State High Court.
A High Court in the territory of India means a State High Court, and article 133 provides for appeals against any judgment, decree or final order in a civil proceeding of such High Court.
Though article 133 does not apply, we have still to see whether it is a matter as regards which jurisdiction and powers were exercisable by the Federal Court immediately before the commencement of the Constitution.
It is unnecessary to refer in detail to the earlier enactments defining the jurisdiction of the Privy Council, and the Government of India Act, 1935 establishing the Federal Court and conferring a limited jurisdiction on the same.
It is sufficient to point out that as the law then stood, the Federal Court had jurisdiction to entertain and hear appeals 111 876 from a decree of a High Court which reversed the lower court 's decree as regards properties of the value of more than Rs. 10,000.
The aggrieved party had a: right to go before it, without any special leave being granted.
It was a matter over which jurisdiction was "exercisable" by the Federal Court.
The construction that it was "exercisable" only if the matter was actually pending before the Federal Court and that it could not be said to be pending until the appeal is declared admitted under Order XLV of the Civil Procedure Code is too narrow, and does not give full and proper scope to the meaning of the word "exercisable" in the article.
Pending matters are dealt with under article 374(2), and we must give some meaning to the provisions of article 135.
As soon as the decree of the High Court came into existence, the jurisdiction of the Federal Court to bear an appeal from that decree became exercisable, provided certain conditions as to security and deposit were complied with, which are not material for our present purpose.
Reference may be made here to paragraph 20 of the Adaptation of Laws Order, 1950, as amended in 1951, which provides "Nothing in this Order shall affect the previous operation of, or anything duly done or suffered under, any existing law or any right, privilege, obligation or liability already acquired, accrued or incurred under any such law. . " By this Order section 110, Civil Procedure Code was adapted to the new situation but the requirement as to value Was raised from 10,000 to 20,000.
What is provided is that this adaptation will not affect the right of appeal already accrued.
If we accede to the argument urged by the respondents, we shall be shutting out altogether a large number of appeals, where the parties had an automatic right to go before the Federal Court before the Constitution and which we must hold was taken away from them for no fault of their own, merely because the Supreme Court came into existence in place of the Federal Court.
An interpretation or 877 construction of the provisions of the Constitution which would lead to such a result should be avoided, unless inevitable.
The Full Bench decision of the Madras High Court in Gundapuneedi Veeranna and three others vs Gundapuneedi China Venkanna and seven others(1) was a case where the decree of the High Court and the application for leave to appeal were both after the Constitution came into force.
Whether in all matters where there was a right of appeal under section 110 of the Civil Procedure Code it continues in respect of all suits filed prior to the Constitution is a question that does not arise for decision now.
On the merits, the appeal is unassailable.
The family whose genealogical tree is given in the opening portion of the judgment of the trial Judge owned what may be compendiously described as Sangam properties and Peta Velapur Mahal properties, and all of them were of the nature of watan.
The Sangam lands were held by the eldest branch represented by Yeshwant Rao (son of Panduranga Rao) by right of lineal primogeniture.
When Yeshwant Rao and his widow Tarabai died in November 1924, these properties went to the plaintiff Shankar Rao 's branch as the next senior in line.
The Peta Velapur Mahal properties were held in three shares by Narsinga Rao, Vithal Rao and Krishna Rao, the fourth brother Shyama Rao having no right as he was insane.
Defendants 1, 2 and 3 represent Krishna Rao 's branch.
After Yeshwant Rao 's death, Lakshman Rao, the grandfather of defendants I and 2, filed a suit No. 1064 of 1925 for a declaration that he was the nearest heir to the Sangam properties, the Peta Velapur Mahal properties and the cash income appertaining to the inamdar 's right in Sangam.
He got a declaratory decree that he was the nearest heir of the deceased Yeshwant Rao, and had a right in such capacity to take possession of ill the properties, excluding the inam income and the Sangam lands specified in Schedule B of the decree and a small item of property situated in the same village and specified in Schedule G.
As regards the excluded items, Shankar (1) I.L.R. 878 Rao, the first defendant, (plaintiff in the present suit) was held to be the heir.
On appeal to the High Court, the decree of the Subordinate Judge was confirmed, except as regards the cash allowance of three villages Nevare, Tambure and Limbagaon, which was also declared to belong to Shankar Rao.
As the decree was only a declaratory decree, a fresh suit had to be filed by Narayana Rao, son of Lakshman Rao, to recover possession of the Peta Velapur Mahal properties at Mahalung, Lavang and Wafegaon.
This was Civil Suit No. 2148 of 1936.
Recovery was also sought of some cash and the value of some ornaments and clothes, etc.
The claim was resisted by Shankar Rao, and his main plea was that in lieu of the properties claimed, a large number of lands at Sangam had originally been given to the plaintiff 's branch, and that unless those properties were given back, the plaintiff could not claim to recover the Velapur Mahal properties.
The suit ended in a compromise decree.
Shankar Rao was to deliver actual possession of the lands to the plaintiff as owner together with costs and mesne profits and the plain tiff was to abandon the rest of the claim.
The decree states, "The defendant has given up all the contentions in his written statement".
After possession was taken of the Velapur Mahal properties under the decree, the plaintiff, Shankar Rao, brought this suit to recover from defendants I and 2 the Sangam lands to which he referred in his earlier written statement alleging that they were given to their grandfather in lieu of maintenance.
The defendants have made the answer that the items of Sangam lands claimed by the plaintiff were given to their ancestor, Krishna Rao absolutely under the deed of 1867, and that since then they had been in the enjoyment as owners thereof.
The Civil Judge dismissed the plaintiff 's suit finding that the case of the plaintiff to the effect that the lands were given to Krishna Rao for maintenance under the deed of 1867 was unfounded.
But on appeal by Shankar Rao (the plaintiff), the High Court reversed this decree construing the deed of 1867 as a deed under which absolute owner 879 ship was not transferred to Krishna Rao and that the specified items of Sangam lands were given to him provisionally and conditionally till Krishna Rao obtained possession of the Peta Velapur Mahal lands which were then under a mortgage.
We have examined the deed closely and do not find any warrant for the view taken by the learned Judges on appeal.
The deed is Exhibit No. 35, and it is printed at page 63 of the Paper Book.
The correctness of the translation is admitted.
It was executed by Narsinga Rao of the first branch in favour of Krishna Rao of the last branch, predecessor in title of defendants 1 to 3.
After reciting that Krishna Rao was entitled to a one third share in the income appertaining to the Deshmuki rent of the family at Peta Velapur Mahal, it proceeds to say, ". .
In lieu of the land of that Mahal and in respect of the cash allowance of the Haqdari rights we have given to you for a 1/3 share of land of this Mahal the following lands from the village of Sangam which is continued with us by Vadilki right (the right of primogeniture)".
The deed proceeds to set out the items by areas, assessment, and boundaries, and then goes on: "In all 6 numbers have been given by us to you in lieu of your entire income from the said Mahal.
Now, five and half Pavs out of the said land are in your Vahiwat ' at present and the remaining land was to have been given over to your vahiwat, but we having formerly mortgaged the said village to Ramchandra Pandurang Deshpande, 5 'Pavs ' of land is not in your Vahiwat this day.
Hence on the expiry of 6 years, the period of the mortgage, you may carry on the entire Vahiwat of the land passed in your favour in writing as aforesaid without any hindrance.
We have no claim of inheritance left on the aforesaid land".
The deed concludes with a provision made for the residence of the donee in an open space in the same villagers It further states: ".
There are four shops and a wada at the Kasba of Velapur, and a one third share thereof has been allotted to your share over which we have no 880 claim of inheritance left".
It is obvious from this document that the one third share of Krishna Rao 's branch in the Peta Velapur Mahal properties was retained by Narasinga Rao and that in lieu thereof Krishna Rao was given six items of the Sangam properties, the whole of which could not then and there be given over into his possession and management as there was a usufructuary mortgage over a portion of the lands which was to expire after the lapse of six years from that date.
The lands referred to as mortgaged are the Sangam lands and not the Peta Velapur Mahal lands as wrongly assumed by the High Court.
There is absolutely nothing said about the properties being given for maintenance to ]Krishna Rao.
On the other hand, in two places we find that any right to inheritance was given up.
In fact, this case of the plaintiff was given up before the trial Judge.
It is true that there was an exchange of properties, but there is nothing to warrant the view of the learned Judges that it was provisional or conditional, and that the Sangam lands were to be returned when the Velapur Mahal properties went into the possession and management of Krishna Rao 's branch.
To say that such an arrangement was implied is to ignore the plain terms of the deed.
The properties now in dispute are the items covered by the deed.
They did not form the subject matter of the two previous litigations.
Since 1867, the date of Exhibit No. 35 they have always been in the possession of the defendants ' branch as owners.
It must also be remembered that the earlier suits of 1925 and 1936 proceeded on the basis that the defendants ' branch was the heir to the properties left by the deceased, Yeshwant Rao.
There is no other question which arises for discussion or decision.
It follows that, the trial Judge was right in holding that the plaintiff 's claim to recover possession of the suit properties covered by the deed of 1867 was entirely baseless.
The decree of the High Court is reversed and that of the trial Judge is restored with costs throughout payable by the plaintiff to the defendants.
| This appeal to the Supreme Court was from a reversing decree of the Bombay High Court in a suit for possession of certain immovable properties.
The suit was dismissed by the trial court on 20 12 1946, the value of properties being found to be over Rs. 10,000.
The decree of the High Court allowing the plaintiff 's claim was passed on the 8th November 1949.
The defendants applied to the High Court for leave to appeal to the Federal Court on 6 1 1950 which was granted on 1 10 1951.
One of the questions for determination was whether article 133 of the Constitution applied to the case and the appeal was competent to the Supreme Court.
Held, that article 133 did not apply as it relates expressly to appeals against any judgment, decree or final order in a civil proceeding of a High Court in the "territory of India".
Held further that on the date of the decree of the High Court, the defendants had a vested right of appeal to the Federal Court as the properties were of the requisite value and on 6 1 1950 a certificate of leave to appeal was bound to be granted.
Held also that the appeal was competent to the Supreme Court by virtue of the provisions of article 135 of the Constitution as the jurisdiction and powers in relation to the matter in dispute were exercisable by the Federal Court immediately before the commencement of the Constitution under an existing law inasmuch as the Federal Court had jurisdiction to entertain and hear appeals from a decree of a High Court which reversed the lower court 's decree as regards properties of the value of more than Rs. 10,000.
The construction contended for by the respondent that the jurisdiction was exercisable under article 135 by the Federal Court only if the matter was actually pending before the Federal Court and that it could not be said to be pending until the appeal is declared admitted under Order XLV of the Civil Procedure Code is 873 too narrow and does not give full and proper scope to the meaning of the word 'exercisable ' in the Article.
|
Appeal No. 219 of 1954.
On appeal from the Judgment and Order dated the 4th day of April 1952 of the Madras High Court in Civil Miscellaneous Petition No. 8302 of 1950.
V. K. T. Chari, Advocate General of Madras (R. Ganapathy Iyer and P. G. Gokhale, with him) for the appellant.
R. Kesava lyengar, (M. section K. Iyengar, with him) for the respondent.
October 21.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
This appeal raises a question of considerable importance as to the rights of holders of darmila or post settlement inams of portions of a village under the Madras Estates (Abolition and Conversion into Ryotwari) Act, 1948 (Madras Act XXVI of 1948), hereinafter referred to as the Act.
The subject matter of this appeal is an one sixteenth share in the village of Karuppur situated within the ambit of the Zamindari of Ramanatha puram.
The holders of this ancient Zamindari were, during the 18th Century, the virtual rulers of that part of South India, and were known as Sethupathis or the Lords of Rameswaram and the adjacent isles and seas.
In 1757 Muthu Vijaya Ragunatha, the then Rajah of Ramanathapuram, made a grant of the whole of the village of Karuppur to a number of persons for various charitable purposes.
In 1802, the estate was permanently settled, and an istimrari sanad was issued in favour of the Rajah.
Before that date, the donees under the grant of 1757 representing an one sixteenth share had abandoned the village, and in consequence, the inam had eo extanti been resumed.
At the permanent settlement, this one sixteenth part was included in the assets of the 909 Zamindari, and taken into account in fixing the peishkush thereon.
Subsequent to the permanent settlement, on some date which does not appear on the record, Rani Mangaleswari, the then holder of the Zamindari, made a fresh grant of the one sixteenth part which had been resumed, to the inamdars who held the remaining 15/16th portion of the village under the grant of 1757.
On 31 12 1863 the Inam Commissioner confirmed the grant of 1757, and issued an inam certificate in respect of the 15/16th portion of the village.
The position, therefore, when the Act was passed was that while a 15/16th portion was held by the inamdars under a pre settlement grant confirmed by the British Government, the remaining one sixteenth portion was held under post settlement grant made by the proprietor of the estate.
The Act came into force on 19 4 1949.
Under section 1(4) of the Act, certain sections thereof were to come into force at once and the other sections on such date as the Government might by notification appoint in respect of any zamindari, under tenure, or inam estate.
In exercise of the powers conferred by this section, the appellant issued a notification on 22 8 1949 bringing the Act into force as regards the Ramanathapuram estate from 7 9 1949.
Among the villages mentioned as comprised in the Zamindari was "Karuppur (part)" described as an under tenure.
It is common ground that the part referred to in this notification is the one sixteenth part, which forms the subject matter of this appeal.
The respondent who represents the holders of this inam filed the application out of which the present appeal arises, under article 226 of the Constitution for a writ of certiorari quashing the notification dated 22 8 1949 as ultra vires.
The ground of attack was that under section 1 (3) of the Act, the State had power to notify only what would be estates as defined in section 3(2) of the Madras Estates Land Act 1908 (Madras Act I of 1908), and that the part of the village of Karuppur included in the notification was not an estate as defined in that section.
Section 3(2) of Act I of 1908, so far as is material, is as follows; 910 "Estate" means (a) any permanently settled estate or temporarily settled zamindari; (b) any portion of such permanently settled estate or temporarily settled zamindari which is separately registered in the office of the Collector; (c) any unsettled palaiyam or jagir; (d) any inam village of which the grant has been made, confirmed or recognised by the British Government, notwithstanding that subsequent to the grant, the village has been partitioned among the grantees or the successors in title of the grantee or grantees.
* * * * (e) any portion consisting of one or more villages of any of the estates specified above in clauses.
(a), (b) and (c) which is held on a permanent under tenure".
The contention of the respondent was that as the grant in question related only to a fraction of a village, it could not be notified as an under tenure, as under section 3 (2) (e) an under tenure would be an estate only if it related to a whole village or villages.
The appellant conceded that the inam in question was not an under tenure as defined in section 3 (2) (e), as it comprised only part of a village, but contended that even though it was not in itself an estate, it was, nevertheless, part of the Zamindari of Ramanathapuram, being a post settlement grant of portion of a village comprised therein, and that when that estate was notified, the entirety of it including the inam in question must vest in the Government under section (b) of the Act.
The respondent demurred to this contention.
In addition, he raised the further contention that even if post settlement minor inams were within the operation of the Act, they would be protected by section 20 of the Act, which runs as follows: "20(1) In cases not governed by sections IS and 19, where, before the notified date, a landholder has created any right in any land (whether by way of lease or otherwise) including rights in any forest, 911 mines or minerals, quarries, fisheries or ferries, the transaction shall be deemed to be valid; and all rights and obligations arising thereunder, on or after the notified date, shall be enforceable by or against the Government: Provided that the transaction was not void or illegal under any law in force at the time: Provided further that any such right created on or after the 1st day of July 1945 shall not be enforceable against the Government, unless it was created for a period not exceeding one year: Provided also that where such right was created for a period exceeding one year, unless it relates to the private land of the landholder within the meaning of section 3, clause (10), of the Estates Land Act, the Government may, if, in their opinion, it is in the public interest to do so, by notice given to the person concerned, terminate the right with effect from such date as may be specified in the notice, not being earlier than three months from the date thereof".
The argument of the respondent was that a post settlement minor inam would be a right in land created by a landholder falling within section 20, that the notification of the estate under section 1(3) would not ipso facto divest the inamdar of his title to the lands, and that he would be entitled to hold them subject to any action that might properly be taken by the State under section 20.
The learned Judges of the Madras High Court agreed with the appellant that post settlement minor inams fell within the operation of the Act; but they accepted the contention of the respondent that they were governed by section 20 of the Act.
As it was common ground that the State had not proceeded under that section, they held that the notification was ultra vires, and accordingly quashed the same in so far as it related to the inam forming part of Ka ruppur village.
The appellant applied to the High Court for leave to appeal to this Court against this decision, and though the value of the subject matter was far below the appealable limit, the learned Judges granted a certificate under article 133(1)(c) on the 912 ground that the question involved was one of great public importance.
That is how the appeal comes before us.
Two questions arise for decision in this appeal: (1) Are post settlement minor inams within the operation of Madras Act XXVI of 1948? (2) If they are, are they governed by section 20 of the Act? On the first question, the appellant does not contend that the inam in question is in itself an estate as defined in section 3(2) of the Madras Estates Land Act and liable as such to be notified under the Act.
His contention is that when the Zamindari of Ramanathapuram was notified and there is no dispute that it was validly notified, as it was a permanently settled estate falling within section 3(2) (a) of the Madras Estates Land Act minor post settlement inams of lands within the Zamindari would vest in the State as part of the Zamindari under section 3(b) of the Act.
Section 3(b) is, omitting what is not material, as follows: "With effect on and from the notified date and save as otherwise expressly provided in this Act. . . . the entire estate.
shall stand transferred to the Government and vest in them, free of all encumbrances".
The point for decision is whether post settlement minor inams are parts of the estate out of which they were granted.
If they are, then they will vest in the Government under section 3(b).
If they are not, they will remain unaffected by the notification of the parent estate.
The status of holders of these inams had been the subject of considerable divergence of judicial opinion in the Madras High Court.
To appreciate this, reference must be made to the following definition of 'landholder ' in section 3(5) of the Madras Estates Land Act: "Landholder" means a person owning an estate or part thereof and includes every person entitled to collect the rents of the whole or any portion of the estate by virtue of any transfer from the owner or his predecessor in title or of any order of a competent 913 Court or of any provision of law".
Leaving out the inclusive portion of the definition as not relevant to the present question, it will be seen that owners of parts of an estate would also be landholders.
The question then arose for decision whether darmila minor inamdars were landholders as defined in section 3 (5) of the Estates Land Act.
If they were.
, the tenants would acquire occupancy rights under section 6, and proceedings against them could be taken only in the revenue courts and not in the civil courts, and in general, the rights and obligations of the inamdar and the tenants would be governed by the provisions of the Madras Estates Land Act.
One view was that as the inamdars had to pay quit rent or jodi to the grantors, their status could not be that of owners and therefore they could not be said to own parts of an estate.
The contrary view was that the inamdars were in substance owners of the lands granted to them, and that the liability to make a fixed annual payment did not detract from their character as owners, and they would be landholders owning parts of an estate.
In view of this conflict of opinion, the question was referred to the decision of a Full Bench in Brahmayya vs Achiraju(1), which held by a majority that minor darmila inamdars were landholders as defined in section 3(5) of the Estates Land Act.
This decision was based both on the ground that the inamdars were in the position of owners of parts of an estate and that they were also persons entitled to collect rent, within the inclusive portion of the definition.
In Narayanaraju vs Suryanarayudu(2), the question whether the grantee of a portion of a village subsequent to the settlement was a landholder as defined in section 3(5) came up for decision before the Privy Council.
After reviewing the authorities and the conflicting views expressed therein, the Board agreed with the opinion expressed by the majority of the learned Judges in Brahmayya vs Achiraju (1), and held that the grantee of a post settlement minor inam would be a landholder on both the grounds mentioned in their (1) Mad. 716.
(2) [1939] 66 I.A. 278. 914 judgments.
They discarded "the doctrine that so long as the zamindar reserves any interest, however insignificant, the permanent grantee from him cannot be the owner", and observed that the words "part of the estate" occurring in the definition must be given their prima facie meaning.
The Board felt greater difficulty in accepting the view that the inamdar was a landholder entitled to collect rent within the inclusive portion of the definition.
But they expressed themselves satisfied on either ground that "the Full Bench decision of 1922 represents a careful and reasonable solution of a stubborn ambiguity in the Act, and that it ought not now to be overruled having regard to the time which has elapsed and to the character of the interests affected thereby".
Thus, it was settled law in Madras at the time when Act XXVI of 1948 was passed that minor darmila inamdars were owners of parts of an estate.
Construing section 3(b) in the light of the law as then accepted, when a notified estate vests in its entirety in the State under that provision, a minor darmila inam which forms part of it must also vest in it.
Sri R. Kesava lyengar, learned counsel for the respondent, argued that decisions on section 3(5) of 'the Madras Estates Land Act on the meaning of the word 'landholder ' as defined therein, could not be usefully referred to for construing the true scope of section 3(b) of Act XXVI of 1948, as the definition in the Madras Estates Land Act was only for pur poses of settling the rights of landlords and tenants, and would be irrelevant for determining the rights of the inamdar as against the State.
But the ground of ,the decision in Brahmayya vs Achiraju(1) and Narayanaraju vs Suryanarayudu(2) is that the grantee of the inam is in the position of an owner of the part of the estate granted to him, and that would be relevant when the controversy is as to his true status, whether the dispute is between the landlord and the tenant or between the inamdar and the State.
If the inamdar is owner in relation to his tenants, it would be illogical to hold that he is not that, in relation to (1) Mad. 716.
(2) [1939] 66 I.A. 278.
915 the State.
The question is, in our opinion, concluded by section 2(8) of Act XXVI of 1948 which defines a landholder as including a darmila inamdar, and that is a statutory recognition of the doctrine laid down in Brahmayya vs Achiraju(1) and Narayanaraju vs Suryanarayudu(2) that darmila inamdars are owners ,of parts of an estate.
The result then is that when the darmila inam does not relate to the entire village but only to a fraction of it, it must be held to retain its character as part of the estate in the hands of the inamdar, and when the estate is notified under section 1 (4) of the Act, the inam will vest in the State under section 3(b).
It is next argued for the,, respondent that the Act ,makes no provision for award of compensation to minor darmila inamdars and that as a statute is not to be construed as taking away the proper" of any person unless there is a provision for payment of compensation therefor,, these.
inams should be held to be outside the operation of the Act Reference was made in this connection to section 45 of the Act under which the compensation payable in respect of an impartible estate and Ramanathapuram is one is to be apportioned after payment of debts among the members of the family.
It is said that under this section the respondent would have no right to share in it.
This contention is clearly erroneous.
The material provisions relating to the award of compensation ,are sections 25, 27, 37 and 44.
Under section 25, the compensation is to be determined for the estate as a whole and not separately for each of the interests therein.
Section 27 lays down bow the basic income in the case of zamindaris is to be fixed.
Under section 27(i), it has to include one third of the gross annual ryotwari demand in respect of all lands in the estate and under section 27(iv) "one third of the average net annual miscellaneous revenue derived from all other sources in the estate specified in section 3 (b) ".
Thus, the income from the lands comprised in the minor inam which is a part of the estate is included in the total income of the zamindari.
Under section (1) Mad. 716.
(2) (1939] 66 I.A. 278.
116 916 37, the compensation payable in respect of an estate is calculated in terms of the basic income on the scale prescribed therein.
Section 44 enacts that the Tribunal is to "apportion this compensation among the principal landholder ' and any other persons whose rights or interests in the estate stand transferred to the Government under section 3(b)".
There cannot be any doubt on these provisions that the darmila minor inamdar is a person who is entitled to claim compensation for the transfer of his portion of the estate to the Government.
Then comes section 45 on which the respondent bases his contention.
That applies only to the distribution of the compensation determined under section 44 as payable to the principal landholder, when he is the holder of an impartible estate.
It leaves untouched the rights of minor darmila inamdars to claim compensation under section 44.
The contention of the respondent that the Act provides no compensation to them, and that they should therefore be held to fall outside the Act must accordingly be rejected.
(2)That brings us on to the second question whether a post settlement minor inam is a right in land created by a landholder within the intendment of section 20 of the Act.
At the very outset, it seems somewhat inconsistent to hold that a darmila minor inam is part of an estate, and also that it is governed by section 20.
If it is part of an estate, it must automatically vest in the Government under section 3(b).
But if it falls within section 20, the title to it will continue to stand in the inamdar with a right in the Government to take action under the third proviso, subject to the conditions laid down therein.
It was argued for the respondent that section 3 operates on its own terms only "save as otherwise expressly provided herein", and that section 20 was such a provision.
It is somewhat difficult to follow this argument, because if section 20 applied to darmila minor inams, then they could never fall within the operation of section 3(b).
And how is this result to be reconciled with the conclusion that they are parts of 917 the estate, and that the inamdar is a landholder for purposes of the Act? But it is argued for the respondent that the words "rights in land created by landlord" are of the widest import and would take in darmila minor inams.
The point for decision is whether this contention is correct.
We start with this that a darinila minor inamdar is a landholder as defined in section 2,(8) of the Act, and he is that, by reason of his being the owner of a part of the estate.
Can such a person be held to be one who has obtained a right in the land from the landholder within section 20? The Act makes a clear distinction between estates held by landholders and rights and interests held by other persons in or over estates.
Section 3(b) enacts that when there is a notification under section 1(4), the entire estate shall stand transferred to the Government and vest in it.
We have held that the part of the estate belonging to a darmila inamdar would vest in the Government.
Section 3(c) provides that on notification all rights in or over the estate shall cease and terminate.
Section 3(b) and section 3(c) deal with two distinct matters which may respectively be described in broad terms as ownership of the estate and rights in or over estate not amounting to ownership, and these two categories are mutually exclusive.
Now, turning to section 20, it protects rights in land by way of lease or otherwise created by the landholder before the notified date.
In this context, and having regard to the distinction between estates under section 3(b) and rights over estates under section 3(c), the rights mentioned in section 20 can only refer to the rights dealt with in section 3(c), and not to ownership which is within section 3(b).
When, therefore, the transaction for which protection is claimed under section 20 is one which vests ownership of the estate or a portion thereof in the transferee, it will fall outside the section.
In other words, section 20 has no application to transactions by which a person becomes a landholder by reason of ownership of even a part of the estate being transferred to him, and that being the character of a, darmila minor inam it is not pro 918 tected by section 20.
There are also indications in the language of section 20 pointing to the same conclusion.
Section 20(2) provides that the persons whose rights are terminated under the proviso to section 20(1) shall be entitled to compensation having regard to the value of the right which is terminated and the unexpired portion of the period for which the right is created.
These words are more appropriate to connote rights which are to be exercised for specified periods, such as lease or contract for the exploitation of mines or forests for a term than "ownership of the estate".
There is one other consideration, which lends support to this conclusion.
The object of the Act was to establish direct relationship between the State and the tillers of the soil, and to abolish all intermediate tenures.
In Madras, the rights and obligations of intermediate tenure holders were regulated by the Madras Estates Land Act, and under that Act the intermediaries consisted not merely of the holders of the estates as defined in section 3(2) of that Act but also holders of post settlement minor inams as settled by decisions of the highest authority.
If the purpose of the Act is to be fully achieved, it would be necessary to abolish not merely estates as defined in section 3(2) of the Madras Estates Land Act but also darmila minor inams.
But if the contention of the respondent is to be accepted, it is only the estates mentioned in section 3(2) that will, on notification, vest in the Government and not the minor inams.
These will continue to be held by the inamdars under section 20 until they are terminated in accordance with the proviso therein, and survive as islets in the landscape even after the parent estates have dis appeared from the scene.
The legislation must to this extent be held to have failed to achieve its purpose.
And this is not all.
If the contention of the respondent is correct, then the minor inamdars will not merely be unaffected by the Act but will actually be better off for it.
Under section 3(a) of the Act, the Madras Estates Land Act stands repealed on and from the notified date, and as it is by virtue of this 919 Act that the tenants became entitled to occupancy rights, the inamdars would, on notification, be free to eject tenants, and settle their own terms with them.
We cannot accede to a contention which results not merely in the frustration of the object of the Act but further produces consequences, the reverse of what were intended.
On the other hand, the contention of the appellant that minor inams fall outside section 20 and would vest straightaway in the State under section 3(b) will have the effect of extinguishing the rights of the inamdars, and enabling the State to issue ryotwari pattas to the tenants in occupation.
We prefer to accept this contention, as it fully effectuates the intention of the legislature.
In the result, we must hold that the one sixteenth portion of the village of Karuppur forming a darmila inam will vest in the Government under section 3(b) of the Act, and that the only right of the inamdars is to share in the compensation under the terms of the Act.
The petition of the respondent in so far as it relates to this inam must be dismissed.
This appeal is accordingly allowed, and in accordance with the terms of the certificate granting leave, the appellant will pay the costs of the respondent in this Court.
The parties will bear their own costs in the court below.
| At the time of passing of the Madras Estates (Abolition and Conversion into Ryotwari) Act (Madras Act XXVI of 1948), a 15/16th portion of village Karuppur situated within the Zamindari of Ramanathapuram was hold by the inamdars under a pre settlement grant confirmed by the British Government, the estate being permanently settled in 1802.
The remaining one sixteenth portion was held by the holders of darmila or post settlement inams made by the proprietor of the estate.
In exercise of the powers conferred by section 1(4) of the Madras Act XXVI of 1948 the State of Madras issued a notification dated 22nd August 1949 bringing the Act into force as regards the Ramanathapuram estate from 7th September 1949, the latter Zamindari including one sixteenth part of Haruppur village.
The respondent the holder of the one sixteenth inam contended that under section 1(3) of the Madras Act XXVI of 1948 the State of Madras bad power to notify only what would be estates as defined in section 3(2) of the Madras Estates Land Act I of 1908 and that one sixteenth part of the village of Karuppur included in the notification was not an estate as defined in that section and the notification was therefore ultra vires.
Held (repelling the contention) that when the darmila inam does not relate to the entire village but only to a fraction of it, it must be held to retain its character as part of the estate in the hands of the inamdar and when the estate is notified under section 1(4) of the Madras Act XXVI of 1948 the inam will vest in the State under section 3(b) of the Madras Act XXVI of 1948 and therefore one sixteenth portion of the village of Karuppur forming a darmila inam will vest in the State.
Under the provisions of the Madras Act XXVI of 1948 the darmila minor inamdar is entitled to claim compensation for the transfer of his portion of the estate to the Government.
115 908 Darmila minor inam is not protected by section 20 of the Act.
Brahmayya vs Achiraju ([1922] I.L.R. and Nara yanaraju vs Suryanarayudu ([1939] 66 I.A. 278), referred to.
|
Appeal No. 195 of 1954.
Appeal by special leave from the judgment and order dated the 20th May, 1953 of the CustodianGeneral of Evacuee Property, New Delhi in Revision No. 387 R/Judl/53.
Achhru Ram, (Ganpat Rai, with him) for the appellant.
C. K. Daphtary, Solicitor General of India, (Porus A.Mehta and R. H. Dhebar, with him) for respondents Nos. 1 & 2. 1955.
October 28.
The Judgment of the Court was delivered by JAGANNADHADAS J.
This is an appeal by special leave against the order of the Custodian General of Evacuee Property dated the 20th May, 1953, revising an order of the Additional Custodian of East Punjab, Delhi, dated the 20th March, 1952.
The two questions raised before us on the facts and circum stances, to be stated, are (1) whether the Custodian General had the revisional power which he purported to exercise, and (2) was the order of the Custodian General on its merits such as to call for interference by this Court.
The appellant before us, one Mrs. Indira Sobanlal, is a displaced person from Lahore.
She was the owner of a house.
at Lahore known as 5, Danepur Road.
Malik Sir Firoz Khan Noon of West Pakistan owned 766 bighas of agricultural land in a village called Punjab Khore within the State of Delhi.
An oral exchange is said to have taken place between these two.
, of the said properties, on the 10 th October, 1947.
In pursuance of that exchange Malik Sir Firoz Khan Noon is said to have taken possession of the Danepur Road House.
The appellant is also said to have been put in possession of the said agricultural lands in Punjab Khore presumably by way of attornment 1120 of tenants who were in actual cultivating possession of the lands.
Under section 5 A of the East Punjab Evacuees ' (Administration of Property) Act, 1947 (East Punjab Act XIV of 1947), as amended in 1948 and applied to the State of Delhi, such a transaction required confirmation by the Custodian.
In compliance with this section the appellant made an application on the 23rd February, 1948, to the Additional Custodian of Evacuee Property (Rural), Delhi, for confirmation of the above transaction of exchange and of the consequent transfer to her of the property in agricultural land.
In view of certain rules which came into force later and which prescribed that the application was to be in a set form furnishing certain particulars, the appellant filed an amended application dated the 14th August, 1948, furnishing the required particulars.
This application was not disposed of by the Additional Custodian, for reasons not clear on the record, until the 20th March, 1952.
On that date he passed an order confirming the exchange.
Meanwhile, however, a, proposal was put up to the Additional Custodian by his Revenue Assistant to allot agricultural lands of the village Punjab Khore, including those covered by this exchange, to a number of refugee cultivators.
The proposal was approved by the Additional Custodian on the 12th June, 1949.
In pursuance thereof a detailed allotment was made to twenty six individual allottees on the 27th October, 1949.
There is a report of the Rehabilitation Patwari dated the 27th February 1950, on the record showing that the allottees entered into possession of the land and cultivated their respective lands and settled down in the village.
After the order confirming the exchange was passed by the Additional Custodian on the 20th March, 1952, the appellant filed an application on the 5th May, 1952, asking to be placed in possession, and for a warrant of delivery of possession to be issued against the various allottees and tenants of the land.
The Naib Tehsildar recommended that possession may be given to the appellant and that the Patwari may be informed accordingly to take the necessary action in the matter.
But it does 1121 not appear from the record whether this was done, or whether possession was in fact delivered.
At this stage, a notice under section 27 of the (Central Act XXXI of 1950), appears to have been issued to the appellant by the Custodian General to show cause why the order of the Additional Custodian dated the 20th March, 1952, confirming the exchange and the further orders dated the 20th and 28th July, 1952, sanctioning mutation and other consequential and incidental orders made in connection therewith be not set aside.
This notice appears to have been issued asking the appellant to show cause on the 4th May, 1953.
The case was adjourned to the 12th May, 1953, at the request of counsel for the appellant and thereafter a more detailed notice dated the 14th May, 1953, was issued setting out the various grounds on which the previous orders were sought to be set aside.
The learned Custodian General passed the order now under appeal on the 20th May, 1953, setting aside the order of confirmation.
He directed the Custodian to decide the case after giving notice to all those who might be affected by the confirmation of this transaction.
As the earlier part of his order shows, the reference to the persons affected was to those who were allotted the lands in question by virtue of the order of the Additional Custodian of the year 1949 above referred to.
To appreciate the first question that has been raised as to the validity of the exercise of revisional powers by the Custodian General on the above facts, it is necessary to set out the course of the relevant legislative measures from time to time.
To meet the unprecedented situation of sudden migration of vast sections of population on a large scale from West Punjab to East Punjab and vice versa, leaving most of the properties which they had, moveable and immoveable, agricultural and nonagricultural, the concerned Governments bad to take wide legislative powers to deal with the situation, to set up the necessary administrative machinery, and to evolve and give effect to their policies in regard thereto from time to time.
The earliest of these legislative measures so far as we are concerned, was the East Punjab Evacuees (Administration of Property) Act, 1947 (East Punjab Act XIV of 1947), which came into force on the 12th December, 1947.
This Act was amended by the East Pun jab Evacuees ' (Administration of Property) (Amendment) Ordinance, 1948 (East Punjab Ordinance No. II of 1948) and later by East Punjab Evacuees ' (Administration of Property) (Amendment) Act, 1948, (East Punjab Act XXVI of 1948), which inserted two new sections, 5 A and 5 B I prescribing the requirement of confirmation Of transactions relating to eva cuee property and providing a right of appeal or revision therefrom.
These sections were specifically made applicable to transactions on or after the 15th August, 1947.
The above Punjab Legislative measures were extended to the State of Delhi by Central Government notifications under the Delhi Laws Act, dated the 29th December, 1947, the 28th January, 1948, and the 22nd April, 1948, respectively.
In so far as these measures applied to Chief Commissioners ' Provinces they were repealed by the Administration of Evacuee Property (Chief Commissioners ' Provinces) Ordinance, 1949, (Central Ordinance No. XII of 1949) which came into force so far as Delhi is concerned on the 13th June, 1949.
This Ordinance, in its turn, was repealed and a fresh Central Ordinance came into force in its place, applicable to all the Provinces of India except Assam and West Bengal.
That was Administration of Evacuee Property Ordinance.
, 1949, (Central Ordinance No. XXVII of 1949), which came into force on the 18th October, 1949.
This Central Ordinance in its turn was repealed and replaced by the (Central Act XXXI of 1950) which came into force on the 17th April, 1950.
It is necessary to notice at this stage that until the Central Ordinance XXVII of 1949 was passed, the Evacuee Property law was regulated by the respective Provincial Acts and were under the respective Provincial administrations.
Central Ordinance 1123 No. XXVII of 1949 provided for a centralised law and centralised administration which was continued by Central Act No. XXXI of 1950.
One of the main steps taken for such centralised administration was to create the office of Custodian General with powers of appeal and revision as against the orders of Provincial Custodians.
Section 5 of the Central Ordinance No. XXVII of 1949 authorised the Central Government to appoint a Custodian General of Evacuee Property in India for the purpose of discharging the duties imposed on him by or under the Ordinance, while the appointment of Provincial Custodians, Additional, Deputy or Assistant Custodians, was still left to the various Provincial Governments.
These provisions were continued by sections 5 and 6 of Central Act XXXI of 1950.
As regards the transactions by evacuees relating to evacuee property, the first legislative interference in East Punjab and Delhi appears to have been by virtue of East Punjab Evacuees (Administration of Property) (Amendment ') Ordinance, 1948 (East Punjab Ordinance No. II of 1948) and the East Punjab Evacuees ' (Administration of Property) (Amendment) Act, 1948 (East Punjab Act XXVI of 1948) which inserted two new sections 5 A and 5 B into the East Punjab Act XIV of 1947.
The said sections were as follows: "5 A. (1) No sale, mortgage, pledge, lease, exchange or other transfer of any interest or right in or over any property made by an evacuee or by any person in anticipation of his becoming an evacuee, or by the agent, assign or attorney of the evacuee or such person, on or after the fifteenth day of August, 1947, shall be effective so as to confer any rights or remedies on the parties to such transfer or on any person claiming under them unless it is confirmed by the Custodian.
(2) An application for confirming such transfer may be made by any person claiming thereunder or by any person lawfully authorised by him.
(3) The Custodian shall reject any application made after the thirty first day of March, 1948 or after 142 1124 the expiration of two months from the date the transaction was entered into, whichever is later.
(4) The Custodian shall hold a summary enquiry into an application, which is not rejected under subsection (3) and may decline to confirm the transaction if it appears to the Custodian that (a) the transaction was not a bona fide one for valuable consideration; or (b) the transaction is in the opinion of the Custodian prejudicial to the prescribed objects; or (c) for any other reason, to be given by the Custodian in writing, the transaction ought not to be confirmed.
(5)If the Custodian confirms the transaction, he may confirm it unconditionally or subject to such conditions and terms as he may consider proper.
(6)The Custodian, if the order is not pronounced in the presence of the applicant, shall forthwith give notice in writing to the applicant of any order passed by him under sub sections (3), (4) or (5).
" 5 B. If the original order under section 5 A is passed by an Assistant or Deputy Custodian of Evacuee Property, any person aggrieved by such order may appeal within sixty days from the date of the order to the Custodian of ]Evacuee Property who may dispose of the appeal himself or make it over for disposal to the Additional Custodian of Evacuee Property; and subject only to the decision on such appeal, if any, the order passed by the Assistant or 'Deputy Custodian of Evacuee Property, or any original or appellate order passed by the Custodian or Additional Custodian of Evacuee Property shall be final and conclusive".
It will be seen that these two sections enjoined that transfers by an evacuee or intending evacuee relating to his property from and after the 15th August, 1947, required confirmation and provided for appeal or revision from the orders passed on applications therefor and subject thereto, such orders were made final and conclusive.
The requirement as to confirmation has been substantially continued in more or less the same form by sections 25, 38 and 40 respectively of 1125 the successive legislative measures with certain modi fications which are not material for this case.
But so far as the appealability or revisability of an order passed on an application for confirmation is concerned.
, there have been changes from: time to time.
It will be seen from section 5 B of the East Punjab Act, XIV of 1947, as quoted above, that any original order passed by the Custodian or Additional Custodian is not subject to appeal or revision and it is specifically declared to be final and conclusive.
Central Ordinance No. XII of 1949 by section 30(1) (b) thereof provided for an appeal to the High Court against an original order of a Custodian or Additional Custodian or authorised Deputy Custodian but there was no provision for revision of such an order.
Under the Central Ordinance No. XXVII of 1949 the position was substantially different.
Section 24 thereof, inter alia, provided that.
any person aggrieved by an order made under section 38 (which corresponds to the previous section 5 A of the East Punjab Act XIV of 1947) may prefer an appeal in ,such manner and within such time as may be prescribed, to the Custodian General where the original order has been passed by the Custodian, Additional Custodian or an Authorised Deputy Custodian.
Section 27 thereof provided for revisional powers of the Custodian General but it was specifically confined to appellate orders and there was no power given thereunder for revision by the Custodian General of an original order passed by the Custodian.
But under Central Act XXXI of 1950 which repealed and replaced this Ordinance the position became different.
The provision for appeal under section 24 thereof was virtually the same as before, in so far as it is relevant here.
But as regards revision, however, section 27 of the Act provided for the revisional powers of the Custodian General in the following terms: "27.
(1) The Custodian General may at any time, either on his own motion or on application made to him in this behalf, call for the record of any proceeding in which any district judge or Custodian has passed an order for the purpose of satisfying him 1126 self as to the legality or propriety of any such order and may pass such order in relation thereto as he thinks fit: Provided that the Custodian General shall not pass an order under this sub section prejudicial to any person without giving him a reasonable opportunity of being heard. . . . . . . " The question relating to the validity of the revisional powers exercised by the Custodian General in the present case arises with reference to the provisions above mentioned.
It is not disputed that Malik Sir Firoz Khan Noon was an evacuee.
Nor is it disputed that this property in Punjab Khore which was the subject matter of the exchange was evacuee property.
Though the exchange in question was alleged to have taken place on the 10th October, 1947, at a time when there was no restriction against any evacuee dealing with the property he left behind, it is indisputable that section 5 A of the East Punjab Act XIV of 1947 which has been specifically made retrospective from the 15th August, 1947, operates in respect of the present transaction also.
It, therefore, requires confirmation under the said section and under the corresponding sections in the subsequent legislative measures in this behalf.
It was in compliance with this requirement that the appellant made an application for confirmation on the 23rd February.
1948, and that a subsequent amended application was filed on the 14th August, 1948.
It is these applications that were disposed of on the 20th March, 1952, by the Additional Custodian, Delhi, by an order confirming the exchange, which has since been revised by the Custodian General on the 20th May, 1953.
The main contention of the learned counsel for the appellant is to the powers which are vested in the Custodian General to revise the original orders of the Custodian or Additional Custodian under section 27 of the Central Act XXXI of 1950 are not applicable to an order passed by the Custodian or Additional 1127 Custodian on an application made long prior to the time when the office of the Custodian General was set up and he was clothed with powers of revision.
It is urged that on the date when the application for confirmation was first made on the 23rd February, 1948, an order passed under section 5 A by the Custodian or Additional Custodian is final and con clusive under section 5 B.
It is strongly urged that the subsequent repeal and re enactment of these provisions cannot affect the right vested in the appellant to obtain a final and conclusive order from the Custodian or Additional Custodian on her application for confirmation.
Section 6 of the General Clauses Act and the Privy Council case in the Colonial Sugar Refining Co. Ltd. vs Irving(1) were relied on in support of this contention.
To determine the validity of this contention, it is necessary to trace the course of the various relevant statutory provisions from time to time which repealed the prior corresponding legislative measures and to determine the effect thereof.
The East Punjab Act XIV of 1947 was replaced by the Central Ordinance No. XII of 1949 relating to Chief Commissioners ' Provinces.
Section 40 thereof which repealed the prior Act was as follows: "40.
(1) The East Punjab Evacuees ' (Administration of Property) Act, 1947 (East Punjab Act XIV of 1947), as in force in Ajmer Merwara and Delhi, is hereby repealed.
(2)Notwithstanding such repeal, anything done or any action taken in the exercise of any power conferred by the Act aforesaid shall, in relation to the Provinces of Ajmer Merwara and Delhi, be deemed to have been done or taken in the exercise of the powers conferred by this Ordinance, and any penalty` incurred or proceeding commenced under the said Act shall be deemed to be a penalty incurred, or proceeding commenced under this Ordinance as if this Ordinance were in force on the day when such thing was done, action taken, penalty incurred or proceeding commenced".
When this Ordinance was in turn repealed by (1) 1128 Central Ordinance No. XXVII of 1949, the repealing section 55 was as follows: "55.
(1) The Administration of Evacuee Property Ordinance, 1949 (XII of 1949), as in force in the Chief Commissioners ' Provinces is here by repealed.
(2). . . . . (3)Notwithstanding the repeal by this Ordinance of the Administration of Evacuee Property Ordinance, 1949, or of any corresponding law, anything done or any action taken in the exercise of any power conferred by that Ordinance or law shall be deemed to have been done or taken in the exercise of the powers conferred by this Ordinance, and any penalty incurred or proceeding commenced under that Ordinance or law shall be deemed to be a penalty incurred or proceeding commenced under this Ordinance as if this Ordinance were in force on the day on which such thing was done, action taken, penalty incurred or proceeding commenced".
Ordinance No. XXVII of 1949 was in its turn repealed by Central Act XXXI of 1950.
This Act was amended by an Ordinance and later by an Act of, the same year.
Section 58 is the repealing provision of this Act as so amended.
The material portion thereof is as follows: "58.
(1) The Administration of Evacuee Property Ordinance, 1949 (XXVII of 1949) is hereby repealed.
(2). . . . . . (3)The repeal by this Act of the Administration of Evacuee Property Ordinance, 1949 (XXVII of 1949). . shall not affect the previous operation thereof, and subject thereto, anything done or any action taken in the exercise of any power conferred by or under that Ordinance shall be deemed to have been done or taken in the exercise of the powers conferred by or under this Act, as if this Act were in force on the day on which such thing was done or action was taken".
Thus in the transition of the Evacuee Property law 1129 relating to Delhi, from the East Punjab Act XIV of 1947 to the present Central Act XXXI of 1950, there have been three repeals.
The first two repealing provisions are in almost identical terms but the third is somewhat different.
The difference is in two respects.
(1) The provision in the previous repealing sections that "any penalty incurred or proceeding commenced under the repealed law shall be deemed to be a penalty incurred or proceeding commenced under the new law as if the new law were in force on the day when the penalty was incurred or proceeding commenced" is now omitted.
(2) The provision that "anything done or any action taken in exercise of any power conferred by the previous law shall be deemed to have been done or taken in exercise of the powers conferred by the new law as if the new law were in force on the day when such thing was done or action taken" is continued.
But it is specifically provided that this is subject to the repeal not affecting the "previous operation of the repealed law" which in the context clearly means the previous operation of the repealed law in respect of "anything done or any action taken".
The question thus for consideration is what is the result brought about by these provisions.
Before proceeding to determine it, it is desirable to consider whether section 6 of the General Clauses Act can be relied on.
The position as regards section 6 of the General Clauses Act in the case of repeal and re enactment has been considered by this Court in State of Punjab vs Mohar Singh( ') and laid down as follows at page 899: "Whenever there is a repeal of an enactment, the consequences laid down in section 6 of the General Clauses Act will follow unless, as the section itself says, a different intention appears.
In the case of a simple repeal there is scarcely any room for expression of a contrary opinion.
But when the repeal is followed by fresh legislation on the same subject we would undoubtedly have to look to the provisions of the new Act, but only for the purpose of determining whether they indicate a different intention.
(1) ; , 899.
1130 The line of enquiry would be, not whether the new Act expressly keeps alive old rights and liabilities but whether it manifests an intention to destroy them.
We cannot therefore subscribe to the broad proposition that section 6 of the General Clauses Act is ruled out when there is repeal of an enactment followed by a fresh legislation.
Section 6 would be applicable in such cases also unless the new legislation manifests an intention incompatible with or con trary to the provisions of the section.
Such incom patibility would have to be ascertained from a consideration of all the relevant provisions of the new law. . . ".
In the present case sub section (3) of section 58 of Central Act XXXI of 1950 purports to indicate the effect of that repeal, both in negative and in positive terms.
The negative portion of it relating to "the previous operation" of the prior Ordinance appears to have been taken from section 6(b) of the General Clauses Act, while the positive portion adopts a "deeming" provision quite contrary to what is contemplated under that section.
Under the General Clauses Act the position, in respect of matters covered by it, would have to be determined as if the repealing Act had not been passed, while under section 58 of Central Act XXXI of 1950, the position so far as the positive portion is concerned has to be judged as if the repealing Act were in force at the earlier relevant date.
Therefore where, as in this case, the repealing section which purports to indicate the effect of the repeal on previous matters, provides for the operation of the previous law in part and in negative terms, as also for the operation of the new law in the other part and in positive terms, the said provision may well be taken to be self contained and indicative of the intention to exclude the application of section 6 of the General Clauses Act.
We are, therefore, of the opinion that the said section cannot be called in aid in this case.
Now, as to the meaning of section 58(3) of Central Act XXXI of 1950, it must be admitted that this is not free from difficulty.
This kind of provision in a 1131 repealing Act appears rather unusual.
Learned counsel for the appellant urges that the positive portion of this provision, i.e., "anything done or any action taken in exercise of any power conferred by or under, the Ordinance shall be deemed to have been done or taken in the exercise of the powers conferred by or under this Act as if this Act were in force on the day on which such thing was done or action was taken" applies only to purely administrative matters and that his case falls within the scope of the first portion, viz., "the repeal. . shall not affect the previous operation of the (repealed) Ordinance".
His contention is that the application for, confirmation which was made by the appellant in 1948 and which remained pending until Act XXXI of 1950 came into force and superseded the earlier legislation in this behalf, had to be disposed of in accordance with sections 5 A and 5 B of the East Punjab Act XIV of 1947, as amended in 1948; that the order of confirmation passed by the Additional Custodian in such a pending application was not open to appeal or revision but became final and conclusive.
It is urged that on the filing of the application in 1948, the appellant got a vested right to have it determined under section 5 A with the attribute of finality and conclusiveness under section 5 B attaching to such determination.
According to the learned counsel this follows from the "previous operation" of the repealed law and is in consonance with the principle laid down by the Privy Council in Colonial Sugar Refining Co. Ltd. vs Irving(1).
It appears to us that these contentions are unsustainable.
Colonial Sugar Refining Co. Ltd. vs Irving(1) relates to the case of a right of appeal against an order passed or to be passed in a pending action.
Their Lordships treated the right of appeal to a superior tribunal in a pending action as an existing right and held that the suitor cannot be retrospectively deprived of it except by express words or by necessary implication.
This doctrine was affirmed by the Privy Council in Delhi Cloth & General Mills Co. Ltd. (1) 143 1132 vs
Income Tax Commissioner, Delhi(1) in its application to the converse case in the following terms: "Their Lordships can have no doubt that provisions which, if applied retrospectively, would deprive of their existing finality orders which, when the statute came into force, were final, are provisions which touch existing rights".
It may be noticed that in the case in Delhi Cloth & General Mills Co. Ltd. vs Income Tax Commissioner(1), the orders of the High Court from which appeals were sought to be filed to the Privy Council were dated the 6th January, 1926 and 12th January, 1926.
As the Indian Income tax Act stood at the time and according to the interpretation of section 66 thereof by the Privy Council in Tata Iron & Steel Co. vs Chief Revenue Authority, Bombay(2) there was no appeal to the Privy Council.
The legislature by an amendment of the Income tax Act, which came into force on the 1st April, 1926, inserted therein section 66 A and gave a right of appeal against such orders as provided therein.
In this situation the Privy Council repelled the contention that the litigant could avail himself of the new provision by pointing out the finality of the orders fought to be appealed against and referring to it as an existing right.
This is obviously so because finality attached to them.
, the moment orders were passed, prior to the new Act.
In the present case, the position is different.
The action was still pending when Central Act XXXI of 1950 came into force.
No order was passed which could attract the attribute of finality and conclusiveness under section 5 B of the East Punjab Act XIV of 1947.
Further the possibility of such finality was definitely affected by the repealing provision in Central Ordinance No. XII of 1949 and Central Ordinance No. XXVII of 1949, which specifically provided that a pending action was to be deemed to be an action commenced under the new Ordinance as if it were in force at the time and therefore required to be continued under the new Ordinances.
Each of these Ordinances provided for (1) Lahore 284.
(2) (1923] L.R. 50 I.A. 212.
1133 appeal against such an order and the second of them provided for the exercise of revisional power against an appellate order of the Custodian.
Learned counsel for the appellant contends that, even so, the finality and conclusiveness, which would have attached to an order made under section 5 A, if made before Ordinance XII of 1949 was promulgated, was affected only to the extent of its being subject to an appeal and not to revision.
But once the attribute of finality in respect of such an order is affected by subsequent legislation, it does not appear to be of consequence that it was affected first by a provision for appeal and later by provisions for appeal and revision.
It is difficult to see that such provisions, in those cir cumstances, are anything more than alterations in procedure.
However this may be, it appears to be clear that while a right of appeal in respect of a pending action may conceivably be treated as a substantive right vesting in the litigant on the commencement of the action though we do not so decide no such vested right to obtain a determination with the attribute of finality can be predicated in favour of a litigant on the institution of the action.
By the very terms of section 5 B of East Punjab Act XIV of 1947, finality attaches to it on the making of the order.
Even if there be, in law, any such right at all as the right to a determination with the attribute of finality, it can in no sense be a vested or accrued right.
It does not accrue until the determination is in "fact made, when alone the right to finality becomes an existing right as in Delhi Cloth and General Mills Co. Ltd. vs IncomeTax Commissioner(1).
We are, therefore, of the opinion that the principle of Colonial Sugar Refining Co. Ltd. vs Irving(2) cannot be invoked in support of a case of the kind we are dealing with.
Nor can this be brought under the ambit of the phrase "previous operation of the repealed law".
What in effect, learned counsel for the appellant contends for is not the "previous operation of the repealed law" but the "future operation of the previous (1) Lahore 284, (2) 1134 law".
There is no justification for such a construction.
Besides, if in respect of the pending application in the present case, the previous repealed law is to continue to be applicable by virtue of the first portion of section 58(3) the question arises as to who are the authorities that can deal with it.
The application can be dealt with by the Custodian and on appeal by the Custodian General only as functioning under the previous law.
But as such Custodian or Custodian General they have disappeared by virtue of the repeal.
It is only the second portion of section 58(3) which continues them as though the appointments were made under the new Act a position which could scarcely be controverted.
To the extent of the future operation, if any, of the repealed law they can have no function.
Indeed, a comparison of the wording of section 58 of Act XXXI of 1950 with the wording of section 6 of the General Clauses Act would show that if the legislature intended either that pending proceedings were to be continued under the previous law or that anything in the nature of vested right of finality of determination or some right akin thereto was to arise in respect of such pending proceedings, the negative portion of section 58(3) would not have stopped short with saving only the "previous operation" of the repealed law.
It would have borrowed from out of some portions of the remaining sub sections (c), (d) and (e) of section 6 of the General Clauses Act, and provided in express terms for the continuance of the previous law in respect of pending pro ceedings.
Obviously no particular sub section of section 6 of the General Clauses Act could be borrowed in toto as that would contradict the positive portion of section 58(3) of Act XXXI of 1950 and would be inconsistent with the idea underlying it.
We are,therefore, clearly of the view that the appellant cannot call in aid the principle of the case in Colonial Sugar Refining Co. Ltd. V. Irving(1), nor can his case fall within the ambit of the first portion of sub section (3) of section 58 of Act XXXI of 1950.
The next question for consideration is how the (1) 1135 second and positive portion of section 58(3) of Act XXXI of 1950 is to be understood.
This portion says that "anything done or any action taken in exercise of any power conferred by or under the (repealed) Ordinance, shall be deemed to have been done or taken in the exercise of the powers conferred by or under this Act as if this Act were in force on the day on which such thing was done or action was taken".
To appreciate the meaning of this it is desirable to have a general idea of the scheme of the repealed Ordinance, the powers exercisable thereunder, and the nature of the things that may be done, or action that may be taken, thereunder.
The powers exercisable are to be gathered from various sections and broadly speaking fall under the follow ing categories.
To make appointments sections 5 and 6. 2.
To make enquiries sections 7, 16, 19 and 38 and to make declarations or issue notifications as a result thereof.
To make various kinds of consequential or administrative order such as those under sections 9, 10, 11, 12 and 21. 4.
To hear and dispose of appeals, reviews or revisions sections 24, 25, 26 and 27.
5.Power of the Central Government, to exempt, to give directions, to take action with regard to evacuee property, to delegate powers and to make rules sections 49, 50, 51, 52 and 53.
In addition there are provisions which bring about various consequences such as vesting in the Custodian, valid discharge by payment to the Custodian, attachment, and so forth, sections 7 (2), 8, 11, 13, 16 (3), 19 (3), 20 and 22, etc.
The above enumeration is by no means intended to be exhaustive but is merely to illustrate the scheme of the various provisions in the Ordinance with reference to which section 58 of the Act has to be understood.
There are also rules framed by virtue of section 53 of the Ordinance under which various powers may be exercised, things done, and action taken.
If section 58 (3) of Central Act XXXI of 1950 which 1136 repealed the prior Ordinance is understood with reference to the above scheme, there is no reason to confine the operation of the second portion of section 58(3) to administrative action as suggested by learned counsel for the appellant.
Broadly speaking, the second portion of section 58(3) refers to the whole range of, things that may be done, or action that may be taken, under the previous Ordinance and the rules framed thereunder, while the first portion of section 58(3) relates to the legal consequences resulting under the Ordinance or the rules from certain facts or from completed acts or things done thereunder.
Without attempting to be meticulously accurate, it may be stated in general terms, that the scheme underlying section 58(3) appears to be that every matter to which the new Act applies has to be treated as arising, and to be dealt with, under the new law except in so far as certain consequences have already ensued or acts have been completed prior thereto to which it is the old law that will apply.
In this view of section 58, the application of the appellant for confirmation pending on the date when Central Act XXXI of 1950 came into force had to be dealt with and disposed of under this Act and the order of confirmation passed in 1952 would clearly be subject to the revisional power of the Custodian General under section 27 of the said Act.
It is next contended that the revisional power cannot be exercised when there was an appeal provided but no appeal was filed, that it was open to the Assistant Custodian who appeared before the Custodian General in support of the notice for revision or to the allottees of the property in whose interest the revisional order appears to have been passed, to file an appeal under the Act as persons aggrieved.
Section 27 however is very wide in its terms and it cannot be construed as being subject to any such limitations.
Nor can the scope of revisional powers be confined only to matters of jurisdiction or illegality as is contended, because under section 27, the Custodian General can exercise revisional powers "for the purpose of satisfying himself as to the legality or 1137 propriety of any order of the Custodian".
We are thus clearly of the opinion that the contention of the learned counsel for the appellant that the exercise of revisional powers in this case by the Custodian General is without jurisdiction or is illegal, must fail.
The next question to be considered is as regards the merits of the revisional order of the Custodian General which is under appeal before us.
Learned counsel for the appellant attacked it on various grounds.
He urged that the ground on which the learned Custodian General set aside the Additional Custodian 's order, viz., absence of notice to the prior allottees is wholly untenable.
He contended that the allottees had no kind of interest in the land which entitled them to contest the application for confirmation, that they were at best only lessees for three years which was due to expire very shortly after the order of confirmation was passed by the Additional Custodian.
He pointed out that as soon as the application for confirmation was filed on the 23rd February, 1948, general notice by beat of drum and affixture in the locality and by publication in the Indian News Chronicle article was given, that the persons in possession at the time were only the previous tenants on the land, who either attorned to the appellant or left the village, that the allottees came into possession much later and pending the disposal of the confirmation proceedings and presumably subject to its result.
He also pointed out that even when the rules in this behalf came into force under Act XXXI of 1950, it was discretionary with the Custodian to give notice to persons other, than the transferor and transferee, if he considered them to be interested, and urged that since the same officer, Shri R. Dayal, made the allotment as also the confirmation, he must be taken to have exercised his discretion properly in not giving any notice to them, in view of the imminent expiry of the three years term for which they were put in possession.
It is strongly urged that having regard to the above considerations and to the categorical findings of the Custodian General himself that the 1138 transaction which was confirmed, was perfectly bona fide, the setting aside of the order of confirmation against which no appeal was filed by any one, and the consequential disturbance of the vested property rights of the appellant, was in the nature of perverse exercise of revisional power.
The learned Solicitor General appearing for the respondent contended that the finding of the CustodianGeneral about the bona fides of the transaction was only tentative, that the allottees, though provisionally placed in possession for three years had, what has come to be recognised as, a quasi permanent interest, that they had a genuine interest in opposing the confirmation sought, which related to a large tract of agricultural land, and which would reduce the pool of agricultural lands available for rehabilitation of displaced agriculturists and that confirmation of transactions relating to such land was opposed to the policy and directives of the Government and that the confirmation should not, in the circumstances, have been lightly granted by the Additional Custodian without notice to the allottees and a proper consideration of the policies and directives in this behalf.
In reply thereto learned counsel for the appellant urged that the alleged policies or directives are not relevant matters for consideration by the Custodian in these proceedings which must be taken to be quasi judicial, if not judicial, unless such policies or directives are embodied in rules made by the Central Government under section 56(2) (q) and that no such rules were prescribed by the relevant dates and that even the Custodian General himself in his order under appeal discounted the usefulness of any reference to notifications and directives for the purposes of this case.
It was also urged that the matters which could be taken into consideration are regulated by section 40(4) of Act XXXI of 1950 and that clause (c) thereof must be construed as referring to matters ejusdem generis with clauses (a) and (b) But in the view we take of the order under appeal and the course we propose to adopt, we do not wish to express any opinion on the merits of the above arguments.
1139 The order under appeal is one passed by virtue of the wide powers of revision vested in the Custodian General under section 27 of the Act.
The jurisdiction which has been challenged having been found in favour of the Custodian General, this Court would normally be slow to interfere with the order on its merits.
But with respect to the learned CustodianGeneral, his order is such that it is difficult to maintain it.
The learned Solicitor General himself has been obliged to put forward arguments in support of it which cannot be clearly gathered from the order itself.
It is also difficult together from it whether the remand to the Additional Custodian for reconsideration, after notice was a general and open remand where all questions on the merits are to be reconsidered or was only a limited remand and if so what the limitations are.
If it was meant to be an open general remand, as the concluding portion of his order seems to indicate, his definite findings on points (1) and (2) which he formulated for himself and the doubt he has expressed in his order about the usefulness of examining afresh the various notifications and directives to which his attention was drawn by the Assistant ,Custodian, would render it difficult for any Custodian on remand to consider any of those matters.
If so, the remand would appear to serve no substantial purpose.
In the circumstances, and in fairness to the learned Custodian General, the only proper course would be to set aside his order under appeal and to remit the matter back to him for fresh consideration.
On such fresh consideration he will give full opportunity to both sides for presentation of their respective points of view.
If on the rehearing, he decides to remand the case to the Custodian, he will clearly indicate what are the matters to be considered by him.
The learned Custodian General may also consider the feasibility of his dealing with the matter finally by himself, calling for a report, if need be, from the Custodian on specified matters, in order to obviate any further delay by appeal and revision in this already protracted matter.
| The appellant, a displaced person from Lahore, was the owner of a house there and on the 10th of October, 1947, she arranged to have it exchanged with certain lands in a village in the State of Delhi, belonging to M, an evacuee.
On the 23rd of February, 1948, she made an application to the Additional Custodian of Evacuee Property (Rural), Delhi, for confirmation of the transaction of ex 1118 change under section 5 A of the East Punjab Evacuees ' (Administration of Property) Act, 1947, as amended in 1948 and applied to the State of Delhi.
Under section 5 B of the Act an order if passed by the Custodian or Additional Custodian would not be subject to appeal or revision, and would become final and conclusive.
But the application was not disposed of until the 20th of March, 1952, and on that date the Additional Custodian passed an order confirming the exchange.
In the meanwhile, there were changes in the law relating to evacuee property by which the East Punjab Act as applied to the State of Delhi witness repealed and re enacted, and ultimately Central Act XXXI of 1950 was passed which, among other things, conferred by section 27 revisional powers on the Custodian General.
The Custodian General issued a notice under section 27 to the appellant and, after hearing her, set aside the order of confirmation and directed the matter to be reconsidered by the Custodian.
It was contended for the appellant that the order of confirmation by the Additional Custodian was not open to revision, on the ground that on the filing of the application in 1948 the appellant got a vested right to have it determined under section 5 A, with the attribute of finality and conclusiveness under section 5 B attaching to such determination, and that the subsequent repeal and re enactment of these provisions cannot affect such a right, in view of section 6 of the General Clauses Act, and section 58(3) of Act XXXI of 1950.
Held (i) that section 6 of the General Clauses Act (X of 1897) was not applicable to the case, as section 58(3) of Act XXXI of 1950 was a self contained provision indicative of the intention to exclude the operation of section 6; (ii)that the right to a determination with the attribute of finality, assuming that such a right exist,.
;, is not a vested right and it does not accrue until the determination is in fact made, when alone it becomes an existing right.
Colonial Sugar Refining Co. Ltd. vs Irving ([1905] A.C. 369) and Delhi Cloth & General Mills Co. Ltd. vs Income Tax Com missioner ([1927] I.L.R. ; 54 I.A. 421), distinguished; (iii)that the words "the repeal shall not affect the previous operation of the repealed law" in section 58(3) of Act XXXI of 1950 cannot be construed as meaning "the repeal shall not affect the future operation of the previous law"; and (iv)that the scheme underlying section 58(3) is that every matter to which the new Act applies has to be treated as arising, and to be dealt with, under the now law except in so far as certain consequences have already ensued or acts have been completed prior to the new Act, to which it is the old law that will apply.
In view of section 58, the application of the appellant for con firmation pending on the date when Act XXXI of 1950 came into force, had to be dealt with and disposed of under this Act and the order of confirmation passed in 1952 was subject to the revisions power of the Custodian General under s, 27 of the said Act, 1119 Quaere.
Whether a right of appeal in respect of a pending action can be treated as a substantive right vesting in the litigant on the commencement of the action.
|
ons Nos. 354 to 359, 362, 370 to 385, 387 to 469, 471 to 475, 477 to 479) 482 to 486, 488) 490, 491 , 493 to 497, 502, 503, 510, 511 to 521, 525, 527 to 529, 535 to 563, 570, 572 to 575, 577 to 584, 586 to 588, 592 to 595, 597, 600@ 602, 603, 606 to 610, 613 to 619, 624, 626 to 634, 637 to 645, 653, 654, 656 to 659, 661, 662, 668, 672, 675, 679, 684 to 688 of 1954 and I to 14, 17, 20, 21, 25 to 27, 35 to 37, 45, 47, 49, 52, 55 to 57 and 61 to 66 of 1955.
Petitions under Article 32 of the Constitution for the enforcement of fundamental rights.
Dr. Bakshi Tek Chand, (O. C. Chatterjee and K. L. Mehta, with him) for 'the petitioners in Petitions Nos. 354, 362,382 to 385, 511 to 516, 519, 537, 308 541, 543 to 547, 550, 553, 556, 558 to 562, 570, 573 to 575, 582 to 584, 587, 588, 593 to 595, 597, 602, 603, 607 to 609, 613, 614, 616 to 619, 626, 628, 631 to 633, 637, 640 to 642, 644, 645, 653, 657 to 659, 661, 662) 6795 684 to 688 of 1954 and 2 to 7, 9 to 14, 21, 25 to 27, 35, 37, 45, 47, 49, 52, 55) 57, 63 and 65 of 1955.
H. L. Mordia and K. L. Mehta for the Petitioners in Petitions Nos.
55 and 65 of 1955.
Frank Anthony and K. L. Mehta, for the Petitioners in Petitions Nos.
56 and 64 of 1955.
U. M. Trivedi, (K. L. Mehta, with him), for the Petitioners in Petitions Nos.
615 of 1954 and 20 of 1955.
R. K. Rastogi and K. L. Mehta, for the Petitioner in Petition No. 634 of 1954.
K. L. Mehta, for the Petitioner in Petition No. 36 of 1955.
Dr. Bakshi Tek Chand, (O. C. Chatterjee and Naunit Lal, with him), for the Petitioners in Petitions Nos.
356 to 359, 370, 372, 373, 374, 376 to 378, 380,, 389, 390, 393 to 400, 415, 4175 463, 469, 482, 484, 521, 563, 577, 578, 586, 592, 606, 610, 627 and 656 of 1954.
Achhru Ram, (Naunit Lal, with him) for the Petitioner in Petition No. 391 of 1954.
Naunit Lal, for the Petitioners in Petitions Nos.
355, 371, 375, 379, 416, 455, 468, 483, 485, 488, 491, 493 to 497, 517, 525, 529, 538, 540, 542 and 551 of 1954.
Dr. Bakshi Tek Chand, (Ganpat Rai, with him), for the Petitioners in Petitions Nos. 381, 387, 388, 402 to 410, 412, 413, 418 to 423; 425, 426, 428 to 454, 456 to 459, 464 to 466, 477, 478, 486, 503, 510, 520, 548, 552, 557, 572, 580, 600, 624, 639, 668 of 1954 and 8 and 17 of 1955.
N. C. Chatterjee, (Ganpat Rai and section K. Kapur, 309 with him), for the Petitioners in Petitions Nos. 462, 536, 549, 579, 630, 638 and 654 of 1954.
U. M. Trivedi, (Ganpat Rai, with him), for the Petitioners in Petitions Nos. 629, 643, 672 of 1954 and 66 of 1955.
Achhru Ram, (Ganpat Rai, with him), for the Petitioner in Petition No. 424 of 1954.
Frank Anthony and Ganpat Rai, for the Petitioners in Petitions Nos. 401, 414) 460) 5023 518, 535 and 539 of 1954.
section K. Kapur and Ganpat Rai, for the Petitioners in Petitions Nos. 411 and 675 of 1954.
R. K. Rastogi and Ganpat Rai, for the Petitioners in Petitions Nos.
427 and 461 of 1954.
O. C. Chatterji and Ganpat Rai, for the Petitioner in Petition No. 62 of 1955.
J. B. Dadachanji and Rajinder Narain, for the Petitioners in Petitions Nos. 473, 479, 490, 527, 528, 554 and 581 of 1954 and Nos. 1 and 61 of 1955.
C. L. Aggarwal and Rajinder Narain, for the Petitioners in Petitions Nos: 471, 472, 474 and 475 of 1954.
K. P. Gupta, for the Petitioners in Petitions Nos. 467 and 555 of 1954.
section C. Isaacs, (section D. Sekhri, with him), for the Petitioner in Petition No. 392 of 1954.
K. section Hajela, Advocate General for the State of Rajasthan and G. section Pathak, (Daulat Ram Bhandari, Porus A. Mehta, P. G. Gokhale and Kan Singh, with them), for the Respondent (State of Rajasthan) in all the petitions.
April 15.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
These are applications under Article 32 of the Constitution impugning the validity of the Rajasthan Land Reforms and Resumption of Jagirs Act No. VI of 1952, hereinafter referred 310 to as the Act.
The history of this legislation may be briefly stated.
On 20 8 1949 the Government of India appointed a Committee presided over by Sri C. section Venkatachar to examine and report on the jagirdari and land tenures in Rajputana and Madhya Bharat, the object avowedly being to effect land reforms so as to establish direct relationship between the State and the tillers of the soil and to eliminate all intermediaries between them.
By its report dated 18 12 1949 the Committee recommended inter alia the resumption of jagirs and payment of rehabilitation grants in certain cases.
(Vide report, page 62).
The question of legislation on the subject was taken up by the Government of Rajasthan in 1951, and eventually a Bill called the Rajasthan Land Reforms and Resumption of Jagirs Bill was prepared, and on 31 12 1951 it was approved by the Rajpramukh and reserved for the consideration of the President.
On 21 1 1952 the President with held his assent from the Bill, and in communicating this decision, the Deputy Secretary to the Government of India informed the Rajasthan Government that if certain amendments were made in the Bill as presented and a fresh Bill submitted, the President would be willing to reconsider the matter.
In accordance with these suggestions, a fresh Bill was prepared in the Ministerial Department incorporating certain amendments, and it was approved by the Rajpramukh on 8 2 1952, and reserved for the consideration of the President, who gave his assent to it on 13 2 1952.
By notification issued on 16 2 1952 the Act came into force on 18 2 1952.
Section 21 (1) of the Act provides that: "As soon as may be after the commencement of this Act, the Government may by notification in the Rajasthan Gazette, appoint a date for the resumption of any class of jagir lands and different dates may be appointed for different classes of jagir lands".
Acting under this provision, the State of Rajasthan issued notifications resuming the jagirs specified therein, whereupon petitions under Article 226 of the Constitution were filed by the persons aggrieved challenging the validity of the Act.
These petitions were 311 heard by a Full Bench of the Rajasthan High Court, which held overruling the contentions of the petitioners, that the Act was valid.
(Vide Amarsingh vs State of Rajasthan(1).
The present applications have been filed under article 32 impugning the Act on the following grounds: I.The Rajpramukh had no competence to enact law, and the Act in question is therefore not a valid piece of legislation.
The Bill was not prepared by the Rajpramukh as required by article 212 A(2), and therefore the law was not validly enacted.
Resumption is not one of the topics of legislation enumerated either in the State list or in the Concurrent List in the Seventh Schedule of the Constitution, and the Act is therefore ultra vires the powers of the State.
The Act does not provide for adequate compensation; nor is there any public purpose involved in it, and so it contravenes article 31(2) It is discriminatory, and therefore contravenes article 14.
And the legislation is not saved by article 31 A, because the lands resumed are neither estates nor jagirs nor grants similar to jagirs, inams or muafi This contention is special to some of the petitioners, and has reference to the specific properties held by them.
V. The properties sought to be resumed are not jagirs as defined in the Act, and the notifications under section 21 in so far as they relate to them are illegal.
This again is a special contention urged in some of the petitions.
These contentions will now be considered seriatim.
On the first question as to the competence of the Rajpramukh to enact the law, it is necessary to notice the events which led up to the formation of the State of Rajasthan and the constitution of the Rajpramukh as its head.
During the 12th and 13th Centuries, the Rajput rulers who were then reigning (1) A.I.R. 40 312 over various parts of Hindusthan were compelled by pressure from the victorious Muhammadan invaders to retreat to the regions to the southwest guarded by the Aravali Hills and interspersed with deserts which if less hospitable were also less vulnerable, and there established several independent kingdoms.
The period which followed the foundation of these States was marked by incessant wars, the powerful Sultans of Delhi making determined efforts to subjugate the Rajput princes and the latter offering stubborn and more or less successful resistance thereto.
The annals of Rajputana especially of this period, present a story of heroic deeds of men and women and are among the most inspiring and fascinating chapters in the history of this country.
The Moghul Emperors who established themselves later saw the wisdom of conciliating the Rajput rulers, and recognised their position as Chiefs getting in return an acknowledgment of their suzerainty from them, and a promise to send troops in support of the Imperial arms whenever required.
When the power of the great Moghul waned and the British established themselves as masters of this country, they in their turn recognised the Rajput princes as Sovereigns, and entered into treaties with them during the Period between 1803 to 1818.
(Vide Aitchison 's Treaties, Volume III).
By these treaties, the British Government accepted their status as independent rulers reserving to themselves Defence, External Relations and Communications and such other matters as might be agreed upon.
The relationship thus created was one of "subordinate union" as it was termed by Mr. Lee Warner, the princes being recognised as Sovereigns and they acknowledging the suzerainty of the British.
(Vide Protected Princes of India,, Chapter VI).
On 15 8 1947 India became independent, and the paramountcy of the British Crown over the States ceased.
The question then arose as to the status of the ruling Chiefs.
It was soon realised by them that in the larger interests of the country and in their own, they could not afford to keep out of the Indian Union and must throw in their lot with it.
The 313 problem of fitting them within the framework of the Indian Constitution was beset with considerable difficulties.
The number of States which had been recognised as independent prior to 15 8 1947 was 552 excluding Hyderabad, Junagadh and Kashmir.
While a few of them were sufficiently large to be able to function as separate States, many of them were too small to be administered as distinct units.
While some of them had representative forms of Government others had not, the rulers being the sole authority: executive, legislative and judicial.
The solution which was adopted by the Government of India was that while the bigger States were continued as independent units of the Union, the smaller States were, where they formed islets within a Province, merged within that Province, and where they were contiguous, integrated together so as to form a new State called the Union.
One of the Unions thus newly formed was Rajasthan.
There were at that time 18 independent rulers functioning over different parts of Rajasthan.
Nine of them, rulers of Banswara, Bundi, Dungarpur, Jhalawar, Kishengarh, Kotah, Pratapgarh, Shahpura and Tonk entered into an agreement in March 1948 merging their States in a single unit called the United State of Rajasthan.
The ruler of Mewar joined this Union on 18 4 1948, and the rulers of Jaipur, Jodhpur, Bikaner and Jaisalmere on 30 3 1949.
The rulers of Alwar, Bharatpur, Dholpur and Karauli who bad formed themselves on 18 3 1948 as Matsya Union dissolved that Union and acceded to the Rajasthan Union on 15 5 1949.
With that, the full strength of the State of Rajasthan was made up.
The constitution of the United State of Rajasthan as it finally emerged is to be found in the Covenant entered into by the 14 rulers on 30 3 1949.
As the authority of the Rajpramukh to enact the impugned legislation was founded on this Covenant, it is necessary to refer to the material provisions thereof bearing on the question.
Under Article II, the Covenanting States agreed "to unite and integrate their territories in one State with a common executive legisla 314 ture and judiciary, by the name of the United State of Rajasthan".
Article VI(2) provides that the ruler of each Covenanting State shall "make over the administration of his State to the Rajpramukh, and thereupon all rights, authority and jurisdiction belonging to the ruler which appertain or are incidental to the Government of the Covenanting States shall vest in the United State and shall thereafter be ex ercisable only as provided by this Covenant or by the Constitution to be framed thereunder.
Article VII (3) provides: "Unless other provision is made by the Act of the Legislature of the United State, the right to resume Jagirs or to recognise succession, according to law and custom, to the rights and titles of the jagirdars shall vest exclusively in the Rajpramukh".
Them comes article X(3) which is as follows: "Until a Constitution so framed comes into operation after receiving the assent of the Rajpramukh, the legislative authority of the United State shall vest in the Rajpramukh, who may make and promulgate Ordinances for the peace and good Government of the State or any part thereof, and any Ordinance so made shall have the like force of law as an Act passed by the legislature of the United State".
Article X(3) was subsequently modified by substituting for the words "Until a Constitution so framed comes into operation after receiving the assent of the Rajpramukh", the words "Until the Legislative Assembly of Rajasthan has been duly constituted and summoned to meet for the first session under the provisions of the Constitution of India".
This modifi cation was necessitated by the fact that the idea of convening a Constituent Assembly for framing a Constitution for the State as contemplated in article X (1) was dropped, and the Constitution as enacted for the Union of India was adopted.
This amendment, however, is of a formal character, and does not affect the substance of the matter.
Then, there is article XIX under which the Rajasthan Government was to act "under the general control of and comply with such particular directions, 315 if any, as may from time to time, be given by the Government of India".
These are the material provisions of the Constitution which was in force in the United State of Rajasthan before the Constitution of India came into operation on 26 11 1950.
Article 385 of the Constitution enacts: "Until the House or Houses of the Legislature of a State specified in Part B of the First Schedule has or have been duly constituted and summoned to meet for the first session under the provisions of this Constitution, the body or authority functioning immediately before the commencement of this Constitution as the legislature of the corresponding Indian States shall exercise the powers and perform the duties conferred by the provisions of this Constitution on the House or Houses of the Legislature of the State so specified".
It is the contention of the respondent that the Rajpramukh was by reason of article X(3) of the Covenant "the authority functioning immediately before the commencement of the Constitution as the Legislature" of Rajasthan, and that he could under article 385 exercise the powers which the Legislature of the State could.
It is conceded by the petitioners that at the time of the impugned legislation.
no House of Legislature had been constituted and summoned, and that to that extent the requirements of that Article are satisfied; but their contention is that on a true construction of the articles of the Covenant the Rajpramukh was not an authority functioning as Legislature within the meaning of article 385, and further that article VII(3) of the Covenant imposed a prohibition on his power to enact a law of the kind now under challenge, and that the prohibition had not been abrogated by the Constitution.
The question then is which was the body or authority which was functioning as the Legislature of the United State of Rajasthan under the terms of the Covenant.
Article X(3) expressly provides that the legislative authority of the State shall vest in the Rajpramukh.
The meaning of this provision is clear and unambigu 316 ous; but it is argued for the petitioners that it is con trolled and cut down by the expression "Ordinance" in article X(3) and by the terms of article VII(3) and of article XIX.
It is contended by Mr. N. C. Chatterjee that the legislative authority of the Rajpramukh was only to "make and promulgate Ordinance" that it is a limited power conferred on him to be exercised in case of emergency pending the constitution of popular legislature, and that accordingly he was not a "legislative authority" for the purpose of article 385.
But this is to import into the word "Ordinance" what it connotes under the Government of India Act, 1935 or the Constitution of India.
Sections 42 and 88 of the Government of India Act conferred on the Governor General and the Governor respectively power to promulgate ordinances when the Legislature was not in session.
Similar power is conferred on the President and the Governors by articles 123 and 213 of the Constitution.
That is a legislative power exercisable by the head of the State, when it is not possible for the Legislature to exercise it.
But the United State of Rajasthan had then no Legislature, which had yet to be constituted, and therefore in its context, the word "Ordinance" in article X (3) cannot bear the meaning which it has under the Government of India Act or the Constitution.
It should be remembered that before the formation of the United State, the Covenanting rulers enjoyed sovereign rights of legislation in their respective territories; and under article VI (2) (a), they agreed to surrender those rights and vest them in the United State.
It was therefore plainly intended that the State of Rajasthan should have plenary.
legislative authority such as was formerly exercised by the rulers; and where was it lodged, if not in the Rajpramukh? If we are to construe article X(3) in the manner contended for by the petitioners, then the anomalous result will follow that there was in that State no authority in which the legislative power was vested.
This anomaly would disappear if we are to construe "Ordinance" as meaning law.
That indeed is its etymological meaning.
According to the Concise Ox 317 ford Dictionary, "to ordain" means "to decree, enact"; and "Ordinance" would therefore mean "decree, enactment".
In Halsbury 's Laws of England, Volume XI, page 183, para 327 it is stated that when the Governor of a colony which has no representative assembly enacts legislation with the advice and consent of the State council, it is designated ordinance or law.
That clearly is the sense in which the word is used in article X(3), and that is placed beyond doubt by the words which follow, that the Ordinance is to have "the like force of law as an Act passed by the Legislature of the United State".
It was next urged that under article VII(3) the Rajpramukh was given authority to resume jagirs only in accordance with law and custom, that he had no authority to enact a law for the resumption of jagirs on grounds other than those recognised by law and custom, that section 22 of the Act provided that the resumption was to take effect notwithstanding any jagir law which as defined in section 2(d) includes also custom, that such a law was directly opposed to what was authorised by article VII(3), that the legislative powers conferred under article X (3) must be exercised subject to the restrictions under article VII(3), and that the Act was therefore beyond his competence.
This contention is, in our opinion, untenable.
The words "according to law and custom" cannot be held to qualify the words "right to resume jagirs", because they are wedged in between the words "right to recognise succession" and the words "to the rights and titles of Jagirdars", and must be construed as qualifying only "the right to recognise succession to the rights and titles of Jagirdars".
But this may not, by itself, be of much consequence, as the power to resume provided in this article is what the grantor possesses under law and custom.
The real difficulty in the way of the petitioners is that article VII(3) has reference to the power which rulers of States had as rulers to resume jagirs, and what it provides is that it should thereafter be exercised by the Rajpramukh.
That power is purely an executive one, and has nothing to do with the legislative power of the ruler, which 318 is specially provided for in article X(3).
The fields covered by the two articles are distinct and separate, and there can be no question of article VII(3) operating as a restriction on the legislative power under article X(3).
Indeed, article VII(3) expressly provides that it is subject to any legislation on the subject, whereas article X(3) is not made subject to article VII(3).
Even if the petitioners are right in their contention that article VII(3) imposes a limitation on the powers of the Rajpramukh, that would not, in view of article 385, derogate from the power of the Rajpramukh to enact the present law.
The scope of that article is that the body or authority which was functioning before the commencement of the Consti tution as the Legislature of the State has first to be ascertained, and when once that has been done and the body or authority identified, the Constitution confides to that body or authority all the powers conferred by the provisions of the Constitution on the House or Houses of Legislature of the State.
These powers might be wider than what the body or authority previously possessed or they might be narrower.
But they are the powers which are allowed to it under article 385, and the extent of the previous authority is wholly immaterial.
The contention that the Act is incompetent by reason of article VII(3) of the Covenant must accordingly fail.
It was next argued that the powers of the Rajpramukh under article X(3) were subject to the general control of the Government of India under article XIX, and that he could not therefore be regarded as legislative authority for the purpose of article 385.
We see no force in this contention.
Article 385 provides that the authority which was to exercise legislative powers in the interim period under that Article should be the authority which was functioning as the Legislature of the State before the commencement of the Constitution.
It does not further require that that authority should have possessed absolute and unlimited powers of legislation.
It could not be, and it was not, contended that the effect of article XIX 319 was to vest the legislative authority of the State in the Government of India, and that being so, the Rajpramukh was the legislative authority of the State, whatever the limitations on that authority.
it was finally contended that article 385 has no application to the present case, because under article 168 the Legislature is to consist of both the Governor and one or more Houses, that article 238(7) extends article 168 to Part B States substituting the Rajpramukh in the place of the Governor, that accordingly the Rajpramukh cannot by himself constitute the Legislature, and that when article 385 refers to the body or authority functioning as Legislature, it could only refer to both the Rajpramukh and the House functioning in conjunction.
Support for this contention was sought in the terms of article 212 A(1) of the Constitution (Removal of Difficulties) Order No. 11, which excluded in relation to Part B States only the first proviso to article 200, but not the body of it.
If this contention is sound, then article 385 must be treated as a dead letter as regards such of the Part B States as had no House of Legislature.
But, in our opinion, this contention is untenable, because article 385 refers not to Legislatures under the Constitution but to the body or authority which was functioning as the Legislature of the State before the commencement of the Constitution., and article 238(7) is, under the Constitution (Removal of Difficulties) Order sub ject to article 385.
Nor can any argument be founded on the exclusion of the first proviso to article 200 but not of the body of that article under article 212 A (1), because it lays down the procedure to be followed when a Bill has been passed by a Legislative Assembly or Legislative Council of a State, and is by its very terms inapplicable when there is no House of Legislature.
The contention of Mr. Frank Anthony that the non inclusion of the body of article 200 among the articles excluded from application to Part B States under article 212 A(1) imposes by implication a limi tation on the power of the Rajpramukh to enact laws unless they are passed by Legislative Assemblies is 320 not supported by anything in the article, and must be rejected.
We must accordingly bold that the Rajpramukh had legislative competence to enact the law under challenge.
II.The second contention that has been pressed by the petitioners is that the Rajasthan Land Reforms and Resumption of Jagirs Bill was not prepared by the Rajpramukh as required by article 212 A(2), and that the Act was therefore not validly enacted.
The facts material for the purpose of this contention are that the Bill was first prepared in the Ministerial Department in accordance with the rules framed under article 166(3) for the "convenient transaction of the business of the State".
It was approved by the Council of Ministers on 27 12 1951 and sent to the Rajpramukh with the following note by the Secretary: "The Bill is submitted for gracious approval and signature and for reserving it for the consideration of the President".
Then there is firstly an endorsement "approved" signed by the Rajpramukh and dated 31 12 1951, and then follows another endorsement, "I hereby reserve this Bill for the consideration of the President" similarly signed and dated.
On 21 1 1952 the President endorsed on the Bill, "I withhold my assent from the Bill".
Thereafter, a fresh Bill was prepared and submitted to the Rajpramukh on 6 2 1952 with the following note by the Chief Secretary: "The Bill as finally agreed to is now submitted to His Highness the Rajpramukh for his approval and for reserving the same for the consideration of the President".
The Rajpramukh gave his approval on 8 2 1952, and by a further order he reserved the Bill for the consideration of the President who gave his assent on 13 2 1952.
Now, the question is whether on these facts the requirements of article 212 A(2) have been complied with.
Article 212 A(2) was enacted by the Constitution (Removal of Difficulties) Order No. 11, and is as follows: 321 "The Rajpramukh or other authority exercising the legislative powers in any such State as aforesaid under article 385 shall prepare such Bills as may be deemed necessary, and the Rajpramukh shall declare as respects any Bill so prepared either that he assents to the Bill or that he withholds assent therefrom or that he reserves it for the consideration of the President".
The contention of the petitioners is that as the Bill was prepared by the Ministers and not the Rajpramukh, article 212 A(2) had been contravened, and that, in consequence, the law had not been properly enacted.
It is conceded that under this article the Rajpramukh has not himself to draft the Bill, and that be might delegate that work to others.
But they insist and in our opinion, rightly that questions of policy which are of the essence of the legislation should at least be decided by him, and that even that had not been done in the present case.
They rely strongly on the statements in the affidavit of Sri Joshi, the Jagir Commissioner, that the Bill was drafted in the Ministerial Department in accordance with the rules framed under article 166(3), approved by the Council of Ministers and sent on to the Rajpramukh for his assent.
These allegations, they con tend, preclude any supposition that the Rajpramukh had any part or lot in the settlement of the policies underlying the Act, and the Bill must be held therefore not to have been prepared by him.
Taking it that such are the facts, what follows? Only that at the inception the Bill was not prepared by the Rajpramukh.
But that does not conclude the question whether there bad been compliance with article 212 A(2), unless we hold that it was not open to the Rajpramukh to adopt a Bill prepared by the Ministers as his own, or if it was open, he did not, in fact, do so.
It cannot be disputed that whether a Bill is in the first instance prepared by the Rajpramukh or whether he adopts what had been prepared by the Ministers as his own, the position in law is the same.
That has not been disputed by the petitioners.
Their contention is that such adoption 322 should be clearly and unequivocally established, and that the records do not establish it.
It was argued that when the Bill was sent to the Rajpramukh, he was not called upon to apply his legislative mind to it but to merely assent to it on the executive side; that when the Rajpramukh endorsed his approval he was, as admitted by Sri Joshi, merely assenting to it, that assent implied that the Act assented to was not that of the person assenting, and that therefore there was nothing to indicate that the Rajpramukh had adopted the Bill prepared by the Ministers as his own.
It was argued by Mr. Agarwala that when the word " approve" was used in the Constitution as in articles 146 and 147, it signified that there were two authorities, one of which was authorised to confirm or sanction what the other had authority to do, and that when the latter was not authorised to do the act, there could be no approval of it by the former; and he also relied on the statement of the law in Corpus Juris, Volume I, page 1365 that the word 'approve ' does not mean the same thing as 'adopt '.
The fallacy in this argument lies in isolating the word "approved" from out of its setting and context and interpreting it narrowly.
It will be noticed that under article 212 A (2) the Rajpramukh has to do two distinct acts: Firstly he has to prepare the Bill, and secondly leaving out of consideration the first two alternatives, namely, assenting to, or with holding assent from, the Bill as not material for the present discussion he has to reserve it for the consideration of the President.
When he himself prepares the Bill, he has, in order to comply with article 212 A(2) merely to reserve it for the consideration of the President.
In such a case, no question of approval to the Bill by him can arise, but when the Bill has not been prepared by him, he has firstly, if he thinks fit, to adopt it before he could pass on to the second stage and reserve the Bill for the consideration of the President; and the very purpose of his endorsing his approval on the Bill is to show that he has thought fit to adopt it.
There is no provision in article 212 A(2) for the Rajpramukh approving of a Bill, and in 323 the context, therefore, an endorsement of approval on the Bill must signify its adoption by him.
We are unable to follow the subtle distinction sought to be made by Mr. Frank Anthony between the Legislative mind of the Rajpramukh and his executive mind.
If it is open to the Rajpramukh to adopt a Bill prepared by his Ministers, the only matter that will have to be considered is whether, in fact, he did so.
And when the Bill is produced with an endorsement of approval under his signature, the question must be held to be concluded, and any further discussion about the legislative or executive state of mind of the Rajpramukh must be ruled out as inadmissible.
It must be mentioned in this connection that Mr. Pathak for the respondent took up the position that the function of the Rajpramukh at the stage of preparation of the Bill was purely executive, and that it became legislative only when he had to decide whether he would assent to the Bill or withhold his assent therefrom, or reserve it for the consideration of the President, and that by leaving it to the Ministers to prepare the Bill there had been no violation of article 212 A(2).
We are unable to agree with this contention.
When a Bill has been passed by the Legislative Assembly of a State, article 200 enacts that it shall be presented to the Governor who is to declare whether he assents to it or withholds his assent therefrom, or reserves it for the consideration of the President.
When there is no Legislative Assembly in a State, the matter is governed by article 212 A(2), and there is substituted under that article in the place of the passing of the Bill by the Legislature, the preparation thereof by the Rajpramukh, and then follows the provision that he has to declare whether he assents to or withholds his assent from the Bill or reserves it for the consideration of the President.
The position under article 212 A(2) has thus been assimilated to that under article 200, the preparation of the Bill by the Rajpramukh taking the place of the passing of the Bill by the Legislative Assembly, and the one is as much a legislative function as the other.
One other contention attacking the Act on the 324 ground of procedural defect may now be considered.
It was argued by Mr. Trivedi that under the proviso to article 201, the President bad no power to return a Money Bill for further consideration by a House of Legislature, that his order dated 21 1 1952 returning the Rajasthan Land Reforms and Resumption of Jagirs Bill for further consideration was ultra vires as it was a Money Bill, that the subsequent presentation of the Bill to him on 8 2 1952 was unauthorised, and that the impugned Act had therefore not been duly passed.
This argument is clearly erroneous.
Under article 212 A(1), the proviso to article 201 has no application to those Part B States where there was no House of the Legislature; and we are unable to follow the argument of the learned counsel that even so, the limitation imposed by the proviso is implicit in the body of the article itself.
Moreover, the order of the President dated 21 1 1952 is not one returning the Bill for further consideration by the House but one refusing assent.
It is true that the Deputy Secretary sent a communication to the Rajasthan Government suggesting some amendments.
But this does not alter the character of the order of the President as one withholding assent.
And finally the Bill which was submitted again to the President for consideration on 6 2 1952 was a fresh Bill, the previous Bill having been modified as regards the scales of compensation.
The contention, therefore, that the Act is bad for non compliance with article 212 A(2) or for other procedural defects must be rejected.
We may now consider the third contention of the petitioners that the Act in so far as it provides for resumption of jagir lands is ultra vires the powers of the State Legislature, as it is not one of the topics mentioned either in List II or List III of the Seventh Schedule to the Constitution.
The contention of the respondent is that the Act is in substance a law relating to acquisition, and is covered by Entry No. 36 in the State List.
On the other hand, the petitioners maintain that the subject matter of the legislation is what it avows itself to be, viz., resumption of jagirs, that resumption is in law totally different from 325 acquisition, and that the Act is therefore not covered by Entry No. 36.
We agree with the petitioners that resumption and acquisition connote two different legal concepts.
While resumption implies that the person or authority which resumes the property has pre existing rights over it, acquisition carries no such implication, and in general, while the effect of resumption is to extinguish the interests of the person whose property is resumed, that of acquisition is to vest that interest in the acquirer.
But the question still remains whether the impugned Act is one for acquisition of jagirs or for their resumption; and to determine that, we must see what the pith and substance of the legislation is, the name given to it by the Legislature not being decisive of the matter.
The provisions of the Act relating to resumption may now be noticed.
Chapter V deals with resumption of jagir lands.
Section 21 authorises the State to issue notifications for resumption of jagirs, and section 22(1) enacts: "As from the date of resumption of any jagir lands, notwithstanding anything contained in any existing jagir legislation applicable thereto but save as otherwise provided in this Act, (a) the right, title and interest of the jagirdar and of every other person claiming through him . in his jagir lands including forests, etc . shall stand resumed to the Government free from all encumbrances".
Section 22(1)(g) is as follows: "the right, title and interest of the jagirdar in all buildings on jagir lands used for schools and hospitals not within residential compounds shall stand extinguished, and such buildings shall be deemed to have been transferred to the Government".
Section 23 exempts certain properties from the operation of section 22, and provides that they are to continue to belong to the jagirdars or to be held by them.
Chapter VI deals with compensation.
Section 26(1) enacts: 326 "Subject to the other provisions of this Act, the Government shall be liable to pay every jagirdar whose Jagir lands are resumed under section 21 such compensation as shall be determined in accordance with the principles laid down in the second schedule".
Chapter VII prescribes the procedure for the determination of compensation and for payment of the same.
The second Schedule to the Act contains the principles on which compensation is to be determined.
That was the scope of the Act as it was passed in 1952.
In 1954 certain amendments were introduced by Act No. XIII of 1954, the most important of which was the provision for payment of rehabilitation grant in accordance with the principles enacted in Schedule III to the Act.
Now, the contention of the petitioners is that the basic assumption on which the Act is framed is that jagirdars have no right of property in the lands themselves, but that they possess some ancillary rights in relation thereto, that the State is therefore entitled to resume the lands without compensation, and that it is sufficient to pay for the ancillary rights.
These, it is argued, were the views expressed by the Venkatachar Committee in its Report on Land Tenures in Rajasthan, and they formed the basis of the impugned Act.
Thus, it is pointed out that the Committee had held that "jagirs are not the property of the jagirdars" (vide page 47, para 5), that ' 'if the jagir system is abolished, jagirdars would not be entitled to any compensation on the ground of the jagirs being private property", and that "even though jagirs are not pro perty. . . those rights which have in many cases been enjoyed for centuries have acquired around them an accretion of rights by long custom and prescription which are entitled to due recognition", and that a rehabilitation grant might be given to the jagirdars.
(Page 47, para 6).
It is contended that it is these views that have been adopted in section 22 of the Act, and that when section 22 (1) (a) declares that the right, title and interest of the jagirdars shall stand resumed, it could not mean that these rights are acquired by the State, because acquisition implies that the 327 properties acquired belong to the person from whom they are acquired, whereas the basis of the legislation was that the jagirdars bad no property in the lands, and there could be no acquisition of what did not belong to them.
Reference is made by way of contrast to the language of section 22(1) (g) under which certain buildings standing on jagir lands presumably constructed by jagirdars should stand transferred to the Government and not resumed as under section 22 (1) (a).
This argument proceeds on an inadequate appreciation of the true nature and scope of the right of resumption under the general law and of the power of resumption which is conferred on the State by the impugned Act.
Under the law, a jagir could be resumed only under certain circumstances.
It can be resumed for breach of the terms of the grant, such as failure to render services or perform the obligations imposed by the grant.
It can be resumed for rebellion or disloyalty or for the commission of serious crimes.
And again, jagir was originally only a life grant and when the holder died.
, it reverted back to the State and succession to the estate was under a fresh grant from the State and not by inheritance, even when the successor was the heir of the deceased holder.
The right to resume jagirs within the limits aforesaid was founded on grant and regulated by general law.
To exercise that right, there was no need to enact any legislation.
It was a right which every ruler of the Covenanting State had as a grantor, and that right had become vested in the Rajpramukh under article VII(3) of the Covenant.
The contention of the petitioners that resumption was not an acquisition would strictly be accurate, if the resumption was in exercise of the power conferred by that article.
But the resumption for which the Act provides is something different from the resumption which is authorised by article VII(3).
It was a resumption not in accordance with the terms of the grant or the law applicable to jagirs but contrary to it, or in the words of section 21 "notwithstanding anything contained in 42 328 any existing jagir law applicable thereto".
It was a resumption made not in enforcement of the rights which the rulers had as grantors but in exercise of the sovereign rights of eminent domain possessed by the State.
The taking of properties is under the circumstances, in substance, acquisition notwithstanding that it is labelled as resumption.
And this conclusion becomes irresistible when regard is had to the provisions for payment of compensation.
Section 26(1) imposes on the Government a liability to pay compensation in accordance with the principles laid down in the second Schedule, and as will be presently shown, it is not illusory.
The award of compensation is consistent only with the taking being an acquisition and not with its being a resumption in accordance with the terms of the grant or the law applicable to it, for in such cases, there is no question of any liability to pay compensation.
It was argued for the petitioners that the provision for the payment of rehabilitation grant was an indication that what was paid as compensation was in reality ex gratia.
But the rehabilitation grant was in addition to the compensation amount, and it was provided by the amendment Act No. XIII of 1954.
Nor are we impressed by the contention that the Act had adopted the findings of the Venkatachar Committee that the jagirs were not the properties of the jagirdars, and that no compensation need be paid for them.
Under section 22(1)(a), what is resumed is expressly the right, title and interest of the jagirdar in his jagir lands, and provision is made for payment of compensation therefor.
Moreover, the opinions in the report of the Venkatachar Committee on the rights of the jagirdars are clearly inadmissible for the purpose of deciding what the pith and substance of the impugned legislation is.
That must be decided on an interpretation of the provisions of the statute, and that decision cannot be controlled or guided by the opinions expressed in the report.
Reading the provisions of the Act as, a whole, it is abundantly plain that what was meant by resumption was only acquisition.
Indeed, if the Act purported to be one for 329 acquisition of jagirs, its provisions could not have been different from what they are.
Such being the true character of the legislation, not much significance could be attached to the use of the word "resumption" in the Act.
It should be remembered that the State has a reversion in jagir lands, and when it takes them back in accordance with the terms of the grant or the law applicable thereto, its action is properly termed resumption.
When the statute enacted a law authorising the taking of jagir lands, it is natural that it should have adopted the same term, though the resumption was not made on any of the grounds previously recognised as valid.
In view of the peculiar relationship between the jagirdar and the State, it cannot be said that the word "resumption" is inadmissible to signify acquisition.
Section 22(1)(a) further enacts that the lands shall stand resumed "to the Government", which words are more appropriate for acquisition by the Government than resumption simpliciter.
It was also contended for the respondent that the Act is one relating to land and land tenures, and that it would fall under Entry No. 18 in the State List: "Land, that is to say, rights in or over land, land tenures including the relation of landlord and tenant, and the collection of rents; transfer and alienation of agricultural land; land improvement and agricultural loans; colonization".
It was argued that the heads of legislation mentioned in the Entries should receive a liberal construction, and the decision in The United Provinces vs Atiqa Begum(1) was quoted in support of it.
The position is well settled and in accordance therewith, it could rightly be held that the legislation falls also under Entry No. 18.
But there being an Entry No. 36 specifically dealing with acquisition, and in view of our conclusion as to the nature of the legislation, we hold that it falls under that Entry.
IV.Now we come to the contentions special to some of the petitioners that with reference to the (1) , 134, 330 properties held by them the impugned Act is not saved by article 31 A, and that it is void as being in contravention of articles 14 and 31(2) of the Constitution.
On this contention, two questions arise for determination: (A) Is the impugned Act in so far as it relates to the properties of the petitioners within the protection afforded by article 31 A? (B) And is the Act bad as infringing articles 14 and 31(2) of the Constitution? IV(A).
On the first question, the contention of the petitioners is that the properties held by them are neither `estates 'nor 'Jagirs ' nor 'other similar grants, ' within article 31 A, and that therefore the impugned Act falls, quoad hoc, outside the ambit of that article.
At the threshold of the discussion lies the question as to the precise connotation of the words "jagir or other similar grant" in article 31 A, and to determine it, it is necessary to trace in broad outline the origin and evolution of the jagir tenure in Rajasthan.
It has been already mentioned that during the period of the Muhammadan invasion the Rajput princes of Hindusthan migrated to Rajputana and founded new kingdoms.
The system of land tenure adopted by them was that they divided the conquered territories into two parts, reserved one for themselves and distributed the other in blocks or estates among their followers.
In general, the grantees were the leaders of the clan which had followed the King and assisted him in the establishment of the kingdom or his Ministers.
Sometimes, the grant was made as a reward for past services.
The lands reserved for the King were called Khalsa, and the revenue therefrom was collected by him directly through his officials.
The lands distributed among his followers were called jagirs and they were generally granted on condition that the grantee should render military service to the rulers such as maintaining militia of the specified strength or guarding the passes or the marches and the like.
The extent of the grant would depend on the extent of the obligations imposed on the grantee, and it would be such as would enable the grantee to maintain himself and the troops from out of the 331 revenues from the jagir.
It was stated by Mr. Pathak that the grants would in general specify the amount of revenue that was expected to be received from the jagir, and that if the jagirdar received more, he was under an obligation to account to the State for the excess.
And he quoted the following passage in BadenPowell on Land Systems of British India, Volume 1, page 257 as supporting him: "While a strict control lasted, the jagirdar was bound to take no more than the sum assigned; and if more came into his hands, he had rigidly to account for the surplus to the State treasury".
This statement has value only as throwing light on the jural relationship between the State and the jagirdar, for it does not appear that it was ever observed in practice.
It may be deduced from the foregoing that all the lands of the State must fall within one or the other of the two categories, Khalsa or jagir, and that the essential features of a jagir are that it is held under a grant from the ruler, and that the grant is of the land revenue.
Some of the incidents of the jagir tenure have been already touched upon.
It was a life grant and succession to it depended on recognition by the ruler.
It was impartible, and inalienable.
But in course of time, however, grants came to be made with incidents annexed to them different from those of the jagirs, Some of them were heritable, though impartible; a few of them were both heritable and partible.
While originally the jagirs were granted to the Rajput clansmen for military service the later grants were made even to non Rajputs and for religious and charitable purposes.
These grants were also known as jagirs.
"The term 'jagir ' is used", it is observed in the Report of the Venia tachar Committee, page 18, para 2, "both in a generic and specific sense.
In its generic sense it connotes all non khalsa area".
The stand taken by the petitioners in their argument was also that the word 'jagir ' bad both a wider and a narrower connotation.
Thus, after quoting from the Rajputana Gazetteer the passage that "the rest of 332 the territory is held on one of the following tenures, viz, Jagir, Jivka, Sansan, Doli, Bhum, Inam, Pasaita and Nankar" (Vide Erskine 's Rajputana Gazetteers, Volume III A, Chapter XIII Land Revenue and Tenures), Sri Amar Singh who presented the case of his father Zorawar Singh, a leading Bhoomichara of Mallani, with conspicuous ability, argued that jagir was used in the passage in its specific sense, and that in its generic sense, it would comprise all the other tenures mentioned above.
In the impugned Act also, jagir land is defined in section 2(h) as meaning "any land in which or in relation to which a jagirdar has rights in respect of land revenue or any other kind of revenue and includes any land held on any of the tenures specified in the First Schedule", and in the Schedule ' jagir is mentioned as the first of the items.
It also appears that in the laws enacted in the States of Rajputana to which our attention has been drawn, the word `jagir 'is generally used in its extended meaning.
Thus, both in its popular sense and legislative practice, the word 'jagir ' is used as connoting State grants which conferred on the grantees rights "in respect of land revenue".
(See section 2(h) of the Act.) It was argued that though the extended definition of jagirs in section 2(h) of the impugned Act might govern questions arising under that Act, the word 'jagir ' in article 31 A must be construed as limited to its original and primary meaning of a grant made for military service rendered or to be rendered, and that accordingly other grants such as maintenance grants made in favour of near relations and dependents would not be covered by it.
We do not find any sufficient ground for putting a restricted meaning on the word 'jagir ' in article 31 A.
At the time of the enactment of that article, the word had acquired both in popular usage and legislative practice a wide connotation, and it will be in accord with sound canons of interpretation to ascribe that connotation to that word rather than an archaic meaning to be gathered from a study of ancient tenures.
Moreover, the object of article 31 A was to save legislation which was directed to the abolition of intermediaries so as to 333 establish direct relationship between the State and the tillers of the soil, and construing the word in that sense which would achieve that object in a full measure, we must hold that jagir was meant to cover all grant under which the grantees bad only rights in respect of revenue and were not the tillers of the soil.
Maintenance grants in favour of persons who were not cultivators such as members of the ruling family would be jagirs for purposes of article 31 A. We may now proceed to consider the contentions of the several petitioners with reference to the specific properties held by them, and they may be grouped under two categories: (1) those relating to the tenures on which the properties are held, and (2) those relating to particular properties.
Under category (1) fall the estates held by (a) Bhomicharas of Marwar, (b) Bhomats of Mewar, (c) Tikanadars of Shekhwati, and (d) Subeguzars of Jaipur.
(1)(a) Bhomicharas: This is the subject matter of Petitions Nos.
462, 579, 630, 638 and 654,of 1954.
The Bhomichara tenure is to be found in Jaisalmere, in Shekhawati in Jaipur and in Marwar.
(Vide Report of the Venkatachar Committee, page 19, para 13).
But we are concerned here only with the Bhomichara tenure in the State of Marwar.
Its history goes back to the year 1212 A.D. when the clan of Rathors led by Rao Siaji, grandson of King Jayachander of Kanouj invaded Rajputana, subjugated the territories now known as Mallani, Yeshwantpura and Sanchora and established itself there.
Some two centuries later, a section of the Rathors beaded by Biram Deo who was the younger brother of Mallinath, the ruling prince of Mallani, expanded eastwards, and established the kingdom of Jodhpur.
The elder branch which continued in Mallani, Yeshwantpura and Sanchora gradually sank in power.
The descendants of Mallinath went on partitioning the lands treating them as their personal properties and the principality thus came to be broken up into fragments, and its holders became weak and disunited.
Their internecine disputes led to the intervention of Jodhpur which had grown to 334 be a powerful kingdom, and they were compelled to accept its ruler as their suzerain and to pay him an annual tribute of Rs. 10,000 called "Foujbal".
Thereafter, they continued to hold lands subject to the payment of this tribute, and came to be known as Bhomicharas.
The area continued to be distracted by disputes and dissensions among its leaders, and fell into so much anarchy and confusion that in 1835 the British had to intervene to restore order.
It should be remembered that they had entered into a treaty of alliance with Jodhpur in 1818, and their intervention was presumably by virtue of their obligations under the treaty.
Thereafter, the territory was put under the charge of a British superintendent and latterly of the Resident at Jodhpur.
The annual tribute was, during this period, collected by the British and paid to the Jodhpur State.
Writing on the status of the Bhomicharas during this period, Major Malcolm remarked in his report dated 1849 thus: ". though the British Government had established a claim to the District themselves, consequent on having reduced them to order and obedience, it was willing, out of kindness and consideration to His Highness, to waive its just rights and to acknowledge His Highness as entitled to sovereignty over those districts, and the tribute they might yield.
In 1891 the British withdrew from the administration of the Province, and handed it over to the Maharajah of Jodhpur who thereafter continued to govern it as part of his Dominions.
On these facts, it is contended by Mr. N. C. Chatterjee and Shri Amar Singh that Bhomicharas are not holders of jagirs or other similar grants within the meaning of article 31 A, because a jagir could be created only by grant by the ruler, and that the petitioners could not be said to hold under a grant from Jodhpur, because they had obtained the territory by right of conquest long before Jodhpur established its suzerainty, and even prior to its foundation as a State, and that though they lost their political independence when Jodhpur established its overlord 335 ship, they had not lost their right to property, that their status was that of semi independent chiefs, not jagirdars, and that "Foujbal" was paid by them not on account of land revenue but by way of tribute.
We agree with the petitioners that a jagir can be created only by a grant, and that if it is established that Bhomichara tenure is not held under a grant, it cannot be classed as a jagir.
We do not base this conclusion on the ground put forward by Mr. Achhru Ram that the word 'jagir ' in article 31 A should be read ejusdem generis with 'other similar grants ' because the true scope of the rule of ejusdem generis is that words of a general nature following specific and particular words should be construed as limited to things which are of the same nature as those specified and not its reverse, that specific words which precede are controlled by the general words which follow.
But we are of opinion that it is inherent in the very conception of jagir that it should have been granted by the ruling power, and that where there is no grant, there could be no jagir.
This, however, does not mean that the grant must be express.
It may be implied, and the question for decision is whether on the facts of this case a grant could be impiled.
What then are the facts? We start with this that the ancestors of the petitioners acquired the lands in question by conquest and held them as sovereigns.
Then Jodhpur came on the scene, imposed its sovereignty over them,and exacted annual payments from them, what was their status thereafter? In Vajesingji Joravar Singji and others vs Secretary of State(1) Lord Dunedin observed: "When a territory is acquired by a sovereign State for the first time that is an act of State.
It matters not how the acquisition has been brought about.
It may be by conquest, it may be by cession following on treaty, it may be by occupation of territory hitherto unoccupied by a recognised ruler.
In all cases the, result is the same.
Any inhabitant of (1) [1924] L.R. 51 I.A. 357, 360.
43 336 the territory can make good in the municipal Courts established by the new sovereign only such rights, as that sovereign has, through his officers recognised.
Such rights as he had under the rule of predecessors avail him nothing".
Vide also the judgment of the Privy Council in Secretary of State vs Sardar Rustam Khan(1).
Applying these principles when Jodhpur as a sovereign State imposed its sovereignty over the territory, and permitted the ex rulers to continue in possession of their lands on payment of an annual sum, the position is that there was, in effect, a conquest of the territory and a re grant of the same to the ex rulers, whose title to the lands should thereafter be held to rest on the recognition of it by the ruler of Jodhpur.
It may be noted that both in Vajesingji Joravar Singji and others vs Secretary of State(1) and Secretary of State vs Sardar Rustam Khan(1) the question was whether a subject of the former State could enforce against the new sovereign the right which he had against the former ruler, and it was held that he could not.
But here, the claimants are the representatives of the former rulers themselves, and as against them, the above conclusion must follow a fortiori.
As already stated, it is as if the Maharajah of Jodhpur annexed all the territories and re granted them to the former rulers.
They must accordingly be held to derive their title under an implied grant.
It is argued that notwithstanding that the Bhomicharas had acknowledged the sovereignty of the ruler of Jodhpur, his hold over the country was slight and ineffective, and even the payment of "Foujbal" was irregular, and that in substance therefore they enjoyed semi sovereign status, and that their relationship to the Jodhpur ruler resembled that of the rulers of Native States to the British Crown.
We are unable to accept this argument.
The status of a person must be either that of a sovereign or a subject.
There is no tertium quid.
The law does not recognise an intermediate status of a person being partly a sovereign (1) [1941] L.R. 68 I.A. 109.
(2) [1924] L.R. 51 I.A. 357,360.
337 and partly a subject, and when once it is admitted that the Bhomicharas had acknowledged the sovereignty of Jodhpur their status can only be that of a subject: A subject might occupy an exalted position and enjoy special privileges, but he is nonetheless a subject; and even if the status of Bhomicharas might be considered superior to that of ordinary jagirdars, they were also subjects.
The contention that the relationship between Bhomicharas and Jodhpur was of the same kind as that which subsisted between the rulers of Native States and the British Crown is untenable.
Whether those States could be recognised as sovereign on the well accepted principles of international law was itself a question on which juristic opinion was adverse to such recognition.
(See Mr. Lee Warner, Protected Princes of India, 1894 Edn., Chapter XIII, sec.
150, pages 373 376).
But those States at least had each a distinct persona with a ruler who possessed executive, legislative and judicial power of a sovereign character; but the Bhomicharas had ceased to have a distinct person.
There was no State with a ruler acknowledged as its head, but a number of persons holding lands independently of each other.
This is what Major Malcolm remarked of them in his report in 1849: "It is uncertain how long the Rawats of Kher continued to exercise any control over the rest of the Chiefs, or to be considered as the head of a principality; but at the period when we first become acquainted with them, all traces of such power had long ceased and each Chief of the principal families into which the tribe is divided, claimed to be independent".
When the British handed over the administration of the territory to the State of Jodhpur in 1891, it was in recognition of its rights as sovereign, and on the footing that Bhomicharas were its subjects.
It is true that in the agreement by which the British handed over the administration they inserted a condition that the appointment of the chief officers for Mallani and imposition of any new tax or cess other than Foujbal by the State of Jodhpur should be made 338 with the approval of the Resident or Agent to the Governor General of Rajputana, but that was a matter between the high contracting parties, and did not affect the status of the Bhomicharas.
On the other hand, it emphasises that they were themselves without any semblance of independence.
That the status of the Bhomicharas was that of subjects will also be clear from the subsequent course of legislation in Marwar.
In 1922 an Excise Act was passed for the whole of Marwar including this area.
On 24 11 1922 "The Marwar Court of Wards Act, 1923" was passed, and that applied to the estates of Bhomicharas.
In 1937 rules were framed for the maintenance of the wives of jagirdars, and Bhomicharas also were subject to that Act.
In 1938 the Marwar Customs Act was passed, and that applied to these territories.
In 1947 rules for assessment of rents on jagir estates were passed and they applied to lands held on Bhomichara tenure.
There was again a Customs Act in 1948, and it applied to the whole of Marwar including this area.
In 1949 a Tenancy Act was passed, and that applied to the Bhomicharas.
It is thus plain that the State of Marwar was exercising full legislative control over the Bhomichara area.
This alone is sufficient to differentiate the position of the petitioners from that of the rulers of the Native States.
The British Government never exercised legislative authority over those States.
In the argument before us, Sri Amar Singh conceded the authority of the State of Marwar to legislate for Mallani.
But he contended that the definition of jagirdars as including Bhomicharas in the several Acts .referred to above was only for the purpose of those Acts, and bad no bearing on their true status, and referred to the provisions of the Marwar Encumbered Estates Act, 1922, where the word 'jagir ' is defined as excluding Bhomicharas.
But the question is not whether the petitioners are jagirdars by force of the definition in those Acts, but whether their status is that of subjects of Jodhpur, and the only inference that could be drawn from the course of legislation above noticed is that their status Was that of 339 subjects, and if that is their position, and if they are allowed to continue in possession of lands held by their ancestors as sovereigns, it could only be on the basis of an implied grant, and that is sufficient to attract the operation of article 31 A to their estates.
It was also contended for the respondent that even if on the facts aforesaid a grant from the State could not be implied and the status of the petitioners was different from that of jagirdars, that status had at least been modified by section 169 of the Marwar Land Revenue Act No. XL of 1949, which had the effect of putting them in the same position as State grantees, and that therefore their tenure fell within the operation of article 31 A either as a jagir or other similar grant.
Section 169 runs as follows: "The ownership of all land vests in His Highness and all Jagirs, Bhoms, Sasans, Dolis or similar proprietary interests are held and shall be deemed to be held as grants from His Highness".
Under this section, all lands in the State vest in the Maharajah and all proprietary interests therein are deemed to be held under a grant from him.
It cannot be disputed that it is within the competence of the Legislature in the exercise of its sovereign powers to alter and abridge rights of its subjects in such manner as it may decide, subject of course to any constitutional prohibition.
In Thakur Jagannath Baksh Singh vs United Provinces(1) which was cited by Mr. Pathak as authority in support of the above propo sition, it was held by the Privy Council that a law of the State curtailing the rights which a talukdar held under a sanad from the Crown was intra vires.
This decision was followed by this Court in Raja Suriya Pal Singh vs The State of U. P. and Another(1).
But these cases are not exactly in point, because the present contention of the respondent arises only on the hypothesis that the petitioners did not hold under a Crown grant express or implied.
But the proposition for which Mr. Pathak contends is itself not open to exception, and it must be held that it was competent (1) (2) , 340 for the legislative authority of Marwar to define and limit the rights which the petitioners possessed in Bhomichara lands.
It was also contended by Mr. Pathak that if the effect of the legislation was to impress on the tenure the character of a grant, that would be sufficient to attract article 31 A, the argument being that a grant like a contract could be not merely express or implied but also constructive.
He quoted the following statement of the law in Halsbury 's Laws of England, Volume VII, page 261, para 361: "Contracts may be either express or implied, and of the latter there are two broad divisions, the term 'implied contract ' in English law being applied not only to contracts which are inferred from the conduct or presumed intention of the parties, of which examples have already been given, but also to obligations imposed by implication of law, quite apart from and without regard to the probable intention of the parties, and sometimes even in opposition to their ex pressed or presumed intention.
Strictly speaking, the latter class, or constructive contracts, as they are sometimes called, are not true contracts at all, since the element of consent is absent, but by a fiction of law, invented for the purposes of pleading, they are regarded as contracts, and will be treated here as such".
It must be observed that the Indian law does not recognise constructive contracts, and what are classed under that category in the statement of the law in Halsbury 's Laws of England would be known as quasicontracts under the Indian Contract Act.
It will be more appropriate to term grants which are the creatures of statutes as legislative grants.
We, however, agree with the respondent that for the purpose of article 3 1 A, it would make no difference Whether the grant is made by the sovereign in the exercise of his prerogative right or by the Legislature in the exercise of its sovereign rights.
They were both of them equally within the operation of that article.
The question then is, assuming that the Bhomicharas did not prior to the enactment of Marwar Act No. XL of 341 1949 hold the lands as grantees from the State, whether they must be deemed to hold as State grantees by force of section 169 of that Act; and that will depend on whether they fall within the purview of that section.
The language of the section, it will be admitted, is general and unqualified in its terms, and would in its natural sense include them.
But it is argued for the petitioners that they are outside its scope, because 'jagir ' in that article must be interpreted in a specific sense as otherwise there was no need to mention tenures like Bhom, Sasan and Dolis, which would be jagirs in a generic sense, and that further Bhomicharas could not be brought within the category of similar proprietary interests, because in the context 'similar interests ' must mean interests held under a grant.
Having considered the matter carefully, we are not satisfied that there is any ground for cutting down the scope of the section in the manner contended for by the petitioners.
We are of opinion that by long usage and recognition and by the legislative practice of the State Bhomicharas had come to be regarded as jagirdars, and that their tenure is a jagir within the intendment of section 169.
In the Gazetteer of Mallani by Major Walter published prior to 1891 the Bhomi charas are referred to as jagirdars.
(Vide page 94).
In the official publication called Brief Account of Mallani, the title given to the history of Bhomicharas is "Brief history of the jagirdars".
In Sir Drake Brockman 's Report of the Settlement Operations, 1921 to 1924, he refers to the Bhomichara jagir as "survival from a time antecedent to the establishment of the Raj".
Turning next to legislation in Marwar, its general trend was to include Bhomicharas in the definition of jagirdars.
Vide section 3(1) of the Marwar Court of Wards Act, 1923; rule 4 of rules regulating claims for maintenance by ladies against jagirdars, 1937.
In the Customs Act, 1938, section 64 and Appendix E refer to the Bhomicharas as jagirdars of Mallani.
In Marwar Tenancy Act No. XXXIX of 1949, section 3(9) defines landlord as including a "Bhomichara jagirdai,", and in view of the fact that 342 both this Act and Act No. XL of 1949 were part of a comprehensive scheme of legislation, that both of them came into force on 6 4 1949 and that section 4 (I 1) of Act No. XL of 1949 enacts that the words and expressions used therein are to have the same meaning as in Act No. XXXIX of 1949, it would be safe to assume that the word 'jagir ' was used in section 169 as including Bhomichara tenures.
It was argued that section 171 classifies jagirs as listed jagirs and scheduled jagirs, that there is an enumeration thereof in schedules I and 11 of the Act, and that no estate held on Bhomichara tenure was mentioned therein, and that that was an indication that it was not intended to be included in section 169.
But section 171 does not exhaust all the jagirs or similar proprietary interests falling within section 169.
The scheme of the Act is that for purposes of succession and partition, jagirs are divided into three groups, scheduled jagirs, listed jagirs and other jagirs.
Scheduled jagirs are those which are governed by the rule of primogeniture.
Section 188 and the following sections lay down the procedure for settling succession to them.
Listed jagirs are those which are held by co heirs but are impartible, and section 131 provides that they should not be partitioned but that the income therefrom should be divided among the co sharers.
Then there is the third category of jagirs which devolve on heirs under the ordinary Hindu law, and are partible.
Section 172 applies to these jagirs.
As the Bhomichara tenure descends like personal property and is divisible among the heirs, it will be governed by section 172, and cannot find a place in the schedule of listed or scheduled jagirs.
It was contended that the Act was one to declare and consolidate the law, and that such an Act should not be construed as altering the existing law; further that clear and unambiguous language was necessary before a subject could be deprived of his vested rights, and that in case of doubt the statute should be construed so as not to interfere with the existing rights; and the statements of law from Maxwell on Interpretation of Statutes, 10th Edition, pages 20 and 24 343 and Craies on Statute Law, 5th Edition, pages 106, 107 and Ill were quoted in support of the above propositions.
These rules of construction are well settled, but recourse to them would be necessary only when a statute is capable of two interpretations.
But where, as here, the language is clear and the meaning plain, effect must be given to it.
It must also be added that the Act is one not merely to consolidate the law on the subject but also to amend it.
On the language of the section, therefore, we must hold that Bhomichara tenure is comprehended within the term 'jagir ' in section 169.
We are also of opinion that it will, in any event, be "similar proprietary interests" within the language of the section.
It is argued that the only feature common to jagirs, Bhoms, Sasan and Dolis is that they are held under grant, and that therefore "similar proprietary interests" must mean interests acquired under a grant.
It is true that Bhom, Sasan and Doli are held under grant from the State.
(Vide Rajasthan Gazetteer, Volume III A, Chapter XIII); but section 169 enacts that the proprietary interests to which it applies, shall be held or deemed to be held as grant from His Highness.
The word "deemed" imports that in fact there was no grant, and therefore interests which were held otherwise than under a grant were obviously intended to be included.
Therefore, if Bhomichara is a proprietary interest, it cannot be taken out of the section because its origin was not in grant.
In the result, it must be held to fall within section 169, and therefore within the operation of article 31 A.
The respondent further contended that Bhomichara tenure was also an estate as defined in section 4(iii) of Act No. XL of 1949 and that therefore it fell within the purview of article 31 A. Under section 4(iii), "estate" means a mahal or mahals held by the same landlord.
Section 4(v) defines mahal as any area not being a survey number which has been separately assessed to land revenue; and 'land revenue ' is defined in section 4(iv) as "any sum payable to the Govern 44 344 ment on account of an estate or survey number and includes rekh, chakri and bhombab".
It is common ground that the annual payment which is made by the Bhomicharas to the estate is the sum of Rs. 10,000 called "Foujpal".
The petitioners contend that this amount is really in the nature of tribute and not land tax.
If it is a military cess, it is difficult to say that it is revenue paid on account of land.
It is argued for the respondent that Bhomicharas are allowed to continue in possession of the land only on condition that they pay this amount annually and that it is therefore payment made in respect of lands held by them.
If this contention is right, every tribute must per se be held to be land revenue, and that appears to us to be too wide a proposition.
Mr. Pathak relied on the description of this amount in the Administration Report of 1883 1884 in Hindi as "Kar" "Tax ' but that is not decisive of the true character of the payment.
The petitioners also contend that even if Foujbal is revenue, there has been no separate assessment of the mahals to it, as what is paid is a consolidated sum of Rs. 10,000 for an area of the extent of 36,000 sq.
miles comprised in 550 villages and held by different holders.
It appears from the Gazetteer of Mallani by Major Walter at page 94 that the Foujbal amount has been apportioned among the several holders, and it is contended for the respondent that as this apportionment has been communicated to the Jodhpur Durbar and accepted by it and acted upon, there has been separate assessment of revenue.
In the view taken by us that Bhomichara is a jagir or other similar grant within the meaning of article 31 A, we do not think it necessary to express any opinion on the above contentions, especially as the materials placed before us are meagre.
In the result, it must be held that the legislation in so far as it relates to Bhomichara tenure is protected by article 31 A. (1)(b) Bhomats: This tenure is to be found in Mewar, and of this, the Report of the Venkatachar Committee has the following: "In Mewar those holding on the Bhom tenure 345 may be classed under two groups, namely, the Bhomats who pay a small tribute to the State and are liable to be called for local service and Bhumias who pay a normal quit rent (Bhum Barar) and perform such services as watch and ward of their villages, guarding the roads, etc." (vide page 19, para 10).
Earlier, the Report had stated that Bbom tenure was to be found in Jodhpur, Mewar and Bundi, and that its holders were always Rajputs.
The origin of Bhom tenure is thus stated by Tod in his Annals and Antiquities of Rajasthan: "It is stated in the historical annals of this country that the ancient clans had ceased on the rising greatness of the subsequent new divisions of clans, to hold the higher grades of rank; and had, in fact, merged into the general military landed proprietors of this country under the term bhumia, a most expressive and comprehensive name, importing absolute identity with the soil: bhum meaning 'land These Bhumias, the scions of the earliest princes, are to be met with in various parts of Mewar These, the allodial tenantry of our feudal system, form a considerable body in many districts, armed with matchlock, sword, and shield All this feudal militia pay a quit rent to the crown, and perform local but limited service on the frontier garrison; and upon invasion, when the Kher is called out, the whole are at the disposal of the prince on furnishing rations only.
They assert that they ought not to pay this quit rent and perform service also; but this may be doubted, since the sum is so small".
I, pp. 195 197).
It would appear from this account that the position of the Bhumias in Mewar is in many respects similar to that of Bhomicharas in Marwar.
They represent presumably a section which had occupied the territory by conquest at an earlier stage and when later the rulers of Chittoor and Udaipur established their sovereignty over Mewar, they were allowed to continue in possession of their lands as subjects of the new State.
Their position is not even as strong as that of the Bhomicharas of Marwar, because it was a condition of the tenure under which they held that 346 they had to render military service when called upon and also to pay quit rent.
Their title to the lands is thus referable to an implied grant from the State, and their tenure would be jagir even in its stricter connotation.
It was further contended by Mr. Pathak that whatever status the Bhomats might have had prior to the Mewar Government Kanoon Mal Act No. V of 1947, the effect of that enactment was to modify it and to reduce them to the position of grantees from the State in respect of those tenures, and that article 31 A would accordingly apply.
The relevant provisions of this Act are sections 27, 106 and 116.
Section 27 enacts that all lands belong to His Highness, and that no person has authority to take possession of any land unless the right is granted by His Highness.
Section 106 (1) occurs in Chapter XI which is headed: "The rights of jagirdars, Muafidar, and Bhumias in Tikana jagir, muafi and Bhom lands", and enacts that a "Tikanadar jagirdar, muafidar or Bhumia shall have all such revenue rights in the lands comprised in his jagir, muafi or Bhom under this Act, as are granted to him by His Highness".
Then follow provisions relating to succession and transfer of their tenures by jagirdars, muafidars or Bhumias.
Section 116 provides that the jagir or bhom is liable to be forfeited in the events specified therein.
The argument of the respondent is that under these provisions the ownership of the lands vests in the Maharajah and the tenures mentioned therein including the Bhom are held as grants under him.
It was argued by Mr. Frank Anthony that under section 4(2) of the Act the lands are divided into two categories, one category comprising jagirs, muafi and Bhom and the other Khalsa lands, that section 27 applies only to Khalsa lands, and that section 106(1) applies to grants which may thereafter be made by the State, and that the rights of the persons who held jagirs, muafi or Bhom before this Act were unaffected by it.
We are unable to accede to this contention.
No statute was needed to declare the rights of the sovereign over Khalsa lands, Nor was resort to legis 347 lation necessary to define the rights of the future grantees of those lands, because that could be done by inserting appropriate terms in the grants.
The language of the enactment read as a whole leaves no doubt in our mind as to what the legislature intended to do.
It declared the State ownership of lands, both Khalsa and non Khalsa lands and defined the rights of the holders of the non Khalsa lands; and the result of that law was clearly to impress on the Bhom tenure the characteristics of grant.
It must accord ingly fall within the operation of article 31 A either as jagir or as other similar grant.
It was next contended by the petitioners that the Kanoon Mal Act No. V of 1947 was void, because on 23 5 1947 a Constitution had been established in Mewar which provided that "no person shall be deprived of his life, liberty, or property without due process of law, nor shall any person be denied equality before the law within the territories of Mewar".
(Article XIII, Clause 1), and that Act No. V of 1947 which came into force on 15 11 1947 was void as being repugnant thereto.
Article 11(1) of the Constitution itself provides that the Maharajah shall exercise "all rights, authority and jurisdiction which appertain to or are incidental to such sovereignty except in so far as may be otherwise provided for by or under this Constitution or as may be otherwise be directed by Shriji", and when Shriji (the Maharajah) enacted Act No. V of 1947, it must be taken that he had in the exercise of sovereign authority abrogated the Constitutional provisions enacted earlier.
The authority which enacted the Constitution on 23 5 1947 being His Highness himself, any Act passed subsequently by the same authority must be taken to have repealed or modified the earlier enactment to the extent that it is inconsistent with the later.
It does not also appear that the Constitution was ever put into force.
It is not known whether any Legislature was constituted under the Constitution, or any other step taken pursuant thereto; and though acquiescence is not a ground for giving effect to a law which is ultra vires, it is not without significance that the validity of Act 348 No. V of 1947 was not challenged on the ground that it was repugnant to the Constitution dated 23 5 1947 until the present petitions were filed.
There is no substance in this belated contention, and it must be rejected.
Mr. Frank Anthony appearing for some of the Mewar petitioners contended that their status was that of Chiefs with semi sovereign powers, and that it could not be said that they held the lands under grants from the State.
He referred to certain kowls and agreements brought about by the British Government between their ancestors described therein as Chiefs and the Maharajah of Udaipur, providing for their jointly drawing up a code of law subject to ap proval by the Political Agent and for the settlement in future of all civil and criminal cases in accordance therewith, (vide Aitchison 's Treaties, Vol.
III, pp. 33 and 35) and for compensation being awarded to them for taking over their right to manufacture salt (vide Aitchison 's Treaties, Vol.
III, pp. 38 to 42).
He argued that the payments made by them to the State were not revenue but their contribution for purposes of common defence, and that that had not the effect of reducing their status as feudatory chiefs to that of subordinate tenure holders.
Certain observations in Biswambhar Singh vs The State of Orissa and others(1) were relied on as supporting this contention.
We have had considerable difficulty in following this argument, as it was general in character and unrelated to specific tenures or the claims of individual petitioners.
The kowls which were relied on as showing that their status was not that of subordinates are not conclusive of the matter, because the value to be attached to them would depend on the previous status of the Chiefs with whom they were entered into, and no materials have been placed before us as to what that was.
Two hypotheses are possible: they were the successors, either of the conquerors who had occu pied the territory earlier than the foundation of the Udaipur Raj in which case they would be Bhoms and their rights would be identical with those of (1) ; ,870.
349 Bhomats, or of the Rajput clansmen who followed the ruling dynasty of Mewar and obtained estates as rewards for their service in the establishment of the kingdom, in which case the grants would clearly be jagirs.
The facts forming the background of the agreements as narrated in Aitchison 's Treaties, Vol.
III, pp. 10 to 13 are that for sometime prior to the treaty which was entered into by the Maharajah of Udaipur with the British in 1818, the authority of the Government of Mewar was rather low.
Taking advantage of it, tile neighbouring States had occupied most of its territories, and the Chiefs had also become lax in the performance of their obligations to the Durbar.
This led to considerable friction between the Maharajah and the Chiefs and after the conclusion of the treaty in 1818, the Political Agent Mr. Tod, with a view to restore good relationship between the Maharajah and his Chiefs, prevailed upon them to settle their differences, and the kowls relied on by Mr. Anthony are the outcome of his efforts.
These kowls read in the background of the facts stated above unmistakably establish that the position of the Chiefs had previously been that of grantees from the State, subject to certain obligations.
If so, the agreements did not bring about a change in that status.
They merely provided for the carrying out of the obligations arising out of that status.
On this basis, the properties held by them would be jagirs even according to the original and narrow sense of that word; and in fact, they are so described in the very kowls relied on by Mr. Frank Anthony.
(Vide Aitchison 's Treaties, Volume III, page 35, article 29).
They are clearly within article 31 A.
The respondent also contended that the pro perties held by the Chiefs would be estates as defined in article 31 A. That would prima facie appear to be so; but it is unnecessary to express any opinion on the question, as the resumption would be protected by article 31 A on the ground that it related to jagirs or other similar grants.
(1)(c) Tikanadars of Shekhwati: The northern section of Jaipur forming the trans Aravali region of the State is known as Shekhwati.
It consists of large 350 estates known as Panchpana Singhana, Sikar, Udaipurwati, Khandela and others.
These estates are known as Tikanas and their holders as Tikanadars.
The petitioner in Petition No. 424 of 1954 is one of them, his estate being the Tikana of Malsisar and Mandrela in Panchpana Singhana.
His contention is that he is a ruler with semi sovereign status subject only to the obligation to render military service and to pay tribute called Maumla to the State of Jaipur, that be is accordingly a Maumlaguzar and not jagirdar, and that he is not a grantee from the State.
The history of these estates is narrated in great detail by Mr. Wills in his report on "The Land Tenures and Special Powers of Certain Tikanadars of Jaipur State, 1933".
To state it briefly, these estates originally formed part of the Khalsa lands of the Moghuls.
During the period of their decline, King Sawai Jai Singh who ruled over Jaipur from 1700 1743 with great distinction acquired them from the Moghul Emperors on izara, and in his turn granted them on sub leases or izaras to various persons mostly his clansmen, on condition that in addition to the payment of izara amount fixed they should render military service to the rulers.
Subject to these obligations they were entitled to collect revenues from the villages comprised in the izara and maintain themselves.
In course of time, when the hold of the Moghul Empire on the outlying territories became weak, the Jaipur rulers assumed practically sovereign powers over the izara lands, which came to be regarded as part of the royal domain.
There was a corresponding rise in the status of the sub lessees who continued in possession of the estate as permanent grantees.
Towards the end of the 18th Century when the power of Jaipur waned and its authority weakened, the holders of these estates in Shekhwati attempted in their turn to shake off their allegiance to Jaipur, asserted an independent status in themselves, and began to seize the territories belonging to the State.
Before their plan succeeded, Jaipur concluded a treaty with the British which recognised its position as sovereign of the whole State 351 including Shekhwati.
"The first duty urged on the Maharaja after the conclusion of the treaty was the resumption of the lands usurped by the nobles, and the reduction of the nobles to their proper relation of subordination to the Maharaja.
Through the mediation of Sir David Ochterlony Agreements were entered into in 1819 similar to those made at Udaipur.
The usurped lands were restored to the Maharajah and the nobles were guaranteed in their legitimate rights and possession".
(Aitchison 's Treaties, Vol.
III, p. 55).
Even after the conclusion of the agreement of 1819 there were disputes between the Maharajah and the Chiefs in respect of various matters, such as the right of the ruler to revise the amount payable by the Tikanadars and the right of the latter to minerals and to customs; but this did not affect the nature of the relationship established between them under the agreement of 1819.
Thus, the true position of the Tikanadars is that they got into possession of the properties as izaradars under the rulers of Jaipur, improved that position latterly and became permanent holders of the estates and were eventually recognised as chiefs subordinate to the Maharajah.
They were not like the Bhomicharas of Marwar or the Bhumias of Mewar the previous conquerors and occupants of the territory before they were subjugated by Jaipur, as erroneously supposed by Col. Tod; nor were they the clansmen of the ruling dynasty who assisted in the establishment of the Raj.
They derived their title to the properties only under grants made by the rulers of Jaipur, and even if their estates could not be considered, as they shaped themselves, as jagirs, they were at least " other similar grants" within article 31 _A.
That was the view which the State took of their position.
Section 4(15) of the Jaipur State Grants Land Tenures Act No. I of 1947 defines "State grant" as including a jagir, muamla, etc.
Muamla is, as already stated, the amount payable by the Tikanadars of Shekhwati to the ruler of Jaipur.
Section 4 (7) defines an estate as meaning "land comprised in a State grant".
45 352 According to this definition, the properties in question would be 'estate ' as defined in article 31 A of the Constitution.
The Matmi Rules of 1945 provide for recognising succession to State grants, and they include Muamlaguzars.
(Vide Part III in Appendix A).
Describing the tenures in the non Khalsa area, the Administration Report of Jaipur 1947 1948 states that "Muamla is the grant of an interest in land for which a fixed amount is payable under a settlement arrived at with the State".
(Vide page 35).
The position taken up by the petitioner both in the petition and in the opening argument that his status is that of an independent Chieftain holding the properties by right of conquest and not under grant cannot therefore be maintained.
In his reply, however Mr. Achhru Ram shifted the ground, and contended that the ancestors of the petitioner having come in as izaradars, the impugned Act had no application to him, as izara is not one of the tenures mentioned in the first schedule to the Act.
But Muamla is mentioned as item 6 in the schedule, and that is the name under which the tenure of the petitioner is known.
It must accordingly be held that his lands are within the purview of article 31 A. (1) (d) Subeguzars: The question as to the status of subeguzar is raised in Petitions Nos. 471, 472 and 473 of 1954.
The petitioner in Petition No. 473 of 1954 is the holder of the estate of Isarda in Jaipur.
It is stated that in the beginning of the 18th Century his ancestor Mohansinghji migrated from Bagri, settled in the hilly regions at Sarsop, built a fortress at Isarda and established an independent principality.
In 17 51 the ruler of Isarda acknowledged the suzerainty of the Maharaja of Jaipur who, in turn, "recognised the ancestor of the petitioner as Subeguzar", subject to a liability to pay tribute every year to Jaipur.
(Vide para 2 of the petition).
The result of this arrangement was, as in the case of Bhomicharas, to put the Chieftain in the position of a grantee from the State, and that is also the position under the Jaipur State Grants Land Tenures Act No. I of 1947 Section 4(15) includes within the definition of 'grant 353 " suba" tenure, and the Matmi Rules of 1945 also apply to this tenure.
(Vide Appendix A, Part III).
While the tenure is called 'Sube ', its holder is called not Subedar which has a different meaning but Subeguzar.
In the Administration Report of Jaipur 1947 48, Sube is described as follows: "Suba is a tenure peculiar to Nizamat Sawai Madhopur.
It is analogous to the istimrar tenure in other parts of the State.
The subeguzars pay a fixed annual amount for the grant held by them".
(Vide p. 35).
The position therefore is that the petitioner who is admittedly a subeguzar holds under a grant from the State and falls within article 31 A.
It was argued that the family of the petitioners had always enjoyed a special distinction in that the adoption of the ruling house of Jaipur was always made from among the members in this family.
That, however, would not affect the status of subeguzars who must be held to be grantees from the State.
A special contention was raised with reference to 12 villages which are stated to have been purchased in 1730 by Raja Jaisingh the then holder of Isarda for a sum of Rs. 20,000; and it was argued that these villages at least could not be treated as held under grant from the State.
Isarda was a new State founded by Mohansinghji, and its area was extended from time to time by incorporation of fresh villages, and when in 1751 the Chief acknowledged the suzerainty of Jaipur and held the estate as subeguzar under him, that title must have related to the entire estate including these villages, and there is therefore no ground for treating them differently from the rest.
It must be mentioned that this contention was raised only in the reply statement.
It must be overruled.
Petitions Nos. 471 and 472 of 1954: The petitioner in Petition No. 471 of '1954 is the Tikanadar of Jhalai.
In para 2 he admits that he is styled as a subaguzar, and for the reasons given in Petition No. 473 of 1954 his estate must be held to fall within article 31 A.
But it is argued that the Tikana consists of 18 villages, and that only two of them are held as 'Sube '.
354 But what is the case put forward in the petitions as regards the other villages? The schedule to the petition mentions that four of them are held as maintenance grants, and two as muafi.
They are clearly within article 31 A.
As regards the others, there is no specific case put forward as to the nature of their tenure.
But it is admitted that the Tikana is a permanently settled estate paying a fixed annual reve nue of Rs. 1,681, and it is therefore an estate both under section 4(7) of the Jaipur State Grants Land Tenures Act No. I of 1947 and article 31 A.
This decision will also govern Petition No. 472 of 1954 in which the petitioner owns the village of Bagina as "subeguzar" and the village of Siras as jagirdar.
(2)We now come to the second category of cases wherein the contention is that the particular properties held by the petitioners do not fall within the purview of article 31 A. (a)Petitions Nos. 391 and 417 of 1954: Petition No. 391 of 1954 relates to the estate of Yeshwantgarh in the State of Alwar.
It was settled on 11 8 1941 by its then ruler on his son for maintenance.
The grant is described in the deed as jagir, and the Gazette Notification dated 25 8 1941 publishing it states: "We are also faced with the problem of arranging for our second Maharaj Kumar, a Jagir, which, in the matter of size and powers, should be on a much higher footing than the existing Jagirs.
Accordingly with the object of creating a new Jagir for him, we have today gifted to him in perpetuity and from generation to generation, all the villages included in the Thikana of Thana together with all other properties enjoyed by the deceased Raja Sahib during his lifetime.
This new Jagir shall remain free from liability for rates and cesses for all time, and shall also never be required to maintain any horses".
In 1944 some more villages were added to this grant, and the resumption relates to all these properties.
The contention of Mr. Achhru Ram for the petitioner is that the grant is not an estate under the law relating to land tenures in Alwar, and that it is outside article 31 A. Under section 2(a) of the Alwar 355 State Revenue Code, `estate ' means "an area for which there is a separate record of rights or which is treated as such under orders of His Highness ' Government".
It is stated by the petitioners that there has been no separate record of rights in the State of Alwar, and that therefore there could not be an estate as defined in the Code.
The respondent, however, does not admit this, and contends that, in any event, the grants are jagirs and are therefore within article 31 A.
The question is whether the grant is a jagir.
The deed dated 11 8 1941 describes it as a jagir, and so does the Gazette Notification publishing it; and that is also how the estate is described by the petitioner himself Section 3(3) of the Alwar State Jagir Rules, 1939 defines jagir as meaning "grant of land or money granted is such by His Highness or recognised as such by His Highness".
Section 2(k) of the Alwar Revenue Code defines "assignee of land revenue" as meaning "a Muafidar or a Jagirdar".
Thus, all the requirements of a Jagir are satisfied, and the grant would fall within the scope of article 31 A.
It was next argued that even if the grant was a jagir within article 31 A, the rights of the petitioner in it could not be resumed under section 22(1)(a) of the Act, inasmuch as what could be resumed under that section was not the jagir lands, but the right, title and interest of the jagirdars therein, and that the petitioner was not a jagirdar as defined in section 2(g) of the Act, as be had not been recognised as a jagirdar as required therein.
This contention was also raised by the petitioners, whose properties would not be jagirs in the specific sense of the word, but would fall within the extended definition of that word under section 2(h) as including the several tenures mentioned in the first schedule to the Act.
The contention is that while their estates would be jagirs within the inclusive portion of the definition, they themselves would not be jagirdars as defined in the Act, because they were recognised not as jagirdars but as holders of the specific tenures enumerated in that schedule, and that therefore their interests could not be resumed under section 22(1) (a) even 356 though their estates might be notified as jagirs.
In other words, for the section to apply, there must not merely be an estate which is a jagir but also a holder who is a jagirdar.
It is conceded that this contention, if accepted, would render Chapter V providing for resumption inoperative except as regards jagirs in the specific sense and mentioned as item I in the first schedule to the Act.
But it is argued that it is a case of casus omissus, and that it is not within the province of this Court to supply it.
But the definition of jagir in section 2(h) is, as provided therein, subject to any contrary intention which the context might disclose; and when section 22 (1) (a) enacts that on the resumption of jagir lands the rights of the jagirdar in the lands should cease, it clearly means that the holders of jagirs are jagirdars for the purpose of the section.
There cannot be jagirs without there being jagirdars, and there fore the word 'jagirdar ' in section 22 (1) (a) must mean all holders of jagirs including the tenures mentioned in the schedule to the Act.
Section 20 exempts from the operation of the Chapter properties whose incomes are utilised for religious purposes.
Those properties would be held on tenures such as Sasan, Doli and so forth which are enumerated in the schedule.
There was no need for exempting them under section 20 if the Legislature did not understand them as falling within the operation of section 22(1)(a), and they would fall under that section only if the word 'jagirdar ' is interpreted as meaning all persons who hold properties which are jagirs as defined in the Act.
In the result, the resumption must be held to be valid.
Petition No. 417 of 1954 relates to properties in Alwar, and the contention raised therein is the same as in Petition No. 391 of 1954, that they are not an estate within article 31 A.
But the petitioner describes himself in the petition as the "proprietor jagirdar of the jagir known as Garhi", and states in para (9) that his jagir is unsettled and pays neither revenue nor tribute, and the prayer in para 21(3) is that the State should be restrained by an injunction from interfering with the rights of the petitioner.
as jagirdar.
357 In view of these allegations, it is idle for him now to contend that the properties do not fall within article 31 A. (b) Petitions Nos. 401, 414, 518, 535 and 539 of 1954: The properties comprised in these petitions are situated wholly or in part in the former State of Bikaner, and the contention raised with reference to them is that they are not estates according to the law of Bikaner, and are therefore outside article 31 A. Section 3(1) of the Bikaner State Land Revenue Act No. IV of 1945 defines 'estate ' as meaning an area (a) for which a separate record of rights has been made, or (b) which has been separately assessed to land revenue or would have been assessed if the land revenue bad not been released, compounded for or redeemed.
Section 28 of the Act provides for record of rights, and section 45 enacts that "all land, to whatever purposes applied and wherever situated, is liable to the payment of land revenue to His Highness ' Government".
Then there are provisions for assessment of land revenue.
It is argued for the petitioners that the record of rights as contemplated by section 28 has not been made, and that the lands have not been assessed to revenue, nor has it been released, com pounded for or redeemed, and that therefore the properties are not estates within section 3(1) of the Bikaner Act No. IV of 1945.
The contention of the respondent is that they are, at any rate, jagirs, and so fall within article 31 A.
The preamble to the Act proceeds on the basis that whatever is not Khalsa is jagir land.
In three of the Petitions Nos. 414, 518 and 535 of 1954 the properties are described in the schedule as jagirs and the petitioners as jagirdars.
In Petitions Nos. 401 and 539 of 1954 there are no such admissions, there being no schedules to the petitions.
But in the petitions for stay of notification filed in all the above petitions, it is alleged that "notification under the impugned Act with respect to the jagir of the petitioners has not yet been made".
(Vide para 16).
ID view of these admissions, we are unable to accept the contention of Mr. Frank Anthony based on the narration in Tod 's Annals of Rajasthan, 358 Volume II, pp. 25, 26, 140 and 141 that the properties of the petitioners are not jagirs.
(c)Petition No. 634 of 1954: In this petition there are 192 petitioners, some of whom are from Kishangarh.
The special contention urged as regards the petitioners from Kishangarh is that their properties are not estates according to the law of Kishangarh, and that they are therefore outside article 31 A. Rule 4(1) of the Jagir Rules for the Kishangarh State, 1945, defines a 'jagirdar ' as a person who has been granted a village or land as jagir by the Durbar in consideration of his past and future services, and Rule 5 classifies jagirdars into five categories.
The argument of the petitioners is that they have not been shown to fall within any of these categories.
Not merely is this contention not distinctly raised in the petitions, but it is admitted in para 1 that "the petitioners ' properties are known as Jagirs, Bhoms, Muafi, etc." which will clearly bring them within the operation of article 31 A.
In the schedule to the petition also, the petitioners are described as jagirdars, and the particular villages held by them are noted as jagir villages.
The contention that they do not fall within article 31 A must be rejected.
It is stated that the 128th petitioner, Pratap Singh, does not make any payment in respect of his estate, and that it is not a jagir.
If that is so, then on the admission extracted above, it must be muafi, and will be within article 31 A. (d)Petition No. 536 of 1954: The petitioner is the holder of an estate in Mewar known as Bhaisrodgarh Tikana, and he alleges that there was a dispute between Rawat Himmat Singhji the then holder of the estate, and the Maharajah of Udaipur, and that it was settled in March 1855 through the mediation of the then Agent to the Government, Sir M. Montgomery, and that under the terms of the settlement, the Tikana was recognised as the exclusive property of the holder.
The agreement itself has not been produced, and it could not, even on the allegations in the petition, have had the effect of destroying the character of the estate as a jagir grant.
Moreover, 359 this estate is mentioned as item 8 in the list of jagirs mentioned in the schedule under section 117 in Mewar Act No. V of 1947, and that by itself is sufficient to bring it within article 31 A. (e)Petition No. 672 of 1954: The petitioner is a Bhumia holding an estate called "Jawas".
Its history is given in "Chiefs and Leading Families of Rajputana", page 36, and the argument of Mr, Trivedi based on it is that the Chiefs of Jawas occupied a special position as feudatories, and that they could not be considered as grantees.
But their position is not different from that of the other Bhomats, and indeed it is admitted in para 14 that the lands are comprised in the Bhomat area.
This estate is expressly included in the schedule under section 117 in Mewar Government Kanoon Mal Act No. V of 1947 being item No. 25 and is within article 31 A. (f)Petitions Nos. 483, 527, 528 and 675 of 1954 and 1 and 61 of 1955: The question that is raised in these petitions is whether grants made for maintenance are 'jagirs or other similar grants ' falling within the purview of article 31 A.
In Petition No. 483 of 1954 the grant was made by the ruler of Uniaara, and in Petition No. 528 of 1954 by the then ruler of Katauli before it was merged in the State of Kotah.
We have held that maintenance grants would be jagirs according to their extended connotation, and they are therefore within article 31 A. In Petition No. 527 of 1954 the grant was made in favour of certain members of the Ruling House of Jaipur.
According to the respondent, they were illegitimate issue called Laljis, and the grants were made for Lawazma and Kothrikharch, which expressions mean maintenance of paraphernalia and household expenses.
(Vide the Administration Report of Jaipur 1947 1948, page 36).
The grant in favour of the 33rd petitioner in Petition No. I of 1955 and the 17th petitioner in Petition No. 61 of 1955 are similar in character.
Apart from the general contention that maintenance grants are not within article 31 A, the further argument of Mr. Dadachanji on behalf of these 46 860 petitioners is that Lawazma and Kothrikharch are tenures not mentioned in the first schedule to the Act, and that the resumption of these lands was therefore without the authority of law.
But these expressions meaning maintenance expenses are indicative of the purpose of the grant and are not descriptive of the tenure.
A grant can both be a jagir and a maintenance grant, and the fact that it was granted for Lawazma and Kothrikharch does not militate against its being a jagir.
It was suggested that the question whether Lawazma and Kothrikharch are tenures different from those mentioned in the schedule to the Act might be left open and that the right of the petitioners to establish their contention in other proceedings may be reserved.
That would undoubtedly be the proper course to adopt when the point for determination is not whether the Act itself is uncon stitutional and void, but whether the action taken under it was authorised by its provisions.
But then, there are no allegations in the petition that the properties were held under a tenure, which is outside the schedule to the Act.
On the other hand, some at least of the petitions proceed on the footing that the estates are jagirs.
In Petition No. 675 of 1954 the petitioner is the Raj Mata of the ruler of Tonk.
She was receiving a monthly allowance of Rs. 762/ for her maintenance and in lieu of it, the village of Bagri with its hamlets, Anwarpura and Ismailpura, was granted to her by resolution dated 6 3 1948.
Being a maintenance grant it will be a jagir, and that is the footing on which the petition is drafted.
Mr. section K. Kapur who appeared for the petitioner put forward a special con tention that the Government was estopped from resuming the lands.
The facts on which this plea is founded are that on 28 11 1953 the Secretary to the Government wrote to the Collector of Tonk that the petitioner was not to be disturbed in her enjoyment of the jagir for her lifetime.
In a later communication dated 24 11 1954, however, addressed to the petitioner, the Government expressed its inability to stay resumption, and the argument is that the res 361 pondent is estopped from going back on the assurance and undertaking given in the letter dated 28 11 1953.
We are unable on these facts to see any basis for a plea of estoppel.
The letter dated 28 11 1953 was not addressed to the petitioner; nor does it amount to an assurance or 8undertaking not to resume the jagir.
And even if such assurance had been given, it would certainly not have been binding on the Government, because its powers of resumption are regulated by the statute, and must be exercised in accordance with its provisions.
The Act confers no authority on the Government to grant exemption from resumption, and an undertaking not to resume will be invalid, and there can be no estoppel against a statute.
One other contention advanced with reference to this petition might be noticed.
It was argued that under rule 2(f) in schedule II, no compensation is awarded in respect of the abadi lands, which remain in the possession of the jagirdar, whereas, if they are sold, the income from the sale proceeds is taken into account.
This, it was argued, is discriminatory.
The principle underlying this provision is that compensation is to be fixed on the basis of the income which the properties produce, and that while abadi lands in the hands of the jagirdar yield no income, if they are sold the sale proceeds are income producing assets.
Whether this principle of assessing compensation is open to attack is another question, and that will be considered in its due place.
(g)Petitions Nos. 371, 375, 379, 416) 455 and 461 of 1954: These petitions raise in general terms the contention that the properties to which they relate are not estates as defined in article 31 A. Petition No. 371 of 1954 relates to the estate of Doongri in Jaipur, and it is contended that it is not an estate because the liability of the holder is only to pay Naqdirazan, and it is argued that this is not revenue.
Naqdirazan is money commutation for the obligation of maintaining a specified number of horses.
This is clearly a grant for military service, and will be a jagir, and that is admitted in para I where the 362 petitioner is described as the jagirdar of Doongri and in para 9 where it is stated that the jagir is unsettled.
The prayer is that an injunction might be issued restraining the State from interfering with the rights of the petitioner as jagirdar.
It is also alleged in para 19 of the stay petition that "the whole family is to be supported from this jagir".
Article 31 A clearly applies.
Petition No. 375 of 1954 relates to the estate of Renwal, and the special contention raised is that the petitioner pays no revenue but only Naqdirazan.
But he describes himself in para 1 as jagirdar of Renwal, admits in para 9 that it is a jagir, and claims relief in para 21(3) on that footing.
The properties are clearly jagirs within article 31 A.
The petitioner in Petition No. 379 of 1954 is also stated to be holding the estate on payment of Naqdirazan.
He describes himself as owner of the properties in Khera as jagirdar, admits in paras 9, 14, 16 and 19 that the estate is a jagir, and prays for an injunction restraining the State from interfering with his rights as jagirdar.
His estate is clearly within article 31 A. Petition No. 416 of 1954 relates to an estate called Sanderao.
The payment made by the holder is called Rekchakri, and the contention is that this is not revenue.
But it is admitted in paras 1, 2, 9 and 21(3) of the petition that the properties are jagir lands.
Petition No. 455 of 1954 relates to properties in Mewar.
There are 13 petitioners, and it is argued that the payments made by them called chakri chatund and Bhom barad are not revenue, and their properties are not estates.
But they admit that they are "owners as petty jagirdars" of the properties mentioned in the schedule, and this statement is followed by others which also contain clear admissions that the estates are jagirs.
(Vide paras 12, 17(e), 19 and 21(3) of the petition and paras 16 and 19 of the stay petition).
In Petition No. 461 of 1954 the petitioner admits that he holds ten villages as jagirs, seventeen as istimrar and two as muafi.
Istimrar is one of the tenures mentioned in the first schedule to the Act, and is item No. 2 therein, and that would be "other similar grant" 363 within article 31 A, while jagir and muafi are expressly included therein.
In conclusion, we must hold that the petitioners have failed to establish that the impugned Act, in so far as it relates to properties held by them, is not within the protection of, ' article 31 A. IV.
(B) We may now consider the contention of the petitioners that the Act is bad on the ground that the compensation provided therein is inadequate.
The provisions of the Act bearing on this matter may now be reviewed.
second schedule to the Act lays down the principles on which compensation has to be assessed.
Rule 2 enacts how the gross income is to be ascertained, and enumerates the several heads of income which are to be included therein, and rule 4 mentions the deductions which are admissible.
Rule 4(3) provides that 25 per cent.
of the gross income may be deducted for "administrative charges inclusive of the cost of collection, maintenance of land records, management of jagir lands and irrecoverable arrears of rent"; and there is a proviso to that rule that "in no case shall the net income be computed at a figure less than 50 per cent.
of the gross income".
Under rule 5 compensation payable is seven times the net income calculated under rule 4.
Rule 6 provides that any compensation paid to the jagirdar for customs duties during the basic year shall continue to be payable.
Under section 26(2) the compensation amount carries interest at 21 per cent.
from the date of resumption, and under section 35 it is payable in instalments.
Under section 35(A) the payment may be made in cash or in bond or partly in cash and partly in bond.
In addition to this, there is provision for the payment of rehabilitation grant on the scale mentioned in schedule III.
The complaint of the petitioner is that the compensation provided by the rules is inadequate, being far less than the market value of the estate, that rule 2 takes into account only the income which was being actually received from the properties and omits altogether potential income which might arise in future, as for example, from vacant house sites and unopened 364 mines; and reliance was placed on the decision of this Court in State of West Bengal vs Bela Banerjea(1) where it was held that the compensation guaranteed under article 31(2) was just compensation, equivalent of what the owner had been deprived of.
But we have held that the impugned Act is protected by article 31 A, and that article enacts that no law providing for acquisition of properties falling within its purview is open to attack on the ground that it violates any of the provisions of Part III.
It was held by this Court in State of Bihar vs Maharajadhiraja Sir Kameshwar Singh(1) and Visveshwar Rao vs The State of Madhya Pradesh(1) that an objection to the validity of an Act relating to acquisition of property on the ground that it did not provide for payment of compensation was an objection based on article 31(2), and that it was barred when the impugned legislation fell within articles 31(4), 31 A and 31 B.
It was further held in Raja Suriya Pal Singh vs The State of Uttar Pradesh(1) that when the acquisition was of the whole estate, it was not a valid objection to it that the compensation was awarded on the basis of the income actually received, and that nothing was paid on account of properties which did not yield an income.
It is argued that the compensation payable under the rules is so inadequate as to be illusory, and that the Act must be held to amount to a fraud on the Constitution.
We are unable to agree with this contention.
Under the Act, the jagirdar is entitled to compensation equal to seven years ' net income, and in addition to it he is awarded rehabilitation grant which may vary from 2 to 11 times the net income.
Under section 18 of the Act he will also be allotted a portion of the khudkhast lands in the jagir, the extent of the allotment being proportionate to the total extent thereof.
He is also to get compensation for loss of customs.
The utmost that can be said of these provisions is that the compensation provided thereunder is inadequate, if that is calculated on the basis of the market value of the properties.
But that (1) ; (3) (2) (4) 365 is not a ground on which an Act protected by article 31 A could be impugned.
Before such an Act could be struck down, it must be shown that the true intention of the law was to take properties without making any payment, that the provisions relating to, ' compensation are merely veils concealing that intention, and that the compensation payable is so illusory as to be no compensation at all.
(Vide State of Bihar vs Maharajadhiraja Sir Kameshwar Singh of Darbhanga and others(1).
We are clear that this cannot be said of the provisions of the impugned Act, and the contention that it is a fraud on the Constitution must, in consequence, fail.
It was argued by Mr. Achhru Ram that the impugned Act suffered from a fundamental defect in that it treated all the 41 tenures classed as jagirs in the schedule as of the same character, and on that basis laid down the same principles of compensation for all of them.
It is argued that these tenures differ widely from one another as regards several incidents such as heritability, partibility and alienability, and that different scales of compensation should have been provided suitably to the nature and quality of the tenure.
There is considerable force in this con tention.
But this is an objection to the quantum of compensation, and that is not justiciable under article 31 A. We may add that even if it was open to the petitioners to go behind article 31 A and to assail the legislation on the ground that the compensation awarded was not just, they have failed to place any materials before us for substantiating that contention, and on this ground also, the objection must fail.
It was also argued that there was no public purpose involved in the resumption, and that therefore article 31(2) had been contravened.
This again is an objection which is barred by article 31 A; and even on the merits, the question is concluded against the petitioners by the decision of this Court in State of Bihar vs Maharajadhiraja Sir Kameshwar Singh of Darbhanga (1) , 946 948. 366 and others(1) that legislation of the character of the present is supported by public purpose.
It was next urged that the provisions of the Act offend article 14 and are therefore bad.
Even apart from article 31 A which renders such an objection inadmissible, we are satisfied that it is without substance.
The contention of the petitioners is that the Act according to its title is one to provide for resumption of jagir lands, not all of them; that section 21 provides that the Government "may appoint a date for the resumption of any class of jagir lands", which means that under this section it is not obligatory on it to resume all jagirs, and that it would be within its powers in resuming some of them while leaving others untouched, and thus the Act is discriminatory.
The provisions of this Act bearing on this question are sections 20 and 4.
Section 20 enacts that "the provisions of this Chapter apply to all jagirs except jagirs the income of which is utilised for the maintenance of any place of religious worship or for the performance of any religious service".
We have held that the Act confers no power on the Government to grant exemption.
All the jagirs therefore are liable to be resumed under section 20, no option being left with the Government in the matter.
Section 4 of the Act enacts that all jagir lands become liable to pay assessment from the commencement of the Act, and the liability of the jagirdar to pay tribute also ceases as from that date.
There cannot therefore be any doubt that it was the intention of the Legislature that all jagir lands should be resumed under section 21.
It was also urged that under section 21 the State is authorised to resume different classes of jagir lands on different dates, and that must result in the law operating unequally.
This provision was obviously dictated by practical considerations such as administrative convenience and facilities for payment of compensation ' and cannot be held to be discriminatory.
It was held by this Court in Biswambhar Singh vs The State of Orissa and others(1) that a similar (1) (2) ; , 855.
367 provision in the Orissa Estates Abolition Act No. I of 1952 was not obnoxious to article 14.
The objection must accordingly be overruled.
Petitions Nos.
629 and 643 of 1954: These are petitions by jagirdars of Mewar, and the special contention urged on their behalf by Mr. Trivedi is that their jagirs had been taken possession of by the State in 1949 under section 8(A) of the Rajasthan Ordinance No. 27 of 1948, that by its judgment dated 11 12 1951 the High Court of Rajasthan had held that that enactment was void under article 14, that that judgment had been affirmed by this court in The State of Rajasthan vs Rao Manohar Singhji(1), that the present Act came into force on 8 2 1952, and that the Government having wrongly taken possession of the jagirs in 1949 under the provisions of the Ordinance, instead of returning them to the petitioners notified them first under section 21 of the Act, and thus managed to continue in possession, and that in the result, these jagirdars had been treated differently from the jagirdars in other States of Rajputana to whom sec tion 8(A) did not apply and article 14 had been contravened.
There is no substance in this contention.
The Mewar jagirdars having lost possession under a legislation which has been held to be void, the rights which they had over the jagirs until the date of the present notifications would remain unaffected, and no unequal treatment could result therefrom.
And, moreover, the present Act makes no discrimination in the matter, as it applies to all the jagirs in Rajasthan.
There is no ground, therefore, for holding that the Act in any manner contravenes article 14.
V. It now remains to deal with the contention of some of the petitioners that even if the impugned Act is valid, their estates do not fall within its mischief, and that their resumption is therefore unauthorised (a) Petition No.392 of 1954 The subject matter of this petition is the estate of Khandela in the former State of Jaipur.
By a deed of the year 1836, it (1) ; 47 368 was settled by the Maharajah of Jaipur on Raja Abayasingh and Raja Lakshmansingh on izara istimrar on an annual assessment of Rs. 80,001.
The present petitioner is the successor in interest of Raja Abayasingh, and is entitled to three fifths share in the estate.
The contention that is urged on his behalf by Mr. Isaacs is that the Act does not apply to him, because be is neither a Jagirdar nor a holder of any of the tenures mentioned in schedule I to the Act.
The history of this estate is set out in Mr. Wills 's Report at pp.
75 79.
Khandela was an ancient principality held by the members of the Raisalot family as Mansubdars under the Moghul Emperor.
In 1725 Sawai Jaisingh of Amber obtained an izara of Khandela from the Moghul Emperor, and the Raisalot holders became subordinate to him.
In 1797 the Raisalot family lost possession of the estate, which became incorporated in the Khalsa lands of Jaipur, and administered as such till 1812.
Thereafter, it was leased to the Chieftain of Sikar and others on short Term leases till 1836 when the grant under which the petitioner claims was made.
The occasion for the grant was that there were negotiations for marrying a princess of the Bikaner royal family to the ruler of Jaipur, and the Bikaner Durbar insisted that the Khandela estate should be restored to the Raisalot family.
Though the marriage itself did not eventually materialise, the princess having in the meantime died, the negotiations which had been going on with the Jaipur State for the handing over of the Khandela estate to its old holders resulted in the izara of 1836.
Now the question is whether the grant of 1836 was that of a jagir.
It was clearly not a grant for services rendered or to be rendered, nor was there an assignment of any right to collect revenue.
The grantees were to enjoy the income from the lands and pay a fixed annual amount to the Durbar.
It is true that the estate had some of the incidents of a jagir tenure attached to it.
It was impartible, it was inalienable, and in matters of succession it was governed by the Matmi Rules.
All this did not affect the true character of the grant which was both in name and in 369, substance a permanent lease and not a jagir.
Mr. Pathak contends that even if what was granted under the deed was not a jagir, it was at least a grant of istimrari tenure, which is item 2 in schedule I to the Act.
This argument is mainly founded on certain, ' proceedings which were taken with reference to the Khandela estate during the years 1932 to 1939.
The occasion for these proceedings was a dispute between the Thikanadars of Shekhwati and the Durbar with reference to their respective rights, and the status of the Izaradars of Khandela also came up for investigation.
There was an enquiry and report by Mr. Wills in 1933, and on that report the matter was again in vestigated by a Committee which submitted its report in 1935.
Therein, it was held on an examination of all the materials that the status of the holders of Khandela differed from that of other Thikanadars, who paid Muamla and claimed semi independent status as "Muamlaguzars", that they held merely as istimrar Izaradars under a " permanent and specific izar" and not as istimrar Muamlaguzars, that the grant of Mal, Sayer, Bhom and Kuli habubayat under the deed did not add to their status as Izaradars.
(Vide para 5).
This report was accepted by the Maharajah of Jaipur on 14 4 1939.
Mr. Pathak contends that the effect of the finding of the Committee that the grantees held as istimrar Izaradars was to bring them within item 2 of schedule I to the Act, and that therefore the resumption is within the Act.
But the report emphasises that the grantee held as "istimrar Izaradar" and not as "istimrar Muamlaguzar", and in the context the word "istimrar" has reference not to the character of the tenure but its duration as permanent.
The precise nature of the tenure called 'istimrari ' is thus set out in Venkatachar 's Report: "Permanently quit rented estates and lands These are denoted by various terms as Dumba, Chukota, Suba and Istimrari.
Of these the Istimrari tenure merits some attention.
The largest number of Istimrari estates in Rajasthan lies in Ajmer Merwara 370 which area is outside the scope of this report.
The original tenure of the Istimrari estate in Ajmer is exactly like the Jagirs in Rajasthan.
None of the Ajmer estates ever paid revenue till 1755, but were held on condition of military service. . .
Under British rule, the estate holders were made liable to pay an annual fixed and permanent quit rent and were converted into Istimrari tenure holders".
(Page 22, para 24).
"This quit rent or fixed revenue is a nominal assessment, not related to the income from the holding, but with the condition of confirmation of grant; the amount is invariable.
This class of persons are known as 'Istimrardars" '.
(Page 24, para 36).
It is clear from the above that the essential features of istimrari tenure are that the lands are assessed to a nominal quit rent and that is permanent.
The amount of Rs. 80,001 fixed as assessment under the deed of 1836 cannot be said to be a nominal amount, and as found in the report of the 1933 Committee, it was not a permanent assessment.
It cannot therefore be held that what was created by the deed of 1836 was istimrari tenure.
It was argued for the respondent that Khandela was clearly an estate as defined in article 31 A, that the policy of the law was to abolish all intermediaries, and that section 2(h) should be so construed as to comprehend all holders of intermediate tenures.
The answer to this is that whatever the legislature intended, effect can be given only to its expressed intention, and that the definition of "jagir" in section 2(h) is not sufficiently wide to catch the petitioner.
The notification under section 21 in so far as it relates to the properties held by the petitioner under the izara of 1836 must be held to be not within the purview of the Act and therefore unauthorised.
(b)Petition No. 427 of 1954: Three villages, Haripura, Khata and Niradun, are comprised in this petition.
Lands in Haripura belonged to certain Bhumias of Jaipur.
The petitioner acquired them under a number of purchases, the last of them being in 1915.
Bhom tenure is item 17 in schedule I to the Act, and 371 these lands would therefore be within the purview of the Act.
It is argued by Mr. Rastogi that as the petitioner had acquired lands from the Bhomias long prior to the Act his rights in them could not retrospectively be affected by subsequent legislation.
We are unable to see where the question of retrospective operation comes in.
If Bhom is a tenure and that is what it is under the first schedule to the Act, and if the intention of the Legislature was to bring it within the operation of the Act, then the only question to be considered is whether the particular properties notified under the Act are held under that tenure.
And if that is answered in the affirmative, the Act would clearly apply, and it would make no difference in the result that the holder derived title to them by purchase and not by inheritance.
On the admission of the petitioner that the lands notified belonged to his vendors as Bhom, the Act will clearly apply.
With reference to the lands in the village of Khata, the contention of the petitioner is that it is held on izara tenure, and that it is therefore outside schedule I to the Act.
This village is a Thikana in Shekhwati, and though the estates in that area were originally held on izara, they had, as already stated, risen to the status of jagirs and had been recognised as such.
This village is stated to have been granted for maintaining horses, and is really a Mansab jagir and must be held to be covered by item 1 in schedule I. The village of Niradun is stated to be held as Javad, and the contention is that it is not one of the tenures mentioned in schedule I to the Act.
The respondent contends that Javad is not the name of any tenure, and that it means only a sub grant.
In the petition it is not stated that Javad is a tenure; nor is there a mention of its incidents.
The word 'javad ' is not noticed either in Wilson 's Glossary or in Ramanatha Iyer 's Law Lexicon.
In the Jagir Rules of Kishangarh, section 4(xiii) defines 'javad ' as "a jagir con fiscated by or reverted to the State", and that has reference to the practice of making a grant of a small portion of the jagir to the 'jagirdar when it is confiscated or to the members of the family when it 372 reverts back to the State.
We are satisfied that there is no tenure called Javad, and it will not assist the petitioner whether Javad is a sub grant or a grant of jagir of the nature mentioned in section 4(xiii) of the Kishangarh Rules.
We may add that this contention was raised by the petitioner in a supplemental statement.
(c) Petition No. 468 of 1954: The petitioner is the holder of an estate known as Jobner.
He contends that he is a Mansubdar and not a jagirdar, and that his tenure is not included in schedule I to the Act.
During the Moghul administration persons to whom assignments of land revenue were made subject to an obligation to maintain horses for Imperial service were called Mansubdars.
The petitioner states that Akbar the Great granted three paraganas, Narayana, Kolak and Jobner, to his ancestors as Mansub for maintaining 1000 horses, that in 1727 they came under "the subordination of the Amber Durbar" which was the name of the State prior to the foundation of Jaipur in 1728, and that they had continued to hold the estate thereafter as Mansubdars and not as jagirdars.
But the grant will clearly be a jagir as there is an assignment of land revenue for the rendering of military service, and Mansub is only another name for a jagir.
It is classified as a jagir in the Jaipur Administration Report 1947 1948, page 35, and even though the Report has not the force of legislation, it is valuable as showing that Mansub is recognised as a jagir.
The estate is therefore covered by item I in schedule 1.
With reference to one of the villages forming part of this estate, Jorpura, a special contention was put forward by Mr. Naunit Lal that it was dedicated for worship of the Devi, and was therefore within the exemption enacted in section 20.
A document is also produced in support of this claim.
The respondent claims that under this deed the grant is not in its entirety in favour of the Deity, but the petitioner disputes it.
This is not a question which can be determined in this petition.
It will be open to the petitioner to establish in appropriate proceedings that the 373 village or any portion thereof is within the exemption of section 20 of the Act.
(d) Petitions Nos. 474 and 475 of 1954: In 1948 the Maharajah of Jaipur granted to the petitioners, who are his sons, the Thikanas of Bhagwatgarh and Mangarh consisting of 20 villages revenue free.
Now, the contention that has been urged before us in these and other similar petitions is that in the first schedule to the Act.
, only Thikanas of Dholpur are mentioned, being item 11, and that therefore Thikanas in other States are excluded.
But the expression 'Thikanadar ' is a honorific and 'Thikana ' does not, except in Dholpur, mean anything more than an estate and that estate can as well be a jagir.
The petitioners, in fact,, admit in their petitions that they are jagirdars.
The grant is clearly a jagir, and falls within item I in the schedule.
(e) Petition No. 488 of 1954: The petitioners are interested in two of the villages, Dadia Rampur and Tapiplya comprised in the izara of Khandela of the year 1836, which forms the subject matter of Petition No. 392 of 1954, and their title rests on Chhut Bhayas or sub grant from the izaradar.
Their rights are therefore precisely those of the izaradars, and for the reasons given in Petition No. 392 of 1954 these petitioners must succeed.
(f) Petition No. 36 of 1955: The properties to which this petition relates are held as "Sansan" which is one of the tenures mentioned in the first schedule being item 25, and would therefore fall within the operation of section 21.
The contention of the petitioner is that they are dedicated for the worship of Lord Shiva and Goddess Shakti, and that he is a Brahmacharan utilising the income from the lands for the above religious service.
The properties comprised in the grant are said to be of a small extent, and the dedication is not improbable.
There has been no denial by the respondent of the allegation in the petition, and on the materials placed before us, we have come to the conclusion that the dedication pleaded by the petitioner has been established, and that the 374 properties are within the exemption enacted in section 20.
To sum up: The impugned Act is not open to attack either on the ground that the Rajpramukh had no legislative competence to enact it, or that the procedure prescribed in article 212 A for enactment of laws had not been followed.
The Act is, in substance, one for acquisition of property, and is within the legislative competence of the State, and it is protected by article 31 A.
But the notification is bad as regards properties comprised in Petitions Nos.
392 and 488 of 1954, as izaras are not within the impugned Act.
The properties mentioned in Petition No. 36 of 1955 are dedicated for religious services, and are exempt under section 20 of the Act.
Appropriate writs will issue in these three petitions.
In Petition No. 468 of 1954 the right of the petitioner to claim exemption under section 20 for the village of Jorpura on the ground that it is dedicated for worship of the Deity is reserved, and the petition is otherwise dismissed.
All the other petitions will stand dismissed.
The parties will bear their own costs in all the petitions.
| The Bill which came to be enacted as the Rajasthan Land Re forms and Resumption of Jagirs Act was prepared in the Ministerial Department of the Government of Rajasthan.
It was approved by the Rajpramukh on 8 2 1952, and reserved for the consideration of the President, who gave his assent to it on 13 2 1952.
By notification issued on 16 2 1952, the Act came into force on 18 2 1952.
In pursuance of section 21(1) of the Act, the State of Rajasthan issued notifications resuming the jagirs specified therein, whereupon petitions under article 226 of the Constitution were filed by the persons aggrieved challenging the validity of the Act before the Rajasthan High Court.
The petitions were dismissed and thereupon they filed petitions before the Supreme Court under article 32 of the Constitution of India, impugning the Act.
They contended inter alia that the Rajpramukh had no competence to enact the law, that the Bill was not prepared by the Rajpramakh as required by article 212 A(2), that resumption was not one of the topics of legislation enumerated either in the State List or in the Concurrent List in the Seventh Schedule of the Constitution and that the Act was therefore ultra vires the powers of the State, that the Act did not provide for adequate compensation nor was there any public purpose involved in it and therefore it contravened article 31(2), and that as the Act was discrimi natory it contravened article 14.
There were some special contentions that the Act was not saved by article 31 A, because the lands resumed were neither estates nor jagirs nor grants similar to jagirs, inams or muafi and that some of the properties sought to be resumed were not jagirs as defined in the Act and therefore the notifications under section 21 of the Act in so far as they related to them were illegal.
39 304 Held that, (1) the Rajpramukh was competent to enact the im pugned law, under article 385, as he was the authority functioning immediately before the commencement of the Constitution as the legislature of Rajasthan under article X (3) of the Covenant of the United State of Rajasthan.
The expression "Ordinance" in article X (3) must be construed as meaning "Law".
Article VII (3) of the Covenant has reference to the executive power which the Rulers had to resume jagirs and does not operate as a restriction on the legislative powers under article X (3).
The Legislature of the corresponding State mentioned in article 385 refers not to the legislature under the Constitution, but to the body or the authority which was functioning as the legislature of the State before the commencement of the Constitution and under article X (3) of the Covenant of the United State of Rajasthan, that authority was the Rajpramukh.
Article 385 does not require that that authority should have had absolute and unlimited powers of legislation.
If it was functioning as the legislative authority before the Constitution, it would, under the article, have all the powers conferred by the Constitution on the House or Houses of legislature of the States.
(ii) Article 212 A(2) which provides that the Rajpramukh should prepare the Bill, does not require that he should himself draft it.
It is sufficient if he decides questions of policy which are of the essence of the legislation.
It is open to the Rajpramukh to adopt a Bill prepared by his ministers and the only matter that will have to be con sidered is whether in fact he did so.
There is no provision in article 212 A(2) for the Rajpramukh approving of a Bill and an endorsement of approval on the Bill prepared in the ministerial department must therefore signify its adoption by him.
When the Bill is produced with an endorsement of approval under his signature, the question must be held to be concluded and any further discussion about the legislative or executive state of mind of the Rajpramukh must be ruled out as inadmissible.
(iii) The impugned Act is not ultra vires the powers of the State Legislature as the subject matter of the legislation is in substance acquisition of properties falling under entry 36 of List II of the Seventh Schedule.
Resumption and acquisition connote two different concepts, but whether the impugned Act is one for acquisition of jagirs or for their resumption must be determined with ref erence to the pith and substance of the legislation, the name given to it by the legislature not being decisive of the matter.
The resumption for which the Act provides is not in enforcement of the rights which the Rulers had to resume jagirs in accordance with the terms of the grant or the law applicable to it, but in exercise of the sovereign rights of eminent domain possessed by the State.
Under the circumstances, the taking of the properties is in substance acquisition notwithstanding that it is labelled as resumption.
The payment of compensation to the Jagirdars is consistent only with the taking being an acquisition and not resumption in 305 accordance with the terms of the grant or the law applicable to it.
Though the legislation also falls under entry 18 of List II of the Seventh Schedule, there being an entry 36 dealing with acquisition, it must be held that the Act falls under that entry and is valid.
(iv) The word 'jagir ' connoted originally grants made by Rajput Rulers to their clansmen for military services rendered or to be rendered.
Later on grants made for religious and charitable purposes and even to non Rajputs were called jagirs, and both in its popular sense and legislative practice, the word jagir came to be used as connoting all grants which conferred on the grantees rights in respect of land revenue, and that is the sense in which the word jagir should be construed in article 31 A.
The object of article 31 A was to save legislation which was directed to the abolition of intermediaries so as to establish direct relationship between the State and the tillers of the soil.
Construing the word in that sense which would achieve that object in full measure, it must be held that jagir was meant to cover all grants under which the grantees had only rights in respect of revenue and were not tillers of the soil.
Maintenance grants in favour of persons who were not cultivators such as members of the ruling family would be jagirs for purposes of article 31 A. (v) Bhomicharas.
The Bhomicharas are the representatives of Rajput Rulers who conquered the. country and established their sovereignty over it in the thirteenth century.
Later on the Ruler of Jodhpur imposed his sovereignty over the territory but permitted the previous rulers to continue in possession of the lands on payment of an annual sum.
The question was whether they held the lands as jagirs.
Held that, there could be a jagir only by grant by the Rul ing power but that such a grant need not be express, and could be implied and when the Ruler of Jodhpur imposed his sovereignty over the territory of the Bhomicharas but recognised their possession of the lands, it is as if there was annexation by him and re grant to them of these lands.
Vajesinghji Joravar Singji and Others vs Secretary of State [(1924) L.R. 51 I.A. 357] and Secretary of State vs Sardar Bustam Khan [(1941) L.R. 68 I.A. 109], referred to.
Though the Bhomicharas enjoyed large powers, their status was only that of subjects.
The status of a person must be either that of a sovereign or a subject.
There is no tertium quid.
The law does not recognise an intermediate status of a person being partly a sovereign and partly a subject.
And when once it is admitted that the Bhomicharas had acknowledged the sovereignty of Jodhpur, their status can only be that of a subject.
Even if the Bhomicharas did not prior to the enactment of the Marwar Land Revenue Act XL of 1949 hold the lands as grantees 306 from the State, they must be deemed to have become such grantees by force of section 169 of the Act which provides that all lands in the State vest in the Maharajah and all proprietary interests therein are deemed to be held under a grant from him.
The Bbomicharas bad by long usage and recognition and by the legislative practice of the State come to be recognised as jagirdars and their tenure is a jagir within the intendment of section 169.
For the purposes of article 31 A, it would make no difference whether the grant is made by the sovereign in the exercise of his prerogative right or by the legislature in the exercise of its sovereign rights, Grants which are the creatures of statutes called legislative grants are equally within the operation of that article.
Bhomicharas are, accordingly, within the operation of article 31 A. (vi) The position of Bhumias in Mewar is similar to that of Bhomicharas in Marwar and in addition it was a condition of the terms on which their title to the lands was recognised by the rulers of Chittoor and Udaipur, that they had to render military service when called upon and also pay quit rent.
Their title to the lands therefore rested on an implied grant and their tenure would be jagir even in its stricter sense.
Section 27 of the Mewar Government Kanoon Mal Act (V of 1947) enacts that all lands belong to His Highness and that no person has authority to take possession of any lands unless the right is granted by His Highness.
Section 106 (1) of the Act declares that a Tikanadar, Jagirdar, Muafidar or Bhumia shall have all such revenue rights in the lands comprised in his jagir, muafi, or Bhom under this Act, as are granted to him by His Highness".
The effect of these provisions was to impress on the Bhom tenure the charac teristics of a grant.
Article 13, Clause (1) of the Constitution of Mewar provided that, "no person shall be deprived of his life, liberty or property without due process of law, nor shall any person be denied equality before the law within the territories of Mewar".
It was contended for the petitioners that the impugned Act was void as contravening the above provisions.
Held that, as the authority which enacted the Constitution of Mewar was His Highness, it could be repealed or modified by the same authority, and the impugned Act must be held to have repealed the Constitution to the extent that it was in consistent with it.
(vii) The Tikanadars of Shekwati got into possession of lands as ijaradars or lessees and were subsequently treated as jagirdars.
Their tenure was, if not jagirs, at least other "similar grants" within article 31 A.
It is included in Schedule I to the impugned Act as item 6.
The nature of the tenures of lands held by Subeguzars, Mansubdars, maintenance holders (Lawazma and Kothrikarch), Tikanadars and of Naqdirazan, Sansan grants, etc., considered, 307 (viii) The Khandela estate was granted in 1836 on a permanent lease.
The definition of jagir in section 2(h) includes the tenures mentioned in Schedule I to the Act and Istimrari tenure is item 2 therein.
The question was whether the Istimrar ijara was within item 2.
Held that, the essential features of Istimrari tenure are that the lands are assessed to a nominal quit rent, and that it is permanent.
The amount of Rs. 80,001 fixed as assessment under the deed of 1836 cannot be said to be nominal.
The grant is, therefore, not an Istimrari tenure, but a permanent Izara.
(ix) Objections raised as to the validity of the Act on the ground that it did not provide for payment of compensation, that there was no public purpose involved in the resumption and that therefore it contravenes article 31(2) or that the provisions of the Act offend article 14, are barred by the provisions of article 31 A of the Constitution.
Even apart from article 31 A, the impugned Act must be held to be supported by public purpose and is not in contravention of article 31(2).
Nor is there a contravention of article 14, as under the Act all jagirs are liable to be resumed, no power having been conferred on the Government to grant exemption.
State of Bihar vs Maharajadhiraja Sir Kameshwar Singh of Darbhanga and Others ([1952] S.C.R. 889) and Biswambhar Singh vs The State of Orissa and Others ([1954] S.C.R. 842), referred to.
The true scope of the rule of ejusdem generis is that words of a general nature following specific and particular words should be construed as limited to things which are of the same nature as those specified and not its reverse, that specific words 'which precede are controlled by the general words which follow.
|
Appeal No. 136 of 1953.
Appeal by Special Leave from the Judgment and Order dated the 4th day of May 1949 of the High Court of Judicature at Patna in Appeal from Appellate Decree No. 1918 of 1947 against the Decree dated the 23rd day of July 1947 of the Subordinate Judge, Arrah in Appeal No. 137 of 1946 arising from the Decree dated the 29th March 1946 of the Court of the 2nd Munsif at Arrah in Suit No. T. section 120 of 1943.
R. C. Prasad, for the appellant.
section P. Varma, for the respondent.
187 1955.
April 7.
The Judgment of the Court was delivered by JAGANNADHADAS J.
This is an appeal by leave granted under article 136(1) of the Constitution against the second appellate judgment of the High Court of Patna.
It relates to the office of Pujari and Panda of a famous temple in the town of Arrah in the State of Bihar, known as the temple of Aranya Devi and Killa Ki Devi.
The appellant before us a woman brought this suit claiming joint title to the office along with the defendant and as such entitled to perform the Puja either by herself or through her Karinda and to get a half share in the income of offerings of the said Asthan.
It is the admitted case that this office belongs to the family of both the parties and that the duties of the office were being jointly performed by the defendant and his deceased brother, Rambeyas Pande, and that they were enjoy ing the emoluments jointly.
The plaintiff the widow of Rambeyas Pande claims to have succeeded to her husband 's share in this property and bases her suit on the said claim.
In the written statement the defendant raised three main defences, two out of which are (1) the plaintiff was not the legally wedded wife of his brother, Rambeyas Pande, and (2) during the life time of Rambeyas Pande, there was a division between them with reference to the office of Pujari and Panda belonging to this family in respect of two temples (a) at Arrah and (b) at Gangipul, that the office of pujari at Gangipul was given to the plaintiff 's husband and that the temple of Aran Devi at Arrah was given to the defendant and that since then, i.e., for about 11 years prior to the date of the suit, the plaintiff 's husband had no connection with the office of Pujari in this temple nor with the receipt of any offerings therein.
Both these contentions were found against the defendant by the trial court as well as by the first appellate court and they have become conclusive.
The further and third defence raised by the defendant was that the property in suit, viz., the office of Pujari and Panda of the templet cannot be inherited by a female, The contention 188 is set out in the following terms in the written statement: "The plaintiff is not at all entitled to the office and the post of Pujari and Panda of Arun Devi and she is not entitled to get 1/2 share or any share in the income and offering of the said Asthan, nor has she got any right to perform Puja as a Panda personally, or through her karinda and to get the income, etc.
This is against the custom and usage and practice and also against the Sastras.
The property in suit is such as cannot be inherited by a female".
It is the question thus raised which has got to be con sidered in this appeal.
The trial Court held against this contention in the following terms: "No authority has been cited nor any custom proved to show that, female cannot inherit a property of this nature".
The first appellate Court also affirmed this view as follows: "The defendant 's objection that the plaintiff being a female is not authorised to hold the office of a priest of the Aranya Debi temple is not borne out by any evidence or material on the record.
There is nothing to show that by reason of her sex she is debarred from holding this office either by religion, custom or usage.
Moreover admittedly she holds the office at the Gangi temple".
On the findings arrived at by the trial court and the first appellate court, the plaintiff got a decree as prayed, for declaring her right to half share in the office and for recovery of mesne profits on that footing.
On second appeal to the High Court, the learned Judges went into the question at some length and were of the opinion that "the plaintiff being a female is not entitled to inherit the priestly office in question and her claim to officiate as a priest in the temple by rotation cannot be sustained.
The declaration sought for by her that she is entitled to the office of Pujari cannot, therefore, be granted".
They held, however, "that she is not debar red from being entitled to be maintained out of the estate of her, husband which, in 189 the particular case, happens to be no other than the emoluments attached to the priestly office in the shape of offerings made to the deity which office was undoubtedly hereditary".
They further held that "she will be entitled to receive from the defendant half the amount of the offerings in lieu of her maintenance" and they varied the decree of the trial court accordingly.
The short question that arises, therefore, for consideration in this appeal is whether a Hindu female is entitled to succeed to the hereditary priestly office of a Pujari and Panda held by her husband in a temple and to receive the emoluments thereof.
This is a question about which there has been some diff erence of opinion in the decided cases.
It requires close examination.
That religious offices can be hereditary and that the right to such an office is in the nature of property under the Hindu Law is now well established.
A Full Bench of the Calcutta High Court in Manohar vs Bhupendra(1) has laid this down in respect of Shebaitship of a temple and this view has been accepted by the Privy Council in two subsequent cases in Ganesh vs Lal Behary(2) and Bhabatarini vs Ashalata (3).
In a recent judgment of this Court reported as The Com missioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar(4) this view has been reiterated and extended to the office of a Mahant.
On the view that Shebaiti is property, this Court has also recognised the right of a female to succeed to the religious office of Shebaitship in the case reported as Angurbala vs Debabrata(5), where the question as to the applicability of Hindu Women 's Right to Property Act to the office of Shebaitship came up for consideration.
On the same analogy as that of a Shebaiti right, the right of a hereditary priest or Pujari in a temple must also amount to property where emoluments are attached to such an office.
Indeed, some of the decisions which have recognised the Shebaiti right as property appear to be cases where the Shebaiti (1) A.I.R. 1932 Calcutta 791.
(2) (1936] L.R. 68 I.A. 448.
(3) [1943] L.R. 70 I.A. 57.
(4) ; (5) 190 right combines the priestly office of a Pujari of the idol with the office of the manager of the temple, who in South India, is known by the name of Dharmakarta.
As early as in Mitta Kunth Audhicarry vs Neerunjun Audhicarry(1), it was recognised that hereditary priestly office in a family is property liable to partition.
A number of other decisions to be noticed in the later part of this judgment recognise this position.
The learned Judges of the High Court in their judgment in the case under appeal, have attempted to distinguish the present case from that of the case of the Shebaitship and have come to the conclusion that while in respect of Shebaiti right a woman may succeed by heirship, she is not entitled to such succession in respect of the right of a Panda and Pujari.
But in making this distinction they do not negative the idea that the right to the office of the Pujari itself is property to which a female could succeed, but for her supposed disqualification.
The disqualification is said to arise with reference to the duties attached to this office, and it is said that in this respect it differs from the office of a Shebait.
Now there can be no doubt that while in one sense the right to such a religious office is property it involves also substantial elements of duty.
As has been stated by this Court in Angurbala vs Debabrata(2) and in The Commissioner, H. R. E., Madras vs Sri Lakshmindra Thirtha Swamiar(3) "both the elements of office and property, of duties and personal interest are blended together (in such offices) and neither can be detached from the other".
It must also be recognised that in respect of such offices especially where they are attached to public institutions, the duties are to be regarded as primary and that the rights and emoluments are only appurtenant to the duties.
See the observations of Justice Page in Nagendra vs Rabindra(4) at pages 495 and 496 and that of Justice Sadasiva Aiyar in Sundarambal vs Yogavanagurukkal(5) at page 564, as also of Mukherjea on 'Endowments (1) [1875] XIV B.L.R. 166.
(2) (1951] S.C.R. 1125.
(3) ; (4) A.I.R. 1926 Calcutta.490.
(5) A.I.R. 1915 Madras 561.
191 (1952 Edn.) page 201.
If, therefore, it is found that the recognition of a female 's right to succeed to the hereditary office of Pujari in a temple held by her husband is incompatible with due discharge of the duties of the office, her right to succeed must be negatived.
The correct approach to a question of this kind has been laid down by the Privy Council in a case which relates to a Mohammadan religious office but would equally be applicable to a Hindu religious office.
In Shahar Bano vs Aga Mahomed Jaffer Bindaneem(1) their Lordships, after noticing the View taken by the learned Judges of the Calcutta High Court, that "there is no legal prohibition against a woman holding a mutwalliship when the trust, by its nature involves no spiritual duties such as a woman could not properly discharge in person or by deputy" approved this view of the High Court and said "it appears to their Lordships that there is ample authority for that proposition".
The question, therefore, that requires consideration in the present case is whether the office of the Pujari and Panda in a temple involves such duties as could not be discharged by a female in person and if so, whether she is also incompetent to get the same discharged by a deputy.
Now for this purpose it is desirable to have a clear idea of the duties of a Pujari in an ordinary Hindu temple.
A Pujari has to perform the prescribed daily worship of the image as well as the special worship of a periodical nature on particular occasions and for prescribed festivals during the year.
In Ramabrahma Chatterjee V. Kedar Nath Banerjee Justice Sir Asutosh Mookerjee indicated the daily routine of worship in the following passage: "The normal type of continued worship of a consecrated image consists of the sweeping of a temple, the process of smearing, the removal of the previous day 's offerings of flowers, the presentation of fresh flowers and water, and other like practices.
It is sufficient to state that the deity is, in short, conceived as a living being and is treated in the same way as the (1) [1906] L.R. 84 I.A. 46, 53.
(2) A.I.R. 1923 Calcutta 60, 62.
192 master of the house would be treated by his humble servant.
The daily routine of life is gone through with minute accuracy; the vivified image is regaled with the necessaries and luxuries of life in due succession, even to the changing of clothes, the offering of cooked and uncooked food, and the retirement to rest".
In Saraswati 's Hindu Law of Endowments(1) the nature of the daily worship of a consecrated idol in a temple is set out at pages 134 and 135 in detail.
It must be recognised that the daily worship differs according to the tenets and usages of the religious sect for which the temple is intended and the idol is consecrated.
But whatever may be the details of the worship and the variations therein, there can be no doubt that the ministration of various services involving personal touch of the idol, and, often enough, the recitation of religious hymns inclusive of Vedic hymns are amongst the normal and essential features of a Pujari 's duties, at any rate in temples where the worship is conducted according to the Shastras.
It is also undisputed that according to Hindu Shastras the functions of a Pujari can be performed only by certain limited classes and involves special qualifications and that these classes may vary with the nature of the institution.
Now, whatever may have been the position in early times, of which there is no clear historical evidence, it appears to have been well established in later times that a female, even of the recognised limited classes, cannot by herself perform the duties of a Pujari.
Even at a time when the institution of temple worship had probably not come into general vogue, the incapacity of a woman to recite Vedic texts, to offer sacrificial fire, or to perform sacramental rites, is indicated in certain texts of Manu.
(See Sacred Books of the East, Manu, Vol. 25, pages 330 and 437, Chapter 9, section 18 and Chapter 11, section 36).
Whether it is on the basis of these texts or for some other reason, her incapacity to discharge, in person, the duties of the Pujari appears to have been well (1) The Hindu Law of Endowments by Pandit Prannath Saraswati, T.L.L., 1892.
(1897 Edn.).
193 settled in later times as appears from the following text from Brihan Naradiya Purana quoted in Saraswati 's Hindu Law of Endowments at page 136.
"Women, those uninvested with the sacred thread, (i.e. the members of the Dvija class before the initiation ceremony has been performed for them), and Sudras are not competent to touch images of Vishnu or Siva.
A Sudra, one uninvested with the sacred thread, a woman or an outcaste, having touched Vishnu or Siva, goes to hell".
This passage, in terms, refers to the images of Vishnu and Siva but it may reasonably be assumed, in the absence of any evidence to the contrary, that in practice the incapacity of a female to discharge the duties of a Pujari by herself extended, at any rate, to all public temples where an image of whatever form had been consecrated and installed according to the Shastras.
Indeed, all the cases on the subject have assumed this incapacity of the female.
The point of controversy has been whether she is also incompetent to get the duties discharged by employing a qualified substitute.
If her competence in this behalf is recognised and can be accepted there is no reason why she should not be held entitled to succeed to the office.
Thus the really important question for consideration in this case is whether the duties of the Pujari '8 office can be got done by a substitute and if so is there any particular reason or clearly established usage, against a female employing such a substitute and thus becoming entitled to the office.
In early Hindu society a priestly office could have relation only to the performance of various kinds of Vedic rituals and sacrifices either of a daily and routine nature or of a periodical and special nature.
In theory a Brahmin is to perform such functions for himself by himself, while persons of other classes ,should get them done through qualified Brahmin,s.
On principle a, priest in the Hindu concept is chosen as such with reference to his personal qualities and competence.
The system of hereditary priesthood however, with the possibility of persons not fully 25 194 competent, succeeding to or occupying such an office, appears to have come into vogue from fairly early times.
It appears, however, that from the very nature of the situation, the temporary discharge of the priestly function by a substitute in the place of the hereditary priest was a matter of inevitable necessity since the Hindu Shastras recognised temporary and casual disqualifications like that of butt and death pollution.
But there does not appear to be any indication in the early books of any general practice about the functions of priestly office being discharged by proxies.
In comparatively later days, however, there is clear indication of such a practice.
In Saraswati 's Hindu Law of Endowments at page 56, it is stated that in the Padma Purana and other treatises incapacitated persons are directed to have the worship performed through Brahmins.
This statement is with reference to the performance of service of an idol and has presumably reference to the incapacity of persons occupying a priestly office.
In Colebrooke 's translation of the Digest of Hindu Law on Contracts and Successions with a commentary by Jagannatha Tercapanchanana (4th Edition, published by Higginbotham & Co., Madras, 1874), Vol.
I, Book II, Chapter III, Section 11, pages 360 to 381 deal with the topic of partnership among priests jointly officiating at holy rites.
A perusal thereof and particularly of placita 28 to 44 containing citations from various Smrutis with Jagannatha 's commentary thereon, clearly indicate that the institution of hereditary priestship, became established by that date and that the performance of such priestly functions by substitutes had definitely come into vogue.
Various rules are propounded as to the sharing of remuneration between the substitute priest and the hereditary priest when the former happens to perform the functions in the place of the latter.
It is to be noticed that these passages from Jagannatha 's Digest refer in terms only to priestly office by way of officiating at holy rites, i.e., sacrifices and other Vedic or Shastric functions but do not in terms refer to the discharge of a priest 's duties in relation to the worship of an idol in a temple.
195 This is all the more remarkable because by the date of Jagannatha 's Digest the institution of worship of consecrated idols in temples had become long since fairly established.
The probable explanation is that Jagannatha 's Digest is a commentary on selected texts mostly of the various Smrutis from which he quotes and that in the days of the Smrutis the temple worship does not appear to have come sufficiently into vogue.
The historical origin and growth of temple worship has been fully dealt with in Saraswati 's Hindu Law of Endowments and has been also noticed in the referring judgment in Annaya Tantri vs Ammaka Hengsu(1).
It is pointed out therein that according to Hindu sentiment the performance of the duties of an Archaka or Pujari for an idol has been considered sinful and it required inducements by way of liberal grants of land and promise of substantial perquisites to attract competent persons for the office of Pujari or Archaka.
This, in course of time and with the change in social conditions and economic values, rendered the offices of Panda and Pujari in almost all the famous shrines in India, a lucrative affair, and has enabled the hereditary priests to get the functions discharged by paid substitutes and themselves enjoy a substantial margin of income.
Here just in the same way as the patronage of the kings or the society may have been a great incentive to the development of the system of discharge of hereditary priestly functions by substitutes in relation to sacrificial and Vedic religious rites, the phenomenal development and worship of idols in temples and the substantial emoluments which in course of time rendered the discharge of priestly office lucrative must have brought into vogue the employment of substitutes for performance of the duties of the priests not only for sacrificial or other religious rites but also for temple worship.
Whether and how far this practice is permitted by the Shastras is not the question before us.
But it cannot be denied and is indeed a matter of common knowledge, that at the present day, hereditary priestly offices are, as often as not, performed by proxies, (1) A.l.
P, 1919 'Madras 598 (F,B.).
196 the choice of proxy being, of course, limited to a small circle permitted by usage.
The question for consideration of the courts is, whether, in this state of things, a female is to be excluded from succession to the hereditary office of Pujari on account of her well recognised personal disqualification to officiate as such Pujari for the Shastrically installed and consecrated idols in the temples and whether she is to be denied the capacity to retain the property by getting the priestly duties efficiently discharged through a competent substitute.
The only basis for the alleged denial is a passage from Jagannatha 's Digest which is as follows: (Vide Vol. 1, page 379, commentary under placitum 43).
"Wives and others, disqualified by sex for the performance of holy rites, cannot appoint a substitute; as defiled person cannot perform a solemn act ordained by the Vedas, therefore wives have no property in the office of priest".
Now apart from the question whether this passage can be taken to be sufficiently authoritative, there has been some difference of opinion as to the correct import thereof.
In Sundarambal Ammal vs Yogavanagurukkal(1) this passage has been relied upon by Justice Sadasiva Aiyar as showing that women are incompetent to discharge the functions of a priest even through a substitute and that, therefore, they have no right of succession to the office.
The learned Judges of the High Court in the present case have also relied on it.
In Annaya Tantri vs Ammaka Hengsu(2), Justice Seshagiri Aiyar in his referring judgment has referred to this passage and was of the opinion that it does not express a specific view.
In Ganapathi Iyer on Hindu and Mahomedan Endowments (2nd Edn.) the learned author while commenting on this very passage says as follows at page 453 of his book: "Jagannatha there considers the question whether wives and others have a title to the succession to this priestly office.
As usual with the discussions of (1) A.I.R. 1915 Mad.
(2) A.I.R. 1919 Mad.
598 (F.B.).
197 Jagannatha it is difficult to say what his final opinion is.
But we should certainly think that Jagannatha 's opinion is that women can inherit doing the duties through a substitute, but enjoying the emoluments attached to that office".
It appears on a careful consideration of the disputed passage with reference to its context, that this view ' of the learned author is correct.
In any case the passage cannot be definitely relied upon as an authority for the contrary view.
The discussion in connection with which this passage occurs in the commentary is under placitum No. 43 in Section II of Chapter III, Book II, which is a text from Narada relating to hereditary priests.
The statement relied on occurs at a place where there is an attempt to reconcile the disqualification of the female to discharge the functions of a hereditary priest, and the recognition of her right to succeed to all property including a hereditary office.
The relevant portions of the discussion are herein below set out: "It is doubted whether wives and others have a title to this succession, although the partition founded on the admission of a right vesting in Agraharicas and other officiating priests, ought to be similar to the partition of inheritance in general.
As the wife 's title to succession, on failure of heirs in the male line as far as the great grandson, will be declared under the head of Inheritance, what should reverse her title in this instance? It should not be argued, that the wife can have no right to the village, because as a woman, she is disqualified for the performance of holy rites, and because the wives of agraharicas and others are totally incapable of receiving tila delivered as a gift to priests.
The tila may be received, and the rites be performed, through the intervention of a substitute.
Let it not be argued, that, were it so, a property in the sacrificial fee and regular dues would vest in the substitute.
The wife may have the benefit of property acquired by the substitute, as a sacrificer has the benefit of rites per formed by an officiating priest.
However, there is this difference: the sacrificer acquires merit from rites 198 performed by an officiating priest, and none is ever acquired by the intermediate performer of the rites; but if the duty of the officiating priest.
be performed by a substitute, property in the sacrificial fee is at first vested in the substitute, and through him, in the widow entitled thereto.
It is alleged, that there is no authority for this construction.
* * * * The text which ordains that "a person unable to act shall appoint another to act for him", is the foundation of this construction: but the property of an outcaste, or other person disqualified for solemn rites, is absolutely lost, in the same manner with his right to the paternal gold, silver, and the like.
This will be explained in the fifth book on Inheritance.
Wives and others, disqualified by sex for the performance of holy rites, cannot appoint a substitute: as a defiled person cannot perform a solemn act ordained by the Vedas: therefore wives have no property in the office of priest".
At the end of the discussion there is the following significant passage: "Therefore the difficulty is thus reconciled; women are entitled to that only for which they are qualified.
In regard to the assertion, that women, being disqualified, cannot appoint a substitute, this must be understood: being disqualified for solemn acts ordained by the Vedas, they cannot appoint a substitute for such acts; but, qualified for worldly acts, nothing prevents their appointment of a substitute for temporal affairs: and the right should devolve on the next in succession, under the text quoted in another place (Book 5, vs 477) and because women are dependent on men.
Grain and similar property may be consumed by a woman entitled to the succession; but gold, silver, and the like, should be preserved: if she cannot guard it, let it be entrusted to her husband 's heir, as will be mentioned under the title of inheritance.
Here, since a woman cannot preserve the office, it should be executed by her husband 's daughter 's son, or other heir: but the produce 199 should be enjoyed by the woman.
However, should the daughter 's son be at variance with his maternal grandmother, it may be executed by another person: he is not entitled to his maternal grandfather 's property, if that grandfather leave a wife: and should the maternal grandmother litigate, it must be amicably adjusted".
The concluding portion seems rather to indicate that the more categorical passage underlined above and relied upon is in the nature of an objection which is being answered and that the final conclusion is the recognition of a right to succeed by getting the duties of the office performed by the next male in succession.
The learned Judges of the High Court have in fact noticed this concluding passage but have missed its correct import.
It is desirable now to consider how this question stands with reference to the decided cases in the various High Courts.
A fairly substantial number of cases appear in the reports of the Madras High Court.
One of the earliest decisions is that of the Madras Sadar Diwani Adalat in Seshu Ammal vs Soundaraja Aiyar(1) wherein it was held, following the opinion of the Sadar Court Pandits, that a woman was disqualified by reason of her sex from inheriting the office of Acharya purusha but the same Pandits ' opinion distinctly recognises that religious offices like those of an Archaka or Pujari can be held by a female, by her getting the duties thereof performed through a competent male substitute.
In Tangirala Chiranjivi vs Rama Manikya Rao Rajaya Lakshmamma(2) it was stated that there was no basis for the assumption that a minor, a female, or a person unlearned in the Vedas, will lose the right to service in the temple and that the onus will be on the person who alleges the dis qualification to prove it.
The learned Judges categorically asserted (apparently as being a matter within general knowledge and experience) that "service in temples is being performed by proxies".
In Ramasundaram Pillai vs Savundaratha Ammal(3) the learned Judges say as follows: (1) [1863] M.S.D.A. 261.
(2) A.I.R. 1915 Madras 505(1).
(3) A.I.R. 1915 Madras 725.
200 "It is undeniable that this and other High Courts have in numerous cases acted on the assumption (which was not questioned) that women could hold religious offices and get the duties performed by proxy".
They further say "It may be that the parties concerned are so accustomed to the idea of female office holders with proxies that it has usually not occurred to them to question the legality of such a state of affairs and that in the absence of contest, the Courts have somewhat too readily assumed it to be legal without requiring proof of a valid custom in support of it".
In Rajeswari Ammal vs Subramania Archaka(1) the learned Judges state as follows: "We are of the opinion that a female is not, under Hindu law or custom, disqualified from succeeding to a hereditary religious office and getting such duties as she may be disqualified by reason of her sex from performing, performed by proxy".
The only dissentient view against this current of authority in the Madras High Court was that of Justice Sadasiva Aiyar in Sundarambal Ammal vs Yogavanagurukkal (2) .
He expressed a strong opinion that the practice of allowing the priestly office to be performed by a substitute excepting for merely temporary occasions or casual purposes, is wholly opposed to public policy and that it should not be recognised.
In a later judgment in Annaya Tantri vs Ammaka Hengsu(3) relating to the same topic be (Justice Sadasiva Aiyar) stated as follows: "It is notorious that the deputy is usually chosen on the principle of a Dutch auction.
The man who agrees to allow the widow to retain the largest portion of the emoluments of the office and to receive the least as his own remuneration is given the place of the deputy".
The learned Judge pointed out that "such a practice was mischievous and that even (1) A.I.R. 1917 Madras 963(2).
(2) A.I.R. 1915 Madras 561.
(3) A.I.R.1919 Madras 598 (F.B.). 201 if it was sanctioned by usage it ought not to be recognised by courts".
There is certainly force in this comment.
But in a matter of this kind where there is no express prohibition in the texts for the performance of the duties of the Pujari 's office by the appointment of substitutes and where such an office has developed into a hereditary right of property, the consideration of public policy cannot be insisted to the extent of negativing the right itself.
In such a situation what has to be equally emphasised is the duty aspect of the office and to insist, on the superior authorities in charge of the temple exercising vigilantly their responsibility by controlling the then incumbent of the priestly office in the exercise of his rights (or by other persons having interest taking appropriate steps through court), when it is found that the services are not being properly or efficiently performed.
In view of the peculiar nature of such offices as combining in them both the element of property and the element of duty, it cannot be doubted that superior authorities in charge of the institutions or other persons interested have this right which may be enforced by appropriate legal means.
In Raja Peary Mohan Mukherji vs Manohar Mukherji(1) the Privy Council has recognised that notwithstanding the personal interest of a Shebait in respect of his office, the performance of the duties thereof has got to be safeguarded and that he can be removed where he has put himself in a position in which the obligation of his office can no longer be faithfully discharged.
So far as the Madras High Court area is concerned, the controversy has been settled by the Full Bench case in Annaya Tantri vs Ammaka Hengsu(2) where the view taken by Justice Sadasiva Aiyar was specifically overruled on the ground that "there were numerous decisions of the Madras High Court in conformity with the decisions of the other High Courts by which the widow and the daughter and the daughter (1) [1921] L.R. 48 I.A. 258.
(2) A.I.R. 1919 Madras 598 (F.B.).
26 202 of the last male Archaka are held entitled in accordance with the established user to succeed to the office of Archaka discharging his duties by deputy and to transmit it to their heirs, who as male heirs are preferred to female, and will generally be competent to perform the duties in person".
These decisions of the Madras High Court seem to recognise both the factum and validity of the usage as one that has been accepted by the courts not only within its own jurisdiction but also within the jurisdiction of the other High Courts.
It is urged, however, that there is no such usage that can be definitely said to be established with reference to the decisions of the other High Courts.
As regards the other High Courts doubtless the actual cases appearing in the reports about this point are not many.
In the Bombay High Court one of the earliest decisions is the case in 1866 of Keshavbhat bin Ganeshbhat vs Bhagirhibai kom Narayanbhat(1) where the learned Judges say as follows: "With respect to the objection, that a Hindu female cannot perform the duties which attach to the office for the maintenance of which the allowance was granted, it may be observed that the defendant had not proved the existence of any usage in conformity with his allegations.
The claim in question in that case was to an annual allowance paid from the Government Treasury to the members of a family for the maintenance of certain religious services at the temple of Mahadev at Baneshvar near Poona.
In Sitarambhat et al vs Sitaram Ganesh(2) the head note shows as follows: "Semble, that an hereditary priestly office descends in default of males through females".
This is apparently the assumption on which that judgment appears to have proceeded though the matter does not appear to have been specifically so decided.
In Calcutta one of the early cases is Poorun Narain Dutt vs Kasheessuree Dosee(3).
There it was recognised that a woman can succeed to a priestly (1) 3 B.H.C.R., A.C.J. 75.
(2) 6 B.H.C.R.
A.C.J. 250.
(3) 203 office and the contention to the contrary was over.
ruled on the ground that the lower appellate court found the same as a fact on the evidence and that no one but the defendant had raised the contention.
In Joy Deb Surma vs Huroputty Surma(1) the same question was raised, viz., whether according to Hindu law a woman can succeed to the priestly office and reliance appears to have been placed for that contention on the passage from Colebrooke 's Digest already above referred to.
In view of this contention the learned Judges remitted the case to the lower court for deter mination of the question whether with reference to any particular custom or rule of Hindu law a woman is entitled to succeed to the priestly office.
In that case it was the office of the Dolloi of the temple.
It does not appear what the finding received was and how this matter was finally decided.
In Radha Mohun Mundul vs Jadoomonee Dossee(2) their Lordships of the Judicial Committee quoted with apparent approval the following passage from the judgment of the trial Court: "They (the members of the family) merely say that as the said properties are of a debuttur character, they are not susceptible of division among the shareholders; and that since the plaintiff is a childless widow, she is not competent to carry on the service of the gods.
That the properties in question do not admit of any partition among the co sharers is a fact which must be admitted by me; but I do not see any reason why a widow of the family should be incapacitated from superintending the service of the gods.
It is not urged by the defendants that any such rule has been laid down in the family, and that under it the widows have been excluded from the above superintendence.
On the other hand, among the Hindoos, persons belonging to no other caste except that of Brahmins can perform the service of a god with his own hands, that is, worship the idol by touching its person.
Men of other castes simply superintend the service of the gods and goddesses established by them selves, while they cause their actual worship to be (1) (2) 204 performed by Brahmins.
Thus, when persons of the above description can conduct the service of idols in the above mentioned manner, why should not the widows of their family be able to carry on worship in a similar way?. . . . . .
Consequently, there is nothing to prevent the Court from finding that the plaintiff has a right to hold possession of the debutter properties enumerated by the defendants in the 12th paragraph of their written statement, and to superintend the service of the gods conjointly with the other co sharers".
In Mahamaya Debi vs Haridas Haldar(1) it has been recognised that according to custom the palas of Kalighat shrine in Calcutta are heritable and that it was immaterial whether the heir is a male or a female.
This must necessarily have involved the recognition of the capacity of the female to get the worship performed by a male substitute who is to be taken from a limited class.
As has been already noticed, the reported cases dealing with this matter outside the Madras High Court do not appear to be many.
At any rate, no others have been brought to our notice dealing with this question directly, though there are many cases relating to the question of succession to the office of Shebait and the performance of duties thereof by proxy, which is a matter distinguishable from a case relating to the office of Pujari or Archaka simpliciter.
The paucity of decided cases in the reports of the other High Courts may very well be due to what has been pointed out in one of the Madras cases, viz., that the practice of females succeeding to this office and getting the duties thereof performed by a substitute was so common and well recognised that it has not been seriously contested and brought up to the Courts.
Further the institution of private family temples and the endowments of large and substantial properties for the Deb seva in such temples though somewhat uncommon in South India is fairly common in Bengal and some other States.
In view of the Dayabhaga system of law of succession prevalent in Bengal and the very much larger number (1) A.I.R. 1915 Calcutta 161(2).
205 of occasions for wives and daughters succeeding to a sonless coparcener in Dayabhaga joint families, the practice of females succeeding to the priestly office and of getting the duties performed by other members of the family as proxies in their places must, by the very situation, have been common in these areas.
The case reported in Jalandhar Thakur vs Jharula Das(1) is a case relating to Shebait 's (priest 's) office in the Singheswar temple of Bhagalpur and the facts therein show that there was unquestioned female succession to the office.
It is a clear indication of the prevalence of the usage of female succession to priestly office in the State of Bihar from which the present case arises.
A careful review, therefore, of the reported cases on this matter shows that the usage of a female succeeding to a priestly office and getting the same performed through a competent deputy is one that has been fairly well recognised.
There is nothing in the textual Hindu law to the contrary.
Nor can it be said that the recognition of such a usage is opposed to public policy, in the Hindu law sense.
As already pointed out the consideration of public policy can only be given effect in the present state of the law, to the extent required for enforcing adequate discharge of the duties appurtenant to the office.
Subject to the proper and efficient discharge of the duties of the office, there can be no reason either on principle or on authority to refuse to accord to a female the right to succeed to the hereditary office held by her husband and to get the duties of the office performed by a substitute excepting in cases where usage to the contrary is pleaded and established.
In the present case such a usage was pleaded by the defendant in his written statement but no evidence of it was given.
Indeed as pointed out by the first appellate Court, the plea that there has been a partition of the offices of the two temples and the implied recognition of the plaintiff 's right to the office of the other temple at Gangupal appears to indicate the contrary usage.
We are accordingly of the opinion (1) A.I.R. 1914 P.C. 72. 206 that the claim of the plaintiff appellant is made out and that she is entitled to succeed.
The discussion above is more germane to the case of a public temple wherein the idol has been Shastrically installed and consecrated and the worship is in accordance with the Shastras.
There is nothing on the record to show whether the temple in this case falls within this category.
If, however, the temple is a private one or the idol therein is not one Shastrically consecrated, the case in favour of the plaintiff is much stronger and her right cannot be seriously challenged.
At this stage, it is desirable to mention one other matter.
In the present case the emoluments attached to the office are stated to be the daily and other offerings made to the deity at the worship by the visiting devotees.
Both the parties to this case have come up to Court on the common footing that it is this which constitutes the emoluments.
Whether and how far such votive offerings can be appropriated by a Pujari for his emoluments if the temple is a public institution, (i.e., not a private family temple) and whether any usage in this behalf is valid is a matter which does not arise before us in this case.
In the result, the appeal must be allowed with costs throughout and the decree of the trial court must be restored.
| Though a female is personally disqualified from officiating as a Pujari for the Shastrically installed and consecrated idols in the temples, the usage of a Hindu female succeeding to a priestly office and getting the same erformed through a competent deputy has been well recognised and it is not contrary to textual Hindu Law nor opposed to public policy.
Subject to the proper and efficient discharge of the duties of the office being safeguarded by appropriate action when necessary, a Hindu female has a right to succeed to the hereditary priestly office of a Pujari and Panda held by her husband and to get the duties of the office performed by a substitute except in cases where usage to the contrary is pleaded and established.
Quaere: Whether and how far votive offerings can be appropriated by a Pujari for his emoluments if the temple is a public institution, (i.e., not a private family temple) and whether any usage in this behalf is valid.
Case law and the relevant texts reviewed.
Judgment of the High Court of Patna reversed.
|
iminal Appeal No. 42 of 1955.
On Appeal by Special leave from the Judgment and Order dated the 8th October 1954 of the Bombay High Court in Criminal Appeal No. 315 of 1954 arising out of the Judgment and Order dated the 6th January 1954 of the Court of the 4th Presidency Magistrate, Bombay in Cases Nos.
639 40/P 1955.
H. J. Umrigar, J. B. Dadachanji and Rajinder Narain for the appellant.
Porus A. Mehta and P. G. Gokhale for the respondent.
October 14.
The Judgment of the Court was delivered by BHAGWATI J.
The accused No. 1, the Appellant before us, and accused Nos. 2, 3 and 4 were charged that they, at Bombay, between about June 1950 and November 1950, were parties to a criminal conspiracy by agreeing to do certain illegal acts, to wit: Firstly, 882 that they used as genuine forged bills of entry which included bills of entry Exhibit Z; Secondly, that they ,heated the Deputy Chief Controller of Imports, Bombay, by fraudulently I and dishonestly inducing him to deliver to the firm of J. Sobhraj & Co., an import licence bearing No. 248189/48 to import cycles from United Kingdom of the value of Rs. 1,98,960; Thirdly, that they cheated the Deputy Chief Controller of Imports, Bombay, by falsely and dishonestly inducing him to deliver to the firm of J. Sobhraj & Co., an import licence bearing No. 203056/48 to import watches from Switzerland of the value of Rs. 3,45,325; and Fourthly, that they cheated the Deputy Chief Controller of Imports, Bombay, by fraudulently and dishonestly inducing him to deliver to the firm of J. Sobhraj & Co., an import licence bearing No. 250288/48 to import artificial silk piece goods from Switzerland of the value of Rs. 12,11,829; and the above said illegal acts were done in pursuance of the said agreement and that they thereby committed an offence punishable under section 120 B of the Indian Penal Code.
There were also charges against all the accused under section 471 read with section 465 and section 34 and also under section 420 read with section 34 of the Indian Penal Code in respect of each of the three illegal acts aforesaid.
The learned Presidency Magistrate, 23rd Court, Esplanade, Bombay, tried all the accused for the said offences and acquitted all of them.
The State of Bombay thereupon took an appeal to the High Court of Judicature at Bombay, and the High Court reversed the acquittal of accused No. I and held him guilty of all the offences with which he had been charged including the offence under section 120 B of the Indian Penal Code.
The acquittal of accused 2, 3 and 4 was confirmed.
The High Court, even though it acquitted accused 2) 3 and 4 of the charge under section 120 B of the Indian Penal Code, was of the opinion that the deed of assignment put forward by the accused No. I in his defence was a false and fabricated document and the ,said document along with its accompaniments was 883 forged or was got forged by or with the knowledge or connivance of the accused No. 1 and his co conspirators and it was impossible to believe that this conspiracy carried out with such meticulous care could be the work of only accused No. 1.
There was no evidence on the record to warrant any inference that the accused No. I was acting in the matter in collaboration with any other 'co conspirators and the only evidence was in regard to the various acts alleged to have been done by accused 2, 3 and 4 in the matter of the conspiracy and the furtherance of the objects thereof While considering the question of sentence to be passed on the accused No. 1 who, in spite of the circumstances aforesaid, was convicted of the offence under section 120 B of the Indian Penal Code, the High Court observed that "the conspirators, whoever they were, had shown considerable ingenuity and daring in carrying out the object of the conspiracy and that it felt no hesitation in Coming to the conclusion that it was not straitened circumstances or financial difficulties which were the basis of the conspiracy but it was the greed for money on such a large scale as could never be regarded as an extenuating circumstance".
It, therefore, directed that the accused No. I should undergo rigorous imprisonment for 18 months for the offence under section 120 B of the Indian Penal Code.
The application for leave to appeal to this Court filed by accused No. 1 was rejected by the High Court.
The accused No. 1 thereupon applied for and obtained special leave to appeal against the decision of the High Court.
The special leave was, however, limited to the question of law, whether the conviction under section 120 B is maintainable in view of the fact that the other alleged conspirators had been acquitted.
The charge as framed under section 120 B of the Indian Penal Code was levelled against 4 named individuals, the accused Nos. 1) 2, 3 and 4.
It was not a charge against them and other persons unknown with the result that if accused 2, 3 and 4 were acquitted of that charge, there remained only accused No. 1 and 112 884 the question, therefore, arises for our consideration whether, under the circumstances, the accused No. I could be convicted of the offence under section 120 B of the Indian Penal Code.
Criminal conspiracy has been defined in section 120 A of the Indian Penal Code: "When two or more persons agree to do or cause to be done (i) an illegal act, or (ii) an act which is, not illegal by illegal means, such an agreement is designated a criminal conspiracy".
By the terms of the definition itself there ought to be two or more persons who must be parties to such an agreement and it is trite to say that one person alone can never be held guilty of criminal conspiracy for the simple reason that one cannot conspire with oneself.
If, therefore, 4 named individuals were charged with having committed the offence under section 120 B of the Indian Penal Code, and if three out of these 4 were acquitted of the charge, the remaining accused, who was the accused No. 1 in the case before us, could never be held guilty of the offence of criminal conspiracy.
If authority for the above proposition were needed, it is to be found in Archbold 's Criminal Pleading, Evidence and Practice, 33rd edition, page 201, paragraph 361: "Where several prisoners are included in the same indictment, the jury may find one guilty and acquit the others, and vice versa.
But if several are indicted for a riot, and the jury acquit all but two, they must acquit those two also, unless it is charged in the indictment, and proved, that they committed the riot together with some other person not tried upon that indictment.
2 Hawk.
c. 47.
section 8.
And, if upon an indictment for a conspiracy, the jury acquit all the prisoners but one, they must acquit that one also, unless it is charged in the indictment, and proved, that he conspired with some other person not tried upon that indictment.
2 Hawk.
c. 47.
section 8; 3 Chit.
Cr. L., (2nd ed.) 1141; R. vs Thompson, ; R. vs Manning, 12.
Q.B.D. 241; R. vs Plummer The King vs Plummer ([1902] 2 K.B. 339) which is 885 cited in support of this proposition was a case in which, on a trial of indictment charging three persona jointly with conspiring together, one person had pleaded guilty and a judgment passed against him, and the other two were acquitted.
It was held that the judgment passed against one who had pleaded guilty was bad and could not stand.
Lord Justice Wright observed at page 343: "There is much authority to the effect that, if the appellant had pleaded not guilty to the charge of conspiracy, and the trial of all three defendants together had proceeded on that charge, and had resulted in the conviction of the appellant and the acquittal of the only alleged co conspirators, no judgment could have been passed on the appellant, because the verdict must have been regarded as repugnant in finding that there was a criminal agreement.
between the appellant and the others and none between them and him: see Harrison vs Errington (Popham, 202), where upon an indictment of three for riot two were found not guilty and one guilty, and upon error brought it was held a "void verdict", and said to be "like to the case in 11 Hen.
4, c. 2, conspiracy against two, and only one of them is found guilty, it is void, for one alone cannot conspire".
" Lord Justice Bruce at page 347 quoted with approval the statement in the Chitty 's Criminal Law, 2nd ed., Vol.
III, page 1141: "And it is holden that if all the defendants mentioned in the indictment, except one, are acquitted, and it is not stated as a conspiracy with certain persons unknown, the conviction of the single defendant will be invalid, and no judgment can be passed upon him".
The following observations made by Lord Justice Bruce are apposite in the context before us: "The point of the passage turns upon the circumstance that the defendants are included in the same indictment, and I think it logically follows from the nature of the offence of conspiracy that, where two or more persons are charged in the same indictment with conspiracy with another, and the indictment 886 contains no charge of their conspiring with other persons not named in the indictment, then, if all but one of the persons named in the indictment are acquitted, no valid judgment can be passed upon the one remaining person, whether he has been convicted by the verdict of a jury or upon his own confession, because, as the record of conviction can only be made up in the terms of the indictment, it would be inconsistent and contradictory and so bad on its face.
The gist of the crime of conspiracy is that two or more persons did combine, confederate, and agree together to carry out the object of the conspiracy".
This position has also been accepted in India.
In Gulab Singh vs The Emperor (A.I.R. 1916 All. 141) Justice Knox followed the case of The King vs Plummer, supra, and held that "it is necessary in a prosecution for conspiracy to prove that there were two or more persons agreeing for the purpose of conspiracy" and that "there could not be a conspiracy of one".
To similar effect was the judgment in King Emperor vs Osman Sardar (A.I.R. where Chief Justice Sanderson observed that "the gist of an offence under section 120 B was an alleged agreement between the two accused and when the jury found that one of them was not a party to the agreement and acquitted him of that charge, it followed as a matter of course that the other accused could not be convicted of that charge.
The assent of both of them was necessary to constitute the agreement which was the basis of the charge".
Ratanlal in his Law of Crimes, 18th ed., page 270, has summarised the position as it emerges from the above two cases in the manner following: "Where, therefore, three persons were charged with having entered into a conspiracy, and two of them were acquitted, the third person could not be convicted of conspiracy whether the conviction be upon the verdict of a jury or upon his own confession".
The position in law is, therefore, clear that on the charge as it was framed against the accused Nos. 1, 2 3 and 4 in this case, the accused No. I could not 887 be convicted of the offence under section 120 B of the Indian Penal Code when his alleged co conspirators accused 2, 3 and 4 were acquitted of that offence.
In our opinion, therefore, the conviction of the accused No. I of the charge under section 120 B of the Indian Penal Code was clearly illegal.
The appeal of the accused No. 1 will, therefore, be allowed to the extent that his conviction under section 120 B of the Indian Penal Code and the sentence of rigorous imprisonment of 18 months awarded to him as the result thereof would be quashed.
We are not concerned here with the conviction of the accused No I of the offences under section 471 read with section 465 and also his conviction for each of the three offences under section 420 of the Indian Penal Code and the concurrent sentences of rigorous imprisonment for one year in respect of each of them passed by the lower Courts upon him in regard to the same.
These convictions and sentences will of course stand.
| According to the definition of criminal conspiracy in section 120 A ' of the Indian Penal Code two or more persons must be patties, to such an agreement and one person alone can never be held guilty of criminal conspiracy for the simple reason that one cannot conspire with oneself.
Where, therefore, 4 named individuals as in the present case eye charged with having committed an offence under section 120 .B.
I.P.C. and three out of those four were acquitted of the charge, the fourth accused could not be held guilty of the offence of criminal conspiracy.
|
217 of 1955.
Under article 32 of the Constitution of India for the enforcement of Fundamental Rights.
N. C. Chatterjee, (Vir Sen Sawhney and Ganpat Rai, with him), for the petitioners.
Lal Narain Sinha, (Bajrang Sahai and section P. Verma, with him), for respondent No. 2. 1955.
October 28.
The Judgment of the Court was delivered by IMAM J.
The petitioners have filed this application under article 32 of the Constitution claiming that the buildings and lands as set out in the Schedule annexed to the petition and marked "A" (hereinafter referred to as the disputed properties) did not vest in the State of Bihar under the provisions of the 990 Bihar Land Reforms Act 1950 (hereinafter referred to as the Act).
Petitioner No. I in his individual capacity was at one time the owner, of the disputed properties which lie within Touzi No. 28 of the Collectorate of Hazaribagh.
On the 29th of December, 1947 petitioner No. I as owner leased out the disputed properties to a Company known as Mineral Development Ltd. (hereinafter referred to as the Company).
The Company took possession of the disputed properties and has been paying rent.
On the 7th of April, 1949 petitioner No. I in his individual capacity executed a deed of settlement whereby he transferred the disputed properties to three trustees, namely, himself and petitioners 2 and 3.
The Company has been paying rent to the trustees since then.
The Act came into force on the 25th of September, 1950.
On the 3rd of November, 1951 the State Government issued a notification under section 3(1) of the Act declaring that the estate of petitioner No. I in his individual capacity specified therein had passed to and become vested in the State.
On the 26th of October, 1953 a notice under section 4(h) of the Act was issued by the Collector to the Company, and on the 4th of March, 1954 the State Government issued a notification under section 3(1) of the Act purporting to vest in the State the properties covered by the above mentioned deed of settlement and another deed of settlement with which we are ' not concerned.
The Company instituted a title suit No. 33 of 1951 against the State of Bihar in the Court of the Subordinate Judge, Hazaribagh basing its claim on a mining lease executed by petitioner No. I in his individual capacity the genuineness of which was challenged by the State.
Petitioner No. I in his individual capacity was made a party to this suit.
The Company also instituted a title suit No. 9 of 1954 against the State of Bihar to which petitioner No. I in his individual capacity was made a party challenging the legality of the issue of notice dated 26 10 1953 under section 4(h) of the Act.
On the 11th of November, 1954 the State of Bihar filed title suit No, 53 of 1954 to which the Company, 991 petitioner No. I in his individual capacity, the three trustees and others were made parties.
By this suit the State of Bihar challenged the genuineness of the lease in favour of the Company and the deed of settlement in favour of the trustees.
The real question for determination is, what vested in the State on the publication of the notification under section 3 and by virtue of the provisions of section 4(a) of the Act? According to Mr. Chatterjee the disputed properties did not vest in the State, whatever else may have.
Having regard to the definition of "estate" in the Act, if anything vested in the State on the publication of a notification it was the land comprised in the notified estate.
Although the disputed properties stood on the land in the notified estate, they did not vest in the State, because the definition of "estate" speaks of land only and not of any building on it.
The notification under section 3 was a mere declaration and actual vesting took place under section 4(a).
On the date of vesting the disputed properties were not used as office or cutchery for the collection of rent of the notified estate of petitioner No. 1, who had parted with his right, title, and interest therein long before the Act was enacted and the publication of the notification under section: 3.
Mr. Sinha on behalf of the State of Bihar, on the other hand, contended that on a perusal of the provi sions of sections 4, 5 and 7 of the Act, it would appear that the Act contemplated something more than the ' land in an estate vesting in the State and the disputed ' properties could and did vest in the State on the publication of the notification under section 3.
In our opinion, it is of little consequence in the present case whether the notified estate vested in the State by reason of the publication of the notification under section 3 or by virtue of the provisions of section 4 of the Act, because in either case a vesting did take place.
Although the word land is used in the definition of "estate", the provisions of sections 4, 5 and 7 show the necessary intention to include something more than the land when an estate vests in the State.
Under section 4(a) it is not only the 992 estate but also buildings of a certain description and other things which vest in the State absolutely on the publication of a notification under section 3.
Under sections 5 and 7 the buildings mentioned therein also vest in the State, because the buildings in question are deemed to be settled by the State with the intermediary in possession.
This could only be on the supposition that these buildings vested in the State and the person in possession held the same as settlee under the State.
In the present case on the date of the publication of the notification under section 3 the disputed properties were said to be in the possession of the Company as lessee and the petitioner No. I had no right, title or interest therein as he had transferred his lessor 's reversion to trustees by a deed of settlement.
We may assume, therefore, that on the date of publication of the notification the disputed properties were not used primarily as office or cutchery for the collection of rent of the notified estate of petitioner No. 1 It.
becomes, therefore, necessary to interpret the word "used" occurring in section 4(a).
It is to be noticed that this clause of section 4 does not expressly state that a building used primarily as office or cutchery for the collection of rent must be so used at the date of the publication of the notification.
In this clause the words "used primarily as office or cutchery for the collection of rent of such estate" must be read in the light.
of the provisions of section 4(h) where similar words are employed.
Under section 4(h) the Collector has the power to make inquiries in respect of any transfer of any kind of interest in any building used primarily as office or cutchery for the collection of rent of such estate, if the transfer had been made at any time after the first day of January, 1946.
If on due inquiry the Collector is satisfied that such transfer was made with the object of defeating he provisions of the Act or causing loss to the State or obtaining higher compensation, then the Collector may, after giving notice to the parties concerned and hearing them and with the previous sanction of she State Government, annul the transfer and dis 993 possess the person claiming under it.
These provisions clearly indicate that if any building was used primarily as office or cutchery for the collection of rent and such building had been transferred after the first day of January, 1946, the transfer could be annulled if the circumstances mentioned in section 4(h) had been established.
That is to say, under. ' these provisions the use to which the building was put previous to its transfer after the first day of January, 1946 and not thereafter was what the Collector was concerned with and not to what use it had been put after its transfer after the first day of January, 1946.
To hold otherwise would be to make the provisions of section 4(h) meaningless.
When a proprietor transfers any such building ' it necessarily follows that the building thereafter was not used by him as office or cutchery for the collection of rent of his estate.
If the transfer was made before the first day of January, 1946 the provisions of section 4(h) would not apply and such a transfer would not be liable to be annulled and the building so transferred would not vest in the State on the date of the publication of the notification covering the estate on which such building stands.
If, on the other hand, this transfer was made after the first day of January, 1946, a building comprised in a notified estate, which was used immediately previous to the date of the transfer primarily as office or cutchery for the collection of rent of such estate the transfer would be liable to be annulled under section 4(h) and it would vest absolutely in the State on the publication of the notification and the provisions of section 4(a) must be read accordingly.
It would be unreasonable to construe the provisions of section 4(a) in the way suggested by Mr. Chatterjee.
The scheme of the Act has to be borne in mind and the provisions of sections 4(a) and 4(h) have to be read together.
The petitioners had not asserted in their petition that the disputed properties were not used as office or cutchery for the collection of rent of the notified estate of petitioner No. I before the first of January, 1946 or before the lease in favour of the Company.
On behalf 994 of the State, on affidavit, it has been stated that the disputed properties were all along used as cutchery before the creation of the lease and that they were not being used in connection with any mining operation.
In our opinion, if as a result of the inquiry under section 4(h) the transfer of the disputed properties by the petitioner No. I is annulled the disputed properties must be regarded as having vested in the State, because they were used as office or cutchery for the collection of rent previous to the transfers made by the petitioner No. 1.
It was next contended that section 4(h) is ultra vires the Constitution, because it imposed an unreasonable restriction on the fundamental right of the petitioners to realize rent from the Company, as the transfer in its favour was imperilled by the notice issued to it under section 4(h).
No appeal or review was provided in the Act against the order of the Collector issuing notice or an order of annulment made by him.
The Collector was left with absolute power to annul a transfer and to dispossess a person in possession thereunder.
Section 4(b), however, does direct the Collector to give reasonable notice to the parties concerned and to bear them.
Such annulment or dispossession which he may order, must be with the previous sanction of the State Government and he is compelled to do so on terms which may appear to him fair and equitable.
The power is, therefore, not quite so absolute or arbitrary as suggested.
Assuming, however, that the Collector has very wide powers, it is to be remembered that section 4(h) is a part of the law of acquisition of estates as enacted by the Act and is an integral part of the machinery by which acquisition of an estate takes place.
The Act is a valid law of acquisition and its whole purpose may be defeated unless there was some such provision as contained in section 4(b).
The Act being a law for acquisition of estates the question of it or section 4(h) of it imposing any unreasonable restriction on the fundamental rights of the petitioners does not arise.
In any event the Act including sect ton 4(h) is protected by article 31 A of the Constitution.
The petition is accordingly dismissed with costs.
| On the 29th of December, 1947, petitioner No. 1 executed a lease to C (a company) of certain properties consisting of lands and buildings comprised in the estate belonging to him.
Subsequently, in 1949 he executed a deed of settlement whereby he transferred the properties to three trustees, namely, himself and petitioners 2 and 3.
Bihar Land Reforms Act, 1950 (Bihar Act XXX of 1950) came into force on the 25th of September, 1950, and on the 3rd of November, 1951, the State of Bihar issued a notification under section 3(1) of the Act declaring that the estate of petitioner No. 1 had passed to and become vested in the State.
A notice under section 4(h) of the Act was issued by the Collector to C and on the 4th of March, 1954, the State Government issued a notification under s.3(1) purporting to vest in the State the properties in question.
It was contended for the petitioners that the buildings standing on the land comprised in the notified estate did not vest in the State, on the ground (1) that the estate of the petitioner No. 1 did not vest in the State under section 3 of the Act but by virtue of the provisions of section 4, (2) that the definition of "estate" in the Act speaks of land only and not of any building on it, (3) that on the date of vesting, the buildings were not used as office or cutchery for the collection of rent of the notified estate within the meaning of section 4(a), and (4) that section 4(h) is ultra vires the Constitution as it imposes an unreasonable restriction on the fundamental right of the petitioners to realise rent from the company.
Held, that (1) whether the estate of petitioner No. I vested in the State by reason of the publication of the notification under section 3 or by virtue of the provisions of section 4 was of little consequence as in either case a vesting took place; (2) although in the definition of "estate" the word land is used and there is no mention of the word building, the provisions of sections 4, 5 and 7 show the intention of the legislature to include some 989 thing more than merely the land of a notified estate as vesting in the State.
Under section 4(a), buildings of a certain description and other things vest in the State absolutely on the publication of a notification under section 3.
Under sections 5 and 7, the buildings mentioned therein are deemed to be settled by the State with the intermediary and this could only be an the supposition that the buildings vested in the State, the intermediary being a settlee under the State; (3) sections 4(a) and 4(h) must be read together.
Under section 4(h), the use to which the building was put previous to its transfer after the first day of January, 1946, and not thereafter was what the Collector was concerned with and not to what use it had been put after its transfer after the first day of January, 1946.
If a transfer was made after the first day of January, 1946 of a building comprised in the notified estate which was used immediately previous to the date of transfer primarily as office or cutchery for the collection of rent of such estate the transfer would be liable to be annulled under section 4(h) and the building would vest absolutely in the State on the publication of the notification and the provisions of section 4(a) must be read accordingly; and (4) the Collector 's powers under section 4(h), wide as they are, are not quite so absolute or arbitrary as suggested.
section 4(h) is a part of a validly enacted law of acquisition of estates and is an integral part of the machinery by which acquisition of an estate takes place.
The Act or section 4(h) of it imposing any unreasonable restriction on the fundamental right of the petitioners, therefore, does not &rise.
The Act including section 4(h) of it, is protected by article 31 A of the Constitution.
|
306 of 1954.
Under Article 32 of the Constitution for the enforcement of Fundamental Rights.
Kundan Lal Mehta and B.R.L. Iyengar, for the petitioner.
C.K. Daphtary, Solicitor General of India (Porus A. Mehta and R. H. Dhebar, with him) for the respondent.
October 28.
The Judgment of the Court was delivered by JAGANNADHADAS J.
This is an application under article 32 of the Constitution which arises under the following circumstances.
The petitioner, Sadhu Ram, purchased from one Imam ud Din, a muslim evacuee, 43 Bighas 14 Biswas of agricultural land comprised in Khasra Nos.
2135 to 2139, 2158, 2159, 21715 2204 and 2206 with Shamlat rights in village Kaithal, District Karnal, Punjab.
The sale deed was executed on the 6th September, 1947, and registered on the 9th September, 1947, before Imam ud Din left for Pakistan.
The consideration therefor was Rs. 3,000 and as much as Rs. 2,700 thereof appears to have been paid by the petitioner to the vendor before the Sub Registrar.
Possession also was transferred on the execution of the sale deed.
Mutation was made by the revenue authorities on the 23rd January, 1948.
East Punjab 1115 Evacuees ' (Administration of Property) Act, 1947 (East Punjab Act XIV of 1947) came into force on the 12th of December, 1947.
It was amended by East Punjab Evacuees ' (Administration of Property) (Amendment) Ordinance, 1948 (East Punjab Ordinance No. II of 1948) which came into force on the 16th January, 1948.
This gave place to East Punjab Evacuees '(Administration of Property) (Amendment) ' Act, 1948 (East Punjab Act XXVI of 1948) which came into force on the 11th April, 1948.
By these amendments a new section, section 5 A, was inserted in the East Punjab Act XIV of 1947.
It will be seen that these amendments were subsequent to the date of the execution and registration of the sale deed and the transfer of possession thereof.
Section 5 A, so far as it is relevant for our present purpose, is in the following terms: "5 A. (1) No sale, mortgage, pledge, lease, exchange or other transfer of any interest or right in or over any property made by an evacuee or by any person in anticipation of his becoming an evacuee, or by the agent, assign or attorney of the evacuee or such person on or after the fifteenth day of August, 1947, shall be, effective so as to confer any rights or remedies on the parties to such transfer or on any person claiming under them unless it is confirmed by the Custodian.
(2)An application for confirming such transfer may be made by any person claiming thereunder or by any person lawfully authorised by him".
This section purports to be retrospective.
Hence an application for confirmation was made by the petitioner on the 23rd March, 1948.
The Assistant Custodian, Karnal, on being satisfied about the genuineness of the transaction, recommended confirmation.
But the Additional Custodian, Jullundur, by his order dated the 11th February, 1953, rejected the application for confirmation acting on the Custodian General 's circular dated the 9th March, 1950, under which a policy of not confirming transactions relating to agricultural property was enunciated.
This was 1116 affirmed by the Assistant Custodian General on an application to him for revision.
Learned counsel for the petitioner relies on the fact that his transaction which, on enquiry, was held to be genuine, was entered into.
before the East Punjab Act XIV of 1947 was enacted and before the amendment thereof by insertion of section 5 A came into operation.
He contends that the retrospective operation of section 5 A in such circumstances amounts to deprivation of his property, without any compensation and is, therefore, hit by article 31 of the Constitution.
Whatever may have been the position if this matter had to be dealt with much earlier, it seems doubtful whether any such contention can be raised by the petitioner before us, on this date, in view of the recent Constitution (Fourth Amendment) Act, 1955, which has come into force on the 27th April, 1955.
It is unnecessary, however, to base our decision on this ground.
It appears to us clear that section 5 A cannot be read as a legislative provision depriving the owner of his property.
There can be no doubt that so far as transactions subsequent to the date of amendment are concerned, if is nothing more than a restriction on the transfer of property by the owner thereof.
Any transferee in such a situation takes the property subject to the requirement of confirmation.
The case would then, be one which falls under article 19 of the Constitution and not under article 31.
There can be no doubt that having regard to the purpose and policy underlying the law relating to Evacuee Property and the abnormal conditions which arose from and after the 15th August, 1947, the requirement of confirmation with reference to transactions affecting Evacuee Property cannot but be considered a reasonable restriction.
If this requirement was in essence not a deprivation but a restriction in respect of future transactions, there is no reason for treating it as deprivation by virtue of its having been given retrospective effect, such retrospectivity being within the competence of the appropriate legislature.
The retrospectivity commencing from the 15th August, 1947, is 1117 also not only reasonable but called for in the circum stances, which occasioned the Evacuee Property laws.
In this case the petitioner is deprived of his bargain and incurs consequential loss, Dot by virtue of any unconstitutional law but by reason of the quasi judicial order of the Custodian declining to confirm the transaction.
The contention of the learned counsel for the petitioner that any fundamental right of his has been violated must, therefore, be rejected.
Learned counsel next urges that the action of the Custodian in basing his decision on some circular of the Custodian General is illegal and that it is not relevant material under section 5 A.
It is enough to say that even if this contention be correct, this does not raise any question of violation of fundamental rights.
If this is the sole ground, this application is misconceived.
This petition accordingly fails and is dismissed but in the circumstances without costs.
| The applicant purchased certain agricultural lands from a Muslim evacuee.
The sale deed was executed, registered and possession was delivered to the applicant in September, 1947, before the East Punjab Evacuees ' (Administration of Property) Act of 1947 came into operation on the 12th of December, 1947.
By subsequent amendments a new section, section 5 A, was inserted into the Act with retrospective effect from the 15th of August, 1947, rendering transactions in respect of evacuee property ineffective unless confirmed by the Custodian.
The applicant applied for confirmation.
The Assistant Custodian recommended such confirmation but the Additional Custodian, acting in terms of a circular issued by the Custodian General enunciating a policy of non confirmation with regard to agricultural lands, refused to confirm the applicant 's purchase and this order was affirmed by the Assistant Custodian General in revision, It was contended on behalf of the applicant, inter alia, that the retrospective operation of section 5 A of the Act was in effect a deprivation of property without compensation and was hit by article 31 of the Constitution.
Held that 9.
5 A of the East Punjab Evacuees ' (Administration of Property) Act though retrospective in operation does not amount to deprivation of property in respect of past transactions and is valid.
, In respect of future transactions the requirement of con 1114 firmation is clearly a restriction and not a deprivation.
Such restriction was also reasonable having regard to the purpose and policy of the Evacuee Property Law.
The requirement of confirmation being thus in essence only a restriction and not a deprivation, retrospectivity in the operation of that restriction does not make it deprivation.
That the applicant 's loss was occasioned not by any unconstitutional law but by a quasi judicial order of the Custodian refusing confirmation and, consequently, his contention that any fundamental right had been violated must be rejected.
That even if the contention that the order was itself illegal being based on irrelevant material be correct, that did not by itself raise any question of violation of any fundamental right and would be no ground for an application under article 32 of the Constitution.
|
Appeal No. 159 of 1954.
Appeal by Special Leave from the Judgment and Order dated the 27th day of June 1952 of the Calcutta High Court in Matter No. 214 of 1951 A reference under section 57 of the Indian Stamp Act.
M. C. Setalvad, Attorney General of India (B. Sen and P. K. Bose, with him) for the appellant.
section Chaudhury, (section N. Mukherjee, B. N. Ghosh and A. K. Basu, with him) for the respondent.
October 4.
VENKATARAMA AYYAR J.
This appeal raises a question under section 5 of the Indian Stamp Act II of 1899.
The respondent was, at the material time, the Managing Director of Messrs Bird and Co. Ltd., and of Messrs F. W. Heilgers and Co., Ltd., which were acting as Managing Agents of several Companies registered under the Indian Companies Act.
He was also a Director of a number of other Companies, and had on occasions acted as liquidator of some Com 107 844 panies, as executor or administrator of estates of deceased persons and as trustees of various estates.
On 4 7 1949 he applied to the Collector of Calcutta under section 31 of the Stamp Act for adjudication of duty payable on a power of attorney, marked as Exhibit A in the proceedings, which he proposed to execute.
By that power, he empowered Messrs Douglas Chisholm Fairbairn and John James Brims Sutherland jointly and severally to act for him in his individual capacity and also as executor, administrator, trustee, managing agent, liquidator and all other capacities.
The Collector referred the matter under section 56(2) of the Act to the decision of the Chief Controlling Revenue Authority, who eventually referred it under section 57 to the High Court of Calcutta stating his own opinion that the stamp duty was payable on the power "for as many respective capacities as the principal executes the power".
The reference was heard by a Bench consisting of the Chief Justice, Das, J. and section R. Das Gupta, J., who differed in their opinion.
The learned Chief Justice with whom Das, J. agreed, held that the different capacities of the executant did not constitute distinct matters for purposes of section 5 of the Act, and that the proper duty payable on the instrument was Rs. 10 under article 48(d) of Schedule 1 A of the Stamp Act as amended by section 13 of Bengal Act III of 1922.
section R. Das Gupta, J. was of the opinion that the different capacities of the executant were distinct matters for the purposes of section 5, and that the instrument was chargeable with the aggregate amount of duty payable if separate instruments were executed in respect of each of those capacities.
In the result, the question was answered in accordance with the opinion of the majority in favour of the respondent.
Against that decision, the Board of Revenue, West Bengal has preferred this appeal by special leave, and contends that the instrument in question comprises distinct matters, and must be stamped in accordance with section 5.
The statutory provisions bearing on the question are sections 3 to 6 of the Act.
Section 3 is the charg 845 ing section, and it enacts that subject to certain exemptions, every instrument mentioned in the Schedule to the Act shall be chargeable with the duty of the amount indicated therein as the proper duty therefor.
Section 4 lays down that when in the case of any sale, mortgage or settlement several instruments are employed for completing the transaction, only one of them called the principal instrument is chargeable with the duty mentioned in Schedule 1, and that the other instruments are chargeable each with a duty of one rupee.
Section 5 enacts that any instrument comprising or relating to several distinct matters shall be chargeable with the aggregate amount of the duties with which separate instruments, each comprising or relating to one of such matters, would be chargeable under the Act.
Section 6, so far as is material, runs as follows: "Subject to the provisions of the last preceding section, an instrument so framed as to come within two or more of the descriptions in Schedule I, shall, where the duties chargeable thereunder are different, be chargeable only with the highest of such duties".
The point for decision in this appeal is as to the meaning to be given to the words "distinct matters" in section 5.
The contention of the respondent which found favour with the majority of the learned Judges in the court below is that the word "matters" in section 5 is synonymous with the word "description" occurring in section 6, and that they both refer to the several categories of instruments which are set out in the Schedule.
The argument in support of this con tention is this: Section 5 lays down that the duty payable when the instrument comprises or relates to distinct matters is the aggregate of what would be payable on separate instruments relating to each of these matters.
An instrument would be chargeable under section 3 only if it fell within one of the categories mentioned in the Schedule.
Therefore, what is contemplated by section 5 is a combination in one document of different categories of instruments such as sale and mortgage, sale and lease or mortgage and lease and the like, But when the category is one 846 and the same, then section 5 has no application, and as, in the present case, the instrument in question is a power of attorney, it would fall under article 48 (a) in whatever capacity it was executed, and there being only one category, there are no distinct matters within section 5.
We are unable to accept the contention that the word "matter" in section 5 was intended to convey the same meaning as the word "description" in section 6.
In its popular sense, the expression "distinct matters" would connote something different from distinct "categories".
Two transactions might be of the same description, but all the same, they might be distinct.
If A sells Black acre to X and mortgages White acre to Y, the transactions fall under different categories, and they are also distinct matters.
But if A mortgages Black acre to X and mortgages Whiteacre to Y, the two transactions fall under the same category, but they would certainly be distinct matters.
If the intention of the legislature was that the expression 'distinct matters ' in section 5 should be understood not in its popular sense but narrowly as meaning different categories in the Schedule, nothing would have been easier than to say so.
When two words of different import are used in a statute in two consecutive provisions, it would be difficult to maintain that they are used in the same sense, and the conclusion must follow that the expression "distinct mat ters" in section 5 and "descriptions" in section 6 have different connotations.
It is urged against this conclusion that if the word "matters" in section 5 is construed as meaning anything other than "categories" or in the phraseology of section 6, "descriptions" mentioned in the Schedule, then there could be no conflict between the two sections, and the clause in section 6 that it is "subject to the provision of the last preceding section" would be meaningless and useless.
We see no force in this contention.
Though the topics covered by sections 5 and 6 are different, it is not difficult to conceive of instruments which might raise questions falling to be determined under both the sections.
Thus, if a part 847 nership carried on by members of a family is wound up and the deed of dissolution effects also a partition of the family properties as in Secretary, Board of Revenue vs Alagappa Chettiar(1), the instrument can be viewed both as a deed of dissolution and a deed of partition, and under section 6, the duty payable will be the higher duty as on an instrument of partition.
But supposing by that very deed one of the members creates a charge or mortgage over the properties allotted to his share in favour of another member for moneys borrowed by him for his own purposes, that would be a distinct matter which would attract section 5.
Now, but for the saving clause, a contention might be advanced that sections 5 and 6 are mutually exclusive, and as the in strument falls within section 6, the only duty payable thereon is as on an instrument of partition and no more.
The purpose of the clause in section 6 is to repel any such contention.
Considerable stress was laid by Mr. Chaudhury on the scheme of the Act as embodied in sections 3 to 6 as strongly supporting the view that 'matters ' in section 5 meant the same thing as 'description ' in section 6.
He argued that under section 3 the duty was laid not on all instruments but on those which were of the descriptions mentioned in the Schedule, that section 4 enacted a special provision with reference to three of the categories mentioned in the Schedule, sale (conveyance), mortgage and settlement, that if they were completed in more than one instrument, not all of them were liable for the duty specified in the Schedule, but only one of them called the principal document, and that section 6 provided that when the instrument fell under two or more of the categories in the Schedule, the duty payable was the highest payable on any one of them, that thus the categories in the schedule were the pivot on which the entire scheme revolved, and that in construing the section in the light of that scheme, the expression "distinct matter" must in the setting be construed as distinct categories.
To construe "distinct matters" as (1) I.L.R. 848 something different from "distinct categories" would be, it was argued, to introduce a concept foreign to the scheme of the enactment.
The error in this argument lies in thinking that the object and scope of sections 4 to 6 are the same, which in fact they are not.
Section 4 deals with a single transaction completed in several instruments, and section 6 with a single transaction which might be viewed as falling under more than one category, whereas section 5 applies only when the instrument comprises more than one transaction, and it is immaterial for this purpose whether those transactions are of the same category or of different categories.
The topics dealt with in the three sections being thus different, no useful purpose will be served by referring to section 4 or section 6 for determining the scope of section 5 or for construing its terms.
It is not without significance that the legislature has used three different words in relation to the three sections, 'transaction ' in section 4, matter ' in section 5, and 'description ' in section 6.
In support of his contention that 'distinct matters ' in section 5 meant only different categories, learned counsel for the respondent relied on certain observations in Ansell vs Inland Revenue Commissioners(1).
There, the instrument under consideration was a deed of settlement which comprised certain Government securities as also other investments, and under the Stamp Act, 1891, it was chargeable with a single duty ad valorem on the value of all the properties settled.
By section 74, sub section (1) of the Finance Act, 1910, voluntary dispositions were chargeable with a higher stamp duty as on a conveyance; but Government securities were, exempted from the operation of the section.
The question that arose for decision was whether a separate duty was payable in respect of Government stocks under the provisions of the Stamp Act, 1891 over and above what was paid under section 74, sub section (1) of the Finance Act, 1910 on account of other investments.
Answering it in the affirmative, Rowlatt, J. observed: (1) , 849 "If two different classes of property are being transferred by the same words of assignment in the same document, and those two different classes of property in the same document are different from the point of view of the Stamp Act and taxation, it seems to me in common sense that they must be distinct matters".
The respondent wants to read these observations as meaning that where the matters are not dealt with separately for purposes of stamp duty, then they are not distinct matters.
This, however, does not follow.
The case before the court was one in which the instrument dealt with properties which fell under ' two categories, and the decision was that they were distinct matters.
There is nothing either in the deci sion or the observations quoted above to support the contention of the respondent that if the instrument comprises matters falling within the same description, it is not to be construed as comprising distinct matters.
Reliance was also placed on the observations in Reversionary Interest Society vs Commissioners of Inland Revenue(1), in which it was held that a statutory declaration for the purpose of carrying through a transaction was liable for a single stamp duty.
There, the declaration was made by husband and wife, and in view of the purpose for which it had to be used, it was construed as one declaration.
This is a decision on the facts, and is not of much assistance.
In the view, then, that section 5 would apply even when the instrument comprises matters of the same description, the point for decision is whether the instrument proposed to be executed by the respondent is a single power of attorney or a combination of several of them.
The contention of Mr. Chaudhury is that when the executant of one instrument confers on the attorney a general authority to act for him in whatever matters he could act, then there is, in fact, only a single delegation, and that therefore the instrument must be construed as a single power of attorney liable for a single duty under article 48(d) (1) 850 of the Schedule.
The contention of the appellant, on the other hand, is that though the instrument is executed by one person, if he fills several capacities and the authority conferred is general, there would be distinct delegations in respect of each of those capacities, and that the instrument should bear the aggregate of stamp duty payable in respect of each of such capacities.
The question is which of these two contentions is correct.
We are unable to agree with the respondent 'that when a person executes a power of attorney in respect of all the matters in which he could act, it should be held, as a matter of law and without regard to the contents of the instrument, to comprise a single matter.
Whether it relates to a single matter or to distinct matters will, in our opinion, depend on a number of factors such as who are parties thereto, which is the subject matter on which it operates and so forth.
Thus, if A executes one power authorising X to manage one estate and Y to manage another estate, there would really be two distinct matters, though there is only one instrument executed by one person.
But if both X and Y are constituted attorneys to act jointly and severally in respect of both the estates, then there is only one delegation and one matter, and that is specifically provided for in article 48(d).
Conversely, if a number of persons join in executing one instrument, and there is community of interest between them in the subject matter comprised therein, it will be chargeable with a single duty.
This was held in Davis vs Williams(1), Bowen vs Ashley(1), Good son vs Forbes(1) and other cases.
But if the interests of the executants are separate, the instrument must be construed as comprising distinct matters.
Vide Freeman vs Commissioners of Inland Revenue(1).
Applying the same principle to powers of attorney, it was held in Allen vs Morrison(1) that when members of a mutual insurance club executed Single power, it related to one matter , Lord Tenterdon, C. J. observing that "there was certainly a community of (1) ; (2) ; , 469.
(3) ; , 1000 1001.
(4) [1870 71] L.R. 6 Exch.
(5) ; , 1153.
purpose actuating all the members of this club".
In Reference under Stamp Act, section 46(1), a power of attorney executed by thirty six persons in relation to a fund in which they were jointly interested was held to comprise a single matter.
A similar decision was given in Reference under Stamp Act, section 46(2) where a power of attorney was executed by ten mirasdars empowering the collection of communal income appurtenant to their mirasi rights.
On the other hand, where several donors having separate interests execute a single power of attorney with reference to their respective properties as, for example, when A constitutes X as attorney for management of his estate Black acre and B constitutes the same person as attorney for the management of his estate White acre, then the instrument must be held to comprise distinct matters.
It was so decided in Reference under Stamp Act, 8.
46(3).
Thus, the question whether a power of attorney relates to distinct matters is one that will have to be decided on a consideration of the terms of the instrument and the nature and the extent of the authority conferred thereby.
It may be mentioned that questions of this character cannot now arise in England in view of the special provision contained in the Finance Act, 1927 (17 & 18, Geo. 5, Ch. 10), section 56 which runs as follows: "No instrument chargeable with stamp duty under the heading Letter or Power of Attorney and Commission, Factory, Mandate, or other instrument in the nature thereof ' in the First Schedule to the Stamp Act, 1891, shall be charged with duty more than once by reason only that more persons than one are named in the instrument as donors or donees (whether jointly or severally or otherwise), of the powers thereby conferred or that those powers relate to more than one matter".
There is no provision in the statute law of this country similar to the above, and it is significant that it assumes that a power of attorney might consist of distinct matters by reason of the fact that there are (1) Mad.
(2) Mad.
(3) 108 852 several donors or donees mentioned in it, or that it relates to more than one matter.
Now, considering Exhibit A in the light of the above discussion, the point for determination is whether it can be said to comprise distinct matters by reason of the fact that the respondent has executed it in different capacities.
In this form, the question is bereft of authority, and falls to be decided on well recognised principles applicable to the matter.
It is, as has been stated above, settled law that when two persons join in executing a power of attorney, whe ther it comprises distinct matters or not will depend on whether the interests of the executants in the subject matter of the power are separate or joint.
Conversely, if one person holding properties in two different capacities, each unconnected with the other, executes a power in respect of both of them, the instrument should logically be held to comprise distinct matters.
That will be in consonance with the generally accepted notion of what are distinct matters, and that certainly was the view which the respondent himself took of the matter when he expressly recited in the power that he executed it both in his individual capacity and in his other capacities.
But it is contended by Mr. Chaudhury that the fact that the respondent filled several capacities would not affect the character of the instrument as relating to a single matter, as the delegation thereunder extended to whatever the respondent could do, and that it would be immaterial that be held some properties in his individual capacity and some others as trustee or executor, as the legal title to all of them would vest in him equally in the latter as well as in the former capacity.
We are concerned, he argued, not with the source from which the title flowed but with the reservoir in which it is now contained.
This is to attach more importance to the form of the matter than to its substance.
When a person is appointed trustee, the legal title to the estate does, under the English law, undoubtedly vest in him; but then he holds it for the benefit of the cestui que trust in whom the equitable estate vests.
Under the 853 Indian law, it is well established that there can be trusts and fiduciary relations in the nature of trust even without there being a vesting of the legal estate in the trustee as in the case of mutts and temples.
Vide Vidya Varuthi vs Balusami(1).
In such cases, the legal title is vested in the institution, the mahant or shebait being the manager thereof, and any delegation of authority by him can only be on behalf of the institution which he represents.
When a person possesses both a personal capacity and a representa tive capacity, such as trustee, and there is a delegation" of power by him in both those capacities, the position in law is exactly the same as if different persons join in executing a power in respect of matters which are unrelated.
There being no community of interest between the personal estate belonging to the executant and the trust estate vested in him, they must be held to be distinct matters for purposes of section 5.
The position is the same when a person is executor or administrator, because in that capacity he represents the estate of the deceased, whose persona is deemed to continue in him for purposes of administration.
It was finally contended by Mr. Chaudhury that if every capacity of the donor is to be considered as a distinct matter, we should have to hold that there are distinct matters not only with reference to the capacity of the executant as trustee, executor and so forth, but in respect of every transaction entered into by him in his personal capacity.
Thus, it is argued, if he confers on his attorney authority to sell one property, to mortgage another and to lease a third, he would have acted in three different capacities as vendor, mortgagor and lessor, and the instrument will have to be stamped as relating to three distinct matters.
This, he contended, would destroy the very basis of a general power of attorney.
The fallacy in this argument is in mixing up the capacity which a person possesses with acts exercisable by virtue of that capacity.
When an executor, for example, sells one property for discharging the debts of the testator and (1) [1921] 48 I.A. 302. 854 mortgages another for raising funds for carrying on his business, he no doubt acts in two different transactions but in respect of both of them, he functions only in his capacity as executor.
In our opinion, there is no substance in this contention.
In the result, we are of the opinion, differing from the majority of the learned Judges of the court below, that the instrument, Exhibit A, comprises distinct matters in respect of the several capacities of the respondent mentioned therein, and that the view taken by the revenue authorities and supported by section R. Das Gupta, J. is correct.
This appeal will accordingly be allowed.
The respondent will pay the costs of the appellant here and in the court below.
BHAGWATI J.
I regret I am unable to agree with the conclusion reached in the Judgment just delivered.
While agreeing in the main with the construction put upon sections 4, 5 and 6 of the Act and the connotation of the words "distinct matters" used in section 5, 1 am of the view that the question still survives whether the instrument in question is a single power of attorney or a combination of several of them.
The argument which has impressed my Bro ther Judges forming the majority of the Bench is that though the instrument is executed by one individual, if he fills several capacities and the authority conferred is general, there would be distinct delegations in respect of each of those capacities and the instrument should bear the aggregate of stamp duty payable in respect of each of such capacities.
With the greatest respect I am unable to accede to that argument.
I agree that the question whether a power of attorney relates to distinct matters is one that will have to be decided on the consideration of the terms of 'the instrument and the nature and the extent of the authority, conferred thereby.
The fact, however, that the donor of the power of attorney executes it in different capacities is not sufficient in my opinion to constitute the instrument one comprising distinct matters and thus requiring to be 855 stamped with the aggregate amount of the duties with which separate instruments each comprising or relating to one of such matters would be chargeable under the Act, within the meaning of section 5.
The transaction is a single transaction whereby the donor constitutes the donees jointly and severally his attorneys for him and in his name and on his behalf to act for him in his individual capacity and also in his capacity as managing director, director, managing agent, agent, secretary or liquidator of any company in which he is or may at any time, thereafter be in terested in any such capacity as aforesaid and also as executor, administrator, trustee or in any capacity whatsoever as occasion shall require.
No doubt, different capacities enjoyed by the donor are combined herein but that does not constitute him different individuals thus bringing this instrument within the mischief of section 5.
The executants of the instrument are not several individuals but is only one individual, the donor himself, though he enjoys different capacities.
These different capacities have a bearing on the nature and extent of the powers which he could exercise as such.
In his own individual capacity he could exercise all the powers as the full owner qua whatever right, title and interest be enjoys in the property, whether it be an absolute interest or a limited one.
he may be the absolute owner of the property or may have a life interest therein, he may have a mortgagee 's interest or a lessees interest therein, he may be a dominant owner of a tenement or may be a mere licensee; but whatever interest be enjoys in that property will be the subject matter of the power which he executes in favour of the donee.
He may, apart from this individual interest which he enjoys therein, be a trustee of certain property and be may also enjoy the several interests described above in his capacity as such trustee.
It may be that, in his turn he may be accountable to the beneficiaries for the due administration of the affairs of the trust but that does not mean that he, as trustee, is not entitled to exercise all these powers, the trust property having vested in him, and he being therefore in a position to exercise 856 all these powers in relation thereto.
The same would be the position if he were an executor or an administrator of an estate, in possession of the estate of the deceased as such.
The property of the deceased would vest in him though his powers of dealing with the same would be circumscribed either by the provisions of the testamentary instrument or the limitations imposed upon the same by law.
All these circumstances would certainly impose limitations on his powers of dealing with the properties but that does not detract from the position that he is entitled to deal with those properties and exercise all the powers in relation thereto though with the limitations imposed upon them by reason of the capacities which he enjoys.
It follows, therefore, that, though enjoying different capacities, he is the same individual who functions though in different capacities and conducts his affairs in the various capacities which he enjoys but as a single individual.
He is not one individual when be is acting in his own individual capacity; he is not another individual when he is acting as a trustee of a particular estate and he is not a third individual when he is acting as an executor or administrator of a deceased person.
In whatever capacity he is acting he is the same individual dealing with various affairs with which he is concerned though with the limita tions imposed upon his powers of dealing with the properties by reason of the properties having vested in him in different capacities.
I am therefore of the opinion that the instrument in question does not comprise distinct matters but comprises one matter only and that matter is the execution of a general power of attorney by the donor in favour of the donees constituting the donees his attorneys to act for him in all the capacities which he enjoys.
The instrument in question cannot be split up into separate instruments each comprising or relating to a distinct matter in so far as the different capacities of the donor are concerned.
A general power of attorney comprises all acts which can be done by the donor himself, whatever be the capacity or capacities which he enjoys and cannot be split up 857 into individual acts which the donor is capable of per forming and which he appoints his attorney to do for him and in his name and on his behalf.
It is within the very nature of the general power of attorney that all the distinct acts which the donor is capable of performing are comprised in the one instrument which is executed by him, and if that is the position, it is but logical that whatever acts the donor is capable of performing whether in his individual capacity or in his representative capacity as trustee or as executor or administrator are also comprised within the instrument and are not distinct matters to be dealt with as such so as to attract the operation of section 5.
I am therefore of the opinion that the conclusion reached by the majority Judges in the High Court of Judicature at Calcutta was correct and would accordingly dismiss this Appeal with costs.
BY THE COURT.
In accordance with the opinion of the majority the Appeal is allowed with costs here and in the Court below.
| Held per section R. DAS, ACTING C. J., VENKATARAMA AYYAR, JAFER IMAM and CHANDRASEKHARA AIYAR JJ.
(BHAGWATI J. dissenting) the contention that the word "matter" in section 5 of the Indian Stamp Act was intended to convey the same meaning as the word "description" in section 6 is without force.
In its popular sense, the expression "distinct matters" would connote something different from distinct "categories".
Two transactions might be of the same description, but all the same, they might be distinct.
When two words of different import are used in a statute in two consecutive provisions, it cannot be maintained that they are used in the same sense and therefore the expression "distinct matters" in section 5 and "description" in section 6 have different connotations.
It is settled law that when two persons join in executing a power of attorney, whether it comprises distinct matters or not will depend on whether the interests of the executants in the subject matter of the power are separate or not.
Conversely, if one person holding properties in two different capacities, each unconnected with the other, executes a power in respect of both of them, the instrument should logically be held to comprise distinct matters.
Held, that the instrument in question, Exhibit A, the power of attorney comprised distinct matters within the meaning of section 5 of the Indian Stamp Act in respect of several capacities of the respondent mentioned therein.
Per BHAGWATI J. (dissenting).
The fact that the donor of the power of attorney executes it in different capacities is not sufficient to constitute the instrument, one comprising distinct matters and thus requiring to be stamped with the aggregate amount of the duties with which separate instruments each comprising or relating to one of such matters would be chargeable under the Act, within the mean ing of section 5 of the Indian Stamp Act.
The instrument in question, Exhibit A, does not comprise distinct matters but comprises one matter only and that matter is the execution of a general power of attorney by the donor in favour of 843 the donees constituting the donees his attorneys to act for him in all the capacities he enjoys.
It is within the very nature of the general power of attorney that all the distinct acts which the donor is capable of performing are comprised in one instrument which is executed by him and therefore whatever acts the donor is capable of performing whether in his individual capacity or in his representative capacity as trustee or as executor or administrator are also comprised within the instrument and are not distinct matters to be dealt with as such so as to attract the operation of section 5 of the Indian Stamp Act.
Secretary, Board of Revenue, Madras vs Alagappa Chettiar I.L.R. , Ansell vs Inland Revenue Commissioners , Reversionary Interest Society vs Commissioners of Inland Revenue [1906] 22 T.L.R. 740, Davis vs Williams ; , Bowen vs Ashley ; , Good son vs Forbes ; , Freeman vs Commissioners of Inland Revenue [1870 71] L.R. 6 Exch.
101, Allen vs Morrison ; , Reference under Stamp Act, section 46, Mad. 358, Reference under Stamp Act, section 46, Mad.
386, Reference under Stamp Act, section 46, , and Vidya Varuthi vs Balusami, 48 I.A. 302, referred to.
|
Appeal No. 183 of 1952.
Appeal by special leave from the Judgment and Decree dated the 16th day of February 1950 of the Madras High Court in Second Appeal No. 1826 of 1945 from Original Decree dated the 16th March, 1945, of the Court of District Judge, East Godavari at Rajahmundry in A.S. No. 32 of 1943 arising out of the Decree dated the 31st October, 1942, of the Court of Sub Judge, Rajahmundry in Suit No. 17 of 1940 and O.S. No. 39 of 1939.
B. Somayya (K. R. Chaudhury and Naunit Lal, with him) for the appellant.
K. section Krishnaswamy Aiyangar, (K. R. Krishnaswamy, with him) for respondents Nos.
I to 4. 1955.
November 4.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
This is an appeal by special leave against the judgment of the Madras High Court in a second appeal which reversed the concurrent judgments of the courts below, and granted a decree 941 in favour of the respondents for partition and possession of 126 acres 33 cents out of a parcel of land of the extent of 503 acres 18 cents in the village of Kalavacherla and of 10 acres 12 cents out of a parcel of land of the extent of 40 acres 47 cents in the village of Nandarada, with mesne profits, past and future.
All these lands measuring 543 acres 65 cents were purchased by five co sharers on 5 6 1888 under two sale deeds, Exhibits P and P 1.
One of these shares of the extent of about 218 acres was, at the material dates, held in common by two brothers, Rangaraju and Kumara, the former owning 136 acres 45 cents and the latter 81 acres 45 cents.
On 19 8 1908 Kumara executed a simple mortgage, Exhibit Q, over 81 acres 45 cents belonging to him for Rs. 1,000 in favour of Nallapparaju, who with his undivided brother, Achutaramaraju, held a share in the two parcels of land aforesaid in Kalavacherla and Nandarada.
On 19 7 1909 both Rangaraju and Kumara executed a mortgage, Exhibit A, for Rs. 2,000 over all the 218 acres belonging to them in favour of Achutaramaraju.
On 4 6 1910 Kumara again created a mortgage over 81 acres 45 cents belonging to him, Exhibit Q 1 for Rs. 2,500 in favour of Achutaramaraju.
On 14 12 1911 Achutaramaraju executed a mortgage for Rs. 14,000 in favour of one Merla Agastayya, Exhibit C, over the properties which he held in full ownership as co sharer, and also the mortgage right which he held over the properties belonging to Rangaraju and Kumara under the three mortgage deeds, Exhibits Q, A and Q 1.
On 29 8 1920 Kumara sold the 81 acres 45 cents belonging to him and comprised in the mortgages aforesaid to Achutaramaraju for Rs. 11,000 as per Exhibit G, and thereby the two deeds, Exhibits Q and Q 1 became completely discharged and Exhibit A to the extent of the half share of Kumara.
The position then was that Achutaramaraju became the owner of 81 acres 45 cents out of the properties mortgaged under Exhibit A, and continued to be a simple mortgagee as regards the rest of them to the extent of half the amount due therein.
By virtue of section 70 of the Transfer of 942 Property Act, the sale under Exhibit G would enure for the benefit of the mortgagee, Merla Agastayya, being an accession to the interest of his mortgagor.
On 20 1 1924 the representatives of Merla Agastayya assigned their interests in the mortgage, Exhibit C, to the present appellant, who instituted O.S. No. 25 of 1927 on the file of the court of the Subordinate Judge of Kakinada to recover the amount due thereon by sale of the hypotheca.
Achutaramaraju, the mortgagor, and the members of his family were defendants I to 4 in that suit.
Kumara was impleaded as the 14th defendant and Rangaraju and his son as defendants 15 and 16.
In the plaint, it was alleged that the properties comprised in the mortgage deed, Exhibit C, consisted of the properties belonging to the mortgagors in full ownership as co sharers and also of the mortgage right under Exhibits Q, A and Q 1.
Then there was an allegation that defendants I to 4 had themselves purchased the mortgaged properties "towards discharge of the first defendant 's mortgage debts".
As a statement of fact, this was not accurate, because the purchase by Achutaramaraju was only of 81 acres 45 cents belonging to Kumara and the re maining properties continued to be held by Rangaraju, and Achutaramaraju was only a mortgagee thereof under Exhibit A.
There were the further allegations that defendants 14 to 16 were impleaded as parties because they were in possession of the properties, and that they were the predecessors in title in respect of the properties which were mortgaged under Exhibits Q, A and Q 1.
Then there was the general prayer for the sale of the properties.
The mortgagors, defendants 1 to 4, entered into a compromise with the plaintiff, while defendants 14 to 16 remained expert.
On 31 1 1931 the suit was decreed in terms of the compromise as against defendants I to 4 and ex parte as against defendants 14 to 16, and a final decree was passed on 6 11 1932.
On 23 8 1934 the decree holder filed E.P. No. 99 of 1934 praying for the sale of the hypotheca including the properties mentioned in Exhibit A. Defendants 15 and 16 then intervened, and filed an objection to 943 their being sold on the ground that the mortgage had been discharged in 1923, and that the exparte decree against them had been obtained fraudulently.
This application was rejected by the Subordinate Judge on 26 8 1935, and an appeal against this order to the High Court, Madras was also dismissed on 1 9 1938.
Meanwhile, 163 acres 18 cents out of the properties mortgaged under Exhibit A, of which 81 acres 86 1/2 cents belonged to Rangaraju, were brought to sale on the 14th and 15th April 1936, and purchased by the decree holder himself.
The sale was confirmed on 26 6 1936, and possession taken on 15 12 1936.
But before possession was taken, on 14 12 1936 Rangaraju and his sons instituted O.S. No. 268 of 1936 in the District Munsif 's court, Rajahmundry for a declaration that the decree in O.S. No. 25 of 1927 had been obtained fraudulently, and that the decree holder was not entitled to execute the decree as against their pro perties.
An objection was taken to the jurisdiction of the court of the District Munsif to try this suit, and eventually, the plaint was returned to be presented to the proper court.
Thereupon, they instituted on 7 8 1939 the present suit, O.S. No. 39 of 1939 on the file of the District Court, East Godavari for a declaration that the decree in 0.
section No. 25 of 1927 was obtained by suppressing service of summons, and was therefore void and could not affect their title to 136 acres 45 cents which were mortgaged under Exhibit A.
The suit was transferred to the court of the Subordinate Judge of Rajahmundry, and was numbered as O.S. No. 79 of 1946.
In his written statement, the appellant denied that the decree in O.S. No. 25 of 1927 was obtained fraudulently, and contended that the present suit was barred by limitation.
He also pleaded that as he had purchased the properties in execution of the decree and obtained possession thereof, the suit which was one for a bare declaration that the decree was void and inexecutable was not maintainable.
It must be mentioned that while 81 acres 86 1/3 cents of land belonging to Rangaraju and his sons had been sold on the 14th and 15th April 1936, their remaining properties of the 944 extent of 54 acres 58 1/2 cents were sold after the insti tution of O.S. No. 268 of 1936 in the court of the District Munsif, Rajahmundry.
In view of the objections aforesaid, the plaintiffs amended the plaint by adding a prayer that 136 acres 45 cents out of the total of 543 acres 65 cents in schedule A and belonging to them might be partitioned and put in their separate possession.
The Subordinate Judge of Rajahmundry dismissed the suit on the ground that no fraud had been established, and that the suit was barred by limitation in so far as it sought to set aside the decree on the ground of fraud.
The plaintiffs appealed against this judgment to the District Court of East Godavari, which by its judgment dated 16th March 1945 affirmed the decree of the Subordinate Judge.
The plaintiffs then preferred Second Appeal No. 1826 in the High Court, Madras.
There, for the first time the contention was pressed that the decree in O.S. No. 25 of 1927 on its true construction directed a sale only of the mortgage rights which Achutaramaraju had over the A schedule properties, and that the sale of the properties themselves in execution of that decree was in excess of what the decree bad directed., and was therefore void, and that the plaintiffs were accordingly entitled to recover possession of those properties ignoring the sale.
Satyanarayana Rao, J. who heard the appeal, construed the plaint as sufficiently raising this question and issue (2) (b) as covering this contention, and accordingly directed the District Judge to return a finding on the question as to whether the sale of the properties was warranted by the terms of the decree.
The District Judge of East Godavari to whom this issue was referred, held that the decree directed the sale of only the mortgage rights of Achutaramaraju under Exhibit A. and that the sale of the properties themselves was not in accordance with the decree.
But he further held that this was an objection relating to the execution of the decree which could be agitated only before the executing court, and that a separate suit with reference to that matter was barred under section 47, Civil 945 Procedure Code.
On this finding, the second appeal came up for final disposal before Satyanarayana Rao, J. who agreed with the District Judge that the sale of the properties was not authorised by the decree, and was therefore void.
But he declined to entertain the objection that the suit was barred by section 47, Civil Procedure Code, on the ground that it had not been taken in the written statement, and was a new contention preferred for the first time at the stage of second appeal.
In the result,, he granted a decree for partition and delivery of 136 acres 45 cents out of the properties mentioned in schedule A to the plaintiffs, and mesne profits, past and future.
Against this judgment, the defendant prefers the present appeal, and insists that the suit is liable to be dismissed as barred by section 47, Civil Procedure Code.
On behalf of the appellant, it was contended by Mr. Somayya that the question whether having regard to section 47 the suit was maintainable was argued before the learned Judge before he called for a finding, and that it ought to have been therefore considered on the merits, and that, in any event, as it was a pure question of law and went to the root of the matter, it ought to have been entertained.
On behalf of the respondents, Mr. Krishnaswami Iyengar vehemently contends that as the objection to the maintainability of the suit based on section 47 was not taken in the written statement, the learned Judge had a discretion whether he should permit the point to be raised for the first time in second appeal or not, and that we should not interfere with the exercise of that discretion in special appeal.
The basis on which the suit has now been decreed is that the decree in 0.
section No. 25 of 1927 properly construed directed only a sale of mortgage rights under Exhibit A and not of the properties, but it must be conceded that this point does not distinctly emerge on the face of the plaint.
It is true that there are allegations therein which might be read as comprehending that question, but they are vague and elusive, and what is more, this contention was not argued either in the court of the 946 Subordinate Judge of Rajahmundry or in the District Court of East Godavari, and it is only in second appeal that the question appears to have been first thought of in this form.
Though we are not prepared to say that the allegations in the plaint are not.
sufficient to cover this point, we are of the opinion that they are so obscure that it is possible that the appellant might have missed their true import, and omitted to plead in answer thereto that the suit was barred by section 47.
Apart from this, it is to be noted that this point does not involve any fresh investigation of facts.
Indeed, when the matter was before the District Judge in pursuance of the order of the High Court calling for a finding, counsel on both sides understood it as involving a decision on this point as well, and the argument proceeded on the footing that it was a pure question of law involving no further enquiry on facts.
We have therefore permitted the appellant to raise this contention.
Mr. Somayya for the appellant does not challenge the finding of the District Court confirmed by the High Court that the decree directed only the sale of the mortgage rights of Achutaramaraju under Exhibit A, but he contends that the sale in execution of that decree of not merely the mortgage rights under Exhibit A but of the properties themselves was excessive execution against which the judgment debtor was entitled to obtain relief by application to the execution court, and that a separate suit with reference thereto would be barred under section 47, Civil Procedure Code.
It is well settled that when a sale in execution of a decree is impugned on the ground that it is not warranted by the terms thereof, that question could be agitated, when it arises between parties to the decree, only by an application under section 47, Civil Procedure Code and not in a separate suit.
In J. Marret vs Md. K. Shirazi & Sons(1) the facts were that an order was made by the execution court directing, contrary to the terms of the decree, payment of a certain fund to the decree holder.
A separate suit (1) A.I.R. 1930 P.C. 86. 947 having been instituted by the judgment debtor for recovery of the amount on the ground that the payment was not in accordance with the decree, it was held by the Privy Council that the action was barred under section 47.
A case directly in point is Venkatachalapathy Aiyen vs Perumal Aiyen(1).
There, the suit was to enforce a mortgage which related both to properties held in ownership by the mortgagor and mortgage rights held by him.
In execution of the decree passed therein, the properties themselves and not merely the mortgage rights were sold.
The judgment debtor then sued for a declaration that what was sold was only the mortgage right and to recover possession of the properties.
It was held that such a suit was barred under section 47.
Vide also the decisions in Biru Mahata vs Shyama Charan Khawas(2), Abdul Karim vs Islamunnissa Bibi(3) and Lakshmi narayan vs Laduram(4).
The position is, in our opinion, too well settled to be open to argument, and it must accordingly be held that the present suit is barred under section 47, Civil Procedure Code.
That, however, does not conclude the matter.
Section 47, clause (2) enacts that "the Court may, subject to any objection as to limitation or jurisdiction, treat a proceeding under this section as a suit or a suit as a proceeding. . .
Under this provision, this Court has the power to treat the plaint presented on 7 8 1939 as an application under section 47 provided that on that date an application for the relief claimed was not barred by limitation, and provided further that the court in which it was filed was competent to execute the decree.
On the question of limitation, the relevant dates are the 14th and 15th, April 1936, when 81 acres 861 cents belonging to the plaintiffs were sold, and 15th December 1936 when possession was taken thereof through court.
As regards the remaining properties, the exact date on which they were, sold does not appear on the record, but it is sufficient for the present purpose that it was subsequent to the institution of O.S. No. 268 of 1936 on 2,0.4 (1) (2) Cal.
(3) All. 339.
(4) [1931] A.I.R. 1932 Bom.
120 948 the file of the District Munsif 's court, Rajahmundry, which was on 14 12 1936.
Now, the point for determination is whether the plaint was barred by limitation either under article 165 or article 166 of the Indian Limitation Act, if it is treated as an execution application presented.
on 7 8 1939, or whether it was in time under article 181.
Under article 165, an application by a person dispossessed of immovable properties and disputing the right of the decree holder or purchaser at an execution,sale to be put in possession must be filed within 30 days of dispossession.
If this is the article applicable to the present proceedings, then it must be held that the plaint treated as an execution application was filed out of time.
In Vachali Rohini vs Kombi Aliassab(1), a Full Bench of the Madras High Court has held, dissenting from the view previously ex pressed in Ratnam Aiyar vs Krishna Doss Vital DSS(2) and following Abdul Karim vs Mt.
Is amunnissa Bibi (3), that this article applies only to applications for being restored to possession by persons other than judgment debtors, as under Order XXI, rule 100, Civil Procedure Code and that applications by judgmentdebtors claiming relief on the ground that their properties had been erroneously taken in execution of the decree are not governed by it.
This view was approved and followed in Rasul vs Amina (4) and Bahir Das vs Girish Chandra(1).
We are of the opinion that the law has been correctly laid down in the above decisions, and that in accordance therewith, the present proceedings are not barred by article 165.
Coming next to article 166, an application by a judgment debtor to set aside a sale in execution of a decree has, under that article, to be filed within 30 days of the sale.
If the present proceedings are governed by this article, there can be no question that they are barred by limitation.
But then, there is abundant authority that article 166 applies only when the sale is one which has under the law to be 2,0.4 (1) Mad.
(2) Mad.
(3) All. 339 (4) Bom.
(5) [1922) A.I.R. 1923 Cal.
949 set aside as for example, under Order XXI, rules 8990 and 91, but that it has no application when the sale is inoperative and void.
In Seshagiri Rao vs Srinivasa Rao(1), the appellant was a party to the suit, but the decree had exonerated him from liability.
In execution of the decree, his three fourths ' share in the properties was sold on 26 1 1910 and purchased by the decree holder and possession delivered to him on 16 12 1910.
The appellant then filed a suit on 25 7 1911 to set aside the sale on the ground that it was in contravention of the decree and therefore void.
An objection having been taken by the defendant that the suit was barred under section 47, the court, while upholding the same, held that the plaint could be treated as an application under that section if it was in time as an execution application, and the question arose for decision whether the application was governed by article 166 or article 181 of the Indian Limitation Act.
It was held that as the sale was a nullity, it had not to be set aside under the law, and therefore the article applicable was article 181 and not article 166.
This statement of the law was ap proved by a Full Bench of the Madras High Court in Rajagopalier vs Ramanujachariar.
A similar decision was given in, Manmothanath Ghose vs Lachmi Devi(1), wherein it was observed by Page, J. that the sale being void need not have been set aside at all, and the order to be passed was "in substance merely a declaration that the sale was null and of no effect".
The question whether an application by a judgmentdebtor for setting aside a sale on the ground that there was excessive execution and that the sale of his properties was in consequence void was governed by article 166 or article 181 came up directly for consideration in Nirode Kali Roy vs Harendra Nath(1).
In holding that the application was governed by article 181, B. K. Mukherjea, J., (as he then was) observed that "article 166 must be confined to cases where the sale is voidable only and not void when the execution sale is a nullity, if a party files an application under (1) Mad. 813.
(2) [ Mad. 288.
(3) Cal 96.
(4) I.L.R. , 950 section 47 to have it pronounced a nullity or for setting it aside for safety 's sake to avoid future difficulties, the proper article would be article 181 and not article 166 of the Indian Limitation Act".
The decisions in Seshagiri Rao vs Srinivasa Rao(1) and Rajagopalier vs Ramanujachariar(2) were again followed in Ma We Gyan vs Maung Than Byu(3), wherein it was held that if the execution sale was void, it was not necessary for the applicant to have it set aside, and that even if there was such a prayer, that would not affect the real nature of the application which was really "for an order directing the respondent to deliver property on the ground that there was no valid sale".
We are in agreement with these decisions, and hold that when a sale in execution is inoperative and void, an application by a judgment debtor to have it declared void and for appropriate reliefs is governed by article 181 and not article 166.
On the findings of the courts below that the decree in O.S. No. 25 of 1927 properly construed authorised only the sale of the mortgage rights of Achutaramaraju under Exhibit A and not the lands which were the subject matter of that mortgage, the respondents were entitled to apply to the court for delivery of possession of the properties wrongly sold through process of court and delivered to the appellant, and such an application would be governed by article 181.
Then, there is the further question whether applying article 181, the plaint presented on 7 8 1939 was within time under that article.
As already stated, 81 acres 581 cents were sold on the 14th and 15th April 1936.
If the starting point of limitation is the date of sale, then the application must be held to be barred, unless the period during which the suit was pending in the court of the District Munsif, Rajahmundry, is deducted under section 14 of the Indian Limitation Act.
But if limitation is to be reckoned from the date of dispossession, then the application would clearly be in time.
Under article 166, an application to set aside a sale must be presented within 30 days thereof.
(1) Mad. 313.
(2) (1923] I.L.R. 47 Mad.
(3) A.I.R. 1937 Rang.
951 But if the sale in question was void, and for that reason article 166 becomes inapplicable, then the date of the sale must vanish as the starting point of limitation, as it has no existence in law.
It is not until the purchaser acting under colour of sale interferes with his possession that the person whose properties have been sold is really aggrieved, and what gives him right to apply under article 181 is such interference or dispossession and not the sale.
As observed in Ma We Gyan vs Maung Than Byu(1), such an application is really one for an order for redelivery of the properties wrongly taken possession of by the purchaser.
If that is the correct position, the right to apply arises by reason of dispossession and not of sale, and the starting point for limitation would be the date of dispossession.
It was so held in Chengalraya vs Kollapuri(2).
There, the properties of a party to the suit who had been exonerated by the decree were sold in execution of that decree on 8 1 1918 and purchased by the decree holder.
It was found that lie took actual possession of the properties in 1919.
On 23 11 1921 the representatives in interest of the exonerated defendant commenced proceedings to recover possession ,of the properties from the decree holder purchaser on the ground that the sale under which he claimed was void.
It was held that the proper article of limitation applicable was article 181, and that time commenced to run under that article from the date not of sale but of actual dispossession, and that the proceedings were accordingly in time.
We agree with this decision, and hold that an application by a party to the suit to recover possession of properties which had been taken delivery of under a void execution sale would be in time under article 181, if it was filed within three years of his dispossession.
Therefore, there is no legal impediment to the plaint filed on 7 8 1939 being treated as an application under section 47, on the ground that it is barred by limitation.
The next question for consideration is whether the present suit was filed in a court which had jurisdiction to execute the decree in O. section No. 25 of 1927.
(1) A.I.R. 1937 Rang.
(2) A.I.R. 1930 mad.
12. 952 That was a decree passed by the Subordinate Judge of Kakinada, whereas the present suit was filed in the District Court, East Godavari to which the court of the Subordinate Judge of Kakinada is subordinate.
Section 38, Civil Procedure Code provides that a decree may be executed either by the court which passed it or by the court to which it is sent for execution.
The District Court of East Godavari is neither the court which passed the decree in O.S. No. 25 of 1927 nor the court to which it had been sent for execution.
But it is common ground that when the present suit was instituted in the District Court, East Godavari, it had jurisdiction over the properties, which are the subject matter of this suit.
It is true that by itself this is not sufficient to make the District Court of East Godavari the court which passed the decree for purpose of section 38, because under section 37, it is only when the court which passed the decree has ceased to have jurisdiction to execute it that the court which has jurisdiction over the subject matter when the execution application is presented can be considered as the court which passed the decree.
And it is settled law that the court which actually passed the decree does not lose its jurisdiction to execute it, by reason of the subject matter thereof being transferred subsequently to the jurisdiction of another court.
Vide Seeni Nadan vs Muthuswamy Pillai(1) Masrab Khan vs Debnath Mali(1) and Jagannath vs Ichharam(3).
But does it follow from this that the District Court, East Godavari has no jurisdiction to entertain the execution application in respect of the decree in O.S. No. 25 of 1927 passed by the court of the Subordinate Judge, Kakinada? There is a long course of decisions in the High Court of Calcutta that when jurisdiction over the subjectmatter of a decree is transferred to another court, that court is also competent to entertain an application for execution of the decree.
Vide Latchman vs Madan Mohun (4), Jahar vs Kamini Devi(1) and Udit Narayan vs Mathura Prasad(6).
But in Ramier vs 2,0.3 (1) Mad. 821.
F.B. (2) I.L.R. (3) A.1 R. (4) Cal.
(5) (6) Cal.
974. 953 Muthukrishna Ayyar(1), a Full Bench of the Madras High Court has taken a different view, and held that in the absence of an order of transfer by the court which passed the decree, that court alone can entertain an application for execution and not the court to whose jurisdiction the subject matter has been transferred.
This view is supported by the decision in Masrab Khan vs Debnath Mali(1).
It is not necessary in this case to decide which of these two views is correct, because even assuming that the opinion expressed in Ramier vs Muthukrishna Ayyar(1) is correct, the present case is governed by the principle laid down in Balakrishnayya vs Linga Rao(1).
It was held therein that the court to whose jurisdiction the subject matter of the decree is transferred acquires inherent jurisdiction over the same by reason of such transfer, and that if it entertains an execution appli cation with reference thereto, it would at the worst be an irregular assumption of jurisdiction and not a total absence of it, and if objection to it is not taken at the earliest opportunity, it must be deemed to have been waived, and cannot be raised at any later stage of the proceedings.
That precisely is the position here.
We have held that the allegations in the plaint do raise the question of excessive execution, and it was therefore open to the appellant to have raised the plea that the suit was barred by section 47, and then, there could have been no question of waiver.
We have, it is true, permitted the appellant to raise the contention that the present suit is barred by section 47, and one of the reasons therefor is that the allegations in the plaint are so vague that the appellant might have missed their true import.
But that is not a sufficient ground for relieving him from the consequence which must follow on his failure to raise the objection in his written statement.
We agree with the decision in Balakrishnayya vs Linga Rao(,), and hold that the objection to the District Court enter taining an application to execute the decree in 0.
section No. 25 of 1927 is one that could be waived and not (1) Mad. 801.
(2) I.L.R. (3) I.L.R. 954 having been taken in the written statement is not now available to the appellant.
There is thus no legal bar to our treating the plaint presented by the respondents on 7 8 1939 as an execution application under section 47, and in the interests of justice, we direct it to be so treated.
But this should be on terms.
We cannot ignore the fact that it is the gross negligence of the respondents at all stages that has been responsible for all the troubles.
They did not appear in the suit, and put forward their rights under Exhibit A.
They intervened at the stage of execution, but their complaint was mainly that the ex parte decree had been obtained by fraud, a plea which has now been negatived.
Even in this suit.
they did not press the plea on which they have succeeded until they came to the High Court.
Under the circumstances, we think it just that they should be dep rived of all claims for mesne profits down to this date.
In the result, treating the plaint as I an execution application, we direct that the properties mentioned in schedule A to the plaint be partitioned and the respondents put in possession of 126 acres 33 cents in Kalavacherla village and of 10 acres 12 cents in Nandarada village in proceedings to be taken in execution of this order.
The respondents will be entitled to their share of the net income attributable to 136 acres 45 cents aforesaid from this date down to the date on which they are put in separate possession thereof.
Subject to the modification of the decree of the court below as stated above, this appeal will stand dismissed.
The parties will, however, bear their own costs throughout.
| The appellant was the assignee of a mortgage dated 14 12 1911, executed by A, which comprised.
lands belonging to the mortgagor and also a mortgage executed by the respondents in his favour on 19 7 1909.
The appellant instituted a suit in the court of the Subordinate Judge of Kakinada, for the recovery of the amount due on the mortgage, dated 14 12 1911, and prayed for sale of the hypotheca.
The respondents were impleaded as defendants but did not appear.
The suit was decreed ex parte, and in execution of the decree, the properties of the respondents, mortgaged to A on 19 7 1909, were brought to sale, and purchased by the decree holder.
The respondents then instituted the present suit in the District Court of East Godavari which then bad jurisdiction over the properties in suit, for a declaration that the decree obtained by the appellant was fraudulent and inoperative and could not affect their title.
The plaint was later on amended and a prayer added that the properties might be partitioned and the respondents put in separate possession of their share.
The trial Judge dismissed the suit and the District Court in appeal affirmed his decision.
Before the High Court in second appeal it was contended for the first time that the decree in question did not direct a sale of the mortgaged properties but a sale of the mort gagee 's rights under the mortgage deed dated 19 7 1909 and as such the sale of the properties was void.
The High Court having called for a finding from the District Court as to what was sold, it was 939 found by that Court that the decree bad really directed a sale of the mortgagee 's rights and not of the properties mortgaged and that there was excessive execution.
It was, however, of opinion that the point should have been taken before the executing court and the suit in so far as it claimed relief on the basis of excessive execution was barred under section 47 of the Code of Civil Procedure.
The High Court declined to entertain the objection that the suit was barred under section 47 as it had not been taken in the written statement and was raised for the first time in second appeal, and decreed the respondent 's suit.
It was contended for the appellant that the High Court should have entertained the objection and held that the suit was so barred.
Held, that the appellant should be permitted to raise the contention.
The point relating to excessive execution had never been specifically raised except before the High Court and the allegations in the plaint were vague and obscure.
It is a pure question of law which requires no further investigation of facts and was understood and debated as such by the parties before the District Court.
That it was well settled that the question whether an execution sale was in excess of the decree and, therefore, not warranted by it could be raised as between the parties only by an application under section 47 of the Code before the executing court and not by a separate suit.
J. Marret vs Md. K. Shirazi & Sons (A.I.R. 1930 P. C. 86), Venkatachalapathy Aiyen vs Perumal Aiyen ([1912] M.W.N. 44), Biru Mohata vs Shyania Charan Khowas ([1895] I.L.R. , Abdul Karim vs Islamunnissa Bibi ([1916] I.L.R. 38 All. 339) and Lakshminarayan vs Laduram ([1931] A.I.R. , approved.
That the court, however, had the power to treat the plaint in the suit as an application under section 47 subject to any objection as to limitation or jurisdiction.
That the application was not barred under article 165 as it ap plied only to applications for restoration to possession by persons other than judgment debtors and bad no application to the present case.
Vachali Bohini vs Kombi Aliassan '([1919] I.L.R. 42 Mad. 753), Batnam Aiyar vs Krishna Doss Vital Doss ([1897] I.L.R. , Basul vs Amina ([1922] I.L.R. and Bahir Das vs Girish Chandra ([1922] A.I.R. 1923 Cal.
287), approved.
Nor could article 166 apply since it had application only where the sale was voidable and not void and had to be set aside.
That the article applicable to a case of a void sale such as the present was article 181 of the Indian Limitation Act.
Seshagiri Rao vs Srinivasa Rao ([1919] I. , Bajagopalier vs Bamanujachariar ([1923] I.L.R. 47 Mad. 288), Manmothanoth Ghose vs Lachmi Devi ([1927] I.L.R. 55 Cal.
96), Nirode Kali Boy vs Harendra Nath (I.L.R. [1938] 1 Cal. 280), and 119 940 Md We Gyan vs Maung Than Byu (A.I.R. 1937 Rang.
126), ap proved.
That the starting point of limitation for an application under article 181 would be the date of dispossession by the purchaser and not the date of the void sale which had no existence in law and the plaint in the present suit, treated as an application, having been filed ,within 3 years of such dispossession was in time.
Chengalraya vs Kollapuri (A.I.R. , approved.
That the District Court of East Godavari to whose jurisdiction the properties had been transferred before the present suit was instituted had by reason of such transfer acquired an inherent jurisdiction over them and if it entertained an application for execution with reference to them such action was no more than an irregular assumption of jurisdiction and no objection to jurisdiction having been taken by the appellant at the earliest opportunity he must be deemed to have waived it and, consequently, there was no legal bar to treating the plaint as an execution application under section 47 of the Code.
Balakrishnayya vs Linga Bao, (I.L.R. , applied.
Case law discussed.
|
iminal Appeal No. 60 of 1954.
Appeal under Article 134(1)(c) of the Constitution of India from the Judgment and order dated the 19th January 1954 of the Calcutta High Court in Criminal Revision No. 865 of 1953 arising out of the Judgment and Order dated the 29th April 1953 of the Court of Third Municipal Magistrate, Calcutta in Case No. 108 A of 1951.
N. C. Chatterji, (section K. Bose and Sukumar Ghose, with him) for the appellant.
G. P. Kar, (A. K. Mukherjee and D. N. Mukherjee, with him) for the respondent.
November 17.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
This is an appeal against the judgment of the High Court of Calcutta affirming the order of the Municipal Magistrate, whereby he dismissed an application filed by the appellant under section 363 of the Calcutta Municipal Act, 1923, hereinafter referred to as the Act, for demolition of certain constructions on the ground that they had been erected without the previous permission of the authorities and in contravention of the prescriptions laid down in the building rules.
The respondent is the owner of house No. 36, Armenian Street, Calcutta.
On 28 10 1950 the Building Inspector of the Corporation discovered that some new masonry structures were being constructed on the fifth storey of that house.
A notice under section 365 of the Act was immediately served on the respondent directing him to stop forthwith further con 997 structions pending an application to the Magistrate under section 363 of the Act.
What followed thereon is graphically described by the learned Chief Justice of the High Court in his order dated 9 4 1954 granting leave to appeal to this Court, as a hide and seek game.
On receipt of the notice, the respondent stopped the work for a few days, and thereby lulled the Building Inspector into the belief that no further constructions would be made.
When the Inspector ceased to inspect the premises daily, the respondent resumed the work, and on 7 11 1950 when the Inspector came again on the scene, he found that the construction was being proceeded with.
A police constable was then posted for watch under section 365 (3) of the Act, and he continued there till 10 11 1950, on which date the respondent wrote to the Corporation that he would not proceed further with the construction.
The police watch was thereupon withdrawn on the respondent paying Rs. 40 being the charges payable therefor.
On 7 12 1950 the Inspector again inspected the premises, and found that the construc tion was being proceeded with, and had a constable posted again for watch.
On 13 12 1950 the appellant lodged a complaint before the Magistrate under section 488 read with Rule 62 of Schedule XVII charging the respondent with constructing two rooms in the fifth storey without obtaining permission.
Section 488(1)(a) enacts that whoever commits any offence by contravening any provisions of any of the sections or rules of the Act mentioned in the first column of the table annexed thereto, shall be punished with fine as specified in the said table.
Rule 62 provides that the erection of a new building shall not be commenced unless and until the Corporation have granted written permission for the execution of the same.
The complaint was heard on 11 4 1951.
The respondent pleaded guilty, and was fined Rs. 200.
While the proceedings under section 488 were pending before the Magistrate, the Corporation would appear to have examined the nature of the constructions put up by the respondent, and found that they contravened Rules 3, 14, 25 and 32 of Schedule XVII, 998 and decided to take action under section 363.
They accordingly issued a notice to the respondent to show cause why action should not be taken under that section.
The respondent appeared by counsel on 13 2 1951, and after hearing him, the appellant decided on 6 3 1951 to move the court for an order under section 363, and the petition out of which the present appeal arises, was actually filed on 4 4 1951.
There was delay in serving the respondent, and after he was actually served which was on 17 9 1951, the case underwent several adjournments, and finally on 29 4 1953 the Magistrate passed an order dismissing the petition.
There was no dispute that the building rules had been contravened.
The Magistrate, however, held that he had a discretion under section 363 whether he should direct demolition, and that this was not a fit case in which an order should be made for demolition, because the constructions being on the fifth storey could not obstruct light and air and thereby inconvenience the neighbours, and there was no complaint from the residents of the locality, and that as the respondent had already been fined in pro ceedings under section 488, an order for demolition would be to penalise him twice over for the same offence.
Against this order, the appellant preferred a revision to the High Court of Calcutta.
That was heard by K. C. Chunder, J. He agreed with the Magistrate that under section 363 the court had a discretion whether it should order demolition or not, and that as the Corporation had taken proceedings under section 488 and was content to have a fine imposed on the respondent for breach of Rule 62, it would be unjust to permit it thereafter to start proceedings under section 363 for the further relief of demolition of the building.
He also commented on the undue ,delay on the part of the Corporation in taking out the application, and took into account the fact that no complaint had been received from the locality.
In the result, he dismissed the revision.
The appellant applied under article 134(1)(c) for leave to appeal to this Court.
Chakravarti, C. J. and 999 section R. Das Gupta, J. who heard this application, considered that two questions of general importance arose on which it was desirable to have the decision of this Court, viz., (1) whether the Corporation was precluded from taking proceedings under section 363 of the Act by reason of its having taken proceedings prior thereto under section 488 of the Act read with Rule 62 of Schedule XVII, and (2) whether the question of inconvenience to neighbours was relevant for the purpose of deciding whether an order for demolition should be made under section 363 of the Act.
They accordingly granted leave under article 134 (1)(c), and that is how the appeal is now before us.
The first question that arises for our determination is whether the present proceedings under section 363 are barred by reason of the application which was filed under section 488.
It is conceded that there is nothing express in the statute enacting such a bar, but it is contended that it is to be implied from the proviso to section 363 that "where the Corporation have instituted proceedings under section 493, no application shall be made under this section".
Admittedly, the appellant instituted no proceedings under section 493; but it is argued that proceedings under section 488 substantially fall within section 493, and that the proviso should therefore be held to be applicable.
Under section 493, if the erection of any new building is commenced without obtaining the writen permission of the Corporation, the owner of the building shall be liable to a fine which may extend up to Rs. 500.
Then, there is a proviso that where an application had been made under section 363, no proceeding shall be instituted under this section.
This corresponds to the proviso to section 363 set out above, and reading the two provisions, it is clear that the proceedings under the two sections are mutually exclusive.
Now, the contention of the respondent is that a prosecution under section 488 for breach of rule 62 of Schedule XVII is, in essence, a prosecution under section 493(a), and that, therefore, the proviso to section 363 becomes applicable.
We are 1000 unable to agree with this contention.
When the Legislature provides that on the same facts proceedings could be taken under two different sections and the penalties provided in those sections are not the same, it obviously intends to treat them as distinct, and, therefore, where no question under section 403 of the Code of Criminal Procedure arises, proceedings taken under one section cannot be treated as falling within the other.
The penalty prescribed in section 488 for breach of rule 62 of Schedule XVII is fine up to the limit of Rs. 200, whereas the penalty provided for the same offence under section 493(a) is fine which may extend to Rs. 500.
It will not therefore be in consonance with the intention of the Legislature to hold that proceedings under section 488 are in substance the same as proceedings under section 493, so as to be subject to the disability enacted in the proviso to section 363.
If the intention of the Legislature was that proceedings taken under section 488 read with rule 62 of Schedule XVII should bar proceedings under section 363, it could have said so expressly as it did with reference to proceedings taken under section 493.
To accede to the contention of the respondent would be to read into section 363 limitations which are not to be found there.
We cannot accept such a construction.
It was next argued by learned counsel for the respondent that it was open to the Corporation to have asked for demolition of the building in the proceedings taken by it under section 488, and as it did not ask for it and was content with the imposition of fine, it was precluded from claiming that relief in the present proceedings.
This argument is based on section 536, which is as follows: "When under this Act or under any rule or bylaw made thereunder any person is liable, in respect of any unlawful work, (a) to pay a fine, and (b) to be required to demolish the work, a Magistrate may, in his discretion and subject to the provisions of sections 363, 364 and 493, direct the said person to pay the fine and also to demolish the work".
1001 In his order dated 9 4 1954, the learned Chief Justice expressed a doubt whether the Corporation could apply for a demolition order, when instituting an application under section 488 for breach of Rule 62 of Schedule XVII.
We are inclined to share this doubt.
What Rule 62 prohibits is the erection of a building without permission, and under that Rule, the breach is complete when the erection has commenced, without reference to whether the construction is being carried on or completed.
A question of demolition cannot therefore arise with reference to a breach of Rule 62.
It can arise only when the construction of the building is carried on or completed otherwise than in accordance with the terms of the permission or in breach of any of the provisions of the Act or the rules.
Now, in the table annexed to section 488, while a breach of Rule 62 of Schedule XVII is made punishable with fine which may extend to Rs. 200, there is no similar provision with reference to breach of Rules 3, 14, 25 and 32 of that Schedule.
But there is, instead, a provision that when a direction is asked for under section 363(1) for demolition, an order can be passed imposing fine which may extend to Rs. 250.
Under that section, it should be noted, an application for an order for demolition can be made on three grounds, viz., (1) that the erection of building has been commenced without permission, (2) that it has been carried on or completed otherwise than in accordance with the terms of the permission, or (3) that it has been carried on or completed in breach of the provisions contained in the Act or the rules.
But there is this difference between an application based on ground No. 1 aforesaid and one founded on grounds Nos. 2 and 3, that while a question of demolition cannot arise with reference to the former when the charge is com mencement or the construction without permission and at that stage no question of demolition of, a building necessarily arises, it does arise as regards the latter.
Therefore, when an application is made under section 488, whether an order could be made under section 536 for demolition will depend on the ground on which it is founded.
And, where, as in the 1002 present case, the application was based solely and exclusively on a breach of Rule 62 of Schedule XVII, no order could have been passed for demolition under section 536.
It is immaterial for the present purpose that the building had been completed when the order was passed on 11 4 1951 on the application under section 488, because the power to pass an order under section 536 would depend on what the charge as actually laid in the petition was and not on what it might have been.
But even if the Magistrate had the power under section 536 to order demolition of the building, we cannot hold that the appellant is precluded from asking for such an order under section 363 merely by reason of the fact that the Magistrate had failed to pass such an order, or even that the Corporation did not ask for it in the prior proceedings.
There is no question of the application of any principle of constructive res judicata, and there is nothing in the statute which bars the appellant from claiming relief under section 363.
We cannot therefore uphold the contention that the appellant is precluded in any manner by the prior proceedings taken under section 488 from instituting the present petition under section 363.
In this view, the point for decision is whether the order passed by the Municipal Magistrate and affirmed by the learned Judge in revision is open to attack on the merits.
The respondent contends that the Magistrate has under section 363 a discretion whether he should pass an order for demolition or not, and that this Court should not in appeal interfere with the exercise of that discretion especially when it has been concurred in by the High Court.
Now, the language of section 363 is that the Magistrate may pass an order for demolition of the building, and though the word 'may ' might in some contexts be construed as meaning 'shall ', that is not the sense in which it is used in section 363.
We agree with the respondent that section 363 does not require that when a building is shown to have been erected without permission or completed otherwise than in accordance with the terms of the permission or in breach 1003 of the building rules, an order for its demolition should be made as a matter of course.
In our opinion, it does give the Magistrate a discretion whether he should or should not pass such an order.
That was the construction put in Abdul Samad vs Corporation of Calcutta( ') on section 449 of the Calcutta Municipal Act, (Bengal Act III of 1899) which corresponds to section 363 of the present Act on language which is, so far as the present matter is concerned, the same.
in re enacting the present section in the same terms as section 449 of Bengal Act III of 1899, it must be taken that the legislature has accepted the interpretation put on them in Abdul Samad vs Corporation of Calcutta(1) as correctly representing its intention.
It should accordingly be held that the word 'may ' in section 363 does not mean "shall ', and that the Magistrate has under that section a discretion whether be should pass an order for demolition or not.
Then the question is whether the exercise of that discretion by the courts below is open to review by this Court.
It is a well settled principle that when the legislature entrusts to an authority the power to pass an order in its discretion, an order passed by that authority in exercise of that discretion is, in general, not liable to be interfered with by an appellate court, unless it can be shown to have been based on some mistake of fact or misapprehension of the principles applicable thereto.
The appellant contends that the orders under appeal are based on mistakes and misapprehensions, and are therefore liable to be reversed, and that contention must now be examined.
The grounds on which the orders of the courts below are based are (1) that there has been considerable delay on the part of the appellant in moving in the matter, (2) that as in the proceedings taken under section 488 the respondent has been fined, an order for demolition was not called for, and (3) that the breach of the building rules has not resulted in any inconvenience to the public, nor has there been any complaint from the residents of the locality about this.
The materials placed before us do not show (1) Cal.
127 1004 that there has been any great delay on the part of the appellant, The learned Judge has stated that the present proceedings for demolition were taken subsequent to the imposition of fine on 11 4 1951 in the proceedings under section 488.
This is a mistake.
The proceedings under section 363 bad been commenced as early as February 1951 when notice was issued to the respondent under the provisions of that section, and the petition was actually filed in court on 4 4 1951.
It is true that the proceedings were pending for nearly two years before the Magistrate, but as observed by the learned Chief Justice, far from the Corporation being responsible for it, it appears to have been the victim of delay on the part of the respondent.
Both the courts below have mainly based their order on the fact that the, Corporation having taken proceedings under section 488 and a fine having been imposed on the respondent, it would be unjust to impose a further penalty for the same offence by way of demolition.
The assumption on which this reasoning rests is that the charge on which the present proceedings have been taken is the same as that on which the petition under section 488 was laid.
But, as already pointed out, that is not correct.
The proceedings under section 488 were taken for erecting a building without permission whereas the present proceedings are taken substantially for breaches of the building rules, which are quite independent of the charge under Rule 62, and the respondent is therefore not punished twice over for the same default.
The learned Judge observes that this was not a fit case for exercising the discretion in favour of the appellant, because in the prior proceedings under section 488, it did not ask for an order for demolition, nor was such an order made by the Magistrate.
That is obviously with reference to section 536 which we have held to be inapplicable to the present case.
Moreover , when that section enacts that the Magistrate could both impose a fine and order demolition of the building, that clearly indicates that the fact that a fine has been imposed should not by itself and with 1005 out more, be taken as sufficient ground for refusing demolition.
The courts below were also influenced by the fact that there was no complaint from the neighbours about the erection of the building.
It must be remembered that the building rules are enacted generally for the benefit of the public, and where those rules have been violated and proceedings are taken for an order for demolition of the building under section 363, what has to be decided is whether the breaches are of a formal or trivial character, in which case the im position of a fine might meet the requirements of the case, or whether they are serious and likely to affect adversely the interests of the public, in which case it would be proper to pass an order for demolition.
Whether there has been a complaint from the public would not as such be material for deciding the question, though if there was one, it would be a piece of evidence in deciding whether the interests of the public have suffered by reason of the breaches.
The position, therefore, is that the orders of the courts below are based on mistakes and misdirections, and cannot be supported.
The conduct of the respondent in adopting a hide and seek attitude in completing the constructions in deliberate defiance of the law calls for severe action.
It would be most unfortunate, and the interests of the public will greatly suffer, if the notion were to be encouraged that a person might with impunity break the building rules and put up a construction and get away with it on payment of fine.
All this would be good justification for making an order for demolition.
But then, it is now nearly five years since the building was completed, and though section 363(2) which directs that no application for demolition shall be instituted after a lapse of five years from the date of the work does not, in terms, apply as the proceedings have been started in time, we do not feel that after the lapse of all this time, an order for demolition is called for in the interests of the public.
We also take into account the fact that the orders in question would not have come before Us in the normal course by way of appeal, 1006 were it not that the appellant desired that the decision of this Court should be obtained on certain questions of importance, and that purpose has been achieved.
On a consideration of all the circumstances, we do not think that this is a fit case in which we should pass an order for demolition.
We should, however, add that we find no justification for the strictures passed on the appellant by the court below.
In the result, the appeal is dismissed.
| The Corporation of Calcutta is not precluded from taking proceedings under section 363 of the Calcutta Municipal Act, 1923 by reason of its having taken proceedings prior thereto under section 488 of the Act read with Rule 62 of Schedule XVII.
The question of inconvenience to neighbours is not relevant for the purpose of deciding whether an order for demolition should be made under section 363 of the Act.
When the Legislature provides that on the same facts proceedings could be taken under two different sections and the penalties provided in those sections are not the same, it obviously intends to treat them as distinct, and, therefore, where no question under section 403 of the Code of Criminal Procedure arises, proceedings taken under one section cannot be treated as falling within the other.
The word. "may" in section 363 of the Act does not mean "shall" and the Magistrate has under that section discretion whether he should pass an order for demolition or not.
It is a well settled principle that when the legislature entrusts to an authority the power to pass an order in its discretion an order passed by that authority in exercise of that discretion is, in general, not liable to be interfered with by an appellate court, unless it can be shown to have been based on some mistake of facts or misapprehension of the principles applicable thereto.
In the present case, however, the orders of the courts below were based on mistakes and misdirections and therefore could not be supported.
But the Supreme Court did not think this to be a fit case for an order for the demolition of the buildings in view of certain special circumstances, viz, (1) though section, 363(2), which directs that no appli 126 996 cation for demolition shall be instituted after the lapse of five years from the date of the work, did not, in terms, apply as the proceedings had been started in time, it was nearly five years since the building bad been completed and the interests of the public did not call for its demolition, and (2) the appeal came on a certificate granted under article 134(1)(c) with a view to obtaining the decision of the Supreme Court on certain questions of importance.
Abdul Samzad vs Corporation of Calcutta ([1905] I.L.R. , referred to.
|
minal Appeal No. 150 of 1954.
On appeal by leave from the judgment and order dated the 23rd March 1954 of the Allahabad High Court (Lucknow Bench) in Criminal Appeal No. 112 of 1953 connected with Criminal Reference Register No. 15 of 1953 arising out of the judgment and order dated the 24th February 1953 in Sessions Trial No. 5 of 1952 of the Sessions Court at Lucknow.
1037 B, B. Tawakley, (K. P. Gupta and A. D. Mathur with him) for the appellant.
S.P. Sinha (K. B. Asthana and C. P. Lal with him) for the respondent.
December 7.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
This is an appeal by special leave against the judgment of the High Court of Allahabad affirming the conviction of the appellant by the Sessions Judge, Lucknow under sections 409 and 477 A of the Indian Penal Code.
On 12 2 1949 a Society known as the Model Town Co operative Housing Society, Ltd., was registered under the provisions of the Co operative Societies Act (II of 1912), its object being to acquire vacant sites in the town of Lucknow and to allot them to its members so as to enable them to build houses of their own.
The appellant was the chief promoter thereof, and collected monies from prospective shareholders by way of share money.
The first general body meeting of the Society was held on 1 3 1949.
At that meeting, the appellant was elected Honorary Secretary and one Sri Munna Lal Tewari as Treasurer.
The latter having resigned, one section C. Varma was appointed Treasurer in his stead.
On 22 4 1949, there was a meeting of the Managing Committee, at which the appellant was directed to band over the accounts of the Society and its funds to its Treasurer.
The ap pellant gave a list of 38 persons as members of the Society, delivered cheques issued by 13 of them as their share money, and paid a sum of Rs. 3,500 being the amount stated to have been received by him from the other 25 members as share money.
The Society did not function thereafter.
On 16 7 1949 some of the members wrote a letter to the Registrar of Co operative Societies pointing out that the Society had not functioned ever since its incorporation, and asking that steps might be taken for examination of its accounts and, if necessary, for its being wound up.
On this, there was an investigation of the affairs of the Society by two Assistant 1038 Registrars, and on the basis of their reports dated 22 2 1950 and 18 5 1950 the present prosecution was started against the appellant charging him under sections 409 and 477 A of the Indian Penal Code.
The charge under section 409 was that he had received a sum of Rs. 500 from one Sri Chaturvedi, a sum of Rs. 100 from Dr. 0.
P. Bhanti and another sum of Rs. 100 from Dr. R. section Seth, all as share money in December 1948, and that he had misappropriated the same.
The charge under section 477 A was that on 22 4 1949 the appellant acting as the Secretary of the Society falsified the minute book, Exhibit P 18, by omitting to show therein the share money received from the three persons above mentioned.
The defence of the appellant was that the three amounts aforesaid were paid to him not as prospective Secretary for the purpose of allotment of shares, but were deposited with him in his individual capacity for purchasing shares, in case the Society worked well.
The trial of the offence under section 409 was held with the aid of assessors and that under section 477 A with the aid of a jury, the same persons acting both as assessors and jurors, and they returned a verdict of not guilty with reference to the charges under both the sections.
The Sessions Judge, disagreeing with the verdict of the jury under section 477 A, referred the matter to the High Court under section 307 of the Code of Criminal Procedure.
He also disagreed with the opinion of the assessors with reference to the charge under section 409, and held that the appellant was guilty and sentenced him to four years ' rigorous imprisonment and a fine of Rs. 1,000,.
Against this conviction, the appellant preferred an appeal to the High Court.
Both the reference under section 3O7 and the appeal were heard together by the High Court, which agreed with the Sessions Judge that the appellant had received the three amounts as share money and in his capacity as Secretary, and accordingly confirmed his conviction under section 409 and the sentence passed by the Sessions Judge.
Disagreeing with the verdict of the jury, it also held him guilty under section 477 A and sentenced him to 1039 two years ' rigorous imprisonment.
The present appeal by special leave is directed against this judgment.
Mr. Tawakley firstly contended that the finding of the courts below that the amounts paid by Sri Chaturvedi, Dr. Bhanti and Dr. Seth were paid as share money was erroneous, and in support of this contention relied on a letter written by one of them, Dr. Seth, to the appellant on 3rd May 1951 (exhibit D 5) in which it was stated that the amount was paid on the express understanding that if the Society ran, a share would be allotted to him and otherwise the money would be returned.
This letter was written long after proceedings had been taken by the Registrar, and the courts below did not attach much importance to it.
On the other hand, Dr. Seth himself gave evidence in these proceedings which deprives Exhibit D 5 of very much of its value.
Exhibit P 10 is the receipt granted to Sri Chaturvedi.
It expressly recites that Rs. 500 was received as share money for five shares in the Society.
Notices were also issued to both Sri Chaturvedi and Dr. Bhanti to attend the general body meeting of the Society to be held on 1st March 1949 for electing the President and members of the Managing Committee of the Society, and Dr. Seth and Dr Bhanti actually attended it.
Sri Chaturvedi and Dr. Bhanti have also given evidence that they paid the amounts only as share capital.
The courts below accepted the above evidence, and held that the moneys were not paid to the appellant in his individual capacity.
There are no grounds for disturbing that finding in special appeal.
It is now necessary to deal with the several contentions of law urged by Mr. Tawakley in support of this appeal.
His first contention was that when the Sessions Judge disagreed with the verdict of the jury and with the opinion of the assessors, he should have referred the whole case under section 307 for the decision of the High Court and not merely that part of it which related to the charge under section 477 A, and that his failure to do so vitiated the conviction.
He argued that when the same facts constitute two 1040 distinct offences, one of which is triable with the aid of jurors and the other with assessors, and the accused is charged with both, the reference under section 307 must relate to both the charges, if inconsistent findings by different courts with reference to the same matter is to be avoided.
What would happen, he asked, if, in the present case, the appellant did not file an appeal against his conviction under section 409, but the High Court came to the conclusion in the reference under section 307 that Sri Chaturvedi, Dr. Bhanti and Dr. Seth did not pay the amounts to the appellant as share money, and that no offence had been committed by him under section 477 A? The conviction of the appellant under section 409 based on the finding of the Sessions Judge that those amounts were paid as share money would stand, notwithstanding that it would be against the decision of the High Court.
This anomaly could be avoided, it is argued, by holding that the reference under section 307 must be of the whole case.
Reliance is placed in support of this contention on the observations in Emperor vs Haria Dhobi(1).
We are unable to agree with this contention.
If the procedure adopted by the Sessions Judge is to be held to be illegal, it can only be on the ground that he contravened some provision of law which requires him to refer the whole case to the High Court.
It is conceded that the only provision of law dealing with this matter is section 307.
But that section applies in terms only to trials with the aid of a jury.
There is therefore no power in the Sessions Court to refer cases tried with the aid of assessors for decision of the High Court under that section.
That was the view taken in Pachaimuthu In re(2), where it was held that the Assistant Sessions Judge had no jurisdiction to refer under section 307 the whole case to the High Court, that he should himself dispose of the charges which were triable with the aid of assessors, and that the reference in respect of those charges was bad.
This decision was followed in Emperor vs Lachman (1) A.I.R. 1937 Patna 66 (2) Mad 715.
1041 Gangota(1).
The same view has also been taken by the High Court of Bombay in a number of cases: Vide Emperor vs Kalidas(2), Emperor vs Vyankat Sing(3) and Emperor vs Chanbasappa(4).
We are accordingly of opinion that the Sessions Judge had contravened no provision of law, and had committed no illegality in deciding the case, in so far as it related to the charge under section 409, himself In this case there is the further fact that the appellant preferred an appeal against his conviction under section 409 by the Sessions Judge, and that appeal was heard along with the reference under section 307 in respect of the charge under section 477 A, and that they were both of them disposed of by the same judgment.
It was next contended that the true status of the appellant was that of a servant and not of an agent, and that he should have been charged not under section 409 but under section 408.
The substance of the charge against the appellant is that as the promoter of a Society he lawfully received the amounts paid by Sri Chaturvedi, Dr. Bhanti and Dr. Seth, but that after its incorporation, when he failed on 22 4 1949 to hand over those amounts to the Treasurer and to include their names as shareholders in the minutes book, he committed offences under sections 409 and 477 A.
Now, what is the status of the appellant as Secretary of the Society in which capacity he committed the offences, servant or agent? The distinction between the two is thus stated in Halsbury 's Laws of England, Volume 22, page 113, para 192 "A, servant acts under the direct control and supervision of the master, and is bound to conform to all reasonable orders given him in the course of his work. .
An agent though bound to exercise his authority in accordance with all lawful instructions which may be given to him from time to time by his principal, is not subject in its exercise to the direct control or supervision of the principal".
Having regard to the nature of the duties of the appellant as the Secretary of the Society, we are clearly (1) A.I.R. 1934 Patna 424.
(3) (2) (4) A.I.R. 1932 Bom.
61. 1042 of opinion that his status was that of an agent and not a servant.
Moreover, whether the appellant should be charged under section 408 or section 409 is of no importance in the present case, as the sentence imposed on him under section 409, viz., four years ' rigorous imprisonment could be maintained even under section 408.
It was argued by the appellant that an offence under section 408 was triable with the aid of a jury, whereas that under section 409 was triable with the aid of assessors, and that he had been prejudiced in that be bad lost the benefit of a trial by jury.
But this objection was not taken in the trial court, and is not now open.
Vide section 536 of the Code of Criminal Procedure.
It is next contended that there has been a violation of section 234 of the Code of Criminal Procedure in that the appellant had been charged with three offences under section 409 and one under section 477 A.
But the case is governed by section 235, as the several offences under sections 409 and 477 A arise out of the same acts and form part of the same transaction.
Moreover, the appellant.
has failed to show any prejudice as required by section 537.
This objection must accordingly be overruled.
It was finally contended that there had been no proper examination of the appellant under section 342, and that therefore the conviction was illegal.
This objection was not raised in the Courts below, and is sought to be raised in this Court by a supplemental proceeding.
We find no substance in this objection.
In the result, this appeal fails and is dismissed.
| The appellant was tried by the Sessions Judge with the aid of assessors for an offence under section 409, I.P.C. for misappropriating certain sums of money received as promoter of a Company from three ,different persons for the purpose of allotment of shares and omitted to be brought into the Company after it was formed, and also for an offence under section 477 A, I.P.C. by the same Sessions Judge with the aid of a jury for the offence of falsifying a minute book, the same persons acting both as assessors and jurors.
They returned a verdict of not guilty in respect of both the charges.
The Sessions Judge, disagreeing with the verdict of the jury under section 477 A, referred the matter to the High Court under section 307 of the Code of Criminal Procedure.
Disagreeing also with the opinion of the assessors in respect of the charge under section 409, I.P.C. he held the appellant guilty and sentenced him to 4 years ' rigorous imprisonment.
Against this conviction the appellant appealed to the High Court.
Both the reference under section 307 of the Code of Criminal Procedure and the appeal were heard together by the High Court which confirmed the appellant 's conviction under section 409 and the sentence passed by the Sessions Judge and disagreeing with the verdict of the jury it held him guilty under section 477 A and sentenced him to two years ' rigorous imprisonment.
On appeal by special leave to the Supreme Court: Held (i) that the contention that when the Sessions Judge disagreed with the verdict of the jury and the opinion of the assessors, 1036 he should have referred the whole case under section 307 of the Code of Criminal Procedure to the High Court and not merely that part of it which related to the charge under section 477 A, I.P.C. was without force because the Sessions Judge had contravened no provision of law and committed no illegality in deciding the case which related to the charge under section 409, I.P.C.
That section 307, Code of Criminal Procedure applies in terms only to trials by a jury and the Sessions Judge had no power under that section to refer cases tried with the aid of assessors for the decision of the High Court.
In the present case there was the further fact that both the appeal against the conviction under section 409, I.P.C. and the reference under section 307 of the Code of Criminal Procedure in respect of the charge under section 477 A were disposed of by the same judgment; (ii)that the contention that the appellant 's true status was that of a servant and not that of an agent and that he should have been tried not under section 409, I.P.C. but under section 408, I.P.C. was also without force inasmuch as his status was that of an agent and not that of a servant in view of his duties as Secretary of the Society.
The distinction between the two is this a servant acts under the direct control and supervision of the master, and is bound to con form to all reasonable orders given to him in the course of his work.
An agent though bound to exercise his authority in accordance with all lawful instructions which may be given to him from time to time by his principal, is not subject in its exercise to the direct control or supervision of the principal; (iii)that the contention that there had been violation of section 234 of the Code of Criminal Procedure in that the appellant had been charged with three offences under section 409, I.P.C. and one under section 477 A was also without force as the case was governed by section 235 of the Code of Criminal Procedure as the several offences under section 409, I.P.C. and section 477 A, I.P.C. arose out of the same acts and formed part of the same transaction.
Emperor vs Haria Dhobi, (A.I.R. 1937 Patna 662), Pachaimuthu In re, ([1932] I.L.R. , Emperor vs Lachman Gangota, (A.I.R. 1934 Patna 424), Emperor vs Kalidas, ([1898] , Emperor vs Vyankat Sing ([1907] and Emperor vs Chanbasappa (A.I.R. , referred to.
|
minal Appeal by Special Leave from the Judgment and Order dated the 4th July 1952 of the Calcutta High Court in Criminal Revision No. 312 of 1952 arising out of the Order dated the 12th March 1952 of the Court of Presidency Magistrate at Calcutta in Case No. C/2867 of 1950.
section C. Isaacs (C. P. Lal with him) for the appellant in both appeals.
C. K. Daphtary, Solicitor General of India (Porus A. Mehta and P. G. Gokhale with him) for the respondents in both appeals.
927 1955.
October 31.
The Judgment of the Court was delivered by CHANDRASEKHARA AIYAR J.
These appeals come before us on special leave to appeal granted under article 136 of the Constitution against two orders of the Calcutta High Court dismissing Criminal Revision Petitions Nos. 559 of 1951 and 312 of 1952 preferred by the appellants respectively.
In Criminal Revision Petition No. 559 of 1951, the High Court (Harries, C.J. and Banerjee, J.) confirmed an order made by a Presidency Magistrate discharging the accused on the ground of want of sanction under section 197, Criminal Procedure Code.
In Criminal Revision Petition No. 312 of 1952, Lahiri and Guha, JJ.
set aside an order made by another Presidency Magistrate that no sanction was required and they quashed the proceedings against the accused.
The incidents which gave rise to the two complaints are closely inter related and can be set out briefly.
In connection with certain proceedings pending before the Income Tax Investigation Commission it was found necessary to search two premises 17, Kalakar Street and 36, Armenian Street to inspect, take copies and secure possession of certain books, papers and documents believed to be in them.
A warrant was issued by the Commission for this purpose in favour of four persons, namely, H. C. Bhari, A. D. De, A. K. Bose and P. Mukherjee, to carry out the search.
The authorised officials went to the Kalakar Street premises, third floor on the morning of December 1950.
Matajog Dobey, (Appellant in Criminal Appeal No. 67), the darwan of Kasbiram Agarwala, says that when he found them forcibly breaking open the entrance door of the flat he challenged them and requested them to desist.
They paid no heed to him, broke open the door, went inside and interfered with some boxes and drawers of tables.
They tied him with a rope and assaulted him causing injuries.
On these facts, he filed a complaint on 27 12 1950 against H.C. Bhari and three others (names unknown) under sections 323, 341, 342 and 109, Indian Penal Code, 928 Armenian Street premises on the evening of 26 12 1950.
Nandram Agarwala (father of Kashiram Agarwala) came to the place and found that they had forcibly opened the lock of the door of the room in which there were several books and papers, which they were collecting and packing into bundles for removal.
He protested, pointed out that their actions were illegal and oppressive, and he wanted a proper search list to be prepared and proper receipts to be given to him for the books and documents sought to be seized and removed.
Thereupon, two policemen held him down and he was assaulted mercilessly, kicked, dragged downstairs, put in a police van, and taken to the Burra Bazar thana, where he was as saulted again before being sent to the hospital.
He was brought back and kept in the lock up till midnight when he was released on bail.
Setting out these facts, he lodged a complaint against the four officials, other subordinates and police officers whose names he did not then know but could supply later.
The offences mentioned in the complaint are sections 323, 342 and 504, Indian Penal Code.
Later, the names of two police officers were given Bibhuti Chakravarti and Nageswar Tiwari.
The two complaints were sent over for judicial inquiry to two different magistrates.
On 21 2 1951, the magistrate held on Agarwala 's complaint that a prima facie case had been made out under section 323 against all the four accused and under section 342 against the two policemen.
On this report, summonses were directed to issue under section 323 against all the accused.
On 1 5 1951, two prosecution witnesses were examined in chief and the case stood adjourned to 22 5 1951.
It was on this latter date that the 1st accused Bhari filed a petition, taking the objection of want of sanction under section 197, Criminal Procedure Code.
The objection was upheld and all the accused disc barged on 31 5 1951.
Nandram Agarwala went up to the High Court in revision, but the order of the Presidency Magistrate was affirmed.
In Matajog Dobey 's complaint, after the termina 929 tion of the inquiry, process was issued only against Bhari under sections 323 and 342 , Indian Penal Code for 22 12 1951.
After some adjournments, accused filed on 26 2 1952 a petition as in the other case raising the same objection.
The magistrate on whose file the case was pending overruled the objection and directed that the case should proceed.
Accused Bhari took the matter on revision to the High Court and succeeded.
In Nandram Agarwala 's case (Criminal Revision Petition No. 559 of 1951) Chief Justice Harries and Banerjee, J. held that the test formulated by the Privy Council in Gill 's case(1) applied and that on a fair reading of the complaint, bereft of exaggerations and falsehoods, the officers could reasonably claim that what they did was done by them in the exercise of their official duty.
In Matajog Dobey 's case (Criminal Revision Petition No. 312 of 1952), the learned Judges (Lahiri and Guha, JJ.) came to the same conclusion in these words: "From the nature of the allegations therefore against the petitioner, it is abundantly clear that there was something in the acts alleged against him which attached them to the official character of the petitioner, that is, which attached them to his official character in holding the search".
Mr. Isaacs, learned counsel for the appellants in the two appeals, challenged the soundness of these conclusions and advanced three categorical contentions on their behalf.
Firstly, an act of criminal assault or wrongful confinement can never be regarded as an act done while acting or purporting to act in the discharge of official duty; secondly, that in a case where the duty is clearly defined by statute and warrant of authority, such acts could never come within the scope of employment; and thirdly, that in any case it was the duty of the court to allow the prosecution to proceed and not stifle it in limine.
He also urged that as the entry on the 23rd December was into a wrong place, P 17, Kalakar Street, and not 17, Kalakar Street which was the authorised premises, the search was illegal from the commencement.
He raised the (1) [1948] L.R. 75 I.A. 41. 930 constitutional point that section 5(1) of the Taxation on Income (Investigation Commission) Act XXX of 1947) and section 197, Criminal Procedure Code were ultra vires, as they were discriminatory in their nature, and offended article 14 of the Constitution.
In the course of his arguments, he referred to section 6 sub sections (7) and (9) of the Taxation on Income (Investigation Commission) Act (XXX of 1947) and rule 10 and the search warrant that was issued under them.
His main argument was that there was no power conferred by statute or under common law on the authorised officials to assault or use force in the execution of their duty and any such acts must therefore be deemed to be entirely outside the scope of their employment.
He drew our attention to the sections of the Criminal Procedure Code relating to searches and quoted two old English cases to reinforce this position.
The search warrant is in these terms: "Warrant of Authorisation under sections 6(7) and 6(9) and Rule 8.
Taxation on Income (Investigation Commission) Act, 1947.
Whereas information has been laid before the Commission and on the consideration thereof the Commission has been led to believe that certain books, documents and papers, which are or may be relevant to proceedings under the above Act in the cases compendiously known as the section Jhabbarmull group (R. C. No. 313) and connected cases have been kept and are to be found in (i) the third floor, 17, Kalakar Street, Calcutta (ii) 47 Khengraputty Street, Calcutta 7, and (iii) the second 'floor and adjoining rooms, 36, Armenian Street, Calcutta, compound, offices and out houses or other places in that locality.
This is to authorise and require you, Sri H. C. Bhari, Authorised Official, Income tax Investigation Commission, (a) to enter and search with such assistance of police officers as may be required, the said premises or any other place or places where you may have 931 reason to believe that such books, documents or papers may be found; (b)to place identification marks on such books, documents and papers as may be found and as you may consider relevant to the proceedings aforesaid and to make a list thereof together with particulars of the identification marks; (c) to make copies or extracts from such books, documents and papers; (d) to seize such books, documents and papers and take possession thereof; and (e)to exercise all other powers and duties under the said sections and the Rules relating thereto".
Straightaway, it may be conceded that the warrant set out above specifies precisely the scope of the duties entrusted to the authorised officials.
Whether they took any policemen with them even at the commencement or whether they were only sent for when resistance was offered is not clear.
This, however, does not matter as the warrant authorises police assistance at the search.
The version of the complainants as to what happened at the search is set out in the two complaints.
The story of the accused is found in the petitions filed by Bhari urging the objection under section 197, Criminal Procedure Code.
Details about the occurrences were also elicited at the two judicial enquiries.
There are two medical certificates specifying the injuries found on Nandram Agarwala and Matajog Dobey.
The minor contentions may be disposed of at the outset.
Even if there was anything sound and substantial in the constitutional point about the vires of section 5(1) of the Act, we declined to go into it as it was not raised before the High Court or in the grounds of the petition for special leave to appeal.
Article 14 does not render section 197, Criminal Procedure Code ultra vires as the discrimination is based upon a rational classification.
Public servants have to be protected from harassment in the discharge of official duties while ordinary citizens not so engaged do not require this safeguard.
It was argued that 118 932 section 197, Criminal Procedure Code vested an absolutely arbitrary power in the government to grant or withhold sanction at their sweet will and pleasure, and the legislature did not lay down or even indicate any guiding principles to control the exercise of the discretion.
There is no question of any discrimination between one person and another in the matter of taking proceedings against a public servant for an act done or purporting to be done by the public servant in the discharge of his official duties.
No one can take such proceedings without such sanction.
If the government gives sanction against one public servant but declines to do so against another, then the government servant against whom sanction is given may possibly complain, of discrimination.
But the petitioners who are complainants cannot be heard to say so for there is no discrimination as against any complainant.
It has to be borne in mind that a discretionary power is not necessarily a discriminatory power and that abuse of power is not to be easily assumed where the discretion is vested in the govern ment and not in a minor official.
Further, we are not now concerned with any such question.
We have merely to see whether the court could take cognisance of the case without previous sanction and for this purpose the court has to find out if the act complained against was committed by the accused while acting or purporting to act in the discharge of official duty.
Once this is settled, the case proceeds or is thrown out.
Whether sanction is to be accorded or not is a matter for the government to consider.
The absolute power to accord or withhold sanction conferred on the government is irrelevant and foreign to the duty cast on the court, which is the ascertainment of the true nature of the act.
The objection based on entry into the wrong premises is of no substance; it is quite probable that the warrant specified 17 instead of P. 17 by a bona fide mistake or error; or it may be that the party made an honest mistake.
As a matter of fact, the account books, etc. were found in P. 17, the premises raided.
Slightly differing tests have been laid down in the 933 decided oases to ascertain the scope and the meaning of the relevant words occurring in section 197 of the Code; "any offence alleged to have been committed by him while acting or purporting to act in the discharge of his official duty".
But the difference is only in language and not in substance.
The offence alleged to have been committed must have something to do, or must be related in some manner, with the discharge of official duty.
No question of sanction can arise under section 197, unless the act complained of is an offence; the only point to determine is whether it was committed in the discharge of official duty.
There must be a reasonable connection ' between the act and the official duty.
It does not matter even if the act exceeds what is strictly necessary for the discharge of the duty, as this question will arise only at a later stage when the trial proceeds on the merits.
What we must find out is whether the act and the official duty are so inter related that one can postulate reasonably that it was done by the accused in the performance of the official duty, though possibly in excess of the needs and requirements of the situation.
In Hori Ram Singh vs The Crown(1), Sulaiman, J. observes: "The section cannot be confined to only such acts as are done by a public servant directly in pursuance of his public office, though in excess of the duty or under a mistaken belief as to the existence of such duty.
Nor is it necessary to go to the length of saying that the act constituting the offence should be so inseparably connected with the official duty as to form part and parcel of the same transaction".
The interpretation that found favour with Varadachariar, J. in the same case is stated by him in these terms at page 187: "There must be something in the nature of the act complained of that attaches it to the official character of the person doing it".
In affirming this view, the Judicial Committee of the Privy Council observe in Gill 's case(1) "A public servant can only be said to act or purport to act in the discharge of his official duty, if his act is such as to (1) ,178.
(2) [1948] L.R. 75 I.A. 41.
934 lie within the scope of his official duty .
The test may well be whether the public servant, if challenged, can reasonably claim that, what he does, he does in virtue of his office".
Hori Ram 's case(1) is referred to with approval in the later ease of Lieutenant Hector Thomas Huntley vs The King Emperor(1) but the test laid down that it must be established that the act complained of was an official act appears to us unduly to narrow down the scope of the protection afforded by section 197 of the Criminal Procedure Code as defined and understood in the earlier case.
The decision in Meads vs The King(1) does not carry us any further; it adopts the reasoning in Gill 's case(1).
There are two cases of this Court to which reference may be made here.
In Shreekantiah Ramayya Munipalli vs The State of Bombay(1), Bose, J. observes as follows: "Now it is obvious that if section 197 of the Code of Criminal Procedure is construed too narrowly, it can never be applied, for of course, it is no part of an official 's duty to commit an offence and never can be.
But it is not the duty we have to examine so much as the act, because an official act can be performed in the discharge of official duty as well as in dereliction of it.
The section has content and its language must be given meaning".
The question of previous sanction also arose in Amrik Singh vs The State of PEPSU(6).
A fairly lengthy discussion of the authorities is followed up with this summary: "If the acts complained of are so integrally connected with the duties attaching to the office as to be inseparable from them, then sanction under section 197(1) would be necessary; but if there was no necessary connection between them and the performance of those duties, the official status furnishing only the occasion or opportunity for the acts, then no sanction would be required".
The result of the foregoing discussion is this: There must be a reasonable connection between the act and the discharge of official duty; the act must bear such (1) ,178, (2) (3) [1948] L.R. 75 I.A. 185.
(4) [1948] L.R. 75 I.A. 41.
(5) ; , 1186.
(6) ; , 1307, 1308.
relation to the duty that the accused could lay a reasonable, but not a pretended or fanciful claim, that he did it in the course of the performance of his duty.
Is the need for sanction to be considered as soon as the complaint is lodged and on the allegations therein contained? At first sight, it seems as though there is some support for this view in Hori Ram 's case and also in Sarjoo Prasad vs The King Emperor(1).
Sulaiman, J. says that as the prohibition is against the institution itself, its applicability must be judged in the first instance at the earliest stage of institution.
Varadachariar, J. also states that the question must be determined with reference to the nature of the allegations made against the public servant in the criminal proceeding.
But a careful perusal of the later parts of their judgments shows that they did not intend to lay down any such proposition.
Sulaiman, J. refers (at page 179) to the prosecution case as disclosed by the complaint or the police report and he winds up the discussion in these words: "Of course, if the case as put forward fails or the defence establishes that the act purported to be done is in execution of duty, the proceedings will have to be dropped and the complaint dismissed on that ground".
The other learned Judge also states at page 185, "At this stage we have only to see whether the case alleged against the appellant or sought to be proved against him relates to acts done or purporting to be done by him in the execution of his duty".
It must be so.
The question may arise at any stage of the proceedings.
The complaint may not disclose that the act constituting the offence was done or purported to be done in the discharge of official duty; but facts subsequently coming to light on a police or judicial inquiry or even in the course of the prosecution evidence at the trial, may establish the necessity for sanction.
Whether sanction is necessary or not may have to be determined from stage to stage.
The necessity may reveal itself in the course of the progress of the case.
We are not prepared to concede in favour of the (1) , 936 appellants the correctness of the extreme proportion advanced by Mr. Isaacs on their behalf that when obstruction is laid or resistance offered against an authorised and therefore lawful search, the officials conducting the search have no right to remove or cause to be removed the obstruction or resistance by the employment of reasonable force, and their remedy is only to resort to the police or the magistracy with a complaint.
Such a view would frustrate the due discharge of the official duty and defeat the very object of the search, as the books, etc. might be secreted or destroyed in the interval; and it would encourage obstruction or resistance even to lawful acts.
It may be that more than reasonable force is used to clear the obstruction or remove the resistance, but that would be a fit subject matter for inquiry during the proceedings; it would not make the act of removal improper or unlawful.
It is a matter for doubt if Chapters V and VII of the Criminal Procedure Code can be read as an exhaustive enumeration of all the powers of a search party.
Anyhow, section 6, sub section (9) of the Investigation Commission Act makes the provisions relating to searches applicable only "go far as they can be made applicable".
The two English cases relied on are scarcely of any help.
In Jones vs Owen"), a rather startling view was taken that a power to apprehend a person for a statutory offence did not include a power to move that person gently aside.
Hatton vs Treeby(2) was a case where the Act of Parliament which created a new offence did not in itself provide for a power of detention of the offender.
Where a power is conferred or a duty imposed by statute or otherwise ' and there is nothing said expressly inhibiting the exercise of the power or the performance of the duty by any limitations or restrictions, it is reasonable to hold that it carries with it the power of doing all such acts or employing such means as are reasonably necessary for such execution.
If in the exercise of the power or the performance (1) [1823] L.J. Reports (K.B.) 139; 2 D. & R. 600.
(2) [1897] L.R.2 Q.B.D. 452. 937 of the official duty, improper or unlawful obstruction or resistance is encountered, there must be the right to use reasonable means to remove the obstruction or overcome the resistance.
This accords with commonsense and does not seem contrary to any principle of law.
The true position is neatly stated thus in Broom 's Legal Maxims, 10th Ed., at page 312: "It is a rule that when the law commands a thing to be done, it authorises the performance of whatever may be necessary for executing its command".
Let us however assume that Mr. Isaacs is right in his contention.
Still, it can be urged that the accused could claim that what they did was in the discharge of their official duty.
The belief that they had a right to get rid of the obstruction then and there by binding down the complainants or removing them from the place might be mistaken, but, surely, it could not be said that their act was necessarily mala fide and entirely divorced from or unconnected with the dig ' charge of their duty that it was an independent act maliciously done or perpetrated.
, They. could reasonably claim that what they did was in virtue of their official duty, whether the claim is found ultimately to be well founded or not.
Reading the complaints alone in these two cases, even without the details of facts as narrated by the witnesses at the judicial inquiries, it is fairly clear that the assault and use of criminal force, etc.
alleged against the accused are definitely related to the performance of their official duties.
But taken along with them, it seems to us to be an obvious case for sanction.
The injuries a couple of abrasions and a swelling on Nandram Agarwala and two ecohymosis on Matajog indicate nothing more than a scuffle which is likely to have ensued when there were angry protests against the search and a pushing aside of the protestors so that the search may go on unimpeded.
Mr. Isaacs finally pointed out that the fourth accused Nageswar Tewari was a constable and the case should have been allowed to proceed against him at least.
This question arises only in Nandram Agarwala 's case.
The Magistrate who dismissed the com 938 plaint took the view that theme was no use in proceeding against him alone, as the main attack was directed against the Income Tax Officials.
No such grievance was urged before the High Court and it is not raised in the grounds for special leave.
We hold that the orders of the High Court are correct and dismiss these two appeals.
| In pursuance of a search warrant issued under section 6 of the Taxation on Income (Investigation Commission) Act, 1947 authorising four Officials to search two premises in Calcutta, they went there and forcibly broke open the entrance door of a flat in one case and the lock of the door of a room in the other case.
On being challenged by the darwan and the proprietor of the respective premises they were alleged to have tied the darwan with a rope, causing him injuries and to have assaulted the proprietor mercilessly with the help of two policemen and kept him in a lock up for some hours.
Two separate complaints one by the darwan and the other by the proprietor under sections 323, 342, etc., of the Indian Penal Code were instituted before two different Magistrates.
The common question for determination in both the complaints was whether under the circumstances sanction was necessary under section 197 of the Code of Criminal Procedure.
Held that sanction was necessary as the assault and the use of criminal force related to the performance of the official duties of the accused within the meaning of section 197 of the Code of Criminal Procedure.
article 14 does not render section 197 of the Code of Criminal Procedure ultra vires as the discrimination on the part of the Government to grant sanction against one public servant and not against another is based on a rational classification.
A discretionary power is not necessarily a discriminatory power and abuse of power is not easily to be assumed where the discretion is vested in the Government and not in a minor official.
In the matter of grant of sanction under section 197 of the Code of Criminal Procedure, the offence alleged to have been committed by the accused must have something to do, or must be related in some manner with the discharge of official duty.
In other words there must be a reasonable connection between the act and the discharge of official duty; the act must bear such relation to the duty that the 926 accused could lay a reasonable claim, but not a pretended or fanciful claim, that he did it in the course of this performance of his duty.
The need for sanction under section 197 of the Code of Criminal Procedure is not necessarily to be considered as soon as the complaint is lodged and on the allegations therein contained.
The question may arise at any stage of the proceedings.
The complaint may not disclose that the act constituting the offence was done or purported to be done in the discharge of official duty; but facts subsequently coming to light on a police or judicial inquiry, or even in the course of the prosecution evidence at the trial, may establish ,the necessity for sanction.
Whether sanction is necessary or not may have to be determined from stage to stage.
The necessity may reveal itself in the course of the progress of the case.
Where a power is conferred or a duty imposed by statute or otherwise, and there is nothing said expressly inhibiting the exercise of the power or the performance of the duty by any limitations or restrictions, it is reasonable to hold that it carries with it the power of doing all such acts or employing such means as are reasonably necessary for such execution, because it is a rule that when the law commands a thing to be done, it authorises the performance of whatever may be necessary for executing its command.
Gill and another vs The King, (1948) L.R. 76 I.A. 41, Hori Ram Singh vs The Crown, , 178, Albert West Meads vs The King, (1948) L.R. 75 I.A. 185, Lieutenant Hector Thomas Huntley vs The King Emperor, (1944) F.C.R. 262, Shreekontiah Bamayya Munipalli vs The State of Bombay, ; , Amrik Singh vs The State of PEPSU, ; , Sarjoo Prasad vs The King Emperor, , Jones vs Owen, (1823) L.J. Reports (K.B.) 139 and Hatton vs Treeby, , referred to.
|
262 of 1955.
Under Article 32 of the Constitution for a Writ in the nature of Habeas Corpus.
R. V. section Mani, the next friend, in person.
M. C. Setalvad, Attorney General for India (G. N. Joshi and Porus A. Mehta, with him).
Naunit Lal, for the respondent.
984 1955.
November II.
The Judgment of the Court was delivered by BOSE J.
This is a petition under article 32 of the Constitution for a writ of habeas corpus.
The petition was presented by Mr. R.V.S. Mani, an advocate of the Nagpur High Court, on behalf of Shrimati Vidya Verma and was directed against her father Dr. Shiv Narayan Verma of Nagpur.
Mr. Mani bad no power of attorney from the lady and when the office pointed out that be could not present a petition without producing the necessary authority he amended the petition and described himself as the next friend of the lady.
When the matter first came up for hearing we directed a notice to issue to the father but later the same day it was brought to our notice that the opposite party was not either the Union of India or a State, nor was it some official acting under the orders of one or the other, but a private person.
The question therefore arose of our power under article 32 to issue a writ of this kind against a private party.
Accordingly, before the notice was sent out we recalled it and set the matter down for further hearing.
Mr. Mani appeared again on the appointed date and was robed as he had been on the previous occasion.
He was asked to clarify his position and when be said he had no power of attorney and explained that he was appearing in a private capacity as next friend he was told that at the next hearing he must address the Court without his robes.
He was also warned that if he lost he might have to bear the costs of the other side personally.
After hearing Mr. Mani for a time we decided to fix a date for the hearing of a prelimi nary question only, namely, whether a fundamental right is involved when the detention complained of is by a private person and not by a State or under the authority or orders of a State.
We directed that notices be issued to the opposite party as well as to the Attorney General of India.
At the adjourned hearing Mr. Mani appeared in person, unrobed as directed, but with the advocate on 985 record sitting by his side.
He asked for permission to address us himself.
We declined to hear him unless he discharged the advocate on record.
He did that on the spot and then proceeded to address us in person.
As the question that arises here has been discussed at length in two earlier decisions of this Court we need not examine the matter, in any detail.
The fundamental right that is said to be infringed is the one conferred by article 21: the right to personal liberty.
In A. K. Gopalan vs The State of Madras(1) four of the six learned Judges who were in that case held that the word "law" in article 21 referred to State made law and not to law in the abstract.
They rejected the contention that this was the same as the due process clause in the American Constitution.
One learned Judge dissented and one expressed no opinion on this point.
Patanjali Sastri., J. (as he then was) said at page 204 that as a rule constitutional safeguards are directed against the State and its organs and that protection against violation of rights by individuals must be sought in the ordinary law; and section R. Das, J. dealing with the question of preventive detention said at page 324 that article 21 protects a person against preventive detention by the executive without the sanction of a law made by the legislature.
This principle was applied to articles 19(1) (f) and 31 (1) by a Bench of five Judges in P. D. Shamdasani vs Central Bank of India(1) who held that violation of rights of property by a private individual is not within the purview of these articles, therefore a person whose rights of property are infringed by a private individual must seek his remedy under the ordinary law and not under article 32.
Article 21 was not directly involved but the learned Judges referring to article 31(1) said at page 394: "It is clear that it is a declaration of the fundamental right of private property in the same negative form in which article 21 declares the fundamental right to life and liberty.
There is no express reference to the State in article 21.
But could it be (1) ; (2) ; 986 suggested on that account that that article was intended to afford protection to life and personal liberty against violation by private individuals? The words (except by procedure established by law ' plainly exclude such a suggestions.
They held that the language of article 31 (1) was similar and decided that article 31 (1) did not apply to invasions of a right by a private individual and consequently no writ under article 32 would lie in such a case.
For the same reasons we hold that the present petition which is founded on article 21 does not lie under article 32.
It is accordingly dismissed.
As regards costs Mr. Mani has no power of attorney and has chosen to appear as next friend despite the warning given to him at the last hearing.
This is the fourth time the matter is being agitated in the Courts.
The first attempt was an application under section 100 of the Criminal Procedure Code made by the person who, according to Mr. Mani, is the husband of the lady in whose interests he says he is acting.
It was filed on 10 9 1954 and asked for a search warrant for the recovery of the lady.
The application was dismissed and a revision filed against the order of dismissal also failed.
The same gentleman then applied to the High Court at Nagpur on 18 10 1954 under section 491 of the Criminal Procedure Code.
The learned Judges examined the lady, who is 25 years old, in person, on 20 10 1954 and on the strength of her statement, which they recorded, they held that she was not under any restraint either in the house or outside and so dismissed the application on 10 11 1954.
Mr. Mani then took up the cudgels and filled a second petition in the High Court on 6 12,1954, also under section 491.
The learned Judges again examined the lady, this time on two successive days.
On 20 12 1954 she said that she did not want to live with her father but wanted to live with her uncle at Waraseoni.
She appeared again the next day and clarified this by saying that she would go to her uncle in the company of her father.
She said, that she had no discomfort in living with her father but was not at ease with him 987 and would have more peace of mind with her uncle.
She also said: "I have no need of any counsel and have nothing to talk to Shri R. V. section Mani".
The girl was allowed to go to her uncle.
Mr. Mani then applied for leave to withdraw the petition.
This was allowed on 24 1 1955 and no order was made about costs.
Then came the present petition on 22 8 1955.
The petition does not disclose that Mr. Mani made any attempt to consult the person who he says is the husband of the lady (a fact which is disputed and on which we express no opinion) nor does it show that he made any attempt to contact either the lady or her father or even her uncle.
He has had three hearings in this Court despite the warning he was given about costs and the learned Attorney General was also asked by us to appear.
When the arguments were fully concluded and Mr. Mani found that we were against him he adopted the same tactics as in the Nagpur High Court and asked for permission to withdraw the petition.
That was refused.
We invited him to show cause why he should not be made to pay the costs and have heard all he has to say.
In the circumstances set out above, we feel this is a case in which he should be made to pay the costs personally.
We dismiss the petition and direct that Mr. Mani pay the costs of the opposite party personally in addition to those of the learned Attorney General and that he bear his own, also personally.
| No question of infringement of any fundamental right under article 21 arises where the detention complained of is by a private person and not by, a State or under the authority or orders of a State, and the Supreme Court will not, therefore, entertain an application for a writ of have a corpus, under article 32 of the Constitution.
Consequently a petition under article 32 of the Constitution for a writ of habeas corpus founded on article 21 and directed against a father for alleged detention of his daughter does not lie.
A. K. Gopalan vs The State of Madras ([1950] S.C.R. 88) and P. D Shamdasani vs Central Bank of India ([1952] S.C.R. 391), relied on.
|
Appeal No. 312 of 1955.
On appeal by special leave from the judgment and order dated the 19th October 1955 of the Andhra High Court at Guntur in 0.
section Appeal No. I of 1955 1068 arising out of the Order dated the 26th day of September 1955 of the said High Court in its Ordinary Original Civil Jurisdiction in O.P. No. 3 of 1955.
M. section K. Sastri, for the appellant.
D. Narasaraju, Advocate General, Andhra (T. Anantha Babu and T. V. R. Tatachari with him), for respondent No. 1. D. Narasaraju, Advocate General, Andhra (A. Krishnaswami and K. B. Chowdhry, with him) for respondents Nos. 2 and 3. 1955.
December 16.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
This appeal arises out of an application filed by the first respondent under section 162, clauses (v) and (vi) of the Indian Companies Act for an order that the Rajahmundry Electric Supply Corporation Ltd., be wound up.
The grounds on which the relief was claimed were that the affairs of the Company were being grossly mis managed, that large amounts were owing to the Government for charges for electric energy supplied by them, that the directors had misappropriated the funds of the Company, and that the directorate which had the majority in voting strength was "riding roughshod" over the rights of the shareholders.
In the alternative, it was prayed that action might be taken under section 153 C and appropriate orders passed to protect the rights of the shareholders.
The only effective opposition to the application came from the Chairman of the Company, Appanna Ranga Rao, who contested it on the ground that it was the Vice Chairman, Devata Ramamobanrao, who was responsible for the maladministration of the Company, that he had been removed from the directorate, and steps were being taken to call him to account, and that there was accordingly no ground either for passing an order under section 162, or for taking action under section 153 C.
The learned Judge of the Andhra High Court before whom the application came up for hearing, held that 1069 the charges set out therein had been substantially proved, and that it was a fit case for an order for winding up being made under section 162(vi).
He also held that under the circumstances action could be taken under section 153 C, and accordingly appointed two administrators for the management of the Company for a period of six months vesting in them all the powers of the directorate and authorising them to take the necessary steps for recovering the amounts due, paying the debts and for convening a meeting of the shareholders for the purpose of ascertaining their wishes whether the administration should continue, or whether a new Board of Directors should be constituted for the management of the Company.
Against this order, the Chairman, Appanna Ranga Rao, acting in the name of the Company preferred an appeal to a Bench of the Andhra High Court.
The learned Judges agreed with the trial Judge that the affairs of the Company, as they stood, justified action being taken under section 153 C, and dis missed the appeal.
Against this order, the Company has preferred this appeal by special leave.
On behalf of the appellant, it was firstly contended that the application in so far as it was laid under section 153 C was not maintainable, as there was no proof that the applicant bad obtained the consent of the requisite number of shareholders as provided in sub clause (3)(a)(i) to section 153 C.
That clause provides that a member is entitled to apply for relief only if he has obtained the consent in writing of not less than one hundred in number of the members of the company or not less than one tenth in number of the members, whichever is less.
The first respondent stated in his application that he bad obtained the consent of 80 shareholders, which was more than onetenth of the total number of members, and had thus satisfied the condition laid down in section 153 C, sub clause (3) (a) (i).
To this, an objection was taken in one of the written statements filed on behalf of the respondents that out of the 80 persons who had consented to the institution of the application, 13 were not share holders at all, and that two members 1070 had signed twice.
It was further alleged that 13 of the persons who had given their consent to the filing of the application had subsequently withdrawn their consent.
In the result, excluding these 28 members, it was pleaded, the number of persons who had consented would be reduced to 52, and therefore the condition laid down in section 153 C, sub clause (3) (a) (i) was not satisfied.
This point is not dealt with in the judgment of the trial court, and the argument before us is that as the objection went to the root of the matter and struck at the very maintainability of the application, evidence should have been taken on the matter and a finding, recorded thereon.
We do not find any substance in this contention.
Though the objection was raised in the written statement, the respondents did not press the same at the trial, and the question was never argued before the trial Judge.
The learned Judges before whom this contention was raised on appeal declined to entertain it, as it was not pressed in the trial court, and there are no grounds for permitting the appellant to raise it in this appeal.
Even otherwise, we are of opinion that this contention must, on the allegations in the statement, assuming them to be true, fail on the merits.
Excluding the names of the 13 persons who are stated to be not members and the two who are stated to have signed twice, the number of members who had given consent to the institution of the application was 65.
The number of members of the Company is stated to be 603.
If, therefore, 65 members consented to the application in writing, that would be sufficient to satisfy the condition laid down in section 153 C, subclause (3)(a) (i).
But it is argued that as 13 of the members who had consented to the filing of the application bad, subsequent to its presentation, withdrawn their consent, it thereafter ceased to satisfy the requirements of the statute, and was no longer maintainable.
We have no hesitation in rejecting this contention.
The validity of a petition must be judged on the facts as they were at the time of its presentation, and a petition which was valid when 1071 presented cannot, in the absence of a provision to that effect in the statute, cease to be maintainable by reason of events subsequent to its presentation.
In our opinion, the withdrawal of consent by 13 of the members, even if true, cannot affect either the right of the applicant to proceed with the application or the jurisdiction of the court to dispose of it on its own merits.
It was next contended that the allegations in the application were not sufficient to support a winding up order under section 162, and that therefore no action could be taken under section 153 C.
We agree with the appellant that before taking action under section 153 C, the court must be satisfied that circumstances exist on which an order for winding up could be made under section 162.
The true scope of section 153 C is that whereas prior to its enactment the court had no option but to pass an order for winding up when the conditions mentioned in section 162 were satisfied, it could now in exercise of the powers conferred by that section make an order for its management by the court with a view to its being ultimately salvaged.
Where, therefore, the facts proved do not make out a case for winding up under section 162, no order could be passed under section 153 C.
The question therefore to be determined is whether the facts found make out a case for passing a winding up order under section 162.
In his application the first respondent relied on section 162, clauses (v) and (vi) for an order for winding up.
Under section 162(v), such an order could be made if the company is unable to pay its debts.
It was.
alleged in the application that the arrears due to the Government on 25 6 1955 by way of charges for energy supplied by them amounted to Rs. 3,10,175 3 6.
But there was no evidence that the Company was unable to pay the amount and was commercially insolvent, and the learned trial Judge rightly held that section 162(v) was inapplicable.
But he was of the opinion that on the facts established it was just and equitable to make an order for winding up under section 162(vi), and that view has been affirmed by the learned Judges on appeal.
1072 It was argued for the appellant that the evidence only established that the Vice Chairman, Devata Ramamohan Rao, who had been ineffective management was guilty of misconduct, and that by itself was not a sufficient ground for making an order for winding up.
It was further argued that the words "just and equitable" in clause (vi) must be construed ejusdem generis with the matters mentioned in clauses (i) to (v), that mere misconduct of the directors was not a ground on which a winding up order could be made, and that it was a matter of internal management for which resort must be bad to the other remedies provided in the Act.
The decisions in In re Anglo Greek Steam Company(1) and In re Diamond Fuel Company(2) were relied on in support of this position.
In In re Anglo Greek Steam Company(1), it was held that the misconduct of the directors of a company was not a ground on which the court could order winding up under the just and equitable clause, unless it was established that by reason of such mismanagement the company bad become insolvent.
In In re Diamond Fuel Company(2), it was observed by Baggallay, L.J. that, ". mere misconduct or mismanagement on the part of the directors, even although it might be such as to justify a suit against them in respect of such misconduct or mismanagement, is not of itself sufficient to justify a winding up order".
The contention of the appellant is that as all the charges made in the application amounted only to misconduct on the part of the directors, and as there was no proof that the Company was unable to pay its debts, an order for winding up under section 162 could not be made.
The authorities relied on by the appellant reflect the view which was at one time held in England as to the true meaning and scope of the words "just and equitable" in the provisions corresponding to section 162(vi) of the Indian Act.
In Spackman 's Case(3), Lord Cottenham, L.C. construed them as ejusdem (1) [1866] L.R. 2 Eq.
(2) , 408.
(3) [1849) 1 M. & G. 170; ; , 1230.
1073 generis with the matters mentioned in the other clauses to the section, and that construction was followed in a number of cases.
Vide Re Suburban Hotel Co.(1), In re Anglo Greek Steam Company(2), Re European Life Assurance Society(3) and In re Diamond Fuel Company(4).
But a different view came to be adopted in later decisions (vide In re Amalgamated Syndicate(5)), and the question must now be taken to be settled by the pronouncement of the Judicial Committee in Loch vs John Blackwood Ld.(6), where after an elaborate review of the authorities, Lord Shaw observed that, ". . it is in accordance with the laws of England, of Scotland and of Ireland that the ejusdem generis doctrine (as supposed to have been laid by Lord Cottenham) does not operate so as to confine the cases of winding up to those strictly analogous to the instances of the first five sub sections of section 129 of the British Act '.
The law is thus stated in Halsbury 's Laws of England, Third Edition, Volume 6, page 534, para 1035: "The words 'just and equitable ' in the enactment specifying the grounds for winding up by the court are not to be read as being ejusdem generis with the preceding words of the enactment".
When once it is held that the words "just and equitable" are not to be construed ejusdem generis, then whether mismanagement of directors is a ground for a winding up order under section 162(vi) becomes a question to be decided on the facts of each case.
Where nothing more is established than that the directors have misappropriated the funds of the Company, an order for winding up would not be just or equitable, because if it is a sound concern, such an order must operate harshly on the rights of the share holders.
But if, in addition to such misconduct, circumstances exist which render it desirable in the interests of the shareholders that the Company should be wound up, there is nothing in section 162(vi) (1) (3) (5) (2) [1866] L.R. 2 Eq.
(4) , 408.
(6) ; , 790.
1074 which bars the jurisdiction of the court to make such an order.
Loch vs
John Blackwood.(1)was itself a case in which the order for winding up was asked for on the ground of mismanagement by the directors, and the law was thus stated at page 788: "It is undoubtedly true that at the foundation of applications for winding up, on the 'just and equitable ' rule, there must lie a justifiable lack of confidence in the conduct and management of the company 's affairs.
But this lack of confidence must be grounded on conduct of the directors, not in regard to their private life or affairs, but in regard to the company 's business.
Further more the lack of confidence must spring not from dissatisfaction at being outvoted on the business affairs or on what is called the domestic policy of the company.
On the other hand, wherever the lack of confidence is rested on a lack of probity in the conduct of the company 's affairs, then the former is justified by the latter, and it is under the statute just and equitable that the company be wound up".
Now, the facts as found by the courts below are that the Vice Chairman grossly mismanaged the affairs of the Company, and had drawn considerable amounts for his personal purposes, that arrears due to the Government for supply of electric energy as on 25 6 1955 was Rs. 3,10,175 3 6, that large collections had to be made that the machinery was in a state of disrepair, that by reason of death and other causes the directorate had become greatly attenuated and "a powerful local junta was ruling the roost", and that the shareholders outside the group of the Chairman were apathetic and powerless to set matters right.
On these findings, the courts below had the power to direct the winding up of the Company under section 162(vi), and no grounds have been shown for our interfering with their order.
It was urged on behalf of the appellant that as the Vice Chairman who was responsible for the mismanagement had been removed, and the present (1) ; , 790.
1075 management was taking steps to set things right and to put an end to the matters complained of, there was no need to take action under section 153 C.
But the findings of the courts below are that the Chairman himself either actively co operated with the ViceChairman in various acts of misconduct and maladministration or that he had, at any rate, on his own showing abdicated the entire management to him, and that as the affairs of the Company where in a state of confusion and embarrassment, it was necessary to take action under section 153 C.
We are of opinion that the learned Judges were justified on the above findings in passing the order which they did.
It was also contended that the appointment of administrators in supersession of the directorate and vesting power in them to manage the Company was an interference with its internal management.
It is no doubt the law that courts will not, in general, intervene at the instance of shareholders in matters of internal administration, and will not interfere with the management of a company by its directors, so long as they are acting within the power conferred on them under the Articles of Association.
But this rule can by its very nature apply only when the company is a running concern, and it is sought to interfere with its affairs as a running concern.
But when an application is presented to wind up a company, its very object is to put an end to its existence, and for that purpose to terminate its management in accordance with the Articles of Association and to vest it in the court.
, In that situation, there is no scope for the rule that the court should not interfere in matters of internal management.
And where accordingly a case had been made out for an order for winding up under section 162, the appointment of administrators under section 153 C cannot be attacked on the ground that it is an interference with the internal management of the affairs of the Company.
If a Liquidator can be appointed to manage the affairs of a company when an order for winding up is made under section 162, administrators could also be 136 1076 appointed to manage its affairs, when action is taken under section 153 C.
This contention must accordingly be rejected.
In the result, the appeal fails and is dismissed with costs, of the first respondent.
The costs of the administrator will come out of the estate.
| An application was filed by the first respondent under section 162 clauses (v) and (vi) of the Indian Companies Act for the winding up of the Company on the grounds, inter alia, that the affairs of the Company were being mismanaged and that the directors had misappropriated the funds of the Company.
In the alternative it was prayed that action might be taken under section 153 C and appropriate orders be passed to protect the interests of the shareholders.
The High Court held (i) that the charges set out in the application bad been substantially proved and that it was a fit case for an order for winding up being made under section 162(vi) and (ii) that under the circumstances action could be taken under section 153 C and accordingly it appointed two administrators with all the powers of directors to look after the affairs of the Company.
On appeal by special leave to the Supreme Court by the Company it was contended that the 1067 application under section 153 C was not maintainable inasmuch as there was no proof that the applicant had obtained the consent of requisite number of shareholders as provided in sub clause (3)(a)(i) to section 153 C, that clause providing that a member applying for relief must obtain the consent in writing of not less than one hundred members of the Company or not less than one tenth of the members of the Company whichever is less.
It was alleged that thirteen members who had given their consent to the filing of the application had subsequently withdrawn their consent.
Held that the validity of a petition must be judged on the facts as they were at the time of its presentation, and a petition which was valid when presented cannot, in the absence of a provision to that effect in the statute, cease to be maintainable by reason of events subsequent to its presentation.
The withdrawal of consent by thirteen of the members, even if true, could not affect either the right of the applicant to proceed with the application or the juris diction of the court to dispose of it on its own merits.
Held further that before taking action under section 153 C the court must be satisfied that circumstances exist on which an order for winding up could be made under section 162 and where therefore the facts proved do not make out a case for winding up under section 162, no order can be passed under section 153 C.
The words "just and equitable" in section 162(vi) are not to be construed ejusdem generis with the matters mentioned in clauses (i) to (v) of the section.
If there is merely a misconduct of the directors in misappropriating the funds of the Company an order for winding up would not be just and equitable but if in addition to such misconduct, circumstances exist which render it desirable in the interests of the shareholders that the Company should be wound up, section 162(vi) would be no bar to the jurisdiction of the court to make such an order.
The order for winding up was just and equitable in the cir cumstances of the present case.
In re Anglo Greek Steam Company ([1866] L.R. 2 Eq. 1), In re Diamond Fuel Company ([1879] , Spackman 's Case ([1849] 1 M. & G. 170), Be Suburban Hotel Company ([1867] , Be European Life Assurance Society ([1869] I,.
R. , In re Amalgamated Syndicate ([1897] 2 Ch.
600) and Loch vs John Blackwood Ltd. ([1924] A. C. 783, 790), referred to.
|
iminal Appeal No. 97 of 1953.
Appeal under Article 134(1)(c) of the Constitution from the judgment and order dated the 15th June 1953 of the Travancore Cochin High Court in Criminal Appeals Nos. 54, 55, 56, 58 and 79 of 1952.
section Mohan Kumaramangalam and section Subramaniam, for the appellants.
Sardar Bahadur, for the respondent.
December 15.
The Judgment of the Court was delivered by BOSE J.
This is a case of rioting in which two police constables were killed.
Thirty one persons were put up for trial.
The learned Sessions Judge acquitted twenty one of them on all the charges and acquitted the remaining ten of the most serious charge of all, namely the offence falling under the sections of the Travancore Penal Code which correspond to section 302 of the Indian Penal Code read with section 149.
But she convicted them on several of the lesser charges and imposed sentences ranging from two to five years on each count and directed that the sentences should run consecutively except in the cases of accused 5 to 8 and 18.
She sentenced each of them on only one count and so there was only one sentence.
The convicts appealed to the High Court and the State of Travancore Cochin also appealed against the acquittals on the murder cum rioting count.
The High Court dismissed the appeals made by the ten accused and allowed the appeals ,against the acquittals and imposed the lesser sentence 1059 of transportation in each case.
These ten accused now appeal here.
The accused are said to be communists.
Two of them, namely numbers 30 and 31, were arrested on 27 2 1950 at about I P.m. and were confined in the Edappilly police lock up.
The prosecution case is that the other 29 accused entered into a conspiracy to release their comrades and in pursuance of that conspiracy attacked the police station at about 2 A.M. on the 28th armed with deadly weapons such as choppers, knives, bamboo and other sticks and a dagger.
Two police constables, Mathew and Velayudhan, were killed in the course of the raid.
The first point taken before us is that the charge is not according to law and has prejudiced the appellants in their defence.
The complaint on this score is that each accused has not been told separately what offences he is being tried for.
They have all been lumped together as follows: "The aforesaid offences having been proved by the evidence adduced by the prosecution, you the accused 1 29 have committed offences punishable under . . . . . . " and then follow a string of ten sections of the Travancore Penal Code.
We are satisfied that the charge neither caused, nor could have caused, prejudice.
The body of the charge set out the fact that the accused 1 29 formed an unlawful assembly and stated the common object; and then the charge specified in detail the part that each accused had played.
In the circumstances, each accused was in a position to know just what was charged against him because once the facts are enumerated the law that applies to them can easily be ascertained; and in this particular case it was just a matter of picking out the relevant sections from among the ten mentioned.
There is nothing in this objection; section 225 of the Criminal Procedure Code expressly covers this kind of case.
The next argument was that the examination of each accused under section 342 of the Criminal Procedure Code was defective and that that caused pre 1060 judice.
We agree that the examination was not as full or as clear as it should have been but we are not satisfied that there was any prejudice.
It is to be noted that the question of prejudice was not raised in either of the Courts below nor was it raised in the grounds of appeal to this Court.
The point was taken for the first time in the arguments before us and even there counsel was unable to say that his clients had in fact been prejudiced , all he could urge was that there was a possibility of prejudice.
We agree that the omission to take the objection in the grounds of appeal is not necessarily fatal; everything must depend on the facts of the case; but the fact that the objection was not taken at an earlier stage, if it could and should have, been taken, is a material circumstance that will necessarily weigh heavily against the accused particularly when he has been represented by counsel throughout.
The Explanation to section 537 of the Criminal Procedure Code expressly requires the Court to "have regard to the fact whether the objection could and should have been raised at an earlier stage in the proceedings".
Another strong circumstance is this: the petition for appeal does not set out the questions that, according to the appellants, they should have been asked nor does it indicate the answers that they would have given if they had been asked.
Again, though that is not necessarily fatal ordinarily it will be very difficult to sustain a plea of prejudice unless the Court is told just where the shoe pinches.
It is true that in certain exceptional cases prejudice, or a reasonable likelihood of prejudice, may be so patent on the face of the facts that nothing more is needed; but that class of case must be exceptional.
After all, the only person who can really tell us whether he was in fact prejudiced is the accused; and if there is real prejudice he can at once state the facts and leave the Court to judge their worth.
But if the attitude of the accused, whether in person or through the mouth of his counsel, is: "I don 't know what I would have said.
I still have, 1061 to think that up.
But I might have said this, that or the other", then there will ordinarily be little difficulty in concluding that there neither was, nor could have been, prejudice.
Here, as elsewhere, the Court is entitled to conclude that a person who deliberately withholds facts within his special knowledge and refuses to give the Court that assistance which is its right and due, has nothing of value which he can disclose and that if he did disclose anything that would at once expose the hollowness of his cause.
The purpose of section 342 is set out in its opening words "for the purpose of enabling the accused to explain any circumstances appearing in the evidence against him".
If the accused is not afforded that opportunity, be is entitled to ask the appellate Court to place him in the same position as he would have been in had he been asked.
In other words, he is entitled to ask the appellate Court, which is the ultimate Court of fact, to take the explanation that he would have given in the first Court into consideration when weighing the evidence in just the same way as it would have done if it had been there all along.
But if he does not ask this in the last Court of fact he is in little better position when the case comes here than be would be in had he, say, omitted to call, in his defence, a witness who, he says, would have deposed in his favour.
In very exceptional cases be might be allowed to call such a witness even at such a stage, but if he does not ask for that when his case is under appeal he would normally have but slender hope of succeeding here.
It is true he is in a stronger position when section 342 is in question because the section places a solemn and serious duty on the Court, and the accused can very rightly and properly complain if the Court fails to do its duty; but when all is said and done, he cannot claim to be placed in a better position than he would have been in bad the Court discharged its duty at the outset.
Therefore, all he is entitled to say on appeal is, "I was not asked to explain this matter, Here is my explanation; this is 1062 what I would have said: please consider it".
But if he does not take up that position at the appellate stage and complains of prejudice for the first time here, the inference is strong that the plea is an afterthought and that there was no real prejudice.
However, as the true meaning of "prejudice" in section 537 and other sections of the Code is not yet properly appreciated, probably for want of an authoritative decision by this Court, we invited counsel to tell us what questions his clients should have been asked and at any rate to indicate what, according to him, they might reasonably have said.
His main grievance on this score is that none of the appellants has been asked about the common object and he said it is obvious that most of them could very reasonably have said that they bad no idea that it was murder and that they did not even know that any of the members of the assembly carried lethal weapons.
It is necessary at this stage to explain that both courts find that there was an unlawful assembly and that the police station at Edappilly was raided and that arms and ammunition and some of the station records were carried away by the raiders; also that two of the police constables who were on sentry duty were murdered.
The only point on which they differ is about the common object.
The charge set out that the common object was to rescue the 30th and 31st accused by force and to murder the policemen on duty as well as to loot the records, arms and ammunition of the police station.
The learned Sessions Judge found, mainly because of a concession made by the Public Prosecutor, that the common object could not be placed higher than that of rescue despite the fact that some of the members were armed with deadly weapons; accordingly she (for the learned Sessions Judge was a lady) acquitted all the accused of the charge under section 302 of the Indian Penal Code read with section 149, or rather under the corresponding provisions of the Travancore Penal Code.
The State appealed against these acquittals and 1063 the High Court thereupon convicted on the murdercum rioting charge and imposed the lesser sentence.
The convicts also appealed but their appeals were dismissed.
In view of the admission made by the learned Public Prosecutor we do not think the High Court was justified in holding that the assembly bad the common object to murder but we do not think that that makes any difference to the result.
Even if it be assumed that the common object was only to rescue the two accused who were in the lock up, it is obvious that the use of violence was implicit in that object.
People do not gather together at the dead of night armed with crackers and choppers and sticks to rescue persons who are guarded by armed police without intending to use violence in order to overcome the resistance of the guards; and a person would have to be very naive and simple minded if he did not realise that the sentries posted to guard prisoners at night are fully armed and are expected to use their arms should the need arise; and he would have to be a moron in intelligence if be did not know that murder of the armed guards would be a likely consequence in such a raid; and what holds good for murder also holds good for looting in general.
Now section 149 applies not only to offences actually committed in pursuance of the common ob ject but also to offences that members of the assembly know are likely to be committed.
It would be impossible on the facts of this case to hold that the members of the assembly did not know that murder was likely to be committed in pursuance of a common object of that kind by an assembly as large as the one we have there.
Accordingly, even if the common object be not placed as high as murder the conviction on the murder cum riotiNg charge was fully justified.
,,, This answers the main ground of appeal.
But to go back to the argument about section 342 of the Criminal Procedure Code.
What we have to assess here is the explanation which counsel says each appellant could reasonably have given in the trial Court if he had been asked for one, namely that 1064 he did not know that any member of the assembly carried lethal weapons and that murder was likely to result.
The answer to that is plain.
There is nothing to indicate that the appellants are deficient in intelligence and understanding, and if they are judged by the standard of men of reasonable intelligence, as they must be, then an explanation of this kind cannot be believed.
Men who band themselves together to rescue persons locked behind prison bars and guarded by armed police do not set out with bare hands and doves of peace; of course, they arm themselves with implements that are strong enough to break open locks and break down doors and iron bars and it is obvious that implements of this kind can be used with deadly effect should the need and the desire to use them in that way arise.
It hardly matters whether each member knew the exact nature of the implements, namely that some had choppers and some sticks.
It is enough that they knew that instruments that could be used as deadly weapons would necessarily have to be carried if the purpose underlying the common object was to be achieved.
Therefore, even if the answer now suggested to us bad been given in the trial Court it would have made no difference to the result.
Turning next to the first accused, counsel said that he was not asked about identification in his examination under section 342.
But that is not correct.
The question put was "P.Ws. 1 and 4 say that they had seen you, beating constables Mathew and Velayudhan, etc.
" The point about identification is implicit in this question and we are satisfied that this appellant understood what the question imported because the cross examination of these witnesses discloses that the question of identity was present to the mind of the cross examiner; he specifically questioned each witness about the matter.
Next, it was said that no question was put to the first accused about any robbery, but we need not examine this any further because the matter becomes academic once the murder cum riot conviction is up 1065 held and once we make the sentences concurrent instead of consecutive as we intend to do.
The arguments on this point about the rest of the appellants except the seventh accused, followed the same pattern and we need not examine them separately.
, As regards the seventh accused, the only point of substance in his case is that he was not asked to explain his presence at Kadiparambu where the agreement to rescue and the planning are said to have taken shape.
Counsel said that this accused lives there, so the mere fact that he was seen among a crowd that had gathered there in the day time could not be regarded as a circumstance of suspicion.
That would have had force had it not been for the fact that he was again seen at the police station at 2A.M. and was identified as one of the rioters who took an active part in the raid.
We have gone into the question of possible prejudice under section 342 in the way we have because, as we have said, appellants do not appear to appreciate what is necessary when this kind of plea is raised.
We do not intend to lay down any hard and fast rule but we do wish to emphasise that what we have done in this case is not to be regarded as a precedent and that in future it will be increasingly difficult to induce this Court to look into questions of prejudice if the requisite material is not placed before it and if appellants deliberately withhold from the Court assistance which it is in their power to render; an inference adverse to them must be expected if that attitude is adopted.
Counsel then tried to attack the credibility of the witnesses and the correctness of the findings generally but, following our usual practice, we decline to interfere with concurrent findings of fact where there is ample evidence which, if believed, can be used in support of the findings.
That is the position here.
The only ground on which interference is called for is where the sentences were directed to run consecutively.
The High Court confirmed the convictions and sentences passed by the learned Sessions Judge 1066 but when it allowed the appeal by the State and passed the lesser sentence it said that "the sentences passed on each accused will run concurrently".
We are not sure whether the learned Judges meant that the sentences imposed by them should run concurrently with the others or whether they meant to allow the appeal to that extent.
, In order to remove all doubts, we allow the appeal to the extent of directing that the sentences imposed on each accused shall run concurrently and not consecutively.
Except for that, the appeal is dismissed.
| The appellants were put up for trial along with others before the Court of Sessions.
The charge against them set out the fact that they formed an unlawful assembly, stated the common object specifying in detail the part each accused had played and then gave a list of ten sections of the.
Travancore Penal Code including sections which correspond to section 302 of the Indian Penal Code read with section 149.
The Sessions Judge acquitted them under section 302 read with section 149 but convicted them on the lesser charges.
They appealed to the High Court against their convictions and the State appealed against their acquittals under section 302 read with section 149.
The High Court dismissed their appeals and allowed the appeals against their acquittals and sentenced each of them to transportation for life.
It was contended on their behalf that the charge was not in accordance with law and their examinations under section 342 of the Code of Criminal Procedure were defective and prejudiced them.
Held, that the charge framed was a legal one and was expressly covered by section 225 of the Code of Criminal Procedure.
Each of the accused was apprised of the facts alleged against him and he could easily pick out the relevant sections under which he was charged.
There could, therefore, be no prejudice to any one of them.
Held further, that as no objection was taken to the defective examination under section 342 of the Code of Criminal Procedure at an earlier stage although the accused were represented by counsel, and as the petition of appeal did not set out the questions the court should have put to them and the answers they would have given and as they thereby withheld from the court facts which were within their special knowledge, the court was entitled to draw an adverse conclusion against them and hold that no prejudice had been caused to them.
That when an accused person is not properly questioned under section 342 so as to enable him to explain the circumstances appearing in the evidence against him he is entitled to ask the appellate Court, which is the ultimate court of fact, to place him in the same position 1058 he would have been in if he had been properly questioned and to take the explanation he would have given, if he had been asked, into consideration when weighing the evidence in just the same way as the court would have done if the explanation had been there all along.
But he cannot ask to be placed in a better position than he would have been in if the court had done its duty from the start.
Therefore, when complaining of prejudice he must set out the questions he should have been asked and indicate the answers he would have given.
|
iminal Appeal No. 75 of 1954.
Appeal by Special Leave from the Judgment and dated the 24th July 1953 of the Bombay High Order a Court in Criminal Revision Application No. 669 of 1953 arising out of the Judgment and Order dated the 29th June 1953 of the Court of Presidency Magistrate, 9th Court at Bandra, Bombay in Case No. 11872/73/P of 1952.
, P. K. Chatterjee, for the appellants.
N. section Bindra, (P. G. Gokhale, with him) for the respondent.
December 13.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
The first appellant was, at the relevant date, in possession of room No. 10 in House No. 334, Bazar Road, Bandra, Bombay.
, On information that this room was being used as a gaming house, Mr. Bhatt Sub Inspector of Police, raided it on 19 9 1952, and found the two appellants and four others in possession of gaming instruments All of them were prosecuted under section 5 of the Bombay Prevention of Gambling Act (Bombay Act IV of 1887), hereinafter referred to as the Act, for being present in a gaming house for the purposes of 1051 gaming, and the first appellant was, in addition, charged under section 4(a) of the Act for keeping a gaming house.
The Presidency Magistrate who tried the case, found the first appellant guilty under section 4(a) of the Act, and sentenced him to three months ' rigorous imprisonment.
He also found him guilty under section 5 of the Act, but awarded no separate sentence under that section.
The second appellant was found guilty under section 5, and sentenced to three months ' rigorous imprisonment.
The appellants took the matter in revision to the High Court, which set aside the conviction of the first appellant under section 4(a) but confirmed that under section 5, and awarded a sentence of three months ' rigorous imprisonment under that section.
As regards the second appellant, both the conviction and sen tence were confirmed.
Against this order, the present appeal by special leave has been preferred.
Both the courts below have concurrently found that the appellants were present in a gaming house for the purpose of gaming, and have thereby committed an offence punishable under section 5 of the Act, and that finding is not under challenge before us.
The only contention that has been raised before us and it arises only as regards the first appellant is that as the High Court had set aside his conviction under section 4 (a) 'of the Act, it should have set aside the sentence passed on him under that section, and that it had no power under the Code of Criminal Procedure, to impose a sentence under section 5, when none such had been passed by the Magistrate.
This contention is based on, the terms of section 423.
Under that section, when there is an appeal against a conviction, the court has the power under subclause (1)(b) either (1) to reverse the finding and sentence, and acquit or discharge the accused, or order his retrial, or (2) to alter the finding but maintain the sentence, or (3) to reduce the sentence with or without altering the finding, or (4) to alter the sentence with or without either reducing the sentence or altering the finding, but, subject to section 106(3), not so as to enhance the same.
It is urged that the 1052 present case does not fall within any of the four categories mentioned above as the conviction under section 5 has been affirmed, and no question of reduction or alteration of sentence arises, as none had been imposed under that section by the Magistrate, and that accordingly the order of the High Court could not be justified under any of the provisions of the Code.
It is further contended that the award of sentence under section 5 amounted in the above circumstances to an enhancement, and was, in consequence, illegal, as no notice had been issued therefor '.
as required by law.
In support of this contention, the decision in Ibrahim vs Emperor(1) is relied on.
In that case, as in the present, the accused was convicted both under section 4(a) and section 5 of the Act, but a sentence was passed under section 4(a) and none under section 5.
On appeal, the learned Judges set aside the conviction under section 4(a), and on the question of sentence, observed that the Magistrate was wrong in not having imposed a separate sentence under section 5, and continued: "He ought to have imposed a sentence under each section; but as he has not imposed a sentence under section 5, we cannot impose one ourselves, for that would be enhancing the sentence".
These observations undoubtedly support the first appellant.
A different view, however, was taken in two other decisions, which may now be noticed.
In Superintendent and Remembrancer of Legal Affairs vs Hossein Ali(2), the accused had been convicted by the Magistrate both under section 363 and section 498 of the Indian Penal Code, and sentenced to imprisonment under section 363, no separate sentence having been awarded under section 498.
On appeal, the Sessions Judge set aside the conviction under section 363, but held the accused guilty under section 498.
On a reference as to whether the Sessions Judge could pass any sentence under section 498, it was held by the High Court that he could, under section 423 (1) (b) of (1) A.I.R. 1940 Bom.
(2) A.I.R. 1938 Cal. 439.
1053 the Code of Criminal Procedure, as there was an alteration of the conviction under sections 363 and 498 to one under section 498.
This view proceeds, in our opinion, on a misconception of the true meaning of the words "alter the finding" in section 423(1)(b) of the Code of Criminal Procedure.
When a statute enacts provisions creating specific offences, in law these offences constitute distinct matters with distinct incidents.
Under section 233 of the Code of Criminal Procedure, they have to be separately charged, and under section 367, the judgment has to specify the offence of which and the law under which the accused is convicted.
When there is a conviction for more offences than one, there are distinct findings in respect of each of them, and when section 423 (1) (b) speaks of a finding being reversed or altered by the court of appeal, it has reference to the finding in respect of each of the offences.
When, therefore, the High Court set aside the conviction under section 4 (a) and affirmed that under section 5, there are two distinct findings, one of reversal and another of affirmance, and there is no question of alteration.
The decision in Superintendent and Remembrancer Of Legal Affairs vs Hossein Ali(1) was followed in Pradip Chaudhry vs Emperor(2).
There, the Sessions Judge convicted the accused under sections 324 and 148 of the Indian Penal Code and sentenced them to imprisonment under section 324, but no sentence was imposed on them under section 148.
On appeal, the High Court set aside the conviction under section 324, and confirmed that under section 148.
Dealing with the contention of the accused that the Court had no power under section 423 (1) (b) of the Code of Criminal Procedure to award a sentence under section 148, the learned Judges observed that they had "ample power to transpose the sentence, so long as the transposition does not amount to enhancement".
We are unable to support the reasoning in this decision either.
There is nothing about transposition of sentence under section 423(1)(b).
It only provides for altering the finding and maintaining the sentence, (1) A.I.R. 1938 cal.
(2) A.I.R. 1946 Patna, 235.
1054 and that can apply only to cases where the finding of guilt under one section is altered to a finding of guilt under another.
The section makes a clear distinction between a reversal of a finding and its alteration, and provides that when there is a reversal, the order to be passed is, one of acquittal, discharge or retrial, whereas when there is an alteration, the order to be passed is one of maintaining, reducing or altering the sentence.
But here, the order passed by the High Court is not one of alteration of any finding.
It is, as already stated, a reversal of the finding under section 4(a) and a confirmation of the conviction under section 5.
We are therefore of opinion that on the language of the section, the imposition of a sentence under section 5 by the High Court cannot be justified.
The question still remains whether apart from section 423(1) (b), the High Court has the power to impose the sentence which it has.
When a person is tried for an offence and convicted, it is the duty of the court to impose on him such sentence, as is prescribed therefor.
The law does not envisage a person being convicted for an offence without a sentence being imposed therefor.
When the trial Magistrate convicted the first appellant under section 5, it was plainly his duty to have imposed a sentence.
Having imposed a sentence under section 4(a), he obviously considered that there was no need to impose a like sentence under section 5 and to direct that both the sentences should run concurrently.
But, in strictness, such an order was the proper one to be passed.
The appellants then took the matter in revision to the High Court, and contended that their conviction under section 5 was bad.
The High Court went into the question on the merits, and found them guilty under that section.
It was the duty of the High Court to impose a sentence under section 5, and that is precisely what it has done.
The power to pass a sentence under those circumstances is derived from the law which enacts that on conviction a sentence shall be imposed on the accused, and that is a power which can and ought to be exercised by all the courts which, having jurisdiction to decide whether the 1055 accused is guilty or not, find that he is.
We are of opinion that this power is preserved to the appellate court expressly by section 423(1)(d), which enacts that it can "make any amendment or any consequential or incidental order that may be just or proper".
When a conviction is affirmed in appeal but no sentence had been awarded by the trial Magistrate.
, the award of a sentence is consequential on and incidental to the affirmance of the conviction, and it is a just and proper order to be passed under the law.
We are unable to agree with the view expressed in Ibrahim vs Emperor(1) that such an order could be an enhancement of the sentence.
Before a sentence can be said to be enhanced, there must be one which could be enhanced, and when no sentence was imposed on a conviction by the trial Magistrate and one is for the first time awarded in appeal, it cannot correctly be said to be an enhancement.
We are accordingly of opinion that it was within the competence of the High Court to have passed the sentence which it had.
There is another ground on which the order of the lower court can be sustained.
Against the conviction of the appellants by the Presidency Magistrate, no appeal lay, and accordingly the appellants preferred a revision to the High Court.
Under section 439(1) of the Code of Criminal Procedure, the High Court in hearing a revision can exercise the powers of a court of appeal under section 423, and may enhance the sentence.
Under section 439(2), an order of enhancement could not be passed, unless the accused bad an opportunity of being heard in his defence, and under section 439(6), the accused is also entitled, when proceedings are taken under section 439(2), to show cause against his conviction.
The substance of the matter is that when proceedings are taken against the accused for enhancement of sentence under section 439(2), he has a right to be beard both on the question of the propriety of the conviction and of the sentence to be imposed on him if he is convicted.
In the present case, the first appellant had an opportunity of pre (1) A.I.R. 1940 Bom.
1056 senting his case in respect of both these matters, and, in fact, he availed himself of the same.
He himself raised in his revision the question of his guilt under section 5, and the High Court on a consideration of all the evidence affirmed his conviction.
On the question of sentence, section 5 enacts that when a person is found guilty under that section, the punishment shall not be less than three months ' imprisonment and Rs. 200 fine , if be had been convicted for the same offence previously.
The first appellant had a previous conviction, and the sentence of imprisonment is the minimum which could be passed against him under section 5.
With reference to this aspect of the matter, the High Court observes: "In view of the fact that the first accused admits one previous conviction under section 5 of the Act, the sentence of three months ' rigorous imprisonment passed upon him by the learned Presidency Magistrate is justified".
Now, the question is whether, in the circumstances, the order of the High Court could be held to be bad for want of notice under section 439(2).
The law does not prescribe that any particular formalities should be complied with, before action is taken under that section.
It only provides that the accused should have an opportunity of showing cause against the conviction and enhancement, and, as the first appellant was heard on both these questions, the require ments of the section were satisfied.
The order of the High Court could accordingly be maintained under section 439, even if it were to be regarded as an enhancement of the sentence.
In any event, no prejudice has resulted to the first appellant by reason of the absence of a formal notice under section 439(2).
In the result, the appeal is dismissed.
| The first appellant was prosecuted under section 5 of the Bombay Prevention of Gambling Act (Bombay Act IV of 1887) for being present in a gaming house for the purposes of gaming and was, in addition, charged under section 4(a) of the Act for keeping a gaming house.
The Presidency Magistrate, who tried the case, found him guilty under section 4(a) and sentenced him to three months ' rigorous imprisonment.
He also found him guilty under section 5 but awarded no separate sentence under that section.
In revision, the High Court set aside the conviction under section 4(a), but confirmed that under section 5 and awarded a sentence of three months ' rigorous imprisonment under that section.
It was contended for the first appellant that the High Court had no power under section 423(1)(b) of the Code of Criminal Procedure to impose any sentence under section 5 of the Act when no such sentence had been awarded by the Magistrate and that, in any event, the award of such a sentence amounted to an enhancement and was, in consequence, illegal, as no notice had been issued there for, as required by law.
Held, that though section 423(1)(b) of the Code of Criminal Procedure was not applicable to the case, the High Court had power to pass the sentence under section 423(1)(d).
The law does not envisage a person being convicted for an 1050 offence without a sentence being imposed therefor, and the award of a sentence by the High Court was only consequential on and incidental to the affirmance of the conviction, and it was a just and proper order to be passed under the law, within the meaning of section 423(1)(d) of the Code of Criminal Procedure.
Such a sentence cannot amount to an enhancement as it was awarded only for the first time in appeal.
Even if it were to be regarded as an enhancement, the order of the High Court could not be held to be bad for want of notice under section 439(2), as the first appellant had an opportunity of showing cause against the conviction and enhancement, and, in any event, no prejudice had resulted to him by reason of the absence of a formal notice under the section.
Ibrahim vs Emperor (A.I.R. , Superintendent and Remembrancer of Legal Affairs vs Hossein Ali (A.I.R. and Pradip Chaudhry vs Emperor (A.I.R. 1946 Pat. 235), disapproved.
|
Appeals Nos. 3, 30 and 31 of 1953.
Appeal from the Judgment and Order dated the 12th day of September, 1951, of the High Court of Judicature at Bombay in Income tax Reference No. 27 of 1951 arising out of the order dated the 23rd day of November, 1949, of the Income tax Appellate Tribunal in Income tax Appeal No. 122 of 1947 48.
B.J. M. Mackenna (D. H. Dwarka Das and Rajinder Narain, with him) for the appellant in C. A. No. 3 of 1953.
M.C. Setalvad, Attorney General for India, (G. N. Joshi and P. A. Mehta, with him) for the respondent in C. A. No. 3 and for the appellant in C. A. Nos. 30 and 31.
C.K. Daphtary, Solicitor General for India, (R. J. Kolah, N. A. Palkhiwala and 1.
N. Shroff, with him) for therespondent in C. A. No. 30, R. J. Kolah, N. A. Palkhiwala and I. N. Shroff for the respondent in C. A. No. 3 1.
316 1954.
May 14.
The judgment of Das and Bhagwati JJ. was delivered by Bhagwati J. Jagannadhadas J. delivered a separate judgment.
BHAGWATI J.
These appeals arise out of two judgments and orders of the.
High Court of Judicature at Bombay in Income tax References Nos. 23, 24 and 27 of 1951 made by the Income tax Appellate Tribunal under section 66(1) of the Indian Income tax Act and section 21 of the Excess Profits Tax Act.
E. D. Sassoon and Company Ltd., (hereinafter refered to as the Sassoons) were the Managing Agents of (1) E. D. Sassoon United Mills Ltd., under Agreements dated the 24th February, 1920, and the 2nd October, 1934, (2) Elphinstone Spinning and Weaving Mills Company Ltd. under the Agreement dated 23rd May, 1922, and (3) Apollo Mills Ltd., under the Agreement dated the 23rd May, 1922.
The Sassoons agreed to transfer their Managing Agencies of the said Companies to Messrs. Agarwal and Company, Chidambaram Mulraj and Company Ltd., and Rajputana Textile (Agencies) Ltd. respectively by letters dated the 3rd September, 1943, 16th April, 1943, and the 27th April, 1943.
The consent of the shareholders of the respective companies to the Agreements for transfer was duly obtained and the Managing Agencies were ultimately transferred to the respective transferees with effect from the 1st December, 1943, 1st June, 1943, and 1st July, 1943, respectively.
The Sassoons executed in favour of Messrs. Agarwal and Company, Chidambarain Mulraj and Company Ltd., and Rajputana Textile (Agencies) Ltd., formal deeds of assignment and transfer and received from them Rs. 57,80,000, Rs. 12,50,000 and Rs. 6,00,000 respectively on transfers of the Manaoing Agencies, and the net consideration, viz., Rs. 75,77,693, received by them on such transfers was taken by them to the "Capital Reserve Account".
The accounts of the Managing Agency commission payable by the respective Companies to the Managing Agents for the year 1943 were made up in the year 1944 and Messrs. Agarwal and Company received from the E. D. Sassoon United Mills Ltd., a sum of Rs. 27,94,504, Chidambaram Mulraj and Company Ltd., received from the Elphiiistone Weaving and 317 Spinning Mills Company Ltd., a sum of Rs. 2,37,602 and the Rajputana Textile (Agencies) Ltd., received from the Apollo Mills Ltd., a sum of Rs. 3,82,608 as and by way of such commission.
For the assessment year 1944 45 and the chargeable accounting period 1st January, 1943, to the 31st December, 1943, the original income tax and excese profits tax assessments of the Sassoons were made or the 31st May, 1945, at a total income of Rs. 46,48,483.
This income however did not include any part of the Managing Agency commission received by the transferees.
The entire amounts of the Managing Agency commission received by the transferees were assessed by the Income tax Officer for the assessment year 194546 as the income of the transferees.
The transferees appealed to the Appellate Assistant Commissioner who confirmed the orders of the Income tax Officer.
Wher the matter was taken in further appeal to the Income.
tax Appellate Tribunal, the Tribunal by its order dated the 28th December, 1949, accepted the trans.
ferees ' contention that the Managing Agency commission received by them should be apportioned on a proportionate basis and the transferees should be made liable to pay tax only on the commission earned by them during the period that they had worked as the Managing Agents of the respective Companies.
The Income tax Officer and the Excess Profits Tax.
Officer appear to have discovered that the amounts of the Managing Agency commission earned by the Sassoons prior to the dates of the respective transfers were not brought to tax and therefore issued on the 29th June, 1946, notices under section 34 of the Indian Income tax Act and section 15 of the Excess Profits Tax Act upon the Sassoons on the ground that their income from the Managing Agency had escaped assessment.
The Income tax Officer and the Excess Profits Tax Officer wanted to include in the assessable income of the Sassoons Rs. 28,51,934 made up of Rs. 25,61,629 in respect of the Managing Agency of the E. D. Sassoon United Mills Ltd., for the period of 11 months from the 1st January, 1943, to the 30th November, 1943, Rs. 99,001 in respect of the Managing Agency of the 318 Elphinstone spinning and Weaving Mills Ltd for the period of five months from the 1st January, 1943, to the 31st May, 1943, and ]Rs. 1,91,304 in respect of the Managing Agency of the Apollo Mills Ltd., for the period of six months from the 1st January, 1943, to the 30th June, 1943, contending that such Managing Agency commission had accrued to the Sassoons for services rendered so that on the dates on which the Agencies were transferred the Sassoons were entitled to such remuneration from the managed Companies in the form of commission for services rendered up to the dates of the transfers.
In spite of the objection of the Sassoons the Income tax Officer and the Excess Profits Tax Officer determined these sums as their escaped incomes and assessed them accordingly.
The Sassoons appealed to the Appellate Assistant Commissioner who dismissed the appeals and further appeals were taken to the Income tax Appellate Tribunal.
The Incometax Appellate Tribunal relied upon its order dated the 28th December, 1949, in the case of the transferees and confirmed the orders of the Appellate Assistant Com missioner.
The Tribunal was of the opinon that the Managing Agency commission was earned for services rendered and therefore it was taxed in the hands of the person who carried on the business of the Managing Agency and not in the hands of the person to whom it was assigned, and that therefore so far as the Sassoons were concerned the Managing Agency commission should be apportioned between them and their transferees.
The Sassoons applied under section 66(1) of the Indian Income tax Act and section 21 of the Excess Profits Tax Act requesting the Tribunal to draw a statement of the case and refer the question of law arising out of the orders to the High Court for its decision.
On the 12th January, 1951, the Tribunal by its statement of the case referred to the High Court one question of law as arising out of its orders, viz., " whether in the circumstances of the case was the Managing Agency commission liable to be apportioned between the assessee Company and the assignee " observing that in its opinion the question was not when the Managing Agency commission accrued but the real question was to whom it accrued.
This reference was made by the 319 Tribunal in R.A. No. 474 of 1950 51, and R.A. No. 475 of 1950 51 referring the question of law thus framed in regard to the Managing Agency commission of the D. Sassoon United Mills Ltd., and the Elphinstone Spinning and Weaving Mills Ltd., the whole of the Managing Agency commission having been paid respectively to Messrs. Agarwal and Company and to Chidambaram Mulraj and Company Ltd., in the year 1944.
This was Income tax Reference No. 27 of 1951.
The Commissioner of Income tax Excess Profits Tax, Bombay City, also required the Tribunal to refer to the High Court the question of law arising out of its order in the appeal of Messrs. Agarwal and Company in which the Tribunal had held as above that the Managing Agency comniission should be apportioned between the Sassoons and the transferees.
The statement of the case was accordingly submitted by the Tribunal on the 12th January, 1951, and the same question as above was referred to the High Court.
This reference was Income tax Reference No. 24 of 1951.
A similar application was made by the Commissioner of Income tax/Excess Profits Tax, Bombay City, for reference in the appeal of Chidambaram Mulraj and Company Ltd. The Tribunal submitted its statement of case also on the same day and referred the very same question to the High Court.
This reference was Income tax Reference No. 23 of 1951.
All these references came for hearing and final disposal before the High Court.
Income tax References Nos.
24 and 27 of 1951 were heard together and one judgment was delivered, answering the question submitted to the High Court in both the references in the affirmative.
Following upon this judgment the High Court also answered in the affirmative the question which had been referred to it by the Tribunal in Income tax Reference No. 23 of 1951.
The decision of the High Court was thus against the contentions which had been urged both by the Sassoons and the Commissioner of Income tax and the Sassoons as well as the Commissioner of Income tax obtained leave under section 66A(3) of the Indian Income tax Act and 320 section 133(1)((c) of the Constitution for filing appeals to this Court.
The appeal of the Sassoons was Civil Appeal No. 3 of 1953, and it was filed against the Commissioner of Income tax, Bombay City.
The appeals of the Commissioner of Income tax against Messrs. Agarwal and Company and Chidambaram Mulraj and Company Ltd., respectively were Civil Appeal No. 30 of 1953, and Civil Appeal No. 31 of 1953.
These appeals have come for hearing and final disposal before us.
All the appeals raise one common question of law, viz., whether in the circumstances of the case the Managing Agency commission was liable to be apportioned between the Sassoons and their respective transferees in the proportion of the services rendered as Managing Agents by each one of them and the decision turns upon the question whether any income had accrued to the Sassoons on the dates of the respective transfers of the Managing Agencies to the transferees or at any time thereafter.
This judgment will (, over our decision in all the appeals.
It will be convenient at this stage to set out the relevant clauses of the respective Managing Agency Agreements and the deeds of assignment and transfer.
The original agreement with the E.D. Sassoon United Mills Ltd., was entered into on the 24th February, 1920, by Sir Edward Sassoon and others carrying on business in partnership in the style and form of Messrs. E.D. Sassoon and Company.
The Managing Agency was transferred with the consent of the Company by E. D. Sassoon and Company to the Sassoons and another Managing Agency Agreement was executed between the Company and the Sassoons on the 2nd October, 1934, appointing and recognising the latter as the Agents of the Company from the lst January, 1921, for the residue of the period and upon the same terms and conditions set out in the original Agreement dated the 24th February, 1920.
Under clause 1 of that Agreement the Sassoons and their assigns were appointed the Agents of the Company for a period of 30 years from the date of the registration thereof and thereafter until they resigned or were removed from office by a special resolution of 321 the Company.
Udder clause.
2 the remuneration of the Sassoons and their assigns was fixed at a commission of 71/2 per cent.
per annum on the annual net profit of the Company after making all proper allowances and deductions from revenue for working expenses charge the able against profits, provided however that if in any year no such commission was earned or it fell short of Rs. 1,20,000 the Company was to pay to them a sum sufficient to make up the minimum remuneration of Rs. 1,20,000 per annum on account of such commission.
The said commission was under clause 2(d) to be due to them yearly on the 31st of March in each and every year.
during the continuance of the Agreement and was to be payable and to be paid immediately after the annual accounts of the Company had been passed by the shareholders.
Under clause 3 the Sassoons and their assigns agreed with the Company that they.
would be and act as the Agents of the Company during the said term for the said remuneration and upon and subject to the terms and conditions therein contained.
Clause 10 of the Agreement provided as under: " It shall be lawful for the said firm to assign this Agreement and the rights of the said firm hereunder to any person, firm or Company having authority by its constitution to become bound by the obligations undertaken by the said firm hereunder and upon such assignment being made and notified to the said Company the said Company shall be bound to recognise the person or firm or Company aforesaid as the Agents of the said Company in like manner as if the name of such person, firm or Company had entered into this Agreement with the said Company and the said Company shall forthwith upon demand by the said firm enter into an Agreement with the person, firm or Company aforesaid appointing such person, firm or Company the Agents of the said Company for the then residue of the term outstanding under the Agreement and with the like powers and authorities remuneration and emoluments and subject to the like terms and conditions as are herein contained.
" The letter dated the 3rd September, 1943, recording the Agreement of transfer of the Managing Agency 322 322 provided that in the event of the transaction being com pleted in its entirety as therein stated the transferees would be entitled to receive the commission payable by the Company under the Managing Agency Agreement in the profits for the calendar year 1943.
The deed of assignment and transfer executed between the Sassoons and Messrs. Agarwal and Company in pursuance of this Agreement on the 26th January, 1945, stated that the Sassoons thereby transferred to Messrs. Agarwal and Company as from the lst December, 1943, their office as Managing Agents of the Company for the unexpired residue of the term created by the said Agreement dated the 24th February, 1920, as also the said Agreements dated the 24th February, 1920, and the 2nd October, 1934, and all their rights and benefits as Managing Agents 'under the said Agreements and Messrs. Agarwal and Company agreed to be the Managing Agents of the Company from the 1 st December, J 943, in place, and stead of the Sassoons for the said unexpired residue of the term with like powers authorities remuneration and emoluments as were contained in the said Agreements.
It may be noted that even though the letter recording the Agreement of transfer expressly provided that the transferees would be entitled to receive the commission payable by the Company under the Managing Agency Agreement on the profits for the calendar year 1943 no such term was incorporated in the deed of assignment and transfer.
The original Agreement entered into by the Elphin stone Spinning and Weaving Mills Company Ltd., was with Messrs. Hajee Mahomed Hajee Esmail and Company and was dated the 24th July, 1919.
The Managing Agency was transferred with the consent of the Company by Messrs. Hajee Mahomed Hajee Esmail and Company to the Sassoons and on the 23rd May, 1922, another Managing, Agency Agreement was executed by the Company in favour of the Sassoons their successors and assigns employing them the Agents of the Com pany from the 1st February, 1922, for the unexpired 'Period of the term of 60 years commencing from the 3rd July, 1919.
Under clause 3 of the Agreement the Company was during the continuance thereof to pay to 323 the Sassoons, their successors and assigns by way of remuneration a commission of ten per cent.
on the net profits of the Company and a further sum of Rs. 1,500 per month.
Under clause 6 the Sassooris, their successors and assigns were to be at liberty to retain, reimburse and pay themselves out of the moneys of the ' Company inter alia all sums due to them for commission and otherwise.
The deed of transfer executed by the Sassoons in favour of Chidambaram Mulraj and Company Ltd., on the 2nd June, 1943, stated that the Sassooins assigned and transferred the Agreement dated the 23rd May, 1922, between themselves and the company for the unexpired residue of the term of sixty years specified therein and the full benefit and advantage thereof together with the benefit of the Agency and the office of the Agents thereunder and the right to receive the remuneration thereafter to become payable by the Company under or by virtue of the said Agreement and together with the benefit of all rights, privileges, powers and authorities given and conferred on the Sassoons there under.
It is significant to observe that before the incometax authorities as also the High Court no distinction was drawn between the provisions of these two Agency Agreements in regard to the right of the Managing Agent to remuneration thereunder and the facts in so far as they related to all the Managing Agencies were treated as similar.
The quantum also was not disputed in each case though the principle of apportionment was in dispute.
The Sassoons were assesse for this "escaped income" on the basis that they had earned the income by rendering services as Managing Agents to the Companies for the respective periods that they continued to be the Managing Agents and the transferees had rendered the services for the balance of the periods completing the full year of accounting and had earned the proportionate commission and therefore the amount of commission which the latter actually received included the Sassoons ' share of commission in respect of which they were not liable to tax but the Sassoons.
The High Court adopted this test of the services rendered by the Sassoons as well as the transferees during the whole of 325 become a debt due by the Companies to the Sassoons and it could not therefore be said to have accrued to them.
The contract of employment was an entire ' and an indivisible contract and the remuneration payable by the Companies to the Sassoons thereunder was payable at stated periods.
It was a condition precedent to the Sassoons earning the remuneration that they fulfilled the terms of their employment, completed the period for which the remuneration was payable to them and the service for the particular period was a condition precedent to their earning the remuneration for that period.
The stated period was that of a year and no remuneration was payable to the Sassoons till the end of the year and unless and until they completed the period of the year they would not be entitled to any commission or remuneration for the year, much less for the broken period.
It was therefore contended that the Sassoons had not earned any commission for the broken periods and that not having earned the same they could not have assigned it to the transferees with the result that when the transferees were paid the commission under the terms of the Managing Agency Agreements, the transferees received the same in their own right even though they had not rendered the services to the Company for the whole of the calendar year 1943.
It was contended that in any event, what.
ever be the position as between the Companies and the transferees, the Sassoons had not earned any part of the Managing Agency commission which had been paid by the Companies to the transferees and were not liable to tax in respect of the same.
It was on the other hand urged on behalf of the transferees that even though under the terms of the deeds of assignment and transfer they were paid by the Companies the whole of the Managing Agency commission for the calendar year 1943 they had merely earned the commission or remuneration for the period of actual services rendered by them to the Company and the portions of the Managing Agency commission proportionate to the services actually rendered by the Sassoons to the Companies had accrued to the Sassoons though it had been ascertained and paid to the transferees in the year 1944.
Even though the asceertainment 326 and the payment came later it made no difference which could be referred to the accrual of the income back to the period during which the income was earn Ltded and accordingly whatever amount was earned by me the Sassoons durin 'g the respective periods that they had acted as the Managing Agents of the Companies had accrued to them during those periods and was received by the transferees only by virtue of the respective deeds of assignment and transfer.
Having been received by the transferees by virtue of the assignment those portions of the Managing Agency commission received by them none the less constituted income which had accrued to the Sassoons and were liable to tax against the Sassoons the assignors and not against them the assignees.
The position of an employee under an entire contract of service has been thus enunciated in Halsbury 's Laws of England Hailsham Edition Vol. 22, page 133, paragraph 221: "When the contract of service is an entire contract, providing for payment on the completion of a definite period of service, or of a definite piece of work, it is a con dition precedent to the recovery of any salary or wages in respect thereof that the service or duty shall be completely performed, unless the employer so alters the contract as to entitle the servant to regard it at an end, in which case the whole sum payable under the contract becomes due, or unless there is a usage that the servant is entitled to wages in proportion to the time actually served.
But when the contract,, though in respect of work terminating at a particular time, is to be construed as providing that remuneration shall accrue due and become vested at stated periods, such remuneration constitutes a, debt recoverable at the end of each such period of service.
" Section 219 of the Indian Contract Act also provides that in the absence of any special contract, payment for the performance of any act is not due to the agent until the completion of such act.
Our attention was drawn in this connection to the case of Boston Deep Sea Fishing and Ice Co. vs Ansell(1).
327 In that case the defendant was employed as the managing director of the company for 5 years, at a yearly salary.
He was dismissed for misconduct before the expiration of the current year and claimed against the company damages for wrongful dismissal and the salary for the quarter which had expired before his dismissal.
His claim for salary was disallowed and it was, held that having been dismissed for misconduct he was not entitled to any part of the unpaid salary for the current year of his service.
Lord Justice Cotton at page 360 posed the question as under: "Can he sue for a proportionate part of the salary for the current year?. . .
What he would have been entitled to if he continued in their service until the end of the year would have been pound 8OO, but in my; opinion that would give him no right of action until the year was completed." Lord Justice Bowen observed at page 364: "As regards his, current salary it is clear and established beyond all doubt by authorities. . . that the servant who is dismissed for wrongful behaviour cannot recover his current salary, that is to say, he cannot recover salary which is not due and payable at the time of his dismissal but which is only to accrue due and become payable at some later date, and on the condition that he had fulfilled his duty as a faithful servant down to that later date.
" The case of Moriarty vs Regents Garage & Engineering Company Limited(1) was particularly relied upon by the learned counsel for the Sassoona.
No question of dismissal or removal for misconduct arose in that case, but the director whose remuneration was fixed "at the rate of pound150 per annum" ceased to be a director on settlement of disputes between himself and the company the director agreeing to accept payment of all money due to him upon his debentures and the debentures being paid off in the middle of the year.
The director sued the company to recover a proportionate part of the pound 150 as his fees for the broken period.
The Deputy County Court Judge gave judgment for the company, (1) (1921] 2 K.B. 766, 328 holding that the director was not entitled to remuneraion for a broken part of a year.
The Divisional Court versed the decision of the Deputy County Court judge and there was a further appeal.
It was held by the Court of Appeal that neither under the Agreement or under the articles was the director entitled to the he claimed.
The question of the applicability of the Apportionment Act was sought to be raised before the appeal Court but was not allowed to be raised in appeal as it had not been done in the County Court.
arriving at this decision Lord Sterndale M.R. stated the position as follows at page 774: "it seems to me that upon the construction of the agreement it must fail.
It is a payment per annum, a payment for a year, And unless he serves for the year the cannot get the payment.
" The decision in Swabey vs Port Darwin Gold Mining to.(1), had been cited before the Court of Appeal in support of the proposition that the director was in such cases entitled to his proportionate remuneration for the broken period.
The Learned Master of the Rolls however observed at page 777: "There is nothing is Swabey vs Port Darwin Gold Mining Co.(1) in my opinion to oblige us to hold that wherever there is power, mutual or one sided, to terminate an agreement in the middle of the year, there must, as a matter of necessity, be inferred a right to rceive payment from day to day, and receive payment for the broken period.
I do not think in this case there re circumstances which oblige me or induce me to raw that inference.
" These authorities as well as the cases of Mapleson vs years(2), and Sanders vs Whittle(3), enunciate the well stablished principle that wages and salaries are not apportionable upon the sudden cessation of a contract of service, which is stated to be still the law in Batt on the Law of Master and Servant, 4th Edn., at page 209 until a hardy litigant successfully seeks in a higher Court a confirmation of the view of McCardie J. expressed in Moriarty 's case(4) as regards the injustice (I) I Meg.
(3) (2) (4) , 329 of denying the benefit of the Apportionment Act to a man who may have been guilty of misconduct.
This rule applies not only when there is a sudden ' cessation of a contract of service by the unilateral act of the master or the servant but also when,, there is such cessation by mutual consent of the parties.
In the former event the servant would be Part deprived of his proportionate wages by his own act or default or he would be able to sue his master for damages for wrongful dismissal, but no claim for proportionate salary or wages would survive under the contract of service.
In the latter event the consensus of opinion between the master and the servant would be sufficient to terminate the contract of service and no claim for proportionate wages or salary would survive unless it was made an express term of the Agreement thus arrived at between the parties.
In either event there would be no question of the servant claiming from his master wages or salary for the broken period.
Learned counsel for the transferees attempted to throw doubt on the correctness of the rule as enunciated above by citing a passage from Palmer 's Company Precedents 16th Edition Vol. 1, page 583, where the learned author discusses the question of apportionment in the case of director 's remuneration payable at so much per annum: "Where the clause provides that a director is to be paid so much per annum, the words 'at the rate of ' being omitted, and he vacates office before the end of a current year, the question whether he can maintain a claim for an apportioned part of the remuneration for that year has given rise to some difference of opinion.
In Swabey vs Port Darwin Gold Mining Company(1), in the Court of Appeal, the article was as follows, and not as stated in the report: 'The directors shall each receive by way of remuneration out of the funds of the Company in each year the sum of pound 2OO, and the chairman in addition pound 100 per annum. ' The words at the rate of ' were not present (as appears from the articles registered 'at Somerset House).
A director resigned in the course of a current year, (i) (1889) I Meg.
43 330 and was held entitled to an apportioned part of the remuneration for that year.
But in Salton vs New Beeston Cycle Co.(1), where the article provided that 'the directors shall ' be entittled to receive by way of remuneration in each year pound 5,000, Cozens Hardy J. held that a director who vacated office before the end of a current year was not entitled to any apportionment.
This case was followed by Wright J. in McConnell 's Claim(2), the words being ,each director shall be paid the sum of pound 300 per annum ' and by Bruce J. in Inman vs Acroyd and Bert(1).
See also Central de Kapp Gold Mines(4).
In these four cases the Court no doubt proceeded on the assumption that the report of Swabey 's case(5) was correct,, and that the article in that case contained the words 'at the rate of. ' Certainly Lord Alverstone C. J. acted on this assumption in Harrison vs British Mutoscope, etc.
, Co.(,).
There the words were 'the sum of E 1,500 per annum.
In 'the meantime Inman vs Acroyd(7) had been taken to the Court of Appeal, and affirmed, but on the ground that it was by the articles left to the directors, to apportion the remuneration at the end of each year.
This case, therefore, really turned on the construction of the particular article, and as it was carefully distinguished from Swabey 's case(5), the authority of that case, on an article omitting the Words 'at the rate of, ' remains unshaken.
" Swabey 's case(5) was referred to by Lord Sterndale M. R. at page 777 in Moriarty case(3) and the learned Master of the Rolls stated that there was nothing in that case which would oblige the Court to hold that wherever there was power, mutual or one sided, to terminate an Agreement in the middle of the year, there must, as a matter of necessity, be inferred a right to receive payment from.
day to day, and receive payment for the broken period.
(i) [1898] I Ch.
775 (2) [1901] I Ch. 728.
(3) ; on appeal [1901] I Q.B., 613.
(4) , 235; J.).
(5) (1889) I Meg.
(6) Times, Nov. 10, (7) [1901] I Q.B. 613.
(8) [1921] 2 H.B,D. 766.
331 It really depended on the circumstances of each case whether to draw that inference or not.
In any event we have not before us under the terms of the Managing Agency Agreements any provision for payment of remuneration " at the rate of " any particular sum a, year and the ratio of the four cases referred to by Palmer in the passage quoted above as also the observations of Lord Sterndale M. R. at page 777 in Moriarty 's case (1) set out above are sufficient to enable us to hold that when the remuneration or commission is ex pressed at so much per annum without anything more it would amount in law to a stipulation for the payment of remuneration per year and the servant would not be entitled to get any remuneration unless and until he has completely performed his contract and such performance would be a condition precedent to the recovery of any wages or salary for that definite period of service.
That would be the position even if the remuneration was to accrue due and becomes vested at stated periods and unless the servant performed the condition and fulfilled his duty as a faithful servant down to that stipulated date or the stated period no salary would accrue due and become payable to him until at the end of such period of service.
We shall now examine the terms of the Managing Agency Agreements with a view to see whether the Sassoons were entitled thereunder to remuneration or commission for the broken periods.
The Agreement between the E. D. Sassoon United Mills Ltd. and the Managing Agents was for a fixed period of 30 years from the date of the registration of the Company and thereafter until they resigned or were removed from their office by a special resolution of the Company and the appointment of the firm of E. D .
Sassoon and Company and their assigns was for the whole period.
E. D. Sassoon and Company and their assigns covenanted and agreed with the Company to be and act as such Agents for the remuneration and upon and subject to the terms and conditions therein contained.
It was lawful for them to assign the agreement and their rights thereunder to any person, firm or 'Company (1) [1921) 2 K.B.D. 766.
332 having authority by its constitution to become bound by these obligations and upon such assignment being made and notified to the Company, the Company was bound to recognise such person, firm or Company as the Agents of the Company in like manner as if the name of such person, firm or Company had appeared in these presents in lieu of the names of the partners of E. D. Sassoon and Company and as if such person, firm or Company had entered into the Agreement with the Company and the Company agreed upon demand to enter into an Agreement appointing such person, firm or Company the Agents of the Company for the then residue of the term outstanding under the Agreement and with the like powers and authorities remuneration and emoluments and subject to the like terms and.
conditions as therein contained.
These provisions of the Agreement showed the continuity of the Managing Agents who were employed as the Agents of the Company for this specified period and under the terms and conditions therein recorded.
The new or the substituted Managing Agents were treated as if they had entered into the Agreement with the Company and their name had appeared in the original Agreement in lieu of E. D. Sassoon and Company who were in the first instance appointed the Agents of the company These Managing Agents described as such were to be paid the remuneration specified in clause 2(a) of the Agreement which was a commission of 71 per cent per annum on the annual net profits of the Company with a stipulation in regard to the minimum remuneration of Rs. 1,20,000 per annum.
Clause 2(d) specified when the said commission was to become due to the Managing Agents and it provided that the commission was to be due to them yearly on the 31st March in each and every year during the continuance of the Agreement.
The commission was thus an annual payment calculated upon the annual net profits of the Company and was to be due to the Managing Agents yearly on the 31st March in each and every year.
Unless and until the annual net profits of the Company were determined the 71/2 per cent.
commission could not be ascertained but the sum none the less became due on 333 the 31st March in each and every year following the close of the accounting year of the Company.
The ' amount of such commission did not become a debt ' owing by the Company to the Managing Agents until the 31st March in each and every year and was to be paid immediately after the annual accounts of the Company had been passed by the shareholders.
The postponement of the date of payment, in this manner however did not prevent the amount of the commission thus ascertained becoming due to the Managing Agents and it was on the 31st March in each and every year that the amount of commission thus calculated at 71 per cent.
# per annum on the annual net profits of the Company became due by the Company to the Managing Agents.
Until and unless the accounting year of the Company had gone by and the Managing Agents had served the Company as their Agents for the full period no part of the Managing Agency commission which was payable per year in the manner aforesaid could become due to them and the performance of the service, for the year was a condition precedent to the Managing Agents being entitled to any part of the remuneration, or commission for the accounting year of the Company.
The Managing Agency Agreement therefore was an entire and indivisible contract stipulating a payment of remuneration or commission per year and enjoined upon the Managing Agents the duty and obligation of rendering the services to the Company for the whole year by way of condition precedent to their earning any remuneration or commission for the particular accounting year.
It was however urged that clause 10 of the Managing Agency Agreement itself contemplated a broken period, because there was nothing therein to prevent the Managing Agents from assigning the Agreement and their rights thereunder at any time in a particular year during the continuance of the Agreement.
If the Managing Agents therefore could assign the Agreement and their rights thereunder it could not be suggested that neither the transferors who could not complete the year of service nor the transferees who had also not rendered the services as the Managing Agents for the 334 whole of the accounting year could earn any remuneration or commission which would be payable to the managing Agents only if they rendered the services to the Company for the whole year.
It therefore followed as a necessary corollary that both the transferors and the transferees would be paid their remuneration or commission and both would be entitled to the proportionate commission for the respective periods during which they rendered services as Managing Agents to the Company.
This argument however ignores the fact that whatever be the position as between the transferor and the transferee, whatever be their arrangements inter, se, whatever be the periods of the year during which they might have served the Company in their capacity as the Managing Agents, the Managing Agents as described in the recitals and clauses I and 3 of the Managing Agency Agreement were one entity and no severance of I such periods of service during the course of a particular year was ever contemplated under the Agreement.
On assignment, the transferee became the Managing Agent as if its name had been inserted in the Managing Agency Agreement from the beginning.
For the future period the transferor effaced itself and the transferee took the place of the transferor and preserved the continuity of the Managing Agency so that whoever happened to satisfy the description of the Managing Agents at the time when the commission for the accounting year became due to the Managing Agents thus described, which was expressly stated to be due yearly on the 31st March in each and every year, became entitled to receive the debt which thus became due and to the payment thereof after the annual accounts of the Company had been passed by the shareholders.
The stipulation for the Company executing in favour of the new or the substituted Managing Agents an Agreement appointing them the Agents of the Company for the then residue of the term outstanding under the Agreement was merely consequential upon the earlier provision therein contained which stated in so many terms that the Company was bound to recognise such new or substituted Managing Agents in like manner as if their names had appeared in the 335 mid Agreement in lieu of the partners of E.D. Sassoon and Company and as if they had entered into the Agreement with the Company.
The rights of such new or substituted.
Agents were created by the very terms of clause 10 of the Agreement and the formal embodiment thereof in the fresh Agreement to be entered into by the Company with them merely confirmed the rights which had already been created in them under that clause.
It was further pointed out that at the end of the Managing Agency Agreement if not earlier, during the continuance thereof there would certainly be a broken period because the period of 30 years stipulated in clause I of the Agreement would certainly expire on some date in February, 1950.
The calendar year would expire on the 31st December, 1949, and there would of necessity be between the date of the expiration of the calendar year and the date of the expiration of the term of the agreement a period of about 2 months which would certainly be a broken period and not a full year.
What would happen however on the expiration of the period of the Managing Agency Agreement cannot affect the construction of the relevant terms of the Agreement which have reference to a year or years during the continuance of the Agreement.
It is unnecessary to speculate as to whether by reason of the fact that E. D. Sassoon and Company must have received the full year 's remuneration or commission at the end of the first accounting year of the Company ending with the 31st December, 1920, they might just as well give up, if need be, their remuneration or commission for the last two months on the expiration of the term of the Managing Agency Agreement.
We see nothing in the terms of the Managing Agency Agreement which would compel or induce us to hold that there must as a matter of necessity be inferred therefrom a right to receive remuneration or commission for a broken period.
Learned counsel for Chidambaram Mulraj and Company Ltd. however sought to distinguish the terms of the Managing Agency Agreement of the Elphinstone Spinning and Weaving Company Ltd. from those of the 336 Managing Agency Agreement of the E. D. Sassoon United Mills Company Ltd. even though as stated 'before no such distinction was made either before the income tax authorities or the High Court.
He contended that there was nothing in the Agency Agreement with the Elphinstone Spinning and Weaving Company Ltd. which corresponded with clauses 2(a), 2(d) and clause 10 of the Agreement between the E. D. Sassoon United Mills and their Managing Agents.
The only term which was to be found in the Agency Agreement of the Elphinstone Spinning and Weaving Company Ltd. was that the Company was during the continuance of the Agreement to pay to the Managing Agents who were there described as E. D. Sassoon and Company Ltd. their successors and their assigns by way of remuneration a commission of ten per cent.
on the net profits of the Company and a further sum of Rs. 1,500 per month.
There was besides clause 6 of the Agreement which conferred upon the Managing Agents the right of retainer, and reimbursement in connection inter alia with all sums due to them for commission or otherwise.
These terms it was submitted did not constitute the payment of remuneration or commission a payment per annum and it was not possible to argue that the Sassoons were not entitled to any remuneration or commission for a broken period thereunder.
It may however be observed that the Managing Agency Agreement with which we are here concerned was the Agreement dated the 23rd May, 1922, between the Company and the Sassoons and the Managing Agents there described were E. D. Sassoon and Company Ltd on behalf of themselves, their successors and assigns.
Clause 1 of the Agreement employed the Sassoons, their successors and assigns the Agents of the Company from the 1 st February, 1,922, for the unexpired portion of the term of 60 years commencing from the 3rd July, 1919, and it was these Managing Agents thus described, viz., the Sassoons, their successors and assigns, who were during the continuance of the Agreement to be remunerated by a commission of 10 per cent.
on the net profits of the Company and the Company agreed to pay such commission to them.
The 337 right of retainer and reimbursement reserved under clause 6 of the Agreement would not carry the transferees any further because it was in respect of all sums due to them for commission or otherwise.
Unless and until the commission became due to them they had no such right of retainer.
It would still have to be determined whether any sum became due to them by way of such commission.
Whether any commission became due to them would depend upon the construction of clause 3 of the Agreement and under that clause the commission calculated at 10 per cent.
of the net profits of the Company was to become due to them and was to be paid by the Company to them during the continuance of the Agreement.
We have got to determine what is the full implication of this clause of the Agreement, "the commission of 10 per cent.
on the net profits of the Company.
" The word "profits" has a welldefined legal meaning as was observed by Lord Justice Fletcher Moulton at page 98 in The Spanish Prospect ing Company Limited(1): "The word 'Profits ' has in my opinion a welldefined legal meaning, and this meaning coincides with the fundamental conception of profits in general parlance, although in mercantile phraseology the word may at times bear meanings indicated by the special context which deviate in some respects from this fundamental signification. 'Profits ' implies a comparison between the state of a business at two specific dates usually separated by an interval of a year.
The fundamental meaning is the amount of gain made by the the business during the year.
This can only be ascertained by a comparison of the assets of the business at the two dates.
" This concept of the term was also adopted by Mr. Justice Mahajan, as he then was, in Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai and Company, Bombay(2): "Profits of a trade or business are what is gained by the business.
The term implies a comparison between the state of business at two specific dates separated by, an interval of a year and the fundamental (i) [1911] i Ch. D. 92.
44 (2) [1950] i8 I.T.R. 472 at page 5o2.
338 meaning is the amount of gain made by the business during the year and can only be ascertained by a comparison of the assets of the business at the two dates, the increase shown at a later date compared to the ,earlier date represents the profits of the business.
" It was urged before us that there was nothing in the terms of the Agreement which provided that the profits were to be ascertained at the end of every year, and there was nothing to prevent the Company if it so chose from casting its accounts and ascertaining the net profits half yearly or quarterly or even every month by preparing trial balance sheets in that manner.
Theoretically speaking all this may be possible but we have got to construe the Agreements arrived at between business people in a, business sense.
Ordinarily in the case of business or trading concerns accounts of profits are not made except at stated intervals usually separated by a year.
Particularly in the case of limited Companies incorporated under the Indian Companies Act the accounts are cast every year and the net profits earned by the Company are ascertained every year both for the declaration of dividends and for submitting the returns to the income tax authorities.
Under section 131 (I)of the Indian Companies Act of 1913 every Company was required once at least in every year and at intervals of not more than 15 months to cause the accounts to be balanced and a balance sheet to be prepared which was called the annual balance sheet.
The first schedule to the Companies Act which contained the regulations by which unless excluded the affairs of the Company were to be governed provided under Regulation 106 the preparation once at least every year of the profit and loss account for the period and under the Regulation 108 for the balance sheet to be made out in every year and laid before the Company in general meeting.
Having regard to the course of business which prevailed in this Company also so far as it is evidenced by the fact that the account of the Managing Agency commission was made up for the calendar year 1943 and was paid to Chidambaram Mulraj and Company Ltd., who became the Managing Agents in place and stead of the Sasssoons in the year 1944, it is reasonable to assume that the 339 accounts of this Company were throughout made up at the end of every calendar year.
The profit and loss of the Company was then ascertained and a commission of 10 per cent.
on the net profits of the Company was paid to the Managing Agents of the Company for the, time being.
In the case of limited Companies like those before us we would be justified in presuming that normally the accounts are made up every year and even though there may be a theoretical possibility of the accounts being cast half yearly or quarterly or even every month no such procedure would be adopted by the Company.
In any event it would be absurd to suggest that the profits of the Company could accrue from day to day or even from month to month.
The working of the Company from day to day could certainly not indicate any profit or loss.
Even the working of the Company from month to month could not be taken as a reliable guide for this purpose.
If the profit or loss has got to be ascertained by a comparison of the assets at two stated periods, the most businesslike way of doing it would be to do so at stated intervals of one year and that would be a reasonable period to be adopted for the purpose.
In the case of large business concerns like these the working of the Company during a particular month may show profits and the working in a particular month may show loss.
The working during the earlier part of the year may show profit or loss and working in the later part of the year may show loss or profit which would go to counterbalance the profit or loss as the case may be in the earlier part of the year.
It may as well happen that the profits which the Company may appear to have earned during the earlier months of the year or even during the II months of the year may be considerably reduced or even wiped out during the later months or the last months of the year by reason of some catastrophe or unforeseen events.
It would be therefore reasonable to assume that the profit or loss as the case may be should be determined at the end of every year so that on such calculation of net profits the Managing Agents may be paid their remuneration or commission at the percentage stipulated in the Managing Agency Agreement and 340 the shareholders also be paid dividends out of the net profits of the Company.
We are sure that these were the considerations which weighed with the Managing Agents of this Company in not taking up any such contention before the Income tax authorities and the High Court that the remuneration or commission payable to them under the Managing Agency Agreement was not payable per year and the contention put forward before us in this behalf was a clear after thought.
We would be therefore justified in treating the terms and conditions in regard to the payment of Managing Agency Commission in both these Managing Agency Agreements as on a par with each other stipulating for such payment per year on the net annual profits of the Companies.
If this be the true construction of the Managing Agency Agreements it follows that the contract of service between the Companies and the Managing Agents was entire and indivisible, that the remuneration or commission became due by the Companies to the Managing Agents only on completion of a definite period of service and at stated periods, that it was a condition precedent to the recovery of any wages or salary in respect thereof that the service or duty should be completely performed, that such remuneration constituted a debt only at the end of each such period of service and that no remuneration or commission was payable to the Managing Agents for broken periods.
The question still remains whether the remuneration for the broken periods accrued to the Sassoons and the contention which was strenuously urged before us on behalf of the transferees was that the Sassoons had rendered the services in terms of the Managing Agency Agreements to the respective Companies, that the services thus rendered were the source of income and whatever income could be attributed to those services was earned by the Sassoons and accrued to them in the chargeable accounting period though it was ascertained and paid in the year 1944 to the transferees.
The word "earned" has not been used in section 4 of the Income tax Act.
The section talks of " income, 341 profits and gains " from whatever source derived which (a) are received by or on behalf of the assessee, or (b) accrue or arise to the assessee in the taxable territories during the chargeable accounting period.
Neither the word " income " nor the words "is received," "accrues" and " arises " have been defined in the Act.
The Privy Council in Commissioner of Income tax, Bengal vs Shau Wallace & Co.(1) attempted a definition of the term income " in the words following : " Income, their Lordships think, in the Indian Income tax Act, connotes a periodical monetary return ' coming in ' with some sort of regularity, or expected regularity from definite sources.
The source is not necessarily one which is expected to be continuously productive, but it must be one whose object is the production of a definite return excluding anything in the nature of a mere windfall." Mukerji J. has defined these terms in Rogers Pyatt Shellac & Co. vs Secretary of State for India(2): " Now what is income? The term is nowhere defined in the Act.
In the absence of a statutory definition we must take its ordinary dictionary meaning that which comes in as the periodical produce of one 's work, business, lands or investments (considered in reference to its amount and commonly expressed in terms of money) ; annual or periodical receipts accruing to a person or corporation " (Oxford Dictionary).
The word clearly implies the idea of receipt, actual or constructive.
The policy of the Act is to make the amount taxable when it is paid or received either actually or constructively.
i Accrues, ' arises ' and I is received ' are three distinct terms.
So far as receiving of income is concerned there can be no difficulty; it conveys a clear and definite meaning, and I can think of no expression which makes its meaning plainer than the word ' receiving ' itself The words I accrue and arise also are not defined in the Act.
The ordinary dictionary meanings of these words have got to be taken as the meanings attaching to them.
Accruing ' is synonymous with 'arising ' in the sense (i) I.L.R. at p. 1352.
(2) at P. 371 342 of springing as a natural growth or result.
The three Expressions accrues, I arises ' and I is received ' having been used in the section, strictly speaking 'accrues ' should hot be taken as synonymous with I arises ' but on the distinct sense of growing up by way of addition for increase or as an accession or advantage; while the word I arises ' means comes into existence or notice or presents itself.
The former connotes the idea of a growth or accumulation and the latter of the growth or accumulation with a tangible shape so as to be receivable.
It is difficult to say that this distinction has been throughout maintained in the Act and perhaps the two words seem to denote the same idea or ideas very similar, and the difference only lies in this that one is more appropriate than the other when applied to particular cases.
It is clear, however, as pointed out by Fry L.J. in Colquhoun vs Brooks(1), [this part of the decision not having been affected by the reversal of the decision by the House of Lords(2)] that both the words are used in contradistinction to the word " receive " and indicate a right to receive.
They represent a stage anterior to the point of time when the income becomes receivable and connote a character of the income which is more or less inchoate.
One other matter need be referred to in connection with the section.
What is sought to be taxed must be income and it cannot be taxed unless it has arrived at a stage when it can be called 'income '.
" The observations of Lord Justice Fry quoted above by Mukerji J. were made in Colquhoun vs Brooks(1) while construing the provisions of 16 and 17 Victoria Chapter 34 section 2 schedule 'D '.
The words to be construed there were ' profits or gains, arising or accruing ' and it was observed by Lord Justice Fry at page 59: " In the first place, I would observe that the tax is in respect of 'profits or gains arising or accruing.
' I cannot read those words as meaning I received by. ' If the enactment were limited to profits and gains 'received (i) at P. 59.
(2) (I889) 14 APP.
493. 343 by ' the person to be charged, that limitation would apply as much to all Her Majesty 's subjects as to foreigners residing in this country.
The result ' would be that no income tax would be payable upon profits 'which accrued but which were not actually received, although profits might have been earned in the kingdom and might have accrued in the kingdom.
I think, therefore, that the words I arising or accruing are general words descriptive of a right to receive profits.
" To the same effect are the observations of Satyanarayana Rao J. in Commissioner of Income tax, Madras vs Anamallais Timber Trust Ltd.(1) and Mukherjea J. in Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai & Co., Bombay(2) where this passage from the judgment of Mukerji J. in Roqers Pyatt Shellac & Co. vs Secretary of State for India(3), is approved and adopted.
It is clear therefore that income may accrue to an assesee without the actual receipt of the same.
If the assessee acquires a right to receive the income, the income can be said to have accrued to him though it may be received later on its being ascertained.
The basic conception is that he must have acquired a right to receive the income.
There must be a debt owed to him by somebody.
There must be as is otherwise expressed debitum in presenti, solvendum in futuro; See W. section Try Ltd. vs Johnson (Inspector of Taxes)(4), and Webb vs Stenton and Others, Garnishees(5).
Unless and until there is created in favour of the assessee a debt due by somebody it cannot be said that he has acquired a right to receive the income or that income has accrued to him.
The word "earned" even though it does not appear in section 4 of the Act has been very often used in the course of the judgments by learned Judges both in the High Courts as well as the Supreme Court.
(Vide Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai & Co., Bombay(6), and Commissioner of Income tax, Madras vs K. R. M. T. T. Thiagaraja Chetty & Co.(7).
(i) 18 I.T.R.1 333 at P. 342.
(5) II Q.B.D. 5i8 at pp.
522 and 527 ' (2) [19501] S.C. R. 335 at P. 389.
(6) [1950] S.C.R. 335 at P. 364.
(3) I I.T.C. 363 at P. 372.
(7) at P. 533.
(4) [1946] I A.E.R. 532 at P. 539.
344 It has also been used by the Judicial Committee of the Privy Council in Commissioners of Taxation vs Kirk(1).
The concept however cannot be divorced from that of income accruing to the assessee.
If income has accrured to the assessee it is certainly earned by him in the sense that he has contributed to its production or the parenthood of the income can be traced to him.
But in order that the income can be said to have accrued to or earned by the assessee it is not only necessary that the assessee must have contributed to its accruing or arising by rendering services or otherwise but he must have created a debt in his favour.
A debt must have come into existence and he must have acquired a right to receive the payment.
Unless and until his contribution or parenthood is effective in bringing into existence a debt or a right to receive the payment or in other words a debitum in presenti, solvendum in futuro it cannot be said that any income has accrued to him.
The mere expression "earned" in the sense of rendering the services etc., by itself is of no avail.
If therefore on the construction of the Managing Agency Agreements we cannot come to the conclusion that the Sassoons had created any debt in their favour or had acquired a right to receive the payments from the Companies as at the date of the transfers of the Managing Agencies in favour of the transferees no income can be said to have accrued to them.
They had no doubt rendered services as Managing Agents of the Companies for the broken periods.
But unless and until they completed their performance, viz., the completion of the definite period of service of a year which was a condition precedent to their being entitled to receive the remuneration or commission stipulated thereunder, no debt payable by the Companies was created in their favour and they had no right to receive any payment from the Companies.
No remuneration or commission could therefore be said to have accrued to them at the dates of the respective transfers.
It was however urged that even though no income can be said to have accrued to the Sassoons at the date of the respective transfers which could be the (1) at p. 592, 345 subject matter of any assignment by them in favour of the transferees, the moment the remuneration or commission was ascertained at the end of the calendar year and became a debt due to the Managing Agents under the terms of the Managing Agency Agreements it could be referred back to the period in which it was earned and the portions of the remuneration or commission which were earned by the Sassoons during the broken period could certainly then be said to be the income which had accrued to them during the chargeable accounting period.
Reliance was placed is support of this position on Commissioners of Inland Revenue vs Gardner Mountain & D ' Ambrumenil, Ltd.(1).
The assessee in that case carried on inter alia the business of underwriting Agents, and entered into Agreements with certain underwriters at Lloyds under which it was entitled to receive as remuneration for its services in conducting the Agency, commissions on the net profits of each year 's underwriting.
The Agreements provided that " accounts should be kept for the period ending 31st December in each year and that each such account shall be made up and balanced at the end of the second clear year from the expiration of the period or year to which it relates and the amount then remaining to the credit of the account shall be taken to represent the amount of the net profit of the period or year to which it relates and the commission payable to the Company shall be calculated and paid thereon.
" The accounts for the underwriting done in the calendar year 1936 were made up at the end of 1938 and the question that arose was whether the assessee was liable to additional assessment in respect of the commission on under writer 's profits from the policies underwritten in the calendar year 1936 in the year in which the policies were underwritten or in the year when the accounts were thus made up.
The assessee contended that the contracts into which it entered were executory contracts, under which its services were not completed or paid for, as regards commission, until the conclusion of the relevant account; that the profit in the form of commission was (I) 45 346.
not ascertainable or earned, and did not arise, until that time and that the additional assessment which was made in the year in which the policies were underwritten should accordingly be discharged.
The Special ,Commissioner allowed the assessee 's contention and, discharged the additional assessment.
The decision of the Special Commissioners was confirmed on appeal by Macnaghten J. in the King 's Bench Division of the High Court.
The Court of Appeal however reversed this decision and a further appeal was taken by the assessee to the House of Lords.
The House of Lords held that on the true construction of the Agreements, the commissions in question were earned by the assessee in the year in which the policies were underwritten, and must be brought into account accordingly and confirmed the decision of the Court of Appeal.
It may be noted that the charge was on profits arising in each chargeable accounting period and the profits were to be taken to be the actual profits arising in the chargeable accounting period.
The ratio of the decision was that the commission paid was remuneration for services completely performed in the particular year, that, the assessee had at the end of the year done everything it had to do to earn it and that it was remuneration for work done and completely done in the particular year though it was ascertained and paid two years later.
Viscount Simon in his speech at page 93 stated that the assessee had acquired a legal right to be paid in futuro and that the principle was to refer back to the year in which it was earned so far as possible remuneration subsequently received even though it could only be precisely calculated.
afterwards.
Lord Wright in his speech at page 94 said that it was necessary to determine in what year the Commission was earned, or in the language of the Act, in what year the assessee 's profits arose and observed at page 96 : "I agree with the Court of Appeal in thinking that the necessary conclusion from that must be that the right to the commission is treated as a vested right which has accrued at the time when the risk was underwritten, It has then been earned, though the profits resulting from the insurance cannot be then 347 ascertained, but in practice are not ascertained until the end of two years beyond the date of underwriting.
The right is vested, though its valuation is postponed, ' and is not merely postponed but depends on all the contingencies which, are inevitable in any insurance risk, losses which may or may not happen, returns of premium, premiums to be arranged for additional risks, reinsurance, and the whole catalogue of uncertain future factors.
All these have to be brought into account according to ordinary commercial practice and understanding.
But the delays and difficulties which there may be in any particular case, however they may affect the profit, do not affect the right for what it eventually proves to be worth.
" Lord Simonds in his speech at page 110 stated:" It is clear to me that the commission is wholly earned in year 1 in respect of the profits of that year 's underwriting.
If so, I should have thought that it was not arguable that that commission did not accrue for income tax purposes in that same year though it was not ascertainable until later.
" The fact that the account of the commission could not be made up until later did not make any difference to the position that the commission had been wholly earned during the chargeable accounting period and the income had accrued to the assessee during that period.
Learned counsel for the transferees also relied upon the decisions in Bangalore Woollen, Cotton and Silk Mills Co., Ltd. vs Commissioner of Income tax, Madras(1), and Turner Morrison and Co., Ltd. vs Commissioner of Income tax, West Bengal(2), to show that as and when the sale proceeds were received by the Company the profits made by the Company were embedded in those sale proceeds and if that was so the percentage of the net profits which was payable by the Companies to the Managing Agents as and by way of commission was similarly embedded in those sale proceeds.
If the profits thus accrued to the Company.
during the chargeable accounting period the commission payable to the Managing Agents also could be said to have accrued to them during that period.
(I) [1950] is I.T.R 423.
(2) 11953) 348 It is no doubt true that the accrual of income does not depend upon its ascertainment or the accounts cast by assessee.
The accounts may be made up at a much later date.
That depends upon the convenience of the assessee and also upon the exigencies of the situation.
The amount of the income, profits or gains may thus be ascertained later on the accounts being made up.
But when the accounts are thus made up the income, profits or gains ascertained as the result of the account are referred back to the chargeable accounting period during which they have accrued or arisen and the assessee is liable to tax in respect of the same during that chargeable accounting period.
"The computation of the profits whenever it may take place cannot possibly be allowed to suspend their accrual. :. . . . ". "The quantification of the commission is not a condition precedent to ' its accrual." (Per Ghulam Hassan J., in Commissioner of Income tax, Madras vs K. B. M. T. T. Thiagaraja Chetty and Co.(1).
See also Isaac Holden and Sons, Ltd. vs Commissioners of Inland Revenue(2), and Commissioners of Inland Revenue, vs Newcastle Breweries Ltd.(3).
What has however got to be determined is whether the income, profits or gains accrued to the assessee and in order that the same may accrue to him it is necessary that he must have acquired a right to receive the same or that a right to the income, profits or gains has become vested in him though its valuation may be postponed or though its materialisation.
may depend on the contingency that the making up of the accounts would show income, profits or gains.
The argument that the income, profits or gains are embedded in the sale proceeds as and when received by the Company also does not help the transferees, because the Managing Agents have no share or interest in the sale proceeds received as such.
They are not co sharers with the Company and no part of the sale proceeds belongs to them.
Nor is there any ground for saying that the Company are the trustees for the business or any of the assets for the Managing Agents.
The Managing Agents cannot therefore be said to have acquired a (1) at P. 534.
(2) 12 Tax Cases 768.
(3) 12 Tax Cases 927.
349 right to receive any commission unless and until the accounts are made up at the end of the year, the net profits ascertained and the amount of commission due by the Company to the Managing Agents thus determined.
(See Commissioners of Inland Revenue vs Lebus(1) ).
It is cleat therefore that no part of the Managing Agency commission had accrued to the Sassoons at the dates of the respective transfers of the Agencies to the transferees.
The two decisions which were sought to be distinguished by the High Court in the judgments under appeal also support this conclusion.
In the unreported decision of the High Court of Bombay in Commissioner of Excess Profits Tax, Bombay City vs Messrs. P. N. Mehta and Sons(1), the Managing Agency Agreement was couched in the very same terms as that of the E. D. Sassoon United Mills Company Ltd. The Managing Agents were to be paid 10 per cent.
of the net annual profits made by the Company with a guaranteed minimum commission of Rs. 15,000 per annum.
The accounting year of the Company was the calendar year.
The Tribunal had held that the annual profits could only be ascertained when the accounts of the Company were made up and it was then that the 10 per cent.
commission would accrue to the Managing Agents.
The contention of the Department was that as the Managing Agents worked as such from day to day and helped the Company to earn profits, profits accrued to them from day to day and not at the end of the year.
This contention was negatived by the High Court : "It is only on net annual profits that the Managing Agents are entitled to any commission.
A Company may have worked 'for six months at a loss, for the remaining six months it may make a large profit so as to wipe off the loss, and have a net profit to show.
It is only as a result of the working of the Mills for the whole year that it will be possible to ascertain whether the Mills have worked at a loss or at a profit, and what the profit was.
Therefore, the Managing Agents are only entitled to a commission on the result of the (1) [ 1946] i A.E.R. 476 ; S.C. 27 Tax Cases 136.
(2) [1950] I.T.Ref.
No. 19 Of 1950.
350 working of the Mills for a whole year.
If the working shows a net annual profit which gives them a commission of more than Rs. 15,000 on the basis of 10 per cent.
, they are entitled to that amount.
If, on the ,other hand, the working does not show a profit, which entitles them to a comnission of Rs. 15,000 they are in any case entitled to that amount.
Therefore in our opinion, the Tribunal rightly held that the accrual of the commission was at the end of the calendar year, which was the year maintained by the Mills and not from time to time as contended by the Depart ment.
" In the case of Salt and Industries Agencies Ltd., Bombay vs Commissioner of Income tax, Bombay City(1),, the question for the consideration of the Court no doubt was what was the place where the profits had accrued.
In determining the place where the profits had accrued it was however necessary to find when the profits had accrued to the assessee and it was held that, what was conclusive of the matter was the consideration as to when the right to Managing Agency com mission arose and when did the Company become liable to pay Managing Agency commission to the Managing Agents and it was further held that it was only when all the accounts of the working of the Company were submitted to the head office in Bombay and the profit was determined that it could be said that a right to receive a commission at the rate specified in the Managing Agency Agreement had arisen and the Managing Agents became entitled to a certain specified commission.
These considerations are germane to the question which we have to decide in these appeals and support the conclusion which we have already arrived at, that the right to receive the commission would arise and the income, profits or gains would accrue to the Managing Agents only at the end of the calendar year which was the terminus a quo for the making up of the accounts and ascertaining the net profits earned by the Company.
We fail to see how these cases which were relied upon by the Revenue before the High Court could, be distinguished in the manner in which it was done.
(i) iS I.T.R. 58. 351 We were invited by the learned counsel for the Sassoons to approach the question from another point of view and that was that what had been transferred by the Sassoons to the transferees was a source of income, viz., the Managing Agency which was to run for the unexpired residue of the term.
It was urged that where a source of income was transferred any income which accrued from that source after the date of the transfer was the transferees ' income and not of the transferors, and that it was immaterial (a) that at the date of the transfer there was an expectation that at a future date income would accrue, (b) that the transferor by the work before the transfer had contributed to create any income which might eventually accrue and (c) that because of the expectation of income a higher price had been paid for the transfer.
Reliance was placed in this connection on the case Of Commissioners of Inland Revenue vs Forrest (1).
In that case the assessee purchased certain shares on the 25th November, 1919, and paid an excess price " to cover the portion of the dividend accrued to date.
" A dividend of 10 per cent.
for the period ending on 28th February, 1920, was declared on the 13th May, 1920.
The contention of the assessee was that the dividend should be treated as capital in view of the terms of the contract of purchase and not included in the computation of his income.
Under the provisions of the Incometax Act the dividends which were receivable by him 'were required to be included in the computation of his income.
The learned Judges however discussed the legal effect of such a transaction of the purchase of shares.
Lord Ormidale observed at page 709: " The value of the shares had to be determined as a matter of bargain between the parties, and the purchaser thought that it was not unreasonable that he should pay something over par for them because of the possibility, not the certainty but the possibility, of a dividend six months afterwards being paid upon the shares so purchased by him." Lord Anderson observed at page 710: (i) 8 Tax Cases 704.
352 He buys two things with his money.
He buys, in the first place, a share of the assets of the industrial concern proportionate to the number of shares which he hat; purchased; and he also buys the right to participate in any profits which the Company may make in the future.
Now, when a transaction of this nature is entered into during the currency of the financial year of the industrial concern it is obvious that what happens is this, that not only is a part of the assets purchased outright but that a chance is bought as well a chance of sharing in any profits which may be made during the currency of that financial year.
" Wigmore (H. M. Inspector of Taxes) vs, Thomas Summerson and Sons, Limited (1) was the case of a vendor of war loan stock bearing interest payable without deduction of tax.
The sale was effected on the 10th April, 1923, with interest rights.
The vendor was assessed for the year 1923 24 in respect of the amount of interest said to have accrued on the stock in the period between the last payment of interest.
and the sale of the stock, it being contended that the price received by the vendor on sale of stock included this interest.
The purchasers said that they were not liable to tax in respect of the income which had been accruing on the security they had purchased in a period anterior to the date on which they purchased.
It was observed that the truth of the matter was that the vendor did not receive interest and interest was the subject matter of the tax.
But he received the price of an expectancy of interest which was not the subject of taxation.
It was not argued that the interest accrued de die in them and the vendor was held not assessable in respect of the interest accrued at the date of the sale of the stock.
Commissioners of Ihland Revenue vs Pilcher (2) was the case of the gale of an orchard inclusive of the year 's fruit crop.
The assessee had valued the cherries which were on the trees at pound 2,500 and had pat a man immediately in the orchard after he had purchased it at the. auction.
He commenced to pick the fruit on the 25th May, 1942, and completed the operations on the (i) 9 Tax Cases 577.
(2) 3 i Tax Cases 314.
353 12th June, 1942.
He realised pound, 2,903 as the price of the cherries.
This sum was brought into the profit and loss account as a trading receipt and the contention of the assessee was that in computing his profits he was entitled to charge the sum of i 2,500 being the purchase price of the cherries sold for pound 2,903 which sum had been brought into credit as a trading receipt.
This contention was negatived and it was observed by Lord Justice Jenkins at page 332 " It is a well settled principle that outlay on the purchase of an income bearing asset is in the nature of capital outlay, and no part of the capital so laid out can, for income tax purposes, be set off as expenditure against income accruing from the asset in question.
" There is a further passage in the judgment of Jenkins L. J. at page 335 which is very instructive.
It had been contended that the revenue should look at the transaction from the assessee 's point of view and should consider it in a manner favourable to him.
This contention was dealt with in the manner following: One has to remember that this transaction concerned not merely Mr. Pilcher but also the vendor of the orchard.
Mr. Pilcher was able to buy the orchard complete with the cherries from the vendor and by that means, according to his own calculation, the cherries stood him in pound 2,500.
It by no means follows that if he had been minded to buy the cherries from the vendor apart from the land, as a separate transaction, the vendor would have been willing to sell them to him for pound 2,500, or at any price.
The difference is obviously a material one from the vendor 's point of view because, dealing with the matter as he did, he was selling a capital asset, and the resulting capital receipt, prima facie, would attract no tax.
If he sold the cherries separately in the way of trade he would at once have created an income receipt on which, prima facie, tax would have been exigible.
Therefore the alteration in the form of the bargain required to make it more favourable to Mr. Pilcheer from the tax point of view would have involved an alteration not merely of form but of substance owing to its adverse effect on 46 354 the tax situation of the vendor, and it cannot be assumed that the bargain thus altered would have been one to which Mr. Pilcher could have secured the vendor 's agreement.
" These observations throw considerable light on the situation obtaining,in the cases before us.
It will be remembered that the total amount of Rs. 75,77,693 received by the Sassoons on the transfers of the Managing Agencies was taken by them to the " Capital Reserve Account.
" No part of that amount was treated by them as a receipt of income and it is debatable whether any part of the same could have been allocated as a receipt of income even though the transferees had desired to do so.
All that the transferees obtained under the deeds of assignment and transfer executed by the Sassoons in their favour was an income bearing asset consisting of the office of Managing Agents, the Managing Agency Agreement and all the rights and benefits as such Managing Agents under the Agreements and no part of the consideration paid by the transferees to the Sassoons could be allocated as a receipt of income by reason of their contribution towards the earning of the commission in the shape of services rendered by them as Managing Agents of the Companies for the broken periods.
What the transferees obtained under the deeds of assignment and transfer was the expectancy of earning a commission in the event of the condition precedent by way of complete performance of the obligation of the Managing Agents under the Managing Agency Agreements being fulfilled and a debt arising in favour of the Managing Agents at the end of the stated periods of service contingent on the ascertainment of net profits as a result of the working of the Company during the calendar year.
The last case to which we were referred by the learned counsel for the Sassoons was The City of London Contract Corporation, Limited vs Styles (Surveyor of Paxes) (1).
The part of the business taken over by the assessee in that case consisted of unexecuted and partly executed contracts.
The contracts were executed after the date of the purchase by the assessee and the (1) 2 Tax cases.
239, 355 assessee sought to deduct the price paid for the contracts from the profits arising from their performance.
This deduction was not allowed because whatever price the assessee paid for the purchase of the business was treated as the capital which had been invested for the purpose of acquiring that business and the assessee could not deduct from the net profits of the working of the business after the date of the purchase any part of the capital which had been thus invested by it.
This result was achieved even though in the purchase of unexecuted contracts there was included the part of the work done towards the performance of the contracts by the vendors.
The assessee derived the benefit from such partial execution of the contracts by the vendors; nevertheless the value of such work was not treated as any income which had accrued to the vendors and which the assessee was entitled to deduct from its profits arising from the performance by it of those unexecuted contracts.
Learned counsel on behalf of the transferees contended that all these cases were concerned with the question whether the income derived by the assessee out of the income bearing asset after the date of the purchase could be treated as a capital expenditure so far as it formed part of the consideration paid by the assessee to the vendors and in none of these cases were the Courts concerned with the question that arises before us, viz., whether any part of the income which was actually received by the assessees could be said to have accrued to the vendor.
Even though the question did not arise in terms it is nonetheless involved in the consideration of the question whether the assessee was liable to pay the income tax on the whole of the income thus derived by him.
As was pointed out by Jenkins L. J. in Commissioner of Inland Revenue and vs Pilcher(1), quoted above, the vendor 's point of view cannot be neglected and once you come to the conclusion that the assesse alone is liable it necessarily follows that the vendor certainly has nothing to do with the same.
If it were otherwise the vendor would certainly be liable to tax and no purchaser would miss the opportunity of avoiding his liability for that portion of (i) 31 Tax Cases 314 at P. 335.
356 the income which can be said to have accrued to the vendor.
As a matter of fact such a contention was taken by the purchasers in Wigmore (H.M. Inspector of Taxes) vs Thomas Summerson and Sons Limited(1), where they declined to be assessed for tax in respect of income which had been accruing on the securities they had purchased in a period anterior to the date at which they did purchase.
This contention however did not prevail and the vendors were held not assessable in respect of the interest accrued on the date of the sale of the stock.
It is therefore clear that the Sassoons had not earned any income for the broken periods nor had any income accrued to them in respect of the same, and what they transferred to the transferees under the respective deeds of assignment and transfer did not include any income, which they had earned or had accrued to them and which the transferees by virtue of the assignment in their favour were in a position to collect.
If any debt had accrued due to the Sassoons by the respective Companies at the dates of respective transfers of Managing Agencies such debt would certainly have been the subject matter of assignment.
But it what was transferred by the Sassoons, to the respective transferees were merely expectations of earning commission and not any part of the commission actually earned by them or which had accrued to them under the terms of the Managing Agency Agreements, what the transferees received from the Companies under the terms of the Managing Agency Agreements which were thus transferred to them would be their income and no part of such income could ever be said to have accrued to the Sassoons, during the chargeable accounting period.
In view of the above it is unnecessary to deal with the contention which was urged by the learned counsel for the Sassoons that ever be an assignment of income the assignee and not the assignor would be liable to pay the tax.
He referred us to the case of the Commissioner of Income tax, Bombay Presidency vs Tata Sons Ltd.(2), in support of this contention of his and he also referred us to note 'G ' at page 209 in (i) 9 Tax Cases 577.
(2) 357 Simon 's Income tax, 2nd Edn., Vol.
II, where the ratio of Parkins vs Warwick (H.M. Inspector of Taxes)(1), relied upon by the High Court in the judgments under, appeal has been criticised.
We do not however think it necessary to go into this question, as in our opinion there were no debts due by the Companies to the Sassoons which were assigned under the respective deeds of transfer and assignment.
The only question which remains to consider is whether section 36 of the Transfer of Property Act imports the principle of apportionment in regard to the commission received by the transferees herein.
Section 36 of the Transfer of Property Act provides "In the Absence of a contract or local usage to the contrary, all rents, annuities, pensions, dividends and other periodical payments in the nature of income shall, upon the transfer of the interest of the person entitled to receive such payments, be deemed, as between the transferor and the transferee, to accrue due from day to day, and to be apportionable accordingly, but to be payable on the days appointed for the payment thereof.
" It may be noted that the section applies in the absence of a contract or local usage to the contrary and also applies as between the transferor and the transferee.
There is no room for the application of these provisions as between the subject and the Crown.
(Vide The Commissioners of Inland Revenue vs Henderson 's Executors(2)).
The contract to the contrary must of necessity be as between the transferor and the transferee and it is only when there is no such contract to the contrary that the rents, annuities, pensions, dividends and other periodical payments in the nature of income become apportionable as between the transferor and transferee, deemed to accrue due from day to day and be apportionable accordingly.
The deeds of assignment and transfer executed by the Sassoons in favour of the transferees transferred all the rights and benefits under the Agency Agreement to the transferees and there was no question of apportionment of any commission between the Sassoons and the transferees.
In fact the transfer claimed to retain and did retain (1) [I943] (2) i6 Tax CaseS 282 at P. 291, 358 the whole of the commission, which had been paid by the Companies to them in the year 1944 and the Sassoons never claimed any part of it as having been earned by them.
Whatever was their contribution .towards the earning of that commission during the whole of the calendar year 1943 was the subjectmatter of the assignment in favour of the transferees and that was sufficient to spell out a contract to the contrary as provided in section 36 of the Transfer of Property Act.
Section 26(2) of the Indian Income tax Act also does not help the transferees because it is only when the person succeeded has acquired an actual share of the income profits or gains of the previous year that he is liable to tax in respect of it and as set out herein above no part of the commission actually accrued to or became a debt due by the Company to the Sassoons on the dates of the respective transfers of the Managing Agencies to the transferees.
In order to attract the operation of section 26(2) the person succeeded must have had an actual share in the income, profits or gains of the previous year and on the construction of the Agreements the Sassoons cannot be said to have acquired any share in commission for the broken periods.
The whole difficulty has arisen because the High Court could could not reconcile itself to the situation that the transferee had not worked for the whole calendar year and yet they would be held entitled to the whole income of the year of account; whereas the transfers had worked for the broken periods and yet they would be held disentitled to any share in the income for the year.
If the work done by the transferors as well as the transferees during the respective periods of the, year were taken to be the criterion the result would certainly be anomalous.
But the true test under section 4(1)(a) of the Income tax Act is not whether the transferors and the transferees had worked for any particular periods of the year but whether any income had accrued to the transferors and the transferees within the chargeable accounting period.
It is not the work done or the services rendered by the person but the income 359 received or the income which has accrued to the person within the chargeable accounting period that is the subject matter of taxation.
That is the proper method of approach while considering the taxability or otherwise of income and no considerations of the work done for broken periods or contribution made towards the ultimate income derived from the source of income nor any equitable considerations can make any difference to the position which rests entirely on a strict interpretation of the provisions of section 4(1)(a) of the Income tax Act.
The result therefore is that the question referred by the Tribunal to the High Court must be answered in the negative.
All the appeals will accordingly be allowed.
But as regards the costs, under the peculiar circumstances of these appeals where the Commissioner of Income tax, Bombay, has supported the Sassoons in Civil Appeal No. 3 of 1953 and the brunt of the attack in Civil Appeals Nos. 30 of 1953 and 31 of 1953 has been borne not by the Commissioner of the Income tax who is the appellant in both, but by the Sassoons, the proper order should be that each party should bear pay his own costs here as well as in the Court below JAGANNADHADAS J.
I am unable to agree with the judgment just delivered on behalf of both my learned brothers.
It is with considerable regret that I feel constrained to write a separate judgment expressing the reasons for my not being able to agree with them in spite of my profound respect for their views.
These three are appeals against a judgment of the Bombay High Court by leave granted under section 66A(2) of the Indian Income tax Act.
They arise out of a set of facts mostly common.
E. D. Sassoon and Company, Ltd. now in voluntary liquidation (hereinafter referred to as the Sassoonal had the Managing Agency of three Mills (1) F.D. Sassoon United Mills Ltd. (2) Elphinstone Spinning and We having Mills Company, Ltd., and (3) The Apollo Mills Ltd. With the 360 consent of the Mill Companies and by virtue of clauses in the Managing Agency Agreements enabling thereunto, the Sassoons transferred the Managing Agency of the three Mills to three other Companies during the course of the calendar year 1943 as follows: (1) to Agarwal and Company, Ltd. (hereinafter referred to as Agarwals) on the 1st December, 1943, (2) to Chidambaram Mulraj and Company, Ltd. (hereinafter referred to as Chidambarams) on the 1st June 1943, and (3) to Rajputana Textile (Agencies) Ltd., on the 1st july, 1943.
The assessments with which we are concerned are those of (1) Sassoons, (2) Agarwals, and (3) Chidam barams and relate to income by way of Managing Agency remuneration paid in the year 1944 by the Mill Companies to the respective assignee Companies for the calendar year 1943.
For Sassoons and Agarwals the assessment year was 1944 45 and the accounting year was the calendar year 1943.
For Chidambarams the assessment year was 1945 46 and the chargeable accounting period was from 1st July, 1943, to 30th June, 1944.
The tax was assessed on the basis not of receipts but of accrual.
The income tax authorities treated the total remuneration for the entire year 1943 in each case as income which accrued to the assigneeCompanies in the respective accounting periods.
The assignee Companies objected on the ground that part of the remuneration, up to the date of the respective assignments, accrued to the assignor Company, viz., Sassoons and that they were, therefore, liable to be assessed only in respect of the balance of the remuneration referable to the portion of the calendar year 1943 subsequent to the respective dates of the assignments.
The objection was overruled and the assessments were made.
On appeals to the Income tax Appellate Tribunal, their contention was accepted and the assessments were modified.
It may be mentioned that the Rajputans Textiles (Agencies) Ltd. does not appear to have filed any appeal to the Tribunal.
Meanwhile (presumably by way of caution) the income tax authorities issued notices to the assignor Company, viz., Sassoons, under section 34 of the Indian Income tax Act and assessed it in respect of the proportionate part 361 of the year 's Managing Agency commission up to the date of the respective assignments.
The Sassoons objected to this before the income tax.authorities, but the objection was overruled.
It has been stated to us in the case filed by the Sassoons in this Court that the entire net consideration for the three assignments was taken by them into their accounts as capital reserve.
But this finds no mention in the Tribunal 's statement of the case to the High Court.
How the Sassoons made entries in their own accounts is not decisive and has not been relied on before us.
On their objection being overruled, the Sassoons filed an appeal to the Income.
tax Appellate Tribunal.
The Tribunal rejected the appeal in view of the decision they had already given in the appeals filed by the two assignee Companies, Agarwals and Chidambarams.
The three Companies concerned obtained references to the High Court under section 66 of the Indian Income tax Act.
The question referred by the Tribunal in each of the three cases was the same and is as follows: " Whether in the circumstances of the case; was the Managing Agency commission liable to be apportioned between the assessee Company and the assignee (or assignor, as the case may be).
" The High Court answered the question against the Sassoons and in favour of the other two.
What the High Court held was in substance that (1) the Managing Agency remuneration for the year in question accrued as the joint income of both the assignor and the assignee and was apportionable between them, and (2) the assignee Companies received the assignor 's share of the joint income by virtue of the assignments of the assignor 's share and hence to that extent it was not their taxable income but continued to be the taxable income of the assignor ' There are thus three appeals, one by the Sassoons against the Income tax Commissioner and the other two by the Income tax Commissioner against Agarwals and Chidambarams respectively.
In the first of the appeals, the Income tax Commissioner supports the position taken up by the Sassoons, while in the other two the Commissioner is the appellant and contests the position taken by the 47 362 Agarwals and the Chidambarams.
Thus it will be seen that though in form the three appeals are each between the Income tax Commissioner and one of the three Companies, in fact they raise a controversy between the assignor Company, the Sassoons, on the one side and the two assignee Companies, the Agarwals and the Chidambarams on the other, the Commissioner supporting the Sassoons and opposing the other two.
The arguments before us covered a wide range and were advanced on the assumption that what the High Court held was that the Sassoons became entitled on the.
very date of the respective assignments to a proportionate share of the year 's remuneration for the Managing Agency, and that accordingly that share accrued to the Sassoons as their taxable income, then and there, and did not cease to be such notwithstanding the assignment thereof The case was accordingly debated before us as though the decision turned upon the question whether any income could accrue to the Sassoons on the dates of the respective transfers of the Managing Agency to the transferees.
It is necessary, therefore, to clarify, at the outset, what the question was which was directly raised on the reference made to the High Court and what, in the view of the High Court, was the date When a share of the year 's remuneration accrued to the Sassoons as its income.
It appears to me that the judgment of the High Court taken as a whole is based only on the view that the entire Managing Agency remuneration for the year accrued on the completion of 'the year, i.e., on the 31st December, 1943, and that when it so accrued it accrued both to the assignor and to the assignee together.
This appears from the following passage of the judgment of the High.
Court.
" In order to levy income tax it is not enough to enquire when a particular income accrues.
What is more important and what is more pertinent is to enquire whose income it is which is sought to be taxed.
Assuming that this particular income accrued on the 31st December and till 31st December there was nothing earned, even so, when.
the income does accrue the question still remains to be answered as to whose 363 income it is which has accrued on the 31st December, 1943.
" It appears to me also that it is on the footing of the accrual on the completion of the year that the High Court dealt with the question of assignment of the, income as appears from the following passage: " And clearly one of the rights which E. D. Sassoon and Company, Ltd. had, was to receive the Managing.
Agency commission (share therein ?) when it accrued on 31st December. . .
They transferred that right.
" From these passages it appears to me clear that the High Court proceeded on the view that income accrued at the end of the year to both together and that what passed to the assignee under the assignment included a future right of the assignor to a share in the remuneration, when it accrued on the completion of the year, and not on the view that the assignment operated as the transfer of a present right to such a share on the very date of the assignment.
It is in view of the assumption that the remuneration for the year accrued only on the 31st December that the Income tax Appellate Tribunal also took care to say, in making their reference to the High Court, as follows: " The question is not when the Managing Agency commission accrued.
The real question is to whom it accrued.
" It appears to me, therefore, that it is not correct to approach the consideration of this case as though, the decision therein turns directly upon the question whether any income had accrued to the Sassoons on the dates of the respective transfers of the Managing Agency to the transferees.
In the arguments before us, considerable stress was laid by learned counsel appearing for the Sassoons on the fact that the Managing Agency Agreements with which we are concerned provide for annual remuneration for an year 's work.
It was pointed out that the remuneration payable was fixed as commission at a certain specified percentage of the net profits of the respective Mill Companies.
So far as the Sassoons United Mills Ltd., are concerned, whose Managing Agency had been 364 assigned to Agarwals, the commission was in terms stated in the Agency Agreement to be per annum and on the annual net profits of the Company.
So far as Elphinstone Spinning and Weaving Mills Company,Ltd., are concerned, whose Managing Agency was assigned to Chidambarams.
, the remuneration, is merely stated in the corresponding Agreement to be a percentage of the net profits of the company, but is not in terms stated to be per annum or on the annual net profits.
But there can be no reasonable doubt that as a matter of construction, the remuneration in the latter case also must be taken to be per annum and on the annual net profits, notwithstanding some argument before us to the contrary.
Having regard to this basic fact, the following are, in substance, the arguments put forward before us by learned counsel for the assignor Sassoons.
(1) The Managing Agency commission was payable in respect of services for an entire calendar year and not for a portion thereof and therefore no commission became due to the Sassoons for the services rendered by them to the respective Mill Companies for broken periods of the year up to the dates of the respective assignments.
(2) Since no remuneration became a debt due to the Sassoons from any of the Mill Companies on the dates of the respective assignments, no taxable income accrued to them for the broken periods.
(3) By the dates of the respective assignments, the Sassoons had only a bare expectancy, if any, to receive remuneration for the broken period and this expectancy could not be the subject matter of any assignment, and (4) The true legal position, therefore, is that what was assigned was an income bearing asset, viz., the Managing Agency which was the source of income and which entitled the respective assignees to receive all the remuneration for the year payable under the Managing Agency Agreement subsequent to the respective dates of assignment.
Accordingly the same became in its entirety taxable income in the hands of the respective assignees and no portion of it accrued at any time as taxable income of the assignor Sassoons.
In the view that I take of the High Court 's judgment as to the date of accrual of the income and as to 365 the scope of the question presented on the references the first three of the above arguments do not appear, to me to call for any examination.
In the present case no question arises as to the enforceability of the claim for a proportionate share of the remuneration by, the assignor from the very date of assignment.
Nor does any question arise as to the non payability of remuneration on account of non completion of the work.
The year 's work has been completed by the assignee Company in continuation of that of the assignor Company.
The total remuneration for the year has in fact been paid into the hands of the assignee Company.
The only questions, therefore, are (1) whether the money so received accrued by way of remuneration for the year 's work and became taxable income on the 31st December, 1943, (2) if so, whether.
it was the joint income of the assignor and the assignee or the, sole income of the assignee, and (3) whether the assignment operated to transfer the assignor 's share of the income on its accrual.
The answer to the first of the above questions seem$ to me to admit of no doubt.
The remuneration was for the year 's work.
The year 's work was completed on the expiry of the year.
The right to receive the remuneration became, therefore, vested on the 31st December, 1943.
It is true that in Agarwal 's case there is a clause ' in the original Managing Agency Agreement that "the Managing Agency commission shall be due yearly on the 31 st day of March in each and every year and shall be payable and be paid immediately after the annual accounts of the Mill Company have been passed, by the shareholders.
" It has been urged, in reliance on this clause that the accrual of the income, in so far as the case of Agarwals is concerned, is not on the 31st December, but on the 31st March next.
In the first place such a contention in so far as it relates to the date of accrual, is not permissible in view of the clarification in the order of reference made by the Tribunal to the High Court and: in view of the specific and categorical language of some ' of the grounds in the statements of the case filed.
366 before us both by Sassoons and the Income tax Commissioner showing 31st December, 1943, as the date of accrual of the entire remuneration.
(Vide paragraphs 19(1), 26(a) and (g) of the Sassoons ' statement, and paragraphs 12, 15(1), (2) and (5) of the Income tax Commissioner s statement, in Civil Appeal No. 3 of 1953).
But even if the contention be permissible and granting the view strenuously urged on behalf of the appellant Sassoons that there is no accrual of income until there exists a right to receive it, I do not think that the clause in question has any relevancy so far as the date of accrual of income is concerned.
Accrual of income for purposes of taxation, does not depend on the question ' as to when the income becomes payable.
It depends only on when a vested right to receive the income arises.
(See Commissioners of Inland Revenue vs Gardner Mountain and D ' Ambrumenil Ltd., (1)).
The accrual is accordingly complete when the right to the remuneration becomes vested by the occurrence of all the events on which the remuneration depends.
A mere clause that the remuneration shall be due at a later date, notwithstanding ' that all the events on which the remuneration depends have occurred, can only have the effect of postponing the liability for payment and not of postponing the vesting of the right to income.
The requirement of lapse of further time after the occurrence of all the qualifying events is not itself an additional event which imports any element of contingency in the right.
It appears to me, therefore, that the above clause which has been relied upon whatever the reason may be for the distinction which the language seeks to suggest between due and payable can have no bearing on the date of the accrual and cannot have the affect of postponing the accrual from the 31st December to 31st March.
But even otherwise, this does not at all affect.
the final conclusion in this case reached by the High Court of Bombay.
If the view of the High Court is correct that the ncome accrued both to the assignor and to the assignee after the completion of the year 's work it seems to matter little whether that accrual is on the 31st December or on the 31st March next.
(1) 367 by the High Court that the assignments operated to transfer to the assignee the assignor 's share of the year 's remuneration after it accrued to him as his income and whether it continues to remain the assignor 's taxable income in spite of the assignment, may also be shortly dealt with.
If the High Court be right in its view that the remuneration accrued both to the assignor and to the assignee together, whenever it may ' be, then it is clear that on the respective dates of the assignment,, the assignor bad a future right to a share of the remuneration on the completion of the year.
If so, there is ample authority for the position that the assignment of such a future right is valid and becomes operative by way of attaching itself to the right when it springs up.
(See Bansidhar vs Sant Lal (1), Misri Lal vs Mozhar Hossain (2), Palaniappa vs Lakshmanan (3) and Baldeo vs Miller (4).) The validity of such an assignment as between the assignor and the assignee and the effect thereof on the assignor 's future right may also be supported with reference to the principle of estoppel feeding title which finds recognition in section 43 of the Transfer of Property Act.
For the further position, ViZ., that a person continues to be liable for tax in respect of accrued income notwithstanding assignment thereof operating on or after such accrual, there is authority in Parkins vs Warwick (5).
This view is confirmed by the following passages in the Privy Council case in Pondicherry Railway Co. Ltd. vs commissioner of Income tax, Madras (6).
" Profits on their coming into existence attract tax at that point and the revenue is not concerned with the subsequent application of the profits.
" The destination of the profits or the charge which has been made on those profits by previous agreement or otherwise is perfectly immaterial." (Quoted out of an extract from the case in Gresham Life Assurance Society vs Styles(7)).
(1) I.L.R.1o All I33.
(2) I.L.R. (3) I (4) I.L R. (5) 25 Tax Cases gig.
(6) A.I.R. 1931 P.C. i65 at 170.
(7) [I892] A.C. 309. 368 clear recongnition of the principle that when once income accrues to a person, an assignment operative in respect thereof, does not affect his taxability for that income.
It may be mentioned that it is not seriously disputed that the consideration for each assignment included the value of the prospective advantage of collecting the remuneration for the entire year, i.e., in the sense that the actual consideration paid was higher than what it might have been if the assignment had taken place at the very commencement of the year.
The only substantial question, therefore, which this case raises is whether the view taken by the High Court, that the remuneration for the year accrued as income both to the assignor and the assignee, is correct.
It is apparently as an answer to this question that learned counsel appearing for the Sassoons put forward the argument No. 4 above enumerated, viz., that the assignment of Managing Agency is the transfer of an income bearing asset and that all income received subsequent to the date of assignment is entirely the assignee 's taxable income.
It is the validity of this argument that now requires examination.
The cases that have been relied on in support of this argument are the following : The Commissioners of Inland Revenue vs Forrest(1); Wigmore vs Thomas Summerson(2); and Commissioners of Inland Revenue vs Pilcher(3).
Commissioners of Inland Revenue vs Forrest(1) is a case of purchase of certain shares and the income derived therefrom and is analogous to the second head of income chargeable to income tax under section 6, of the Indian Income tax Act, viz., Securities.
The income therefrom is directly referable only to the ownership of the shares or securities.
Mere lapse of time makes income payable and the taxation depends on the receipt of the income.
Wigmore vs Thomas Summerson(2) is also a case similar to the above.
Commissioners of In.
land Revenue vs Pilcher(3) is the case of a sale of an orchard inclusive of the year 's fruit crop, which by the date of the sale does not appear to have become ripe.
(i) 8 Tax Cases 704.
(2) 9 Tax Cases 577 (3) 3T Tax Cases 314.
369 enough to be treated as a severable item of property.
This was a case of property whose.
ownership itself, in the ordinary course and by lapse of time, gives rise to income and is analogous to head No. 3 of section 6 of ' the Indian Income tax Act.
It is interesting to note, that in this case, the learned Judges make a distinction between fructus industriales and fructus naturales and point out that the fruits derived from the orchard being cherries are fructus naturales and not fructus industrials.
That the result might have been different if it was fructus industriales appears clearly, at least so far as Lord Justice Singleton and Lord Justice Tucker are concerned.
In the case of fructus industriales the income does not arise by mere ownership but as a result of further investment and labour which may be the effective source of income.
These decisions refer only to cases where the sole or effective source of income is mere ownership and taxability depends on receipt of the income.
Another case that has been relied on before us is the City of London Contract Corporation vs Styles(1).
That was a case where one Company purchased as a going concern the business carried on by another Company, as contractors for public works.
It was claimed that the assignee Company was entitled to deduction from their taxable income for a portion of the purchase price which may be attributed to the purchase of the right, title and interest to, and the benefit of, certain building contracts of the Company, from the execution of which, a portion of the net profits of the Company arose.
This was negatived on the ground that the entire purchase price was capital investment and that what all was received later on was income derived by the execution of the contracts so purchased.
This, so far as it goes, may seem to suggest by implication that there may be a purchase of contracts yet to be executed and that the benefit of the entire profits therefrom is to be treated as income in the hands of the purchaser.
The report of this case, however, does not indicate clearly whether the contracts, whose benefit was purchased were partially executed and if so, whether the partial execution (1) 2 Tax Cases 239, 370 was substantial or negligible.
The statement of the facts of the case at page 241 of the report shows that the business which was purchased consisted entirely " of partially executed or wholly unexecuted contracts, and of the rights thereunder and the benefits to accrue therefrom.
" If the business consisted of only unexecuted contracts, this case is not an authority for the position contended for on behalf of the Sassoons.
But in any case, even if some of the contracts were partially executed there is nothing to show that the execution was of any such extent as to have become a substantial source of income.
It may also be noted that this decision is a direct authority only on what is capital expenditure and what is revenue expenditure for pur poses of deduction.
The point in the form relevant for the present case was not raised there and cannot be taken to have been decided.
It is interesting to notice that in Simon 's Income tax, Vol. 2, (1949 Edn.), page 188, paragraph 222, the following passage appears.
" In City of London Contract Corporation Ltd. vs Styles(1) where the Company acquired a business including a number of unexecuted contracts, it was held that the sum paid for the contracts could not be deducted in computing the Company 's profits, on the ground that the whole of the purchase price of the business was a sum ' employed or intended to be employed as capital in such trade '.
" Similarly in Spicer and Pegler 's Income tax and Profits tax (20th Edn.), at page 116 it is stated as follows : " Cost of unexecuted contracts taken over with a business (in arriving at the profits from the performance of the contracts)" and the case of City of London Contract Corporation vs Styles(1) is quoted as authority.
These standard textbooks also show that this case has been treated as having reference to unexecuted contracts (and not to partially executed contracts) and as being authority for the question as to what are Permissible deductions from taxable income of business concerns, (I) 2 Tax CaseS 239.
371 The above cases, therefore, cannot be treated as in any way supporting the contention put forward by learned counsel for the appellant Sassoons that in the case of an assignment of Managing Agency the entire remuneration for the year 's work accrues as a matter of law to the assignee and is his sole income, on the ground that the Agency is the source of income and that in this respect it is to be treated as an income bearing asset.
No specific authority has been cited ' before us covering the case of a Managing Agency nor can the case in City of London Contract Corporation vs Styles(1) be treated as an authority showing that in the case of an assignment of partially executed contracts the remuneration or profits relatable to such partial execution is necesarily the income of the assignee.
The question thus raised has, therefore, to be examined on principle.
On such examination it appears to me that the argument advanced in this behalf is based on a fundamental misconception.
Income of the kind with which we are concerned in this case does not arise by virtue of any mere ownership of an asset.
What produces income is not the ownership of the Managing Agency but the actual work turned out for the benefit of the principal.
It is not the fact of a Company having obtained the right to work as a Managing Agent that produces the income but it is the continuous functioning of the Company, as the Managing Agent, in terms of the contract of Agency, that produces the income.
Hence, it is the rendering of the service of the Managing Agency or the carrying out of the Managing Agency business, which is the effective and direct source of income.
This is not to say that work or service is the subject of taxation.
It is the remuneration that is the subject of tax and work is the source of the remuneration.
Hence in such a case service or work is the source of income and not.
the ownership of the right to work.
The above legal position has been very succinctly brought out by Lord Finlay, though in another context, in John Smith & Son vs Moore(2) in the following passage: (1) 2 Tax Cases 239.
(2) (1921] 2 A.C. I3 at 25.
372 "The business makes no profits.
The profits are not fruits yielded by a tree spontaneously.
They are the result of the operations carried on by the owner of 'the business for the time being." Therefore, on principle, apart from authority, it appears to me to be erroneous to treat the Managing Agency.
Agreement as by itself the direct source of income and to treat it as an income producing asset.
An examination of the provisions of the Indian Income tax Act clearly bears out this view.
Sections 3 and 4 of the Income tax Act are the charging sections.
The charge is (in so far, as it is relevant for purposes of this case) on the income of the previous year (a) which is received by the assessee within the taxable territory, or (b) which accrued or arose within the taxable territory to a resident assessee.
As stated at the outset the assessment in the present case is based on accrual and not on receipt.
Computation of the taxable income is governed by the provisions of Chapter III of the Act.
Section 6 thereof enumerates the following heads of income as being chargeable to income tax.
(1) Salaries, (2) Interest on securities, (3) Income from property, (4) Profits and gains of business, profession or vocation, (5) Income from other sources.
The residual item (5) may for the present purposes be left out.
Of the other four heads, items 2 and 3 are the only items in which the taxable income is directly related to the ownership of an asset.
In the present case the computation of the taxable income 'has no relation to those items but may conceivably fall under head No. 1 or head No. 4.
At this stage, it is necessary to observe that, though, so far, in the above discussion, the Managing Agency has been referred to as service and the commission therefor as remuneration, for purposes of convenience, the true nature of the functioning of a Managing Agent, where it is, a firm or a Company, which so functions, has been recently held by this Court in Lakshminarayan Ram Gopal and Son, Ltd. vs The Government of Hyderabad(1) to be a business and the remuneration to be income by way of profits or gains from the business.
The i) Civil Appeals Nos. 292 and 312 Of 1050 of the Suprem Court of India.
373 income, therefore; falls under head No. 4 and the com petation thereof has to be made under section 10 of the Income tax Act.
Sub section (1) of that section runs as follows: "The tax shall be payable by an assessee under the head profits and gains of business, profession or vocation in respect of the profits or gains of any business, profession or vocation carried on by him.
" Now, in computing the taxable income of the assignee, can it reasonably be said that the remuneration for the entire year is the income of the assignee and that it is the profits and gains of the business carried on by the assignee, when as a fact he stepped into the position of the Managing Agent only on some date in the course of the year by virtue of the assignment.
It appears to me that before income can be attributed under this head to an assessee, it must relate to the business carried on by the assessee himself In the present case, therefore, the profits and gains of the whole year seem to me clearly to relate to the business carried on both by the assignor and the assignee taken together and are hence taxable as income accruing to both and apportionable as such between them.
The importance of not overlooking the significance of the phrase "carried on by him" in subsection (1) of section 10, though in a different context, has been emphasised by the Privy Council in Commissioner of Income tax, Bengal vs Shaw Wallace and Co.(1).
A recent decision of this Court in the Liquidators of Pursa Limited vs Commissioner of Incometax, Bihar(2) also emphasises this and explains that the phrase "carried on by him" in section 10(1) of the Indian Income tax Act "connotes the.
fundamental idea of the continuous exercise of an activity as the essential constituent of that which is to produce the taxable income.
" This phrase appears to me also clearly to connote the idea that the taxable income is that of the very assessee or the combination of assessee whose continuous activity produces the income.
Where, as in this case, that continuity is kept up by two persons successively, it appears to tile (i) I.L.R. (2) Civil Appeal NO.
33 Of 1953.
374 that under this section, the profits and gains are the assessable income of both together.
This is in accord with the well accepted notion, under the normal law, that if two persons jointly carry out a work or conduct a business, the total remuneration in fact earned for the work or the total gains made on that business belongs to both of them as their joint property and that such property has to be apportioned between them on some equitable basis.
This is quite independent of any question as to whether the claim for remuneration for the work or for the emoluments of the business can be individually or jointly enforced as against the person who is liable to pay.
It cannot be disputed that in the absence of any specific contract to the contrary between the persons who contribute to the work or business, the fruit of such work or of such business is the joint property of both, when the same has in fact been realised.
Nor can it be said that this holds good only in cases where both the persons concurrently join together to earn the remuneration for the work or the profits of the business.
There is no reason in law why the same principle should not be equally applicable where the two together contribute to the total work or to the total business in succession as in this case and not in concurrence.
If, what arises on such continuous and successive functioning of two persons is the joint remuneration of both, there can be no doubt that such remuneration would be apportionable between them on some equitable basis on the principle that joint property is normally severable.
To such a situation section 26(2) of the Income tax Act would also clearly apply.
That section no doubt indicates nothing as to the principle of apportionment.
But there is no difficulty in the present case since it is agreed that the apportionment, if any, is to be timewise.
This also prima facie is the only equitable way of apportionment on the facts of this case.
At this stage it becomes necessary to notice certain provisions of the relevant Managing Agency Agreements which have been strongly relied on as supporting the view contrary to what I have indicated above.
Reliance 375 has been placed on two provisions of the Managing Agency Agreement between the Sassoon United Mills Ltd. and the Sassoons which are relevant only in the appeal relating to the Agarwals.
The first of these provisions is the one already noticed in another context, viz., clause 2 (d) of the Agency Agreement which, runs as follows: "The said commission shall be due to the said firm yearly on the 31st day of March in each and every year during the continuance of this Agreement. . .
It is urged that this term stamps the Managing Agency Agreement with the characteristic of an incomebearing asset which vests solely in, the assignee the right to the entire income payable after the date of assignment.
But it appears to me that a term of this kind has reference only to the payment aspect of the.
money which constitutes remuneration and has no, bearing on the question as to whose income it is for purposes of taxation.
Taxable income must be derived from specified sources indicated in the Indian Incometax Act.
Since the mere ownership of Managing Agency cannot as a matter of law be treated as the source of ' income, as explained above, any term in the Managing Agency Agreement between the principal and the agent entitling only the assignee to receive the year 's remuneration and negativing to the assignor any direct recourse to his quondam principal for his share of the income, cannot have the effect of denying to the assignor a substantial right to a share in the remuneration, if otherwise he has a vested right thereto.
A distinction exists in law between the right to receive or get payment of a certain amount of money and the right to the money itself.
The right to enforce payment of money may belong to one person.
But the beneficial right in that money may belong wholly or partially to another.
Benami contracts are familar examples of such a case.
Instances of joint rights in money or money 's worth enforceable only at the instance of one out of the persons entitled, in special situations, are easily conceivable.
It may be true that there is no accrual of income unless there is a vested right to receive the money which constitutes income.
But this 376 proposition has relevance only to the factum or date of accrual but not necessarily to the ownership of the income on such accrual.
None of the cases that have been cited before us in support of the proposition that there is no accrual of income unless there is a right to receive it negative this view.
In the course of the arguments repeated stress has been laid on the proposition that there is no accrual of income 'Unless there is a right to receive the income.
This may be so.
But it does not follow that the very person who has the right to receive the money which constitutes the income is the owner of that money or that the income accrues to him alone.
That must depend on the substantive rights, if any, applicable to a particular situation.
A term in a Managing Agency Agreement between the principal and the agent as to the person to whom the remuneration is payable or is to become due can only have been meant as a protection of the principal in respect of multiplicity of claims against himself and cannot settle the substantive rights between persons who may have contributed to earn the remuneration.
The second provision relied on is clause 10 of the Managing Agency Agreement with which the case of Agarwals is concerned.
Clause 10 of the agreement runs as follows: "It shall be lawful for the said firm to assign this agreement and the rights of the said firm hereunder to any person, firm or Company having authority by its constitution to become bound by the obligations undertaken by the said firm hereunder and upon such assignment being made and notified to the said Company shall be bound to recognise the person or firm or Company aforesaid as the Agents of the said Company in like manner as if the name of such person, firm or Company had appeared in these presents in lieu of the names of the partners in the said firm and as if such person, firm or Company, had entered into this Agreement with the said Company and the said Company shall forthwith upon demand by the said firm enter into an Agreement with the person firm or Company aforesaid appointing such person firm of Company the 377 Agents of the said Company for the then residue of the term outstanding under the Agreement and with the like powers and authorities remuneration and emoluments and subject to the like terms and conditions as are herein contained.
" Stress has been laid on the underlined portion of the above clause.
It is urged that this as well as clauses I and 3 of the Managing Agency Agreement show that the assignor and the assignee are to be treated as one entity and that on assignment the assignee becomes the Managing Agent as if his name had been inserted in the Managing Agency Agreement from the beginning, and that the continuity of the Managing Agency was preserved thereby and that whoever satisfies the description of the Managing Agent at the time when the commission for the year becomes due, is also the person entitled to the amount by way of remuneration not, as per this argument by virtue of any mutual arrangement between the assignor and the assignee, but by the very terms of the Managing Agency which is the source of income.
It is urged.
therefore, that this feature stamps the Managing Agency as an income bearing asset.
In substance, therefore, this argument amounts to saying that by virtue of this clause the service of the assignee subsequent to the date of assignment can be tacked on to the service of the assignor for the earlier portion of the year, so as to constitute it service for the entire year which earns the remuneration, as the sole property of the assignee, i.e., that the assignment has to be given retrospective operation from the commencement of the year in respect of the work so far done.
But if this clause is to be construed as having such retrospective operation, it must, on the very terms of the underlined portion, become so operative from the original commencement 2of the Agreement itself and not from any particular date or event thereafter.
There is no reason to confine such retrospective operation only to the inchoate advantage for remuneration arising from partly finished work of the year.
The underlined portion of the clause, if it is to ' have retrospective effect at all, is comprehensive enough to take within its ambit every othere claim,which may have accrued but remained 49 378 unpaid, commencing from the initial stage of the Agency.
On this construction, therefore, the right to. ,very such claim would pass to the assignee.
Such a result would obviously be untenable and no reason exists why the retrospective operation, to be imputed to this clause, should be confined to the limited extent which serves the argument put forward in this behalf by the appellant Sassoons.
It appears to me, therefore, quite clear on a fair reading of the entire clause 10 of the Managing Agency Agreement that the only effect thereof is to bring about the result specifically stated in the second portion of that clause (which has been side lined) i.e. that on assignment, the assignee firm shall be entitled to demand and obtain from the principal Company a fresh Managing Agency Agreement in its own favour for the residue of the term outstanding and with like powers authorities remuneration and emoluments and subject to the like terms and conditions.
In my opinion all that the clause 10 taken as a whole means is no more than that the assignee is entitled to demand a fresh Agreement on the same terms and that even without a fresh Agreement being formally executed as between the principal Mill Company and the assignee company their mutual rights and obligations will be governed by the old Agreement for the residue of the term with the assignee Company 's name substituted for the assignor Company 's name.
Such effect can only be prospective and not retrospective.
There can be no doubt, however, that though any mere clause in the Managing Agency Agreement that the employer is to be responsible only to the assignee for the payment of the entire year 's remuneration is not by itself enough to vest in the assignee a beneficial right to the remuneration of the year, such a right may arise by virtue of a specific or implied term as between the transferor and the transferee, either as part of the deed of transfer or independent thereof.
It may be mentioned that in the Agarwals ' case there was such a specific term in the Agreement preliminary to the actual assignment.
But learned counsel for the Sassoons expressly disclaimed it on the ground that it was not incorporated in the deed of transfer and was, 379 in any case, superfluous and did not rely on it.
In his view the right of the assignee to receive the entire remuneration did not depend on any specific term between the assignor and the assignee, but on the fact that what was transferred is an income bearing asset which carried with it a right to the entire income that falls due after the date of assignment.
It is on account of the insistence on this view, that, as I apprehend, learned counsel for the Sassoons disclaimed the above mentioned special term between the assignor and the assignee as being superfluous.
He seems to have sought thereby to obviate the consequence of the contention that the assignor 's share of remuneration became the assignee 's by virtue of the specific assignment thereof operating thereon 'on its accrual and that hence it remained the taxable income of the assignor.
It may be mentioned in this context that clause 10 of the Managing Agency Agreement in Agarwals ' case has been relied on by learned counsel for Agarwals to show that while, it may be, that in the normal run of events the contract for remuneration under the Managing Agency Agreement is an indivisible contract for a whole year 's remuneration on the completion of a whole year 's work, this clause necessarily implied divisibility of contract and of the remuneration in the year of assignment since the assignment necessarily took place with the consent of the principal Mill Company.
(Vide section 87 B(c) of the Indian Companies Act).
This argument was advanced to support the contention that the Sassoon 's share of the year 's income accrued on the very date of assignment.
Since, however, in my view that was not the basis of the judgment of the High Court as explained above and since such an argument is not, in my opinion, open, having regard to the statement of the case by the Income tax Appellate Tribunal as well as of the statements of appellants and respondents herein, I do not consider it necessary to deal with that argument.
In my view, therefore, the continuous and successive functioning by both the assignor and the assignee under the Managing Agency Agreement was the effective source of the year 's income.
That income accrued on the completion of the year and was the joint income 380 of both the assignor and the assignee.
The prior assignments in the course of the year operated as assign ments of this future right to a share of the income.
It is only by virtue of inter se arrangement between the assignor and the assignee, resulting from the transactions of assignment, that the assignee had the right to collect the entire income.
Nevertheless, the share in this income which accrued to the Sassoons on the completion of the year remained the taxable income of the Sassoons and they were rightly taxed in respect thereof.
The very strenuous arguments of learned counsel for Sassoons to counter the above view are based on the insistence that the Managing Agency is like property which per se produces income and, on ignoring the distinction between right to receive the income and right to the ownership of the income and on treating the former as settling the question of the person to whom income accrues.
In my opinion these arguments are unsustainable and the conclusion reached by the learned Judges of the Bombay High Court is correct.
The appeals are, therefore, liable to be dismissed.
I express no opinion on any of the other points raised.
Appeals allowed.
| The Sassoons had entered into three Managing Agency agree ments as the Managing Agents of three different companies.
They transferred their Managing Agencies to three other companies by formal deeds of assignment and transfer on several dates during the accounting year.
The question for determination was whether in the circum.
stances of the case the Managing Agency commission was liable to be apportioned between the Sassoons and their respective transferees in the proportion of the services rendered as Managing Agents by each of them for the respective portions of the accounting year and the decision turned upon the question whether any income had accrued to the Sassoons for the purpose of income tax on the dates of the respective transfers of the Managing Agencies to the transferees.
Under clause 2(d) of the Managing Agency agreements, the commission to the Sassoons as Managing Agents was to be due to them yearly on the 31st of March in each and every year and was to be payable immediately after the annual accounts of the company had been passed by the shareholders.
Held per S.R. DAS and BHAGWATI JJ.
(JAGANNADHADAS J. dissenting).answering the question in the negative, that on the 41 314 construction of the Managing Agency agreements, the contract of service between the companies and the Managing Agents was entire and indivisible, that the remuneration or commission became due by the companies to the Managing Agents only on the completion of a definite period of service and at stated intervals, that it was a condition precedent to the recovery of any wages or salary in respect thereof that the service or duty should be completely performed, that such debt constituted a debt only at the end of each period of service and that no remuneration or commission was payable to the Managing Agents for broken periods.
The Sassoons had not earned any income for the broken periods nor had any income accrued to them in respect of the same and what they transferred to the transferees under the respective deeds of assignment and transfer did not include any income which they had earned or had accrued to them during the chargeable accounting period and which the transferees by virtue of the assignment in their favour were in a position to collect.
The true test under section 4(1)(a) of the Indian Income tax Act, for the purpose of ascertaining liability for income tax in the case of transfer of Managing Agency is not whether the transferore and the transferees had worked for any particular periods of the year but whether any income had accrued to the transferors and the transferees within the chargeable accounting period.
The word "profit" in section 4 of the Indian Income tax Act has a well defined legal meaning.
The term implies a comparison between the state of business at two specific dates usually separated by an interval of a year.
The fundamental meaning is the amount of gain made by the business during the year.
"Income" connotes a periodical monetary return "coming in" with some sort of regularity, or expected regularity from definite sources.
The source is not necessarily expected to be continuously productive but its object is the production of a definite return excluding anything in the nature of windfall.
The word "income" clearly implies the idea of receipt, actual or constructive.
The words "accrues", "arises" and "is received" are three distinct terms.
The word "accrues" conveys the distinct sense of growing up by way of addition or increase or as an accession or advantage connoting the idea of a growth or accumulation.
The word "arises" means comes into existence or notice or presents itself and conveys the idea of the growth or accumulation with a tangible shape so as to be receivable.
Both the words "accrues" and " arises" are used in contradistinction to the word "receive" and indicate a right to receive income.
The accrual of income to an asseseee does not mean the actual receipt of the same by him and it may be received later on .
its being ascertained.
The word "earned" does not appear in section 4 of the Income tax Act but it has been very often used in the course of judgments by learned Judges.
It conveys the concept of income accruing to the assesses, 315 Per JAGANNADHADAS J.
In the present case the profits and gains of the whole year clearly related to the business carried oil both by the assignor and the assignee token together and were hence taxable as income accruing to both and apportionsble as such between them.
The phrase "carried on by him" in section 10(1) of the Indian Income tax Act connotes the fundamental idea of the continuous exercise of an activity as an essential constituent of that which is to produce the taxable income and that the taxable income is that of the 'very assessee or the combination of assessees whose continuous activity produces the income.
Therefore the continuous and successive functioning by both the assignor and the assignee under the Managing Agency agreement was the effective source of the year 's income.
That income accrued on the completion of the year and was the joint income of both the assignor and the assignee.
The prior assignments in the course of the year operated as assignments of this future right to a share of the income.
It was only by virtue of inter se arrangement between the assignor and the assignee resulting from the transaction of assignment, that the assignee had the right to collect the entire income.
But the share in this income which accrued to the Sassoons on the completion of the year remained the taxable income of the Sassoons and they were rightly taxed in respect thereof.
Case law discussed.
|
iminal Appeal No. 62 of 1954.
Appeal by special leave from the Judgment and 0rder dated the 10th June 1953 of the Punjab High Court at Simla in Criminal Revision No. 86 of 1953 arising out of the Judgment and Order dated the 7th January 1953 of the Court of Sessions Judge, Karnal in Criminal Appeal No. 355 of 1952.
N. C. Chatterjee, (Vir Sen Sawhney and Rajinder Narain, with him) for the appellant.
Gopal Singh and P. G. Gokhale, for the respondent.
1014 1955.
November 24.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
The appellant was a candidate for election to the House of the People from the Karnal Reserved Constituency during the last General Elections.
The proviso to section 33(3) of the Representation of the People Act (XLIII of 1951), omitting what is not material, enacts "that in a constituency where any seat is reserved for the Scheduled Castes, no candidate shall be deemed to be qualified to be chosen to fill that seat unless his nomi nation paper is accompanied by a declaration verified in the prescribed manner that the candidate is a member of the Scheduled Castes for which the seat has been so reserved and the declaration specifies the particular caste of which the candidate is a member and also the area in relation to which such caste is one of the Scheduled Castes".
Rule 6 of the Election Rules provides that the declaration referred to in the above proviso shall be verified by the candidate on oath or solemn affirmation before a Magistrate.
Schedule If contains the form of nomination paper to be used, with the terms in which the declaration is to be made by the candidate and verified by the Magistrate.
On 5 11 1951 the appellant signed two nomination papers, each containing the following declaration: "I hereby declare that I am a member of the Balmiki Caste which has been declared to be a Scheduled Caste in the State of Punjab".
The Balmiki Caste is one of the castes declared to be a Scheduled Caste under the "Constitution (Scheduled Castes) Order, 1950".
The above declaration was made on solemn affirmation before the First Class Magistrate, Karnal, and the nomination paper& with the above declaration were filed before the District Magistrate, Karnal, who was the returning officer.
One Jai Ram Sarup, a member of the Chamar caste, which is one of the Scheduled Castes, was also a candidate for the seat, and he raised the objection that the appellant was not a Balmiki by caste, and that he was therefore not qualified to stand for election to the re served Constituency.
Acting on the declaration afore 1015 said, the returning officer overruled the objection, and accepted the nomination paper of the appellant as valid.
At the polling, the appellant got the majority of votes, and on 6 3 1952 he was declared duly elected.
On 27 8 1952 Jai Ram Sarup filed the application out of which the present appeal arises, under sections 476 and 195 of the Code of Criminal Procedure before the District Magistrate, who functioned as the returning officer.
He therein alleged that the declaration made by the appellant that he belonged to the Balmiki caste was false, that, in fact, be was born a Muslim and had been converted to Hinduism, and that therefore "in the interests of justice" and "for safeguarding the interests of the Scheduled Castes", proceedings should be taken for his prosecution.
In his counter affidavit the appellant stated: "I am not a Muhammadan by birth.
On the other hand, I was born in Balmiki Hindu family.
I am a Hindu".
The District Magistrate held an enquiry in which one Prith Singh Azad, President of the Depressed Classes, Delhi, gave evidence that the appellant was a Muslim of the name of Khaliq Sadiq, that in 1938 he applied to the Suddhi Sabha to be converted to Hinduism, that be was so converted, and that thereafter he came to be known as Virindar Kumar.
In cross examination, he stated that the appellant bad admitted before him that he was a Muslim by birth.
He added that he bad two Muslim wives living at the time of the conversion.
The applicant, Jai Ram Sarup, also produced ten letters stated to be in the handwriting of the appellant in proof of the above facts.
On 17 9 1952 the Magistrate passed an order that there was a prima facie case for taking action, and on 29 9 1952 he filed a complaint before the First Class Magistrate, Karnal, charging the appellant with offences under sections 181, 182 and 193 of the Indian Penal Code.
Against this order, the appellant preferred an appeal to the Court of the Sessions Judge, Karnal, who dismissed the same on the ground that the returning officer was not a Court,, that the proceedings before 1016 him did not fall under section 476, and that there fore no appeal lay under section 476 B.
The appellant took the matter in revision before the High Court, Punjab, and that was heard by Harnam Singh, J., who held, differing from the Sessions Judge, that the returning officer was a Court, and that his order was therefore appealable.
He, however, held that on the merits there was no case for interference, and accordingly dismissed the revision.
It is against this order that the present appeal by special leave is directed.
On behalf of the appellant Mr. N. C. Chatterjee argues that having held that the order of the returning officer was appealable, the learned Judge ought to have remanded the case for hearing by the Sessions Judge on the merits, and that his own disposal of the matter was summary and perfunctory.
The contention of Mr. Gopal Singh for the respondent is that the view of the Sessions Judge that the returning officer was not a court and that his order was not, therefore, appealable was correct ', and that further the order of the High Court in revision declining to inter fere on the merits was not liable to be questioned in special appeal in this Court.
The first question that arises for our decision is whether the order of the District Magistrate passed on 17 9 1952 as returning officer is open to appeal.
The statutory provisions bearing on this point are sections 195, 476 and 476 B of the Code of Criminal Procedure.
Section 195(1)(a) provides that no court shall take cognizance of any offence punishable under sections 172 to 188 of the Indian Penal Code except on the complaint in writing of the public officer concerned or of his superior.
Section 195(1)(b) enacts that no Court shall take cognizance of the offences mentioned therein, where such offence is committed in, or in relation to, any proceeding in any Court, except on the complaint in writing of such Court or a Court to which it is subordinate.
The offence under section 193 is one of those mentioned in section 195 (1) (b).
Section 476 prescribes the procedure to be followed where a Court is moved to lay a complaint, and that applies 1017 only to offences mentioned in sections 195(1) (b) and 195(1) (c) and not to those mentioned in section 195(1) (a).
Section 476 B provides for an appeal from an order passed under section 476 to the appropriate Court.
The result then is that if the complaint relates to offences mentioned in sections 195(1) (b) and 195(1) (c), an appeal would be competent, but not if it relates to offences mentioned in section 195(1) (a).
Now, the order of the Magistrate dated 17 9 1952 directs that the appellant should be prosecuted for offences under sections 181, 182 and 193.
There is no dispute that the order in so far as it relates to offences under sections 181 and 182 is not appealable, as they fall directly under section 195(1) (a).
The controversy is only as regards the charge under section 193.
Section 193 makes it an offence to give false evidence whether it be in a judicial proceeding or not, and it likewise makes it an offence to fabricate false evidence for use in a judicial proceeding or elsewhere.
If the offence is not committed in a judicial proceeding, then it will fall outside section 195(1)(b), which applies only when it is committed in or in relation to a proceeding in Court, and there is in consequence no bar to a complaint being made in respect thereof unaffected by the restrictions contained in section 195(1) (b).
But if the offence under section 193 is committed in or in relation to a proceeding in Court, then it will fall under section 195 (1) (b), and the order directing prosecution under section 476 will be appealable under section 476 B.
The point for decision therefore is whether the returning officer in deciding on the validity of a nomination paper under section 36 of the Act can be held to act as a Court.
The question thus raised does not appear to be covered by authority, and has to be decided on the true character of the functions of the returning officer and the nature and the extent of his powers.
"There has been much difference of opinion as to the precise) character of the office of a returning officer, viz., as to whether he is a judicial or ministerial officer", says Parker on Election Agent and Returning Officer, Fifth Edition, page 30.
The true 1018 view, according to him, is that he partakes of both characters, and that in determining objections to nomination papers, he is a judicial officer.
That is also the view taken in Indian decisions.
But before we can hold that the proceedings before a returning officer resulting in the acceptance or rejection of a nomination paper fall within section 195(1)(b) of the Code of Criminal Procedure, it must be shown not merely that they are judicial in character but that further he is acting as a Court in respect thereof.
It is a familiar feature of modern legislation to set up bodies and tribunals, and entrust to them work of a judicial character, but they are not Courts in the accepted sense of that term, though they may possess, as observed by Lord Sankey, L.C. in Shell Company of Australia vs Federal Commissioner of Taxation(1), some of the trappings of a Court.
The distinction between Courts and tribunals exercising quasi judicial functions is well established, though whether an authority constituted by a particular enactment falls within one category or the other may, on the provisions of that enactment, be open to argument.
There has been considerable discussion in the Courts in England and Australia as to what are the essential characteristics of a Court as distinguished from a tribunal exercising quasi judicial functions.
Vide Shell Company of Australia vs Federal Commissioner of Taxation(1), R. vs London County Council(2), Cooper vs Wilson(3), Huddart Parker and Co. vs Moorehead(4), and Rola Co. vs The Commonwealth(5).
In this Court, the question was considered in some fulness in Bharat Bank Ltd. vs Employees of Bharat Bank Ltd.(6).
It is unnecessary to traverse the same ground once again.
It may be stated broadly that what distinguishes a Court from a quasi judicial tribunal is that it is charged with a duty to decide disputes in a judicial manner and declare the rights of parties in a definitive judgment.
To decide in a judicial manner involves that the parties are entitled as (1) ,296.
(3) (5) ; (2) (4) ; (6) ; 1019 a matter of right to be heard in support of their claim and to adduce evidence in proof of it.
And it also imports an obligation on the part of the authority to decide the matter on a consideration of the evidence adduced and in accordance with law.
When a question therefore arises as to whether an authority created by an Act is a Court as distinguished from a quasi judicial tribunal, what has to be decided is whether having regard to the provisions of the Act it possesses all the attributes of a Court.
We have now to decide whether in view of the principles above stated and the functions and powers entrusted to the returning officer under the Act, be is a court.
The statutory provision bearing on this matter is section 36.
Under section 36(2), the returning officer has to examine the nomination paper and decide all objections which may be made thereto.
This power is undoubtedly judicial in character.
But in exercising this power, he is authorised to come to a decision "after such summary enquiry, if any, as he thinks necessary".
That means that the parties have no right to insist on producing evidence which they may desire to adduce in support of their case.
There is no machinery provided for summoning of witnesses, or of compelling production of documents in an enquiry under section 36.
The returning officer is entitled to act suo motu in the matter.
When one compares this procedure with that prescribed for trial of election petitions by the Election Tribunal under sections 90 and 92 of the Act, the difference between the two becomes marked.
While the proceedings before the Election Tribunal approximate in all essential matters to proceedings in civil courts, the proceedings under section 36 present a different picture.
There is no lis, in which persons with opposing claims are entitled to have their rights adjudicated in a judicial manner, but an enquiry such as is usually conducted by an ad hoc tribunal entrusted with a quasi judicial power.
In other words, the function of the returning officer acting under section 36 is judicial in character, but he is not to act judicially in discharging it.
We are of opinion that the returning officer deciding on 129 1020 the validity of a nomination paper is not a Court for the purpose of section 195 (1) (b) of the Code of Criminal Procedure, and the result is that even as regards the charge under section 193, the order of the Magistrate was not appealable, as the offence was not committed in or in relation to any proceeding in a Court.
In this view, the learned Sessions Judge was right in dismissing the appeal as incompetent, and the question argued by Mr. N. C. Chatterjee that the learned Judge of the High Court ought to have remanded the case for hearing by the Sessions Judge on the merits does not arise.
It was next argued for the appellant that as the application for initiating prosecution under section 193 was made under section 476 on the assumption that the returning officer was a court, the order passed thereon must, in the view that he was not a Court, be quashed as without jurisdiction.
But then, it should be noted that the application was presented under section 195 also, and it was necessary to move the returning officer under section 195(1)(a) with reference to the offences under sections 181 and 182, and there could be no question of quashing the order as without jurisdiction.
Even as regards section 193, the position is this: It has no doubt been held that section 476 must be taken to be exhaustive of all the powers of a Court as such to Jay a complaint, and that a complaint filed by it otherwise than under that section should not be entertained.
But there is abundant authority that section 476 does not preclude the officer presiding over a Court from himself preferring a complaint, and that the jurisdiction.
of the Magistrate before whom the complaint is laid to try it like any other complaint is not taken away by that section.
Vide Meher Singh vs Emperor(1) , Emperor vs Nanak Chand(2), Har Prasad vs Emperor(3) and Channu Lal vs Rex(4).
There is thus no legal impediment to a returning officer filing a complaint under sections 181 and 182 as provided in section 195 (1) (a) and charging the accused therein with also an offence (1) A.I.R. 1933 Lah. 884.
(3) A.I.R. 1947 All. 139.
(2) A.I.R. 1943 Lah. 208.
(4) 1021 under section 193.
In this connection, it should be mentioned that the appellant himself took the objection before the Magistrate that qua returning officer he was not a Court and that the proceedings under section 476 were incompetent, and that that was overruled on the ground that it was an enabling section.
There is, therefore, no ground for holding that the order dated 17 9 1952 was without jurisdiction.
It was finally contended that the Magistrate was under a misapprehension in stating that the appellant had declared that he was born a Balmiki, whereas, in fact, he only declared that he was a Balmiki by caste.
But it was the appellant himself who pleaded in his counter affidavit that he was not a Muslim by birth, and was born in a Balmiki Hindu family, and the observation of the Magistrate has ob vious reference to what was pleaded and argued by the appellant.
And it should also be noted that no objection was taken either in the grounds of appeal to the Sessions Court or in revision to the High Court with reference to the above remark.
Moreover, the charge as laid in the complaint is that the declaration of the appellant in the nomination paper that he "was a member of the Balmiki caste" was false.
There is accordingly no substance in this contention.
It must be emphasised that in the view that the order of the Magistrate dated 17 9 1952 was final, this appeal being really directed against that order there must be exceptional grounds before we can interfere with it in special appeal, and none such has been established.
On the other hand, whether action should be taken under section 195 is a matter primarily for the Court which hears the application, and its discretion is not to be lightly interfered with in appeal, even when that is competent.
But where, as here, the legislature does not provide for an appeal, it is preposterous on the part of the appellant to invite this Court to interfere in special appeal.
This appeal is accordingly dismissed.
| Held that a Returning Officer acting under se. 33 and 36 of the Representation of the People Act, 1951 and deciding on the validity or otherwise of a nomination paper is not a court within the meaning of sections 195(1)(b), 476 and 476 B of the Code of Criminal Procedure.
Shell Co. of Australia vs Federal Commissioner of Taxation ([1931] A.C. 275 at 296), B. vs London County Council ([1931] 2 K.B. 215), Cooper vs Wilson ([1937] 2 K.B. 309), Huddart Parker and Co. vs Moorehead ([1908] ; , Rola Co. vs The Commonwealth ([1944] ; , Bharat Bank Ltd. vs Employees of Bharat Bank Ltd. ([1950] S.C.R. 459), Mehar Singh vs Emperor, (A.I.R. , Emperor vs Nanak Chand (A I.R. , Har Prasad vs Emperor, (A.I.R. 1947 All. 139) and Channu Lal vs Rex ([1950] , referred to.
|
Appeals Nos. 9 and 10 of 1954.
On appeal from the Judgment and Order dated the 9th day of June 1952 of the Calcutta High Court in Appeal No. 26 of 1952 arising out of the Order dated the 6th day of December 1951 of the said High Court exercising its Ordinary Original Civil Jurisdiction in Matter No. 110 of 1950.
C.K. Daphtary, Solicitor General of India, (R. Ganapathy Iyer and R. H. Dhebar, with him) for the appellant in C. A. No. 9 of 1954 and respondent No. 3 in No. 10 of 1954.
section Chowdhury, (section N. Mukherji, B. N. Ghosh and A. K. Bose, with him) for the appellant in C. A. No. 10 of 1954.
section M. Bose, Advocate General of West Bengal, (B. Sen and P. K. Bose, with him) for respondents Nos.
I and 2 in both appeals.
1078 1955.
December 19.
DAS ACTING C. J.
The only question canvassed before us in the above appeals, which have been beard together, is whether certain sales of goods made by Shri Ganesh Jute Mills, Ltd. (hereinafter referred to as the Mills) to the Government of India, Ministry of Industry and Supplies are to be deducted from the taxable turnover of the Mills so as to be exempt from sales tax demanded by the Commercial Tax Officer of the State of West Bengal.
The relevant facts are stated below.
On the first of September 1948 the Government of India, Ministry of Industry and Supplies, in Calcutta, placed with the Mills a confirmatory order in writing bearing No. Cal/J 1/2001/103 for the supply to the Government of India of a large quantity of hessian cloth of different descriptions at different prices ,therein mentioned.
It was stipulated that the contract would be governed by the conditions of contract specified in Form WSB 133 as amended up to date.
It was specifically mentioned that the goods ordered were required to meet an international obligation of the Government of India and as such the execution of the contract in accordance with the programme of deliveries as given in the schedule attached thereto was essential.
The agreed prices were stated to be exclusive of the Bengal Sales Tax and it was stipulated that the Government of India would arrange direct payment of sales tax to the Government of West Bengal if it was ultimately found that Sales Tax was payable in respect of that contract.
Pursuant to the aforesaid contract, the Mills supplied goods to the Government of India of the aggregate value of Rs. 2,10,040 calculated at the prices agreed upon.
The Commercial Tax Officer, Beadon Street, District If Charge, claimed that the aforesaid sales should be included in the taxable turnover of the Mills and assessed to sales tax.
The Mills, on the ,other hand, claimed exemption under section 5 of the Bengal Finance (Sales Tax) Act, 1941.
(Bengal Act VI of 1941).
The relevant portion of section 5 ran as follows; 1079 "5.
(1) The tax payable by a dealer under this Act shalL be levied at the rate of one quarter of an anna in the rupee on his taxable turnover; (2) In this Act the expression "taxable turnover" means that part of a dealer 's gross turnover during any period which remains, after deducting therefrom (a) his turnover during that period on (i). . . (ii). . (iii) sales to the Indian Stores Department, the Supply Department of the Government of India, and any railway or water transport administration; (iv). . . (v). . (vi). . (b). . " The Mills further contended that if any sales tax was at all payable the same was payable by the Government of India and not by them.
The Commercial Tax Officer overruled both these objections and on the 8th November 1950 he assessed the Mills to sales tax in respect of the supplies made by the Mills to the Government of India under the aforesaid contract and demanded a sum of Rs. 9,401 10 6.
On the 6th December 1950 the Mills filed a petition under article 226 of the Constitution of India before the High Court at Calcutta.
In the petition the Mills impleaded as respondents the Commercial Tax Officer, the State of West Bengal and the Union of India.
The Mills prayed for a writ of mandamus on the respondents to cancel and/or recall and/or forbear from acting or giving effect to the demand dated the 8th November 1950 and from realising the sum of Rs. 9,401 10 6 and for a writ of certiorari for production of the records and proceedings before the Commercial Tax Officer and for quashing the same and for other incidental reliefs.
On the same day a rule was issued on the respondents to show cause why the orders prayed for should not be made.
The Commercial Tax Officer filed an affidavit in opposition disputing the contentions put forward by 1080 the Mills in support of their claim for exemption and maintaining that sales tax was due and had been legitimately assessed and demanded.
On behalf of the Union of India was filed an affidavit affirmed by one M. P. Pai, the then Joint Secretary in the Ministry of Works, Production & Supply.
It was therein stated that a department of the Government of India named the Department of Supply came into existence in the month of September 1939 immediately on the commencement of World War II and before the enactment of the Bengal Finance (Sales Tax) Act, 1941 (Bengal Act VI of 1941).
It was averred that before the 7th January 1946 the said Department of Supply was charged with the procurement of Stores from all places in India including Bengal and that it also directed the work of Indian Stores Department in the United Kingdom and of the India Supply Mission in the United States of America.
It was added that by Resolution No. 227/45 Pub(c) dated the 31st December 1945 the Governor General in Council announced the creation with effect from the 7th January 1946 of the Department of Industries & Supply in place of the existing Department of Supply and of Industries and Civil Supplies.
It was claimed that the powers and functions of the Department of Industries and Supplies were the same as those of the Department of Supply and that there was no variation in the nature of the said functions whatsoever.
The rule came up for hearing before Bose, J., who took the view that the newly created Department of Industries & Supplies was charged with the same work of procurement of stores for Government as had been entrusted to the Department of Supply and certain additional works and that later on the name was again changed to Ministry of Industry and Supply.
The learned Judge pointed out that although there was a change in the designation of the Indian Stores Department and the Supply Department of the Government of India, section 5 (2) (a) (iii) was not amended in any way until 1949 when by an amending Act (West Bengal Act X of 1949) the exemption 1081 granted under section 5(2)(a)(iii) was withdrawn.
The learned Judge appears to have regarded this con , tinuance of section 5(2) (a) (iii) in the Bengal Finance (Sales Tax) Act, 1941 as indicative of the fact that in view of the State of West Bengal the Ministry of Industry & Supply was the same as the Indian Stores Department and the Supply Department of the Government of India referred to in the section.
The learned Judge accordingly held that the Mills were entitled to the benefit of the exemption and were not liable to pay sales tax in respect of the supplies in question.
He accordingly, on the 3rd January 1952, made the rule absolute.
The Commercial Tax Officer and the State of West 'Bengal went up on appeal from the said judgment and order of Bose, J.
The appeal came up for hearing before & Bench consisting of K.C. Das Gupta, J. and P. N. Mookerjee, J.
In separate but concurring judgments both the learned Judges rejected the preliminary objection taken by the Mills and the Union of India as to the maintainability of the appeal.
On the merits both of them held that the Department of Industries & Supplies was not the same as the Indian Stores Department or the Supply Department of the Government of India.
The old departments ceased to exist and a new department combining some of the functions of these departments and some new functions was created and that, therefore, sales to the newly created department could not be deducted from the taxable turnover under section 5(2) (a) (iii).
In the result, the Appeal Court allowed the appeal with costs, set aside the order of Bose, J. and dismissed the application of the Mills under Article 226.
The Mills as well as the Union of India have now come up on appeal before us with a certificate of fitness granted by the High Court.
In view of the decision of this Court in National Sewing Thread Co. Ltd. vs James Chadwick & Bros. Ltd.(1), the question of maintainability of the appeal before the High Court has not been raised before us.
The appeals have been fought out on the merits only.
(1) ; 1082 The appeals came up before this Court for bearing on the 22nd and 23rd September 1955.
After going through the records it was felt that the materials on record were not sufficient to enable the Court to determine the real point of controversy between the parties.
The appeals were accordingly adjourned and directions were given for the filing of supplementary affidavits setting out the facts relied on by the parties respectively.
Fresh affidavits have since been filed.
It appears from the affidavit of one A. R. Iyer, Deputy Director, Directorate General of Supplies and Disposals, under the Ministry of Works, Housing & Supply, that in 1918 a department called the Contracts Directorate had been constituted as a purchasing Organisation for the needs of the Army.
With effect from the 1st January 1922 the Indian Stores Department was constituted as a result of the recom mendations of the Stores Purchase Committee.
The functions of this department were to act as a purchasing and inspection agency in respect of certain commodities including textile goods for all Central departments and minor Local Governments and such other authorities as might desire to avail themselves of the services of this department.
Annexure III to the affidavit of Iyer indicates that it was not obligatory on the other departments to make purchases through the Indian Stores Department.
Originally this department was constituted for a period of two years but by Resolution No. section 217 of the Government of India, dated the 6th May 1924, it was placed on a permanent basis and continued to discharge the same functions.
Rules 5 and 6 attached to this Resolution show that purchases could also be made locally by other departments in case of emergency or for convenience.
In 1939 when the outbreak of World War 11 was imminent the necessity for creating a new department was keenly felt and the Governor General in Council by a Resolution of the Home Department dated the 26th August 1939 (Annexure V to Iyer 's affidavit) announced the creation from that date of a department of Supply "to deal directly with ques 1083 tions concerning supplies of all kinds required for the prosecution of war".
Annexure VIII to Iyer 's affidavit shows that the control of the Indian Stores Department and all other matters relating to the purchase of stores in India which were being then dealt with in the Department of Commerce were to be dealt with in the department of Supply as a temporary measure for the duration of the war.
That the Indian Stores Department and the Contracts Directorate did not lose their identity is shown by the Office Memorandum dated the 3rd August 1940 (Annexure X, Clause 4) and Office Memorandum dated the 2nd December 1941 (Annexure XI, Clause I (a) and Clause 4).
It is thus clear that up to the end of the year 1940 purchases used to be made for and on account of the Government of India by the Contracts Directorate, the Indian Stores Department and the Department of Supply and that purchases were also made locally by other departments.
It was then that on the 1st July 1941 the Bengal Legislature passed the Bengal Finance (Sales Tax) Act, 1941 which by section 5(2) (a) (iii) exempted sales to the Indian Stores Department, the Supply Department of the Government of India and any railway or water transport administration from sales tax.
Sales to other departments of the Government of India were not so exempted.
By a Press Note dated the 2nd September 1941 issued by the Government of India in the Supply Department (Annexure XIII to Iyer 's affidavit) a purchase branch of the Supply Department for the duration of the war was created with effect from the 1st August 1941 and it shows that the Contracts Directorate and the Indian Stores Department bad then "ceased to exist as separate entities" for the duration of the war and a new branch was being organised in their place.
Then came the Office Memorandum dated the 23rd December 1941 issued by the Government of India in the Department of Supply (Annexure XIV) which superseded the previous office memorandum dated the 13th December 1940 (Annexure XII).
The 137 1084 authorities under the Central Government concerned with the production, manufacture and purchase of supplies were shown in Statement I annexed thereto.
It is clearly mentioned therein that departments other than the ones referred to therein were and, in the absence of orders to the contrary, would remain independent of the department though working in close touch with it (Clause 3).
Powers of local purchase were also not disturbed in any way (Clause 4).
Statement I indicates that purchases of various supplies, e.g., medical and veterinary supplies, coal and coke for Railway and other civil and military authorities in India, etc., and Printing and Stationery stores, were independent of the Supply Department.
It is thus clear that the Indian Stores Department and the Supply Department of the Government of India were not the only departments which bad authority to make purchases for and on behalf of the Government of India in its various departments.
On the 21st April 1943 came Notification No. 209No.
107/43 Pub(c) whereby the Governor General in Council announced the creation, from the 22nd April 1943, of a Department of Industries and Civil Supplies to deal with (i) Statistics and Research, (ii) Development and (iii) Controls.
Shortly thereafter Office Memorandum No. E4(179) dated the 14th May 1943 issued by the Department of Supply intimated that the Governor General in Council bad decided that the Department of Industries and Civil Supplies would, with effect from the 15th May 1943, take over responsibility for the procurement of cotton textiles and cotton textile stores (Annexure XVI to Iyer 's affidavit).
So this Department of Industries and Civil Supplies became another purchasing organisation of the Government of India apart from the Department of Supply.
The Government of India Resolution dated the 31st December 1945 announced the creation, with effect from the 7th January 1946, of the Department of Industries and Supplies in place of the existing Department of Supply and the Department of Industries and Civil Supplies.
By this Resolution the Indian 1085 Stores Department and the Contracts Directorate which during the war had been brought under the Supply Department, were incorporated in the newly created department.
It will be noticed that this newly created department had assigned to it the work of the procurement of stores for the Government of India which was formerly assigned to the Department of Supply and the Department of Industries and Civil Supplies.
In addition to these duties this department was authorised also to deal with other things, namely, development of industries, administration of Government factories not allocated to specialised departments, Disposals of Surplus and Civil Supplies.
The nature and volume of the purchases made by this newly created department became obviously different from and larger than those of the two departments it replaced.
It is also noteworthy that the Department of Supply which was created for the prosecution of war was abolished as soon as the war was over (Annexure XVII to the affidavit of Iyer).
The Resolution of the Government of India dated the 2nd September 1947 published in the Gazette of India dated the 6th September 1947 (Annexure XVIII) announced, amongst other things, that with effect from the 29th August 1947 the Department of Industries and Supplies would be re designated as the Ministry of Industries and Supply.
From the summary of the annexures to the affidavit of Iyer filed in these proceedings it is quite clear that while the Ministry of Industries and Supply was a new designation of the Department of Industries and Supplies, the Department of Industries and Supplies cannot be regarded merely as a new designation of the Department of Supply and the Department of Industries and Civil Supplies.
Indeed, the Resolution announced the "creation" of the Department of Industries and Supplies in place of the two existing departments mentioned above.
This newly created department had wider powers and was a new department altogether.
The exemption granted by the Bengal Finance (Sales Tax) Act, 1941 was given to two departments by name.
It was not given to the 1086 sales to the Government of India in all its departments.
It is true that the Indian Stores Department and the Supply Department of the Government of India were not corporate bodies but they evidently were sufficiently well defined organisations to be referred to as "entities" in some of the Press Notes and Resolutions mentioned above and even in the affidavits filed in these proceedings.
Further, the Bengal Finance (Sales Tax) Act, 1941 by section 5 (2) (a) (iii) certainly dealt with these two departments as if they were distinct entities.
The Act, in a manner, conferred on these two departments the status, as it were, of well defined and distinct entities at least for the purposes of that Act, namely for making sales to them exempt from the tax.
If it were the object of the Bengal Legislature to give exemption to all sales to all departments of the Government of India it would have been quite easy for it to frame sub clause (iii) in a general way as sub clause (iv) had been flamed.
Further, if sales to these two departments were to be regarded as covering sales to all departments of the Government of India then the sales to the railways which at that time mostly, if not wholly, belonged to the Government of India need not have been separately mentioned in the way it has been in sub clause (iii).
As already stated, there were, at the date when the Act was passed, various other departments of the Government of India which were concerned with purchase of stores but quite clearly the exemption conferred by the section was not intended to extend to the sales to those departments.
Therefore, the reference to these two particular departments in the section cannot possibly be read as a reference to the Government of India generally.
It has been urged that the real object of section 5(2)(a)(iii) was to give exemption not to the particular departments but to the sales of such goods as, at the date of the Act, used to be made to those departments and, therefore, sales of those goods made to any department of the Government of India which came to be charged with the duty of purchasing those 1087 goods should also come within the purview of the section and be entitled to the benefit of the exemption conferred by it.
We are unable to accept this line of reasoning.
This interpretation will unduly narrow the scope and ambit of the exemption by limiting it to sales of only those goods as, at the date of the Act, used to be sold to those two departments and sales of other goods even to those two departments, however necessary for the prosecution of the war, would not get the benefit of the exemption.
Such could not possibly be the intention of the legislature as expressed by the language used by it in framing the section.
According to the section the exemption is given to all sales made to those two departments, no matter whether the sales were only of the kind of goods which used to be sold to them at the date of the Act or of other kinds of goods.
The suggested interpretation involves the addition of qualifying words to the section which ordinarily it is Dot permissible for the court to do.
Further, the press notes and the resolutions of the Government of India summarised above clearly indicate that there were other purchasing departments which were independent of the Indian Stores Department or the Supply Department of the Government of India and that the authority of other departments of making local purchases was not interfered with by the creation of these two departments.
Therefore it may well have been that, at the date of the passing of the Act, same or similar kinds of goods used to be sold to these two departments as well as to other departments but surely it cannot be contended, in view of the language of the section, that the exemption was intended to extend to the sales of the same or similar kinds of goods to those other departments also.
It is not necessary for us to pronounce any opinion as to the validity or soundness of the extreme position taken up by the learned Advocate General of West Bengal namely that as the exemption is given by a statute to sales made to two departments eo nomine it will not extend to sales made to the same department redesignated by a new name.
It is enough for our present 1088 purpose to say that the Department of Industries and Supplies which was subsequently re designated as the Ministry of Industries and Supply was not the same as the Indian Stores Department or the Supply Department of the Government of India under a different name.
The scope and volume of the work entrusted to the Department of Industries and Supplies was much wider and larger than that with which the two departments which it replaced bad been charged.
Unlike those of the two departments, its purchases were not confined to goods necessary for the prosecution of the war.
To extend the benefit of the statutory exemption to the sales made to the newly created department of Industries and Supplies, of goods not required for war purposes but, say, for meeting international obligations as in the present case, will necessarily widen the scope of the exemption and impose greater loss of revenue on the State of West Bengal than what the Act by its language intends to do.
In view of the ever expanding activities of the modern welfare State indifferent fields including that of trade and commerce, the Government departments are often entrusted with the performance of well defined activities and are authorised to deal with the outside world and to enter into contracts of sale and purchase and other transactions in the same way as an ordinary person or company may do.
Such Government departments, therefore, may well be regarded as distinct units or quasi legal entities, at least for the particular purposes for which they are created.
At any rate, the Bengal Finance (Sales Tax) Act, 1941 by providing for the deduction of the sales to the two named departments from the taxable turnover certainly treated those two departments as distinct entities.
This exemption is the creation of the statute and must be construed strictly and cannot be ex tended to sales to other departments.
The fact that the section was not amended until 1949 does not at all indicate that the Bengal Legislature intended to extend the benefit of the section to any but the departments specifically mentioned in the section.
In our opinion the conclusion arrived at by the Appeal 1089 Court, namely that the sales tax is payable on the sale in question is correct and these appeals must be dismissed with costs.
SINHA J. I regret to have to differ from my learned brethren in the determination of the only question involved in these appeals, namely, whether the sales by the appellant in Civil Appeal No. 10 of 1954 (Messrs Shree Ganesh Jute Mills Ltd.) to the appellant in Civil Appeal No. 9 of 1954, the Union of India (the Government of India at the time of the transactions in question) were liable to payment of sales tax under the Bengal Finance (Sales Tax) Act, 1941 (Bengal Act VI of 1941), to be referred to hereinafter as "The Act".
The facts leading up to these appeals may shortly be stated as follows: The Government of India in the Ministry of Industry and Supply (which for the sake of brevity may be called "The Government" entered into a contract on the 1st September 1948 with Messrs Shree Ganesh Jute Mills Ltd., which may be designated "The Mills", for the supply of hessian at certain rates and of certain description appearing in Exhibit A to the affidavit filed on behalf of the Mills.
With reference to the question of sales tax the contract contains the following stipulation: "The prices shown above are exclusive of the Bengal Sales Tax.
The Government of India will arrange direct payment of sales tax to the Government of West Bengal if it is ultimately found that sales tax is payable in respect of this contract".
It is also provided that "This contract will be governed by the conditions of contract specified in Form WSB.
133 as amended up to date".
This contract was entered into and signed by "A Huq, Deputy Director of Supplies, for and on behalf of the Governor General of India".
In pursuance of the aforesaid contract the Mills supplied hessian goods to the Government of India of a certain valuation on which the Commercial Tax Officer of Bengal, the main contesting respondent, made a demand of Rs. 9,401 10 6 as sales tax from the Mills.
The Mills demurred to the 1090 payment and contended that the sales in question were exempt from payment of the sales tax demanded in view of the provisions of section 5 (2) (a) (iii) of the Act.
Eventually the Mills moved the High Court of Calcutta for an appropriate writ under article 226 of the Constitution against the contesting respondents.
The matter was heard by a Single Judge of that Court who by his judgment dated the 6th December 1951 held that the Mills were not liable to pay the sales tax demanded and cancelled the notice of demand and directed the respondents 1 and 2 to forbear from enforcing the demand.
Respondents I and 2 went up in appeal under the Letters Patent.
The appeal was heard by a Division Bench which came to the contrary conclusion.
The major portion of the judgment of the Letters Patent Bench was devoted to the discussion of the question whether the judgment of the learned Single Judge in the writ matter was amendable to the appellate jurisdiction under the Letters Patent.
That question has not been pressed during the arguments and is therefore no more in controversy.
The only question that was canvassed before us was the applicability of section 5 (2) (a) (iii) of the Act which contains the exemption, the benefit of which is being sought by the appellants in each case.
The exemption is in these terms: "Sales to the Indian Stores Department ', the Supply Department of the Government of India, and any railway or water transport administration".
It has been contended on behalf of the appellants that the sale of hessian by the Mills to the Government of India in the Ministry of Industry and Supply is within the terms of the exemption quoted above.
On the other hand, it is contended on behalf of the Sales Tax Department of the Government of West Bengal that the sales in question were not covered by the aforesaid exemption clause.
It is therefore necessary to go into some detail of the formation and development of the Department in question.
The supplementary affidavit filed on behalf of the Government and sworn to by Shri A. R. Iyer, Deputy Director of Directorate General of Supplies & 1091 Disposals, discloses the following facts.
The Indian Stores Department was constituted with effect from the 1st January 1922 as a result of the recommendations of the Stores Purchase Committee which had been constituted by the Government of India to examine the whole question of the constitution of an expert agency to carry out on a large scale purchase of supplies required for the public services, as recommended by the Indian Industrial Commission, with the object of encouraging the purchase of articles made in India for Government requirements.
The scope and functions of the Department, inter alia, were to act as a purchasing and inspection agency, and in an advisory capacity in all matters connected with the purchase of stores for the public services, on behalf of all Central Departments of the Government and of the minor local Governments and also on behalf of such major local Governments, Company worked Railways, Corporations, Port Trusts, Municipalities and quasi public bodies and Indian States as might desire to avail themselves of the Department 's assistance.
The activities of the Department consisted in the purchase and inspection in India of a large variety of goods and articles including "textile goods", so that the purchase of hessian which is the particular commodity involved in this case, would be included in the activities of the Department.
The Department had been constituted in the first instance for a period of two years.
But by a Resolution.
of the Government of India dated the 6th May 1924 it was placed on a permanent basis.
It continued to discharge the same functions as before.
It made purchases not only for the needs of the civilian departments of the Government of India but also of all the requirements of the Army.
Hessian which had been purchased from the Mills in this case was one of the products which the Government of India used to purchase only through the Indian Stores Department whenever needed for Government purposes.
A Department called the "Contracts Directorate" had been constituted in 1918 as a, purchasing organization for the needs of the Army.
But after the constitution of the Indian 138 1092 Stores Department in 1922 the Army authorities also began to utilize the services of the Indian Stores Department for procurement of several categories of stores required by them.
By a Resolution of the Home Department dated the 26th August 1939, apparently to meet the demands of the imminent second world war, the Contracts Directorate and the Indian Stores Department were in 1940 amalgamated with the Department of Supply so that in 1941, when the Act was passed, the position was that the Department of Supply as reorganized on the 3rd August 1940 included amongst its activities and functions the purchase of stores for the needs of the Government.
This branch of its activity was administered by the Directorate General, Supply Branch, located at New Delhi.
Jute products and textiles including hessian had to be purchased only by placing indents by the department concerned with the Directorate General of Supply, New Delhi.
Thus this Department absorbed for the duration of the war the purchasing sections of the Indian Stores Department and the Contracts Directorate which were placed under completely self contained organizations empowered to procure all supplies, whether for war purposes or otherwise.
All authorities requiring supplies to be procured in India had to place their indents or demands on the Directorate General concerned.
With effect from the 1st August 1941 the Contracts Directorate and the Indian Stores Department ceased to exist as separate entities in the Supply Department and became one purchasing organization in the said Department.
This Organisation arranged for supply of all classes of stores for purposes of Government, such as textiles, leather goods, etc.
Thus hessian which came under the bead of "textiles" which was being purchased in the first instance only by the Indian Stores Department continued to be purchased by the Supply Department when the Indian Stores Department came under the control of the Supply Department.
By a notification dated the 21st April 1943 issued by the Government of India in the Home Department, another Department called the Industries and 1093 Civil Supplies Department was created.
This Department was primarily concerned with statistics and.
research and development of industries, as also ' controls on civil supplies (other than foodstuffs).
When this Department was first created, it had no purchasing activity.
But with effect from the, 15th May 1943 the Government directed that the new department should take over responsibility for the procurement of cotton textiles and cotton textile stores which till then were being dealt with by the Indian Stores Department which later came under the Supply Department as aforesaid.
Purchase of jute and woollen textiles continued to be the responsibility of the Supply Department.
By a Resolution of the Government of India dated the 31st December 1945 the Department of Industries and Supplies in place of the existing Departments of Supply and of Industries and Civil Supplies was created with effect from the 7th January 1946.
From that date the Department of Industries and Supplies became responsible for the procurement of stores from all places in India in the same manner as the Department of Supply had been doing previously to its amalgamation with the new Department.
The powers and functions of the Department of Industries and Supplies in the matter of procurement of stores continued as before.
The Department continued to procure and purchase only the same kinds of articles as the Department of Supply had been doing before the coming into existence of the Department of Industries and Supplies so that the creation of the Department of Industries and Supplies did not make any difference in its activities relating to purchase of stores.
There was no addition to or subtraction from its functions in the matter of purchase of stores.
From what has been stated above, it is clear that the purchasing functions of the Government of India with special reference to the procurement of textiles including hessian with which we are immediately concerned were discharged by the Indian Stores Department from 1st January 1922.
Those functions were taken over by the Department of Supply in 1940, 1094 The Department of Supply itself merged in the Department of Industries and Supplies with effect from the 7th January 1946.
By a notification of the 2nd September 1947 the Department of Industries and Supplies was redesignated as the Ministry of Industry and Supply with effect from the 29th August 1947 as a result of the emergence of India as an Independent State.
Thus the Ministry of Industry and Supply is a lineal descendant of the Indian Stores Department, of course, with an added volume of work and functions, but the original activity of purchase of stores remaining the same in bulk and in character.
It has already been noticed that the Indian Stores Department was concerned with the function, amongst others, of purchasing stores of a large variety of articles and goods on behalf of all Central Departments of the Government of India and Local Gov ernments, Railway Companies, Corporations, Port Trusts, Municipalities and other quasi public bodies, as also Indian States if they availed of the services of the department.
Thus the infant Indian Stores Department has grown in stature and volume in the course of the last about 25 years.
The same sapling has grown into a shady tree but its function as the sole purchasing agency of the Government of India and other Governments for a large variety of goods and commodities has 'Continued.
The nomenclature has undergone successive changes, but the function of purchasing agency on behalf of the Central and other Governments and public bodies as aforesaid has remained the same.
Furthermore, the purchase of hessian, which is the subject matter of the demand in question has continued in the same organization, though under a different name.
It is well settled that the provisions of a statute have to be construed with reference to the state of affairs as they existed at the time the statute was passed.
In the year 1941 there was in existence the Supply Department of the Government of India which had incorporated the Indian Stores Department.
According to the affidavit referred to above, the main activities of purchase of goods and commodities 1095 required by the Government of India 'and other governments, local bodies, etc., except for purchases of small values, that is to say, not exceeding Rs. 100 in each case and of certain specified commodities, like foodstuffs, forage, lethal stores, etc.
referred to in para.
7 of the affidavit (at p. 18 of the supplementary paper book) were carried on by the Supply Department.
That is the reason why the exemption to the Government of India was worded as it stands in section 5(2) (a) (iii).
As stated above, the Supply De partment existed as a separate department up to the 6th January 1946.
With effect from the 7th January the Department of Industries & Supplies came into existence which later was re designated as the Ministry of Industry & Supply.
The judgment under appeal is based chiefly on the consideration that the exemption clause in question does not in terms refer to the newly created department which now goes by the name of the Ministry of Industry & Supply.
But this department in so far as it deals with industry, is not concerned with the main purchasing activities of the Government of India.
The exemption was granted in respect of the purchasing activity of the Government of India and that function continues to be assigned to the Supply Department which has now become a wing of the newly created department of the Government.
The question therefore arises whether in those circumstances the Government of India could claim the benefit of the exemption.
The High Court in answering that question in the negative has gone upon mere nomenclature.
It has emphasized the change in the name and overlooked the substance of the matter.
After all, what is a Department of a Government? It is not a mere name, whatever else it may be.
It is not a person, either natural or artificial.
A Department of Government is a particular function.
The Government has so many functions and each of its functions or a group of functions is placed in charge of a particular Department which may be made up of a number of clerks organized in a group, whose work is supervised by a hierarchy of officials with 1096 the head of the department at the apex.
A department may therefore consist of a single function out of the many functions of the Government, or it may comprise several functions placed in charge of a single departmental head.
The Indian Stores Department which came to be incorporated in the Supply Department of the Government of India and later merged in the larger Department of the Ministry of Industry & Supply, could have continued its separate existence as it did until 1939 or could have become part of a larger department as it did after the 3rd August 1940, or the 7th January 1946, or the 29th August 1947; and conversely, its activities could be split up into a number of sub departments under different heads classified according to the nature of the commodities to be purchased.
But, in my opinion, the change in the nomenclature in either direction should not matter so long as the function, namely, of purchasing articles and commodities required by the Government of India and other Governments continued to be the same.
It is a matter of substance and not of form.
The Department concerned cannot be equated with a natural person.
Nor can it be raised to the level of a legal person.
I am not aware of any principle of jurisprudence which would justify placing a department of Government on the pedestal of a legal person.
There is no tertium quid between the two positions.
Though the High Court has not said so in so many words, it has treated the department either as a legal person or as something in between a legal person and a natural person.
That, in my opinion, is not sound logic.
Nor is there any legal basis for treating a department of Government either as a legal person or as a natural person.
In my view, the terms of section 5(2) (a) (iii) show that it was an exemption granted to a particular function of the Government of India described by a certain name.
And one might feel inclined to exclaim with the great poet Shakespeare "What is in a name!" It is but a description of the main purchasing activity of the Government of India, as the history of the department above set out shows, 1097 Sometimes the language of a statute has to be construed in a modified form in order to give effect to the real intentions of the legislature where, as in the present case,, the language is only of a descriptive nature and not a definitive one.
An instance of this is furnished by the case of Miller vs Salomons(1).
In that case the question arose whether a person of Jewish persuasion who was returned to Parliament as a Member of the House of Commons was entitled to sit without taking the prescribed oath.
The form of the oath as given by 6 Geo. 3, c. 53, mentioned the name of "King George" only.
It was argued on behalf of that member that the oath was confined to the name of a sovereign who bore that name.
But it was held by the Court that it was a mere description and that the intention of the statute was to include all sovereigns who came after King George 111.
The relevant portion of the observations of the Court are in these terms: "The second question arising on the construction of the Act is, whether, as the form of the oath given by the 6 Geo. 3, c. 53, mentions the name of King George only, the obligation to administer it ceased with the reign of that Sovereign, because it was applicable to no other than to him.
I think this argument cannot prevail.
It is clear that the legislature meant the oath to be taken always thereafter, for the enactment is general that it shall be taken without limit of time and the oath is not confined to the existing monarch, but mentions 'the successors '; and as it could not be taken in those words during the reign of a Sovereign not of the name of George, it follows that the name George is merely used by way of designating the existing Sovereign; and the oath must be altered from time to time in the name of the Sovereign, in the manner it was when actually administered in this case, in order to carry the obvious meaning of the enactment into effect.
This is an instance in which the language of the legislature must be modified, in order to avoid absurdity and inconsistency with its manifest intentions".
(1) [1852] 7 Exchequer 475; ; , 1068.
1098 The High Court referred to the observation of Lord Halsbury in the case Of Commissioners of Inland Revenue vs Forrest(1) to the effect that exemptions from taxation should be strictly construed because otherwise the burden of taxation will fall on other members of the community.
Those observations, in my opinion, have no relevance to the facts and circumstances of the present controversy, because we know that the exemption was granted to the Government of India in the department dealing with purchase of certain commodities and articles without reference to quantity.
As already pointed out, the Indian Stores Department was concerned with purchase of stores for public services on behalf of all Central Departments of Government and local Governments, etc., and the Government of Bengal as then constituted was one of the Provinces of India which have been receiving subsidies and subventions to make up the deficit in their budgets.
As a matter of fact, as stated on behalf of the Bengal Government the concession was granted in order to enable business communities within the Province of Bengal to compete on favourable terms with others outside Bengal in the matter of supplying the needs of the Government.
Hence there is no question of liberal construction of the exemption resulting in throwing a greater burden on other citizens.
On the other hand, the larger the sales in the Province of Bengal as it used to be, the greater the benefit to the business community doing business within that Province.
It was therefore stated at the Bar that though the present case involved taxes amounting to less than Rs. 10,000, the question arising for determination in this case affected much larger amounts because such sales within the Province amounted to several crores.
I should have thought that the business community in the Province of Bengal having had the advantage of the transactions of sale, the Government of Bengal in all fairness should have allowed the purchasing agency of the Government of India the benefit of the exemption until that benefit was in (1) ; 1099 terms withdrawn some time in the beginning of 1949.
The matter can be looked at from another point of view also.
We are concerned here with the sale of hessian.
As pointed out in the affidavit filed on behalf of the Government of India, the purchase of hessian has all along been the concern of the Supply Department, now incorporated in the Ministry of Industry & Supply.
Sales tax is a tax on sale of goods and tax on hessians falls within the contemplation of the law granting the exemption if the sales were effected through the purchasing agency of the Government of India.
The beneficiary certainly was not an amorphous body like a department but the Government of India, because it is the Government of India which could be a unit for purposes of the Act.
In this connection our attention was invited to the last clause of the exemption covered by the words "and any Railway or water transport administration".
The argument was that if the Government of India as such was to be the beneficiary, then there was no necessity for the words just quoted.
But this argument overlooks the fact that a railway or a water transport administration need not necessarily be a department of Government because there were, and still are, railway systems or water transport systems which are owned and administered by corporate bodies other than the Government of India.
Sales even to those public or semi public bodies were within the terms of the exemption.
Those words therefore are not words of limitation but words which widen the scope of the exemption in so far as the same may be available to railways and water transport administrations not owned and carried on by the Government of India.
Another reason which may be adduced in answer to the contention that there was nothing to prevent the Legislature from stating that the exemption was granted in respect of all purchases by the Government of India is that the Indian Stores Department and its later substitutes had to make purchases Dot only for the Government of India but also for local governments and other public bodies.
Hence the exemption 1100 in the terms in which it occurs in section 5 (2) (a)(iii) was not an exemption in favour of the Government of India only but also to other Governments and public bodies which could avail themselves of the facility of purchase through that department.
Another argument was urged to meet the appellant 's case that really the exemption was meant for the Government of India in its function of purchase of stores and commodities, discharged through the Indian Stores Department and later through the Supply Department.
It was argued that if the legislature meant to grant the exemption to the Government of India, then the easiest thing to do would have been to say that sales to the Government of India were exempt from the tax.
But it has not been the contention of the appellant that all sales to the Government of India are within the terms of the exemption.
Only the sales transacted through the purchasing department of the Government of India were so exempt.
In para.
7 of the affidavit referred to above it has been stated on behalf of the Government that the different departments were entitled to make local purchases of small values, that is to say, not exceeding Rs. 100 and of certain specified commodities like foodstuffs which were not within the purchasing activity of the departments aforesaid of the Government of India.
Hence, in my opinion, there is no validity in this argument either.
It was also suggested during the argument that if the exemption were to be related to only such commodities and articles as were within the purview of the Stores Department and later of the Supply Department, then such an interpretation would involve addition of qualifying words to the section which is not ordinarily within the function of the courts.
But, in my opinion, this argument also suffers from the infirmity that,it equates the departments mentioned in the exemption clause quoted above with a legal person, an argument which has already been dealt with.
In my opinion, there is no escape from the conclusion that those are mere words of description and are not words with defined connotation, because 1101 neither the Act nor the rules framed thereunder define those departments.
If the nomenclature only mattered, then there is no escape from the conclusion that whatever articles and commodities were purchased by the Indian Stores Department or its later substitutes, of whatever magnitude and value, would be within the mischief of the exemption clause in question.
But that, in my opinion, was not the intention of the framers of the Act.
They knew what the activities of the Government through those departments were and the exemption was granted only in respect of those functions of the Government, as already indicated.
For the aforesaid reasons I would allow these appeals, set aside the orders of the Letters Patent Bench and restore the orders passed by the Single Judge of the Calcutta High Court, with costs throughout.
BY THE COURT.
In accordance with the Judgment of the majority the appeals are dismissed with costs.
| Per section R. DAS, ACTING C.j., VIVIAN BOSE, BHAGWATI AND JAGANNADHADAS JJ., SINHA J. dissenting.
The exemption created by the provisions of section 5(2)(a)(iii) of the Bengal Finance (Sales Tax) Act of 1941 must be construed strictly and cannot be extended to sales to Government departments other than those mentioned therein.
The Department of Industries and Supplies, which was subse quently redesignated as the Ministry of Industries and Supplies, was not the same as the Indian Stores Department or the Supply Department of the Government of India and, consequently, sales made to the Ministry of Industries and Supplies are not exempt from payment of sales tax under that section.
In a welfare State with ever expanding activities in different fields including trade and commerce, Government departments are often entrusted with the performance of well defined activities and are authorised to deal with the outside world and enter into transactions in the same way as an ordinary person or a Company may do and may well be regarded as distinct units or quasi legal entities for the purpose for which they are created.
Consequently, the sales of hessian made to the Ministry of Industries and Supplies of the Government of India by the appellant Mills were not exempt from payment of sales tax under the Act and the State of West Bengal was entitled to levy the same.
1077 Per SINHA J.
The language of a statute has sometimes to be construed in a modified form in order to give effect to the real intentions of the legislature where, as in the present case, the language is only of a descriptive nature and not a definitive one.
Miller vs Salomons ([1852] 7 Exchequer 475), referred to.
Commissioners of Inland Revenue vs Forrest ([1890] 15 A. C. 334), held inapplicable.
The terms of section 5(2)(a)(iii) indicate that the exemption created attaches to a particular function of the Government of India described by a certain name.
The change of nomenclature was, therefore, of no consequence so long as a particular department continued to discharge that function, namely, that of purchasing articles including hessian for the Government of India.
History of the department shows that the Ministry of Industry and Supply is a lineal descendant of the Indian Stores Department and was at the time of the contract discharging its function on behalf of the Government of India and, consequently, the sales made to it must be held to be exempt from payment of sales tax.
A department of the Government is neither a natural nor a legal person but is one of the many functions of a Government placed in charge of a hierarchy of officials with the head of the department at the apex.
|
iminal Appeal No. 90 of 1955.
On appeal by special leave from the Judgment and order dated the 17th June 1955 of the Travancore Cochin High Court at Ernakulam in Criminal Miscellaneous Petition No. 113 of 1955 (R.T. 'No. 4 of 1954 and Criminal Appeal No. 136 of 1954).
B. R. L. Iyengar, for the appellant.
Sardar Bahadur, for the respondent, 1023 1955.
December 1.
The appellant was convicted of murder in Sessions Case No. 20 of 1954 by the Sessions Judge of Trichur now in the State of Travancore Cochin and sentenced to death.
The sentence was in due course confirmed by the High Court and an application for leave to appeal against it to this Court was rejected.
The appellant filed mercy petitions to the Raj Pramukh of Travancore Cochin and to the President of India and both of them were rejected.
After all these attempts had failed, the Sessions Judge issued a warrant on the 29th March, 1955, fixing 6th April, 1955, for the execution of the prisoner.
Meanwhile, the Superintendent, Central Jail, Viyyur, where the condemned prisoner was lodged, informed the Sessions Judge by his letter dated the 1st April, 1955, that the prisoner had sent a mercy petition to the Maharaja of Cochin and requested for directions, since no orders had been received in respect of that petition.
it may be mentioned that the Sessions Division of Trichur is admittedly in the former State of Cochin.
It does not appear from the record whether this mercy petition to the Maharaja of Cochin was sent before or after the mercy petitions to the Raj Pramukh of Travancore Cochin and to the President were disposed of.
On receipt of the letter dated the 1st April, 1955, from the Superintendent, Central Jail, the Sessions Judge passed an order that the circumstances of the case demanded that the execution of the sentence should not take place on the date already fixed.
He accordingly issued an order staying execution of the sentence, previously ordered by his warrant dated the 29th March, 1955.
At this stage, the Public Pro secutor filed an application to the Sessions Judge on the 30th May, 1955, praying that the stay may be vacated and that fresh directions to execute the warrant may be issued.
On that application, the Public Prosecutor raised the question that a mercy 1024 petition to the Maharaja of Cochin, who as such, has lost sovereignty over the territory forming part of the previous Cochin State, and hence also lost his prerogative of pardon, was incompetent and could not stand in the way of the warrant being executed.
The learned Sessions Judge dealt with this question and agreed with the contention of the Public Prosecutor.
Accordingly, he vacated the stay and issued a fresh warrant for execution of the prisoner giving a week 's time to the prisoner to take the matter on appeal to the High Court, if so advised.
The prisoner filed an appeal to the High Court and the learned Judges of the High Court after consideration of the arguments on both sides agreed with the view taken by the learned Sessions Judge, and dismissed the appeal by its judgment dated the 17th June, 1955.
The present appeal is against this order of the High Court.
For the hearing of this appeal counsel was assigned to the appellant amicus curiae and all the relevant constitutional provisions have been fully and fairly placed before us.
Learned counsel appearing for the State has also been heard.
We are satisfied that the question that has been raised does not admit of substantial argument and that the view taken by both the Courts below is correct.
The entire basis for any argument on behalf of the appellant is the pre existing undoubted power of the Maharaja of Cochin to exercise the prerogative of pardon in respect of a sentence of death passed by the courts within his State.
That prerogative right has been 'affirmed in Article XXI of the Covenant dated the 29th May, 1949, entered into between the Rulers of Travancore and Cochin for the formation of the United State of Travancore and Cochin.
The article is in the following terms: "Notwithstanding anything contained in the preceding provisions of this Covenant, the Rulers of Travancore and Cochin shall continue to have, and exercise, their present powers of suspension, remission or commutation of death sentences in respect of any person who may have been, or is hereafter, sentenced 1025 to death for capital offence committed within the territories of Travancore or Cochin as the case may be ' It is only on the assumption that the power thus recognised in this article of the Covenant still survives in the Maharaja of Cochin, notwithstanding that he had lost his sovereignty over the territories which constituted the State of Cochin that the appellant has any statable case.
But this assumption is clearly unfounded having regard to the events which culminated in the accession and integration of the State of Travancore Cochin with the Dominion of India and thereafter its absorption into the Union of India, when the Constitution of India came into operation on the 26th January, 1950.
The relevant historical events may briefly be stated.
In August, 1947, the Rulers of the States of Travancore and Cochin executed separate instruments of accession to the Dominion of India on the same lines as most other Indian States did, at the time.
In May, 1949, the two States formed into a United State under a Covenant signed by each of the Maharajas, the provisions of which were guaranteed by the Government of India.
It is Article XXI of this Covenant which has already been referred to and which provides for the continuance of the prerogative of the Maharaja of Cochin for commutation of death sentences within his State.
Under this Covenant it was also provided that the then Ruler of Travancore should be the first Raj Pramukh of the United State of Travancore Cochin.
It was specifically provided by Article IX thereof as follows: "The Raj Pramukh shall, within, a fortnight of the appointed day, execute on behalf of the United State an Instrument of Accession in accordance with the provisions of section 6 of the Government of India Act, 1935, and in place of the Instruments of Accession of the Covenanting States".
By Article X(4) of the Covenant it was provided that "The Legislature of the United State shall, subject to the provisions of this Covenant, have full power 1026 to make laws for the United State, including provisions as to the Constitution of the United State, within the framework of this Covenant and the Constitution of India".
In pursuance of article IX, the Raj Pramukh of Travancore Cochin executed an Instrument of Accession dated the 14th July, 1949, which was accepted by the Governor General of India on the 15th August, 1949.
By article I of this Instrument it was declared that the 'United State acceded to the Dominion of India.
In pursuance of Article X(4) the legislative assembly of the State of Travancore Coobin resolved that the Constitution framed by the Constituent Assembly be adopted by the State.
In consequence thereof the Raj Pramukh of Travancore Cochin issued a proclamation dated the 24th November, 1949, which runs as follows: "Whereas with the inauguration of the new Constitution for the whole of India now being framed by the Constituent Assembly of India, the Government of India Act, 1935, which now governs the constitutional relationship between this State and the Dominion of India will stand repealed; and whereas ' in the best interests of the United State of Travancore and Cochin, which is closely linked with the rest of India by a community of interests in the economic, political and other fields, it is desirable that the constitutional relationship established between this State and the Dominion of India, should not only be continued as between this State and the contemplated Union of India further strengthened, and the Constitution of India as drafted by the Constituent Assembly of India, which includes duly appointed representatives of this State, provides a suitable basis for doing so; And whereas by virtue of the power vesting in it under the Covenant establishing this State, the Legislative Assembly of the State has resolved that the Constitution framed by the Constituent Assembly of India be adopted by this State; I now hereby declare and direct 1027 That the Constitution of India shortly to be adopted by the Constituent Assembly of India shall be the Constitution for the United State of Travancore and Cochin as for the other parts of India and shall be enforced as such in accordance with the tenor of its provisions: That the provisions of the said Constitution shall as from the date of its commencement, supersede and abrogate all other constitutional provisions inconsistent therewith which are at present in force in this State".
For our present purposes, the last paragraph in this Proclamation is important.
On the coming into force of the Constitution of India on the 26th January, 1950, the State of Travancore Cochin became a part of the Union of India and was one of the Part B States as provided under article 1 clause (2) taken with Part B of the First Schedule.
The Constitution specifically provided for the prerogative of mercy in respect of sentences of death in articles 72, 161 and 238.
Article 72 provides for the power of the Presi dent, article 161 for the power of the Governor in a Part A State, and article 238 (1) taken with article 161 for the power of the Raj Pramukh of a Part B State.
In the light of these provisions the continuance of the prerogative of the Maharaja of Cochin relating to the execution of the death sentences with reference to the ex State of Cochin would be inconsistent with the new Constitution.
Such power, there fore, must be taken to have been superseded and abrogated as stated in the last para of the Proclamation above mentioned.
It would follow that article XXI of the Govenant of May, 1949, no longer survives.
Article 372(1) of the Constitution has also been relied upon on behalf of the appellant.
This runs as follows: "Notwithstanding the repeal by this Constitution of the enactments referred to in article 395 but subject to the other provisions of this Constitution, all the law in force in the territory of India immediately before the commencement of this Constitution shall continue in force therein until altered or re 130 1028 pealed or amended by a competent Legislature or other competent authority".
The argument based on this article is that the criminal law of the ex Cochin State continued to be in force in spite of the new Constitution having come into force and that the exercise of the prerogative by the Maharaja of Cochin in respect of the ex State of Cochin was an integral part of that law.
Apart from the question whether such prerogative which was incidental to his sovereignty, could survive after he lost his sovereignty over the territory, the difficulty in the way of this argument is twofold.
(1) The continuance is subject to the other provisions of the Constitution; and (2) The continuance is only until altered or repealed or amended by a competent Legislature.
As already pointed out, the continuance of the prerogative of the Maharaja of Cochin would be inconsistent with articles 72, 161 and 238 of the Constitution.
Further it is to be noticed that by the Code of Criminal Procedure (Amendment) Act, 1951, (Central Act I of 1951), passed by the Union Legislature, the Code of Criminal Procedure, 1898, has been made applicable to the whole of India by amending section I of the Code and by substitution therein for the words "whole of India except Part B States", the words "whole of India except the States of Jammu and Kashmir and Manipur".
The Code of Criminal Procedure and along with it sections 401, 402, and 402 A thereof, relating to commutation of sentences having thus been made specifically applicable to all Part B States by Central Act I of 1951, the prerogative under the old Cochin law must in any case be deemed to have been repealed or abrogated by competent legislative authority after the coming into force of the Constitution.
It was suggested in the Courts below that in so far as the Maharaja 's prero gative was concerned the Legislature was incompetent to abrogate it in view of article 362 of the Constitution.
But that article has no bearing.
It refers only to personal rights, privileges and dignities of the Rulers of Indian States.
It is obvious even from the Covenant, in which article XXI appears, that the 1029 power of pardon thereunder is different from "personal rights, privileges and dignities" which have been dealt with under articles XVI and XVII in the following terms.
The Ruler of each Covenanting State, as also the members of his family, shall be entitled to all the personal privileges, dignities and titles enjoyed by them, whether within or outside the territories of the State, immediately before the 15th day of August,1947.
XVII.(1) The succession, according to law and custom to the gaddi of each Covenanting State and to the personal rights, privileges, dignities and titles of the Ruler thereof is hereby guaranteed".
There is thus no substance in any of the arguments on which the case for the appellant can possibly be presented.
This appeal is accordingly dismissed.
| A sentence of death passed on the appellant by the Sessions Judge of Trichur (now situated in the United State of Travancore Cochin and previously in the former State of Cochin) was confirmed by the High Court.
Mercy petitions presented to the Raj Pramukh of Travancore Cochin and to the President of India were rejected.
The question for determination was whether the appellant could rely on the pre existing power of the Maharaja of Cochin to exercise the power of pardon in respect of a sentence of death passed by the courts in his State, the prerogative right having been affirmed by article XXI of the Covenant dated the 29th May 1949, entered into between the Rulers of Travancore and Cochin.
Held that the pre existing prerogative right of pardon vested in the Maharaja of Cochin must be taken to have been superseded and abrogated having regard to the events which culminated in the accession and integration of the State of Travancore Cochin with the Dominion of India and thereafter its absorption into the Union of India when the Constitution of India came into force on the 26th January 1950, the continuance of such prerogative being inconsistent with articles 72, 161 and 238 of the Constitution.
|
minal Appeal No. 143 of 1954.
On appeal by special leave from the judgment and order dated the 12th August 1953 of the Patna High Court in Criminal Appeal No. 345 of 1952 arising out of the judgment and order dated the 20th August 1952 of the Court of Additional Session Judge, Darbhanga in Session Case No. 12 of 1952.
H.J. Umrigar and B. C. Prasad, for the appellant.
B.K. Saran and M. M. Sinha, for the respondent. 1955.
December 8.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
The appellants were charged before the Additional Sessions Judge, Darbhanga under section 302 read with section 34 of the Indian Penal Code for the murder of one Balbbadra Narain Singh.
They were also charged, some under section 147 and the others under section 148, for be ing members of an unlawful assembly and for rioting.
The case of the prosecution was as follows: The deceased and the appellants were pattidars in the village I of Mahe, and there was ill feeling between them on account of the village pattidari.
On 5 3 1951, at about 10 A.M. the deceased was returning from the river to his baithka.
Oil the way, the appellants who were armed with bhalas, sword and lathi, and some others surrounded him at the courtyard of the village school and attacked him.
One Harischandra Singh, who is still absconding, plunged his bhala into the abdomen of the deceased, and the appellants joined in the attack on him.
The deceased ran to his baithka, and from there, he was taken to the police station at Singhia.
There, he made a complaint which has been filed as the first information report, and therein beset out the incidents mentioned above, and implicated the appellants as concerned in the attack.
The deceased was then taken to the hospital, and in view of his precarious condition the doctor recorded his dying declaration.
The deceased was then sent 1045 for treatment to the hospital at Samastipur, but on the way he died.
On the basis of the first information report and on the enquiries made by them, the police charged the appellants under section 302 read with section 34 for murder and under sections 147 and 148 for rioting.
The defence of the appellant was that the deceased was attacked by some unknown ,assailants in his baithka in the early hours of 5 3 1951, and that they were not concerned in the offence.
The Additional Sessions Judge, Darbbanga accepted the evidence of the prosecution, and convicted the appellants under section 302 read with section 34, and sentenced them to transportation for life.
He also convicted them, some under section 147 and the others under section 148, but imposed no separate sentence under those sections.
The appellants took the matter in appeal to the High Court of Patna.
, The learned Judges agreed with the Sessions Judge in his conclusions of fact, but altered the conviction from one under section 302 read with section 34 to one under 'section 326 read with section 149, and the sentence from transportation for life to various terms of imprisonment.
The learned Judges also maintained the conviction of the appellants on the charge of rioting, but awarded no separate sentence therefor.
It is against this judgment that the present appeal is directed.
On behalf of the appellants, it was firstly contended by Mr. Umrigar that the finding of the courts below that the incident took place at the school courtyard and not at the baithka of the deceased was bad, because it was based on inadmissible evidence, viz., Exhibit P 7 and the testimony of P.Ws. 4, 7 and 12.
Exhibit P 7 is a statement of the deceased taken by the police officer subsequent to the lodging of the first information and after the investigation had begun, and its reception would be barred by section 162 of the Code of Criminal Procedure.
But the learned Judges thought that it would be admissible under section 32(1) of the Indian Evidence Act, and the correctness of this view is disputed by the appellants.
But even if Exhibit P 7 is inadmissible in evidence, 1046 that would not assist the appellants, as the learned Judges observed that apart from that document, they would have, on the other evidence, held that the deceased was attacked at the school courtyard.
Then, we come to the evidence of P.Ws. 4, 7 and 12 on which the courts below have relied in accepting the version of the incident as given by the prosecution.
Mr. Umrigar contended that their evidence was inadmissible, because they were examined by the police at the stage of investigation, and their statements were not recorded separately as required by section 161(3) of the Code of Criminal Procedure.
This is what the investigating officer, P.W. 18, deposed with reference to this matter. "The Daffadar produced Sital Singh (P.W. '12), Ram Karan Singh (P.W. 7) and Ramkinker (P.W. 4).
First of all, I examined them separately but recorded their joint statement in respect of common things.
I made a separate record about the identification and the weapons".
The recording of a joint statement of the examination of P.Ws. 4, 7 and 12 is clearly in contravention of section 161(3), and must be disapproved.
But the question is whether that renders the testimony of P.Ws. 4, 7 and 12 in court inadmissible.
Section 161(3) does not say so, and indeed, seeing that the police are not bound to make a record of the statements of witnesses in which case there is admittedly no bar to the reception of their testimony, it would be anomalous if we were to hold that their evidence is inadmissible, because the statements were also reduced to writing but not in the manner provided in the section.
The Indian Evidence Act contains elaborate provisions as to who are competent witnesses and on what matters their evidence is inadmissible.
And on these provisions P.Ws. 4, 7 and 12 are neither incompetent witnesses, nor is their evidence as to the incidents to which they deposed, inadmissible.
In Zahiruddin vs Emperor(1) it was held by the Privy Council that the failure to comply with the provisions of section 162(1) might greatly (1) A.I.R. 1947 P.C. 75.
1047 impair the value of the evidence of the witness, but that would not affect its admissibility.
On the same reasoning, it will follow that the evidence of P.Ws. 4, 7 and 12 is not inadmissible for the reason that their statements had been recorded by P.W. 18 jointly and not separately as required by section 161(3).
In support of his contention that their evidence is inadmissible, Mr. Umrigar relied on the decisions in Baliram Tikaram vs Emperor(1) and Maganlal Radhakishan vs Emperor(2).
In Baliram Tikaram vs Emperor(1), which was a decision under section 162 of the Code of Criminal Procedure the accused had not been furnished with copies of the statements recorded by the police officers under section 161, and it was held that that deprived the accused of a valuable right, and must have caused prejudice to them.
That was the view taken in Viswanath vs Emperor (3) , and no exception can be taken to it.
But the learned Judges went on to observe that the evidence of the witnesses who gave statements at the investigation would itself be inadmissible.
The reason for this opinion was thus stated by them: "How can the evidence be admissible and proper for consideration when the accused is robbed of his statutory means of cross examination and thereby denied the opportunity of effectively cross examining his adverse witnesses? No evidence recorded by the Court, unless it satisfies the requirement of section 138, Evidence Act, can become admissible and proper for consideration.
It would indeed be bold to say that the evidence of a witness is legally admissible against a party even though he at the time it was given had not the full opportunity to cross examine him".
This view was reiterated by the same learned Judges in Maganlal Radhakishan vs Emperor(2), but, for the reasons already given, we are unable to accept this as a correct statement of the law.
We are of the opinion that while the failure to comply with the requirements of section 161(3) might affect the weight to be (1) A.I.R. 1945 Nag.
(2) A.I.R. 1946 Nag.
(3) I.L.R. , 1048 attached to the evidence of the witnesses, it does not render it inadmissible.
That was so held by Harries, C.J. and Bachawat, J. in Bejoy Chand Patra vs The State(1), where this question arose directly for decision, and we are in agreement with this view.
In the present case, the attention of the learned Judges was drawn to the infirmity in the evidence of P.Ws.4, 7 and 12, arising by reason of the failure to observe section 161(3), but they were, nevertheless, prepared to accept it as reliable.
We must accordingly hold that the findings of the courts below are not open to attack on the ground that they were based on inadmissible evidence.
It was next contended that the charge on which the appellants were tried was one under section 302 read with section 34, and that the learned Judges of the High Court erred in convicting them under section 326 read with section 149.
Before the learned Judges the contention that was pressed was that there was no power in the court to substitute section 149 for section 34, but they declined to accept it.
The question has since been considered by this Court in Karnail Singh and others vs The State of Punjab( ') and Willie Slaney 's case( ').
It is conceded by Mr. Umrigar that in view of these decisions, the question is no longer open.
It must be answered adversely to the appellants.
It was finally contended that there had been no proper examination of the appellants under section 342, and that the conviction should accordingly be quashed.
What happened was that when the court commenced its examination under section 342, the appellants stated that they would file written statements.
Those statements were very elaborate and furnished the answer of the appellants to all the points raised in the prosecution evidence.
Mr. Umrigar was unable to suggest any question which could have been put, with reference to which the statements did not contain an answer.
Clearly, the appellants have not been prejudiced.
It is no doubt true that (1) A.I.R. 1950 Cal. 363.
(2) , (3) Criminal Appeal No. 6 of 1955, 1049 section 342 contemplates an 'examination in court) and the practice of filing statements is to be deprecated.
But that is not a ground for interference, unless prejudice is established.
And it is nothing unusual for the accused to prefer filing statements instead of answering questions under section 342 lest they should suffer by inadvertent admissions or by damaging statements.
As no prejudice has been shown, this contention also must be rejected.
In the result, the appeal is dismissed.
| Although the joint recording of statements made by witnesses during an investigation is a contravention of section 161(3) of the Code of Criminal Procedure and must be disapproved, that by itself does not render the testimony given by such witnesses in court inadmissible.
It is, however, for the court to decide whether it will rely on such testimony or attach any weight to it.
Zahiruddin vs Emperor, (A.I.R. , applied.
Baliram Tikaram vs Emperor, (A.I.R. and Magan lal Radhakishan vs Emperor, (A.I.R. , disapproved.
Bejoy Chand Patra vs The State, (A.I.R. , ap proved.
The court has power to substitute a charge under section 149 of the Indian Penal Code for a charge under section 34.
Karnail Singh and others vs The State of Punjab, ([1954] S.C.R. 904)and Willie Slaney 's case, (Criminal Appeal No. 6 of 1955), referred to.
Although section 342 of the Code of Criminal Procedure contem plates oral examination of the accused in court and though the practice of filing written statements is to be deprecated, the fact that the accused filed a statement instead of being examined is no ground for interference unless he is shown to have been prejudiced thereby.
Consequently, in a case where the accused were put up for trial under section 302 read with section 34 of the Indian Penal Code, and the Additional Sessions Judge relying on the evidence of three of the prosecution witnesses whose statements during the investigation were recorded jointly in contravention of section 161(3) of the Code of Criminal Procedure, convicted and sentenced them to transportation for life and the High Court in appeal agreed with the findings of fact, but altered the conviction to one under section 326 read with section 149 of the Indian Penal Code, as also the sentence, their conviction was not liable to be set aside.
|
Parties will hear their own costs, V.P.S. Appeals dismissed.
Appeal by special leave from the judgment and order dated the 3rd November, 1953 of the High Court of Judicature at Nagpur in Criminal Appeal 1144 No. 220 of 1953 arising out of the judgment and order dated the 21st July 1953 of the Court of Sessions Judge at Jabalpur in Sessions Trial No. 32 of 1953.
H.J. Umrigar and Rajinder Narain, for the appellant.
The courts below were wrong in convicting the appellant of murder under section 302 of the Indian Penal Code in the absence of a charge framed for the offence.
The charge framed against the appellant was different and he was never charged individually of having committed murder.
When the other person was acquitted the charge of an offence under section 302 read with section 34 of the Indian Penal Code falls and the appellant is bound to be acquitted.
It is a fundamental principle of criminal law as administered in India that there should be a separate charge for every distinct offence as the accused person must have notice of the charge which he has to meet.
The only exceptions are contained in sections 236, 237 and 238 of the Code of Criminal Procedure.
The offence of murder under section 302 of the Indian Penal Code being separate, distinct and different from an offence under section 302 read with 34 or an offence under section 302 read with 149 which creates a distinct head of criminal liability known as constructive liability a conviction under section 302 simpliciter without a charge being framed therefor is an illegality in the mode of trial.
Where a person has been convicted of an offence with which he has not been charged (unless allowed by exceptions) the prejudice is inherent in the absence of the charge itself and it is unnecessary to look any further.
Where there is an illegality in the mode of trial as contemplated in sections 233 to 239 it is an illegality, which is not cured by the provisions of sections 535 and 537.
There is no difference in principle between a charge under section 302 read with 34 and a charge under section 302 read with 149 [See: Nanak Chand vs State of Punjab ([1955] 1 S.C.R.1201), Suraj Pal vs State of U. P. ; It is incorrect to say that the decision of the Privy Council in Subramania Iyer 's case as to what is an illegality has been modified by the subse 1145 quent decisions of the Privy Council, and, in fact, in Babulal Chowkhani 's case Lord Wright in delivering the judgment of the Board actually stated that it was taken as settled law by both sides that the breach of the provisions of section 239 of the Code of Criminal Procedure would be an 'illegality ' which would vitiate the trial as opposed to a mere 'irregularity ' which would not vitiate the trial.
Section 535 appears in Chapter XLV of the Code and is headed "Of irregular proceedings" and cannot possibly apply to breaches of the mandatory provisions of sections 233 to 239 of the Code; it may relate to those cases where it is optional to frame a charge.
See sections 263, 362(4).
Assuming that actual prejudice is necessary, then as the only charge against the appellant being one under section 302 read with section 34, and that having failed due to the acquittal of the co accused, and the appellant having successfully shown that there was no "common intention" as contemplated by section 34 of the Indian Penal Code prejudice is bound to occur due to his conviction under section 302 simpliciter, with which he was never charged.
In any event, the 1146 offence committed in the case, even though the blow was struck on the head, could never be murder, as even the medical evidence showed that the bead injury "was likely" to result in fatal consequences.
The offence committed would either be one of grievous hurt under section 325, or alternatively, it is covered by exception 4 to section 300, and punishable under the second part of section 304.
B.Sen and I. N. Shroff, for the respondent.
The word 'illegality ' which is frequently used in the judgments is nowhere defined in the Code of Criminal.
Procedure.
This word had been used by the judges to convey that the trial has been irregular and the irregularity is not curable under the provisions of the Code.
The word has been used in three senses, namely: (a) In cases where the trial and conviction are ab initio void due to some inherent defect, which goes to the root and is by itself enough to vitiate the trial, as in cases of lack of jurisdiction, e.g., where section 197 of the Code has not been complied with; (b) In cases where a mandatory prohibition of the Code has been disregarded and it is apparent from the provision itself that, having regard to its objects and purposes, such disregard is bound to lead to prejudice; (c) In a more popular sense, that is, in respect of a particular case or cases where having regard to the facts and circumstances, whether it be due to prejudice or otherwise, the conviction cannot be sustained.
Proceeding on the basis that an offence under section 302 read with section 149 is a distinct and separate offence from an offence under section 302, the question is whether in the absence of actual prejudice the conviction of a person of the latter offence, when he is only charged with the former, is illegal.
The answer depends on the determination as to whether the failure to frame a charge is such a disregard of the mandatory Provisions of the Code so as to lead to the conclusion that prejudice must have been caused.
In N. A. Subramania Iyer vs King Emperor ([1901] 28 I.A. 257) the decision was based on the facts of the case in which actual prejudice was caused.
In any event, that decision stands modified by the 1141 decisions of the Privy Council in the later cases: [See, Abdul Rahman vs The King Emperor ([1926] 54 I.A. 96) and Pulukuri Kotayya and Others vs King Emperor ([1946] 74 I.A. 65).
It is clear from those decisions that every breach of a mandatory provision is not such as would ipso facto vitiate a trial.
If one looks at the relevant sections, the object behind the enactment of those provisions and the intention of the legislature, it is clear that the framing of a charge though mandatory is not of a vital nature.
See sections 210, 254,271, 221, 222, 223, 225, 226, 227, 232 and 535.
All that the Code contemplates is that an accused person must in fact receive notice of what be is being tried for.
When a person is charged with an offence under section 302 read with section 149 of the Indian Penal Code there is no objection to his being convicted under section 302 without a charge being framed, if it appears from the evidence that he has committed the actual murder and it appears from the record that either by the trend of cross examination or by reason of questions being put to him under section 342 he understood that he was actually being tried for murder: [See Karnail Singh and Another vs The State of Punjab ([1954].
8 C.R. 904) and Lachman Singh and Others vs The State ([1952] S.C.R. 839)].
A case of this nature may even be covered by the provisions of section 237 of the Code of Criminal Procedure.
The cases of Nanak Chand vs State of Punjab ([1955] 1 S.C.R. 1201) and Suraj Pal vs State of U.P. ([1955] 1 S.C.R. 1332), do not lay down the proposition that even in the absence of prejudice conviction of a person under section 302 who is charged with an offence under section 302 read with section 149, would be ipso facto illegal.
Whatever view the Court takes in respect of a conviction under section 302 when a person is charged with section 302 read with section 149, it is quite clear that a person can be validly convicted of murder when he is charged with section 302 read with section 34.
Section 34 does not create a specific offence and a person who is charged under section 302 read with section 34 is really being charged for his act in the murder itself.
It is therefore not necessary to frame a separate charge under section 302.
The Privy Council as well as the High 1148 Courts in India have always taken this view.
See ' The King Emperor vs Barendra Kumar Ghose (A.I.R. , Emperor vs Destrali ([1930] , Debiprasad Kalowar vs Emperor ([1932] , Devki Nandan and Others vs Emperor (A.I.R. 1941 Lah. 423) and Bhondu Das vs King Emperor ([1928] 7 Patna 758).
In this case there was no actual prejudice as the accused knew that he was being charged with murder which is clear from the trend of cross examinations of witnesses and his examination under section 342 of the Code of Criminal Procedure.
The facts clearly show that the offence committed by the accused is one of murder as the deceased died as a result of injuries and the injury was sufficient to cause death according to the doctor 's evidence.
Umrigar in reply.
If section 535 is given its literal meaning it would mean that a trial for any offence could be held and terminated without the framing of any charge whatsoever.
It would also mean that a person could be charged with a minor offence and convicted of a major offence, whereas section 238(2) only allows conviction of a minor offence without a charge, if the major offence with which the person is charged is not made out.
Such a wide meaning which would lead to absurdities should not be given to section 535.
October 31.
The judgment of section R. Das, Acting C.J. and Bose J. was delivered by Bose J.
The judgment of Jagannadhadas and Chandrasekhara Aiyar JJ.
was delivered by Chandrasekhara Aiyar J. Jafer Imam J. delivered a separate judgment.
This appeal was referred to a Bench of five Judges in order to determine whether there was a conflict of view between Nanak Chand vs The State of Punjab(1) and Suraj Pal vs The State of U.P.(2) and (1) [1955] I S.C.R. 1201.
(2) ; 1149 if so, to determine it.
The appeal is against a conviction for murder in which the lesser sentence was given.
The main ground is that the appellant was charged under section 302 of the Indian Penal Code read with section 34.
But the Courts below hold that the appellant inflicted the fatal blow and have made him directly liable for the murder.
He contends that as he was not charged with having murdered the man personally be cannot be convicted under section 302.
He relies on certain observations in Nanak Chand vs The State of Punjab(1) and contends that the conviction is an illegality which cannot be cured and claims that he must either be acquitted or, at the most, be retried, though be adds further that in the circumstances of this case the Court should not in the exercise of its discretion order a retrial.
As against this it is contended for the State that an omission to frame a separate charge in the alternative under section 302 simpliciter is a curable irregularity provided there is no prejudice to the accused.
Therefore, the only matter for determination is a question of fact whether there was prejudice in this case.
The charge was as follows: "That you, on or about the 12th day of February 1953, at Civil Lines, Jabalpur, went with your brother Ronnie Slaney to the house of Mrs. Waters (P.W. 20) at about 7 p.m. and in furtherance of the common intention did commit murder by intentionally or knowingly causing the death of her brother D. Smythe and thereby committed an offence punishable under section 302 of the Indian Penal Code read with section 34 of the Indian Penal Code. . .".
An exactly similar charge with the necessary change of name was framed against the co accused Ronnie Slaney.
It was contended on behalf of the State that this is really a charge under section 302 of the Indian (1) ; , 1150 Penal Code and that the references to common intention and to section 34 are mere surplusage.
There is much to be said for this but we will assume in this case (without so deciding) that the charge is ambiguous and that it means what the appellant says it means, namely a charge under section 302 read with section 34 and not one under section 302 simpliciter.
On that assumption the question for our decision is whether the omission to frame an alternative charge under section 302 of the Indian Penal Code is an illegality that cuts at the root of the conviction and makes not invalid or whether it is a curable irregularity in which all that we are concerned to see is whether there was prejudice.
What it narrows down to is this: Is the charge to be regarded as a ritualistic formula so sacred and fundamental that a total absence of one, or any departure in it from the strict and technical requirements of the Code, is so vital as to cut at the root of the trial and vitiate it from the start, or is it one of many regulations designed to ensure a fair and proper trial so that substantial, as opposed to purely technical, compliance with the spirit and requirements of the Code in this behalf is enough to cure departures from the strict letter of the law? Before we proceed to set out our answer and examine the provisions of the Code, we will pause to observe that the Code is a code of procedure and, like all procedural laws, is designed to further the ends of justice and not to frustrate them by the introduction of endless technicalities.
The object of the Code is to ensure that an accused person gets a full and fair trial along certain well established and well understood lines that accord with our notions of natural justice.
If he does, if he is tried by a competent court, if be is told and clearly understands the nature of the offence for which he is being tried, if the case against him is fully and fairly explained to him and he is afforded a full and fair opportunity of defending himself, then, provided there is substantial compliance with the outward forms of the law, mere mistakes in procedure, mere in consequential errors and omissions 1151 in the trial are regarded as venal by the Code and the trial is not vitiated unless the accused can show substantial prejudice.
That, broadly speaking, is the basic principle on which the Code is based.
Now here, as in all procedural laws, certain things are regarded as vital.
Disregard of a provision of that nature is fatal to the trial and at once invalidates the conviction.
Others are not vital and whatever the irregularity they can be cured; and in that event the conviction must stand unless the Court is satisfied that there was prejudice.
Some of these matters are dealt with by the Code and wherever that is the case full effect must be given to its provisions.
The question here is, does the Code deal with the absence of a charge and irregularities in it, and if so, into which of the two categories does it place them? But before looking into the Code, we deem it desirable to refer to certain decisions of the Privy Council because much of the judicial thinking in this country has been moulded by their observations.
In our opinion, the general effect of those decisions can be summarised as follows.
First comes a class of case in which the Code deals with the matter expressly.
In that event, full effect must be given to the plain meaning of the words used.
"The language of that Code is conclusive, and must be construed according to ordinary principles, so as to give effect to the plain meaning of the language used.
No doubt, in the case of an ambiguity, that meaning must be preferred which is more in accord with justice and convenience, but in general the words used read in their context must prevail".
And at page 177 "But, even so, that can be no ground why the Court should misconstrue the section".
and at page 178 ,"Their Lordships decide the question on what they regard as the plain meaning of the language used".
(1) [1938] L.R. 65 I.A. 158, 175.
1152 Next comes a class of case for which there is no express provision in the Code, or where there is ambiguity.
In that event, the question is whether the trial has been conducted in substantial compliance with the Code or in a manner substantially different from that prescribed.
"When a trial is conducted in a manner different from that prescribed by the Code (as in N. A. Subramania Iyer 's case(1)), the trial is bad and no question of curing an irregularity arises; but if the trial is conducted substantially in the manner prescribed by the Code, but some irregularity occurs in the course of such conduct, the irregularity can be cured under section 537, and none the less so because the irregularity involves, as must nearly always be the case, a breach of one or more of the very comprehensive provisions of the Code".
Pulukuri Kotayya vs King Emperor(2).
The question in such cases is whether the departure is so violent as to strike at the root of the trial and make it no trial at all or is of a less vital character.
It is impossible to lay down any hard and fast rule but taken by and large the question usually narrows down to one of prejudice.
In any case, the courts must be guided by the plain provisions of the Code without straining at its language wherever there is an express provision.
For a time it was thought that all provisions of the Code about the mode of trial were so vital as to make any departure therefrom an illegality that could not be cured.
That was due to the language of the Judicial Committee in N.A. Subramania Iyer vs KingEmperor(1).
Later this was construed to mean that that only applies when there is an express prohibition and there is prejudice.
(2) [1917] L.R. 74 I.A. 66, 75.
1153 in most systems of jurisprudence, but it would be an extraordinary extension of such a branch of administering the criminal law to say that when the Code positively enacts that such a trial as that which has taken place here shall not be permitted that this contravention of the Code comes within the description of error, omission or irregularity".
This was examined and explained in Abdul Rahman vs King Emperor(1) as follows: "The procedure adopted was one which the Code positively prohibited, and it was possible that it might have worked actual injustice to the accused".
In our opinion, the key to the problem lies in the words underlined.
Except where there is something so vital as to cut at the root of jurisdiction or so abhorrent to what one might term natural justice, the matter resolves itself to a question of prejudice.
Some violations of the Code will be so obvious that they will speak for themselves as, for example, a refusal to give the accused a hearing, a refusal to allow him to defend himself, a refusal to explain the nature of the charge to him and so forth.
These go to the foundations of natural justice and would be struck down as illegal forthwith.
It hardly matters whether this is be cause prejudice is then patent or because it is so abhorrent to well establisbed notions of natural justice that a trial of that kind is only a mockery of a trial and not of the kind envisaged by the laws of our land, because either way they would be struck down at once.
Other violations will not be so obvious and it may be possible to show that having regard to all that occurred no prejudice was occasioned or that there was no reasonable probability of prejudice.
In still another class of case, the matter may be so near the border line that very slight evidence of a reasonable possi bility of prejudice would swing the balance in favour of the accused.
This, in our opinion, has been the trend of the more recent decisions of the Privy Council and indeed of latter day criminal jurisprudence in England as well as in India.
The swing of the pendulum has been (1) [1926] L.R. 54 I.A. 96, 109. 1154 away from technicality, and a greater endeavour has been made to regard the substance rather than the shadow and to administer Justice fairly and impartially as it should be administered; fair to the accused, fair to the State and fair to the vast mass of the people for whose protection penal laws are made and administered.
The more recent attitude of the Judicial Committee is summed up by Sir John Beaumont in Pulukuri Kotayya vs King Emperor(1) where he says that "The distinction drawn in many of the cases in India between an illegality and an irregularity is one of degree rather than of kind" and by Viscount Sumner in Atta Mohammad vs King Emperor(2) "In the complete absence of any substantial injustice, in the complete absence of anything that outrages what is due to natural justice in criminal cases, their Lordships find it impossible to advise His Majesty to interfere".
We prefer this way of stating the law, for the distinction that was once sought to be drawn between an express prohibition and an equally express provision positively stated strikes us as unreal.
The real question is not whether a matter is expressed positively or is stated in negative terms but whether disregard of a particular provision amounts to substantial denial of a trial as contemplated by the Code and understood by the comprehensive expression "Natural justice".
It will be observed that disregard of ail express Prohibition was regarded as curable in Zahiruddin vs King Emperor(3), so the question whether a particular provision is stated in positive or in negative terms is not the true criterion.
(2) [1929] L.R. 57 I.A. 71, 76.
(3) [1947] L.R. 74 I.A. 80, 1155 controversy that has raged around the true meaning of N. A. Subramania Iyer vs King Emperor(1).
In any case, our opinion is that the real object of the Code is to leave these matters to the discretion and vigilance of the courts.
Slightly to alter the language of the Privy Council in Babulal Choukhani vs The KingEmperor(2) we would say "It must be hoped, and indeed assumed, that magistrates and judges will exercise their jurisdiction fairly and honestly.
Such is the implied condition of the exercise of judicial power.
If they do not, or if they go wrong in fact or in law, the accused has prima facie a right of recourse to the superior courts by way of appeal or revision; and the cases show bow vigilant and resolute the High Courts are in seeing that the accused is not prejudiced or embarrassed by unsubstantial departures from the Code and bow closely and jealously the Supreme Court guards the position of the accused.
These safeguards may well have appeared to the Legislature to be sufficient when they enacted the remedial provisions of the Code and have now left them substantially unaltered in the new Code recently introduced".
This, we feel, is the true intent and purpose of section 537(a) which covers every proceeding taken with jurisdiction in the general phrase "or other proceedings under this Code".
It is for the Court in all these cases to determine whether there has been prejudice to the accused; and in doing so to bear in mind that some violations are so obviously opposed to natural justice and the true intendment of the Code that on the face of them and without anything else they must be struck, down, while in other cases a closer examination of all the circumstances will be called for in order to discover whether the accused has been pre judiced.
We now proceed to examine the relevant sections of the Code.
Chapter XLV deals generally with irregular proceedings.
There are certain irregularities which do not vitiate the proceedings.
They are set out in section 529.
No question of prejudice arises, (1) [1901] L.R. 28 I.A. 257.
146 (2) [1938] L.R. 5 I.A. 158,177.
1156 in this class of case because the section states cate gorically that they shall not vitiate the proceedings.
Certain other irregularities are treated as vital and there the proceedings are void irrespective of prejudice.
These are set out in section 530.
A third class is dealt with in sections 531, 532, 533, 535, 536 (2) and 537.
There, broadly speaking, the question is whether the error has caused prejudice to the accused or, as some of the sections put it, has occasioned a failure of justice.
The examples we have given are illustrative and not exhaustive.
What we are seeking to demonstrate is that the Code has carefully classified certain kinds of error and expressly indicates bow they are to be dealt with.
In every such case the Court is bound to give effect to the express commands of the legislature: there is no scope for further speculation.
The only class of case in which the Courts are free to reach a decision is that for which no express provision is made.
The present case is concerned with the nature of the charge and we find that the Code expressly deals with this in several of its sections.
Our only task therefore is to interpret them and, having propounded their meaning, to give effect to whatever they say.
Now there is no doubt that a charge forms the foundation of a sessions trial and is a most important step in it.
The accused must know and understand what he is being tried for and must be told in clear and unambiguous terms: section 271 (1).
There can be no shirking that or slurring over it, and this must appear on the face of the record.
It cannot be established by evidence taken after the trial.
But there is, in our opinion, equally no doubt that the Code expressly deals with this and expressly provides that no error, omission or irregularity in the charge, or even total absence of a charge, shall vitiate a trial unless prejudice to the accused is shown.
This is repeatedly reiterated in a number of sections.
The whole question therefore is whether the "charge" must be formally reduced to writing and expressed as a ritualistic formula in order to save the trial from the ' fundamental defect.
of an incurable illegality or 1157 whether the information that is the substance of the matter can be conveyed in other ways.
The question is whether we are to grasp at the substance or play hide and seek among the shadows of procedure.
A perusal of them reveals the reasons why a charge is required.
It must set out the offence with which the accused is charged and if the law which creates the offence does not give it any specific name, so much of the definition of the offence must be stated "as to give the accused notice of the matter with which he is charged".
The charge must also contain such particulars of date, time, place and person "as are reasonably sufficient to give the accused notice of the matter with which he is charged"; and section 223 says "When.the nature of the case is such that the particulars mentioned in sections 221 and 222 do not give the accused sufficient notice of the matter with which he is charged, the charge shall also contain such particulars of the manner in which the alleged offence was committed as will be sufficient for that purpose".
It is clear to us that the object of the charge is not to introduce a provision that goes to the root of jurisdiction as, for example, the requirement of previous sanction under section 197, but to enable the accused to have a clear idea of what he is being tried for and of the essential facts that he has to meet.
But there are other ways of conveying this information.
For example, in summons cases no formal charge is required: all that is necessary is to tell the accused the substance of the accusation made against him (section 242).
The whole question is whether, in warrant cases and in sessions trials, the necessary information must be conveyed in one way and one way only, namely in a formal charge in order that the entire trial may not be ipso facto vitiated because of an incurable illegality, or whether that can be done in other and less formal ways, provided always that it is in fact conveyed in a clear and unambiguous man ner and in circumstances that the court will regard '1158 as fair and in substantial, as opposed to purely technical, compliance with the requirements of the Code.
The law could have provided one way as easily as another, but what it has chosen to do is set out in the following sections.
The marginal note to section 225 is headed "Effect of errors." and the section states that "No error in stating either the offence or the particulars required to be stated in the charge, and no omission to state the offence or those particulars, shall be regarded at any stage of the case as material, unless the accused was in fact misled by such error or omission, and it has occasioned a failure of justice".
Therefore, when there is a charge and there is either error or omission in it or both, and whatever its nature, it is not to be regarded as material unless two conditions are fulfilled both of which are matters of fact: (1) the accused has in fact been misled by it and (2) it has occasioned a failure of justice.
That, in our opinion, is reasonably plain language.
Next, sections 226 and 227 show that errors in a charge, and even the total absence of a charge, do not vitiate a trial from the start so as to render it no trial at all as would the absence of sanction under section 197.
This is evident because these errors and omissions can be remedied at any time during the course of the trial in the sessions Court (section 226) or even at the very end of the trial (section 227), and when this is done the trial need not proceed de novo but can go on from the stage at which the alteration was made provided neither side is prejudiced (section 228).
The proceedings up to the stage of the alteration, which, as ,we have seen, can be at the very end of the trial, are not vitiated unless there is prejudice; they are good despite these imperfections.
That is impossible when the error is so vital as to cut at the root of the trial.
It follows that errors in the charge, and even a total absence of a charge, are not placed in the non curable class.
1159 Next, we have a case in which the error is not observed and corrected during the trial and the accused is convicted.
It is to be observed that this is so whether there was a total absence of a charge or merely an error in it.
It is evident that a conviction cannot stand if the defect cuts at the root of the trial, therefore defects even of this nature are not regarded as fatal.
From there we proceed to section 535.
The marginal note is "Effect of omission to prepare charge", and the section says "No finding or sentence pronounced or passed shall be deemed invalid merely on the ground that no charge was framed, unless, in the opinion of the Court of appeal or revision, a failure of justice has in fact been occasioned thereby".
Here again the language is clear and wide and emphatic.
The section summarises what was already indicated in sections 226, 227, 228 and 232.
Next, there is section 537: "Subject to etc no finding, sentence or order passed by a Court of competent jurisdiction shall be reversed or altered under Chapter XXVLI or on appeal or revision on account (a) of any error, omission or irregularity in the . . charge. or other proceedings before or during trial. . . . . . . . . unless such error, omission, irregularity has in fact occasioned a failure of justice".
The Explanation is also important: "In determining whether any error, omission or irregularity in any proceeding under this Code has occasioned a failure of justice, the Court shall have regard to the fact whether the objection could and should have been raised at an earlier stage in the proceedings".
This repeats what was set out in greater detail in section 225 and is all the more impressive because 1160 even when a death sentence is under review in confirmation proceedings under Chapter XXVII the Court is expressly directed not to regard any error, omission or irregularity in the charge as fatal unless it has in fact occasioned a failure of justice.
Reading these provisions as a whole, there is, in our opinion, no room left for doubt about what was intended.
It was argued on behalf of the appellant that these sections must be read along with sections 236, 237 and 238.
Counsel conceded that there are occasions when an accused person can be convicted in the absence of a charge but he said that they are expressly set out in sections 237 and 238 and he contended that no further departure is permissible.
He put his argument as follows.
He said that sections 237 and 238 deal with cases in which there is a charge to start with but none to support a conviction for an offence which the Court feels is made out by the evidence.
When section 535 is read along with these two sections it is seen that it cannot apply to a case in which there is no charge at all, nor can it apply to any case that is not covered by these two sections.
It is limited to cases in which sections 237 and 238 permit a conviction without a charge.
In answer to this the following argument was put to counsel and be was asked to meet it.
The point was put this way.
Section 535 cures convictions that would be invalid but for its provisions.
This, it was said, follows from the words "shall be deemed invalid".
It was suggested that these words show that a conviction without a charge is in truth and in fact invalid but that it can be cured in certain cases, and when that is done, that which in truth is invalid is deemed not to be invalid because of this section.
But as sections 237 and 238 expressly permit convictions in certain cases without a charge for those offences, provided there is a charge in the case to start with, the convictions so permitted cannot be invalid or even irregular because it would be wrong to say that that which the Code expressly allows is, or can be, 1161 irregular.
Therefore, section 535 cannot apply to cases covered by sections 237 and 238.
Counsel replied that even if that is so, section 535 is still governed by section 233 and so cannot apply to cases in which there is no charge at all.
We do not agree with either view.
In our opinion, the cases contemplated by section 237 are just as much a departure from section 233 as are those envisaged in sections 225, 226, 227, 228, 535 and 537 Sections 236, 237 and 238 deal with joinder of charges and so does section 233.
The first condition is that there shall be a separate charge for each offence and the second is that each charge must be tried separately except in the cases mentioned in sections 234, 235 and 236.
It is to be observed that the exceptions are confined to the rule about joinder of charges and that no exception is made to that part of the rule that requires separate charges for each offence.
It will be seen that though sections 234, 235 and 236 are expressly mentioned, section 237 is not referred to, nor is section 238.
Therefore, so far as section 233 is concerned, there can be no doubt that it requires a separate charge for each offence and does not envisage a situation in which there is either no charge at all or where, there being a charge for some other offence of which the accused is acquitted, he can be convicted instead of something else for which be was not charged.
What then is the position if there is some departure from the normal procedure? In our opinion, sections 225, 226) 227, 228, 535 and 537 furnish the answer and they apply with equal force to every kind of departure from that part of section 233 that requires a separate charge for each offence.
Section 237 is only a corollary to section 236 and is there to emphasise that even when a number of charges could be joined together in the cases set out in section 236 and one or more are not put in, oven then, there can be convictions in respect of those offences despite the 1162 absence of a charge or charges.
But all these sections are governed by the overriding rule about prejudice mentioned in one form or another in sections 225, 226, 227, 228, 535 and 537.
We can envisage cases where there would be grave prejudice under that section just as clearly as we can see cases where there would be none under the others.
The sort of problem that we are now examining can only arise when an express provision of the Code is violated and then the root of the matter is not whether there is violation of an express provision, for the problem postulates that there must be, nor is it whether the provision is expressed in positive or in negative terms, but what are the consequences of such disregard.
Does it result in an illegality that strikes at the root of the trial and cannot be cured or is it an irregularity that is curable? We have used the terms "illegality" and "irregularity" because they have acquired a technical significance and are convenient to demarcate a distinction between two classes of case.
They were first used by the Privy Council in N. A. Subramania Iyer vs KingEmperor(1) and repeated in Babulal Choukhani vs King Emperor(2 ) and in Pulukuri Kotayya vs King Emperor(3), but it is to be observed that the Code does not use the term "illegality".
It refers to both classes as "irregularities"; some vitiate the proceedings (section 530) and others do not (section 529).
Proceedings that come under the former head are "void".
Section 535 uses the words "shall be deemed invalid" which indicate that a total omission to frame a charge would render the conviction invalid but for section 535 which serves to validate it when that sort of "irregularity" has not occasioned a "failure of justice".
Section 537 does not use any of these expressions but merely says that no conviction or (1) [1901] L.R. 28 I.A. 257.
(2) [1938] L.R. 65 I.A. 158, 174.
(3) [1947] L.R. 74 I.A. 65,75.
1163 sentence "shall be reversed or altered" unless there has in fact been a failure of justice.
We do not attach any special significance to these terms.
They are convenient expressions to convey a thought and that is all.
The essence of the matter does not lie there.
It is embedded in broader considerations of justice that cannot be reduced to a set formula of words or rules.
It is a feeling, a way of thinking and of living that has been crystallized into judicial thought and is summed up in the admittedly vague and indefinite expression "natural justice": something that is incapable of being reduced to a set formula of words and yet which is easily recognisable by those steeped in judicial thought and tradition.
In the end, it all narrows down to this: some things are "illegal", that is to say, not curable, because the Code expressly makes them so; others are struck down by the good sense of judges who, whatever expressions they may use, do so because those things occasion prejudice and offend their sense of fair play and justice.
When so struck down, the conviction is "invalid"; when not, it is good whatever the "irregu larity".
It matters little whether this is called an "illegality", an "irregularity that cannot be cured" or an "invalidity", so long as the terms are used in a clearly defined sense.
Turning next to the second branch of the argument about section 535.
We cannot agree that because sections 237 and 238 expressly permit convictions without a charge in the cases contemplated by them, therefore they lift them out of the Chapter on Irregularities, because, if they do, then so does section 232 (1) in the cases with which it deals.
Between them, these sections cover every kind of case in which there is an error, omission or irregularity in a charge and an omission to frame a charge, so, if sections 232(1) and 237 and 238 save departures from section 233 from being irregularities, then there is nothing left for sections 535 and 537 to operate on.
In our opinion, the truth is that the Code deals with the same subject matter under different heads, so there is some overlapping.
147 1164 Sections 222 to 224 deal with the form of a charge and explain what a charge should contain.
Section, 225 deals with the effect of errors relating to a charge.
Sections 233 to 240 deal with the joinder of charges.
Sections 535 and 537 are in the Chapter that deals with irregularities generally and these two sections deal specifically with the charge and make it clear that an omission to frame a charge as well as irregularities, errors and omission in a charge are all irregularities that do not vitiate or invalidate a conviction unless there is prejudice.
But, apart from that, if we examine the learned counsel 's contention more closely the fallacy in his argument becomes clear.
Sections 237 and 238 deal with cases in which there is a charge to start with and then they go on to say that in certain cases the trial can proceed beyond the matter actually charged and a conviction for an offence disclosed in the evidence in that type of case will be good despite the absence of a charge in respect of it.
But what are those cases? Only those in which the additional charge or charges could have been framed from the start; and that is controlled by sections 234, 235 and 239 which set out the rules about joinder of charges and persons.
It is evident that if charges A and B cannot be tried together because of the prohibition in section 233 read with sections 234, 235 and 239, then no conviction could be sustained on either A or B, and if that is the case when specific charges are drawn up it is all the more so when though there is a charge in respect of A there is none in respect of B, for clearly you cannot do indirectly that which you are prohibited from doing directly.
In our opinion sections 233 to 240 deal with joinder of charges and they must be read together and not in isolation.
They all deal with the same subject matter and set out different aspects of it.
When they are read as a whole, it becomes clear that sections 237 and 238 cover every type of case in which a conviction can be sustained when there is no charge for that offence provided there is a charge to start with.
1165 They do not deal with a case in which there is no charge at all, and anything travelling beyond that when there is a charge would be hit by sections 233,234, 235 and 239 read as a whole, for the reasons we have just given.
But if that is so, and if section 535 is excluded where sections 237 and 238 apply, then what is there left for it to operate on except cases in which there is a total omission to frame a charge? We do not think these sections should be regarded disjunctively.
In our opinion, they between them (including sections 535 and 537) cover every possible case that relates to the charge and they place all failures to observe the rules about the charge in the category of curable irregularities.
Chapter XIX deals comprehensively with charges and sections 535 and 537 cover every case in which there is a departure from the rules set out in that Chapter.
Such departures range from errors, omissions and irregularities ' in charges that are framed, down to charges that might have been framed and were not and include a total omission to frame a charge at all at any stage of the trial.
In all these cases the only question is about prejudice.
We say this because the Code repeatedly says so in express and emphatic terms and because that is the foundation on which rules of procedure are based.
We say it because that accords with logic and principle and reason and because it touches the deep verities on which the structure of justice is erected and maintained.
That would necessitate reading into the section words that are not there.
We see no reason for straining at the mean ing of these plain and emphatic provisions unless ritual and form are to be regarded as of the essence in criminal trials.
We are unable to find any magic or charm in the ritual of a charge.
It is the substance of these provisions that count and not their outward 1166 form.
To hold otherwise is only to provide avenues of escape for the guilty and afford no protection to the innocent.
We agree that a man must know what offence he is being tried for and that he must be told in clear and unambiguous terms and that it must all be "explained to him " so that he really understands (section 271(1) in sessions trials, section 255(1) in warrant cases) but to say that a technical jargon of words whose significance no man not trained to the law can grasp or follow affords him greater protection or assistance than the informing and the explain ing that are the substance of the matter, is to base on fanciful theory wholly divorced from practical reality; and the same applies to the vast bulk of jurors who attend our courts.
They are none the wiser because of a formal charge except in a vague and general way that is of no practical account.
The essence of the matter is not a technical formula of words but the reality.
Was he told? Was it explained to him? Did he understand? Was it done in a fair way? We attach equal importance to other sections of the Code that are just as emphatic as section 233, namely, sections 342 and 364; and yet no one doubts that irregularities there are curable.
It is the spirit of section 271 that must be observed in a sessions trial rather than its letter and the essence of that lies in the words "and explained to him".
We do not mean to imply that laxness of procedure should be encouraged in the matter of the charge any more than this Court encourages it in matters relating to section 342; nor do we mean to suggest that a trial can be regarded as good when the accused does not know what be is being tried for and is not told and the matter is not explained to him as section 271 requires.
Of course, the rules should and ought to be punctually observed.
But judges and magistrates are fallible and make mistakes and the question is what is to be done in the exceptional class of case in which there has been a disregard of some express provision.
As an illustration, we give a case in which a Sessions Judge in a sessions trial having no charge 1167 before him from the committal court omits to frame one himself but instead, carefully and painstakingly, explains the particulars and the substance of the offence as in section 242 and complies with the spirit and object of section 271 but omits to observe its technical form.
Then, when the witnesses are examined, the accused shows by his cross examination that he knows just what he is being tried for.
He is examined fully and fairly under section 342 and his answers show that he is under no delusion.
He calls witnesses in defence to meet the very point or points the prosecution seek to make out against him.
He puts in a written statement and is defended by an able lawyer who raises no objection from start to finish.
Will a technical defect in a case like that vitiate the trial? If the Code says Yes, then there is an end of the matter.
We have put a case in which there neither is, nor can be, prejudice.
Surely it would be a travesty of justice to brand a conviction in a case like that as illegal.
And yet that must be done if these words that are otherwise plain are construed in a strained and unnatural manner.
On the other hand, there is nothing in the view we take to imperil or harass an accused however innocent he may be.
How does the technical formula of a charge afford greater protection than the "explaining" under section 271 (1) and the examination under section 342? And yet, on the argument before us, an omission to observe these other rules that are of the substance is curable when there is no prejudice but not the sacred ritual of the framing of the charge; once that is there, the accused cannot be heard to say that be did not understand however much that may be the fact.
Surely, this cannot be right.
Now, as we have said, sections 225, 232, 535 and 537(a) between them, cover every conceivable typo, of error and irregularity referable to a charge that 1168 can possibly arise, ranging from cases in which there is a conviction with no charge at all from start to finish down to cases in which there is a charge but with errors, irregularities and omissions in it.
The Code is emphatic that whatever the irregularity it is not to be regarded as fatal unless there is prejudice.
It is the substance that we must seek.
Courts have to administer justice and justice includes the punishment of guilt just as much as the protection of innocence.
Neither can be done if the shadow is mistaken for the substance and the goal is lost in a labyrinth of unsubstantial technicalities.
Broad vision is required, a nice balancing of the rights of the State and the protection of society in general against protection from harassment to the individual and the risks of unjust conviction.
Every reasonable presumption must be made infavour of an accused person; he must be given the benefit of every reasonable doubt.
The same broad principles of justice and fair play must be brought to bear when determining a matter of prejudice as in adjudging guilt.
But when all is said and done, what we are concerned to see is whether the accused bad a fair trial, whether he knew what be was being tried for, whether the main facts sought to be established against him were explained to him fairly and clearly and whether he was given a full and fair chance to defend himself.
If all these elements are there and no prejudice is shown the conviction must stand whatever the irregularities whether traceable to the charge or to a want of one.
If it was not, and particularly where the accused is defended by counsel [Atta Mohammad vs King Emperor(1)], it may in a given case be proper to conclude that the accused was satisfied and knew just what he was being tried for and knew what was being alleged against him and wanted no further particulars, provided it is always borne in mind that "no serious defect in the mode of conducting a criminal trial can be justified or cured by the consent of the advocate of the accused" [Abdul Rahman vs King Emperor(2)].
But these are matters of fact which will be special to each different case and no conclusion on these questions of fact in any one case can ever be regarded as a precedent or a guide for a conclusion of fact in another, because the facts can never be alike in any two cases however alike they may seem.
There is no such thing as a judicial precedent on facts though counsel, and even judges, are sometimes prone to argue and to act as if there were.
Endeavour was made in the argument to draw a distinction between cases falling under section 34 of the Indian Penal Code and those under section 149 of the Indian Penal Code.
This is not a case under section 149 of the Indian Penal Code so the question does not really arise but it is necessary to advert to the argument because, on the view we take of sections 225, 535 and 537, it is immaterial what the offence is and whether there is a charge at all.
The only question is whether the irregularity occasioned prejudice.
We now turn to an examination of the cases of this Court that are said to give rise to a conflict of view.
In our opinion, there is in reality no conflict and (1) [1929] L.R. 57 I.A. 71, 74.
(2) [1926] L.R. 54 I.A. 96,104, 110.
1170 though the language used in one case might suggest that, a close consideration of its reasons will disclose that there was in fact no difference of view in the type of case where there is a charge to start with.
None of the cases deals with the position where there is no charge at all.
The following cases afford no difficulty because they directly accord with the view we have set out at length above.
In Lachman Singh vs The State(1) it was held that when there is a charge under section 302 of the Indian Penal Code read with section 149 and the charge under section 149 disappears because of the acquittal of some of the accused, a conviction under section 302 of the Indian Penal Code read with section 34 is good even though there is no separate charge under section 302 read with section 34, provided the accused could have been so charged on the facts of the case.
The decision in Karnail Singh vs The State of Punjab(2) is to the same effect and the question about prejudice was also considered.
Pandurang, Tukia and Bhillia vs State of Hyderabad(3) also presents no difficulty because though the point was taken in that case it was expressly left open at page 1093.
From there we come to Suraj Pal vs The, State of U.P. (4).
That was a case in which a number of accused were charged under sections 307/149 and sections 302/149 of the Indian Penal Code.
It was found that there was no common object to kill, so all the accused were acquitted under section 149.
But the evidence disclosed that the appellant had himself made an attempt on the life of one man and had himself shot another dead.
Accordingly the High Court convicted him under sections 307 and 302 of the Indian Penal Code respectively, though there was no separate charge under either of those sections.
Those convictions were challenged here.
The learned Judges then (1)[1952] S.C.R. 839, 848.
(2)[1954] S.C.R. 904,911 (3) ; (4)[1955] I.S.C.R, 1332 1171 proceeded to determine the question of prejudice on the facts of that case.
The conclusion reached on the facts was that prejudice was disclosed, so an acquittal was ordered.
It was argued before us that the ground of the decision there was that the absence of charges under sections 307 and 302 simpliciter was in itself conclusive to establish prejudice and that therefore one need go no further.
It is enough to say that that was not the decision and though that was one of the matters taken into consideration, the conclusion was based on a careful and lengthy investigation of all the facts in the case including the way in which it was conducted, the evidence of several witnesses, the medical evidence, the first information report and certain documents including two filed by the accused.
Next comes Nanak Chand vs The, State of Punjab(1).
That was also a case in which the charge was under section 302/149 of the Indian Penal Code with the conviction under section 302 simpliciter without any separate charge under that section.
The Sessions Judge had convicted under section 302/34 of the Indian Penal Code holding that the charge of rioting was not proved.
The High Court held that no common intention was proved either but as the evidence indicated that the appellant had done the actual killing he was convicted under section 302.
It was found that the appellant there was in fact misled in his defence and one of the factors taken into consideration, as indeed must always be the case, was that when he was told that he was to be tried under section 302 read with section 149 of the Indian Penal Code that indicated to him that he was not being tried for a murder committed by him personally but that he was only being (1) [1955] I S.C.R. 1201.
148 1172 made vicariously liable for an act that another had done in prosecution of the common object of an unlawful assembly of which he was a member.
But that was only one of the matters considered and it does not follow that every accused will be so misled.
It all depends on the circumstances.
The entire evidence and facts on which the learned Judges founded are not set out in the judgment but there is enough to indicate that had the appellant 's attention been drawn to his own part in the actual killing he would probably have cross examined the doctor with more care and there was enough in the medical evidence to show that had that been done the appellant might well have been exonerated.
As judges of fact they were entitled, and indeed bound, to give the accused the benefit of every reasonable doubt and so were justified in reaching their conclusion on the facts of that case.
Illustrations (c) and (e) to section 225 of the Criminal Procedure Code show that what the accused did or omitted to do in defence are relevant on the question of prejudice.
That, however, was, and remains, a pure conclusion of fact resting on the evidence and circumstances of that particular case.
The decision was special to the facts of that case and no decision on facts can ever be used as a guide for a conclusion on facts in another case.
Now having reached the conclusion that there was prejudice, the learned Judges were of the opinion that the irregularity, if it can be so called when prejudice is disclosed was incurable and from that they concluded that an incurable irregularity is nothing but an illegality: a perfectly possible and logical conclusion when the words "irregularity" and "illegality" are not defined.
and it can well be argued from this that this indicates 1173 that an omission to follow the provisions of the Code does in truth and in fact render the decision invalid but because of section 535 that which is in truth and in fact invalid must be deemed to be valid unless prejudice is disclosed.
As there was prejudice in that case, the decision was invalid and being invalid it was illegal.
We do not say that that is necessarily so but it is a reasonably plausible conclusion and was what the learned Judges had in mind.
It is to be.
observed that section 535 of the Code is mandatory in its terms, just as mandatory as section 233.
If it be accepted that an absence of a charge would, but for its provisions, render a conviction invalid, this section cures such an invalidity when there is in fact, not in theory but in fact, no failure of justice.
The section is just as mandatory as section 233 and we can see no justification for giving it less weight than section 237.
If section 237 validates a departure from section 233 and saves it from the stigma of an irregularity, then so does section 535, for it says very expressly that no conviction shall be deemed invalid merely on the ground that no charge was framed unless that in fact occasioned a failure of justice; and if section 535 is held not to apply to cases covered by sections 237 and 238, then it must apply to cases that lie outside the scope of those ' sections and the only kind of case left is a case in which there is a total absence of a charge, for any other type of case would be excluded because of misjoinder.
If section 233 is mandatory, that part of it which prohibits misjoinder except in the cases mentioned in sections 234, 235) 236 and 239 is just as mandatory as the portion that requires a separate charge for each offence.
It is unfortunate that we have no definition of the terms "illegality", "irregularity" and "in .
validity" because they can be used in differing senses, but however that may be, the decision we are now examining and the remarks made in that case must be read in the light of this background.
We agree that some of the expressions used in the judgment appear to travel wider than this but in order to dispel misconception we would now hold that the 1174 true view is the one we have propounded at length in the, present judgment.
We now turn to the question of fact: is there material in this case to justify a finding of prejudice? that will turn largely on the differences between section 302 of the Indian Penal Code and section 302 read with section 34 of the Indian Penal Code and on the measure of criminal liability to which the appellant would be exposed in those two cases; and here again, the matter must be viewed broadly and not in any technical or pettifogging way.
Now what is an accused person entitled to know from the charge and in what way does the charge in this case fall short of that? All he is entitled to get from the charge is (1) the offence with which he is charged, section 221(1),Criminal Procedure Code, (2) the law and, section of the law against which the offence is said to have been committed, section 221(4), (3) particulars of the time, section 222(1) and (4) of the place, section 222(1), and (5) of the person against whom the offence is said to have been committed, section 222(1), and (6) when the nature of the case is such that those particulars do not give him sufficient notice of the matter with which he is charged, such particulars of the manner in which the alleged offence was committed as will be sufficient for that purpose, section 223.
He is not entitled to any further information in the charge: see Illustration (e) to section 223 of the Code: "A is accused of the murder of B at a given time and place.
The charge need not state the manner in which A murdered B".
It is clear from this that when the case is one of murder, the accused is not entitled to be told in the charge how it was committed, whether with a pistol or a lathi or a sword.
He is not entitled to know from the charge simpliciter any further circumstance.
How then is he expected to defend himself? He has the police challan, he has the evidence recorded in the 1175 Committal Court, he hears the prosecution witnesses and he is examined under section 342 of the Code.
It is these proceedings that furnish him with all the necessary, and indeed vital, information, and it is his duty to look into them and defend himself.
Now when several persons join in the commission of a crime and share a common intention, it means that each has the requisite intention in himself; the fact that others share it does not absolve any one of them individually, and when the crime is actually committed in pursuance of the common intention and the accused is present at its commission, the crime becomes the offence actually committed because of section 114 of the Indian Penal Code.
Section 114 does not create the offence nor does section 34.
These sections enunciate a principle of criminal liability.
Therefore, in such cases all that the charge need set out is the offence of murder punishable under section 302 of the Indian Penal Code committed by the accused with another and the accused is left to gather the details of the occurrence as alleged by the prosecution from other sources.
The fact that be is told that he is charged with murder committed by himself with another imports that every legal condition required by law to constitute the offence of murder committed in this way was fulfilled: section 221(5) of the Criminal Procedure Code.
Now what are those legal conditions? What is the effect of charging two persons with a murder committed in pursuance of a common intention? It means that the accused is unmistakably told that be participated in the crime; exactly how is no more a matter for the charge than it is to set out the circumstances in which the murder was committed.
It also means that he is informed that it is immaterial who struck the fatal blow.
The charges here against the appel 1176 lant and his brother Ronnie are identical. 'As there was only one fatal blow and as only one person could have inflicted it and as both are charged in this way, it can only mean that each is put on his guard and made to realise that the prosecution allege that one of the two was responsible for that and which must be discovered from the evidence and not from the charge, just as surely as it must when the question turns on who possessed or used a pistol and who a sword.
It is true that if it cannot be ascertained who struck the fatal blow, then the accused cannot be convicted unless the common intention is proved and in that type of case an acquittal of the co accused may be fatal to the prosecution.
But the converse does not hold good, and if the part that the accused played can be clearly brought home to him and if it is sufficient to convict him of murder simpliciter he cannot escape liability because of the charge unless he can show prejudice.
Put at its highest, all that the appellant can urge is that a charge in the alternative ought to have been framed, which in itself imports that it could have been so framed.
That is what happened here.
They were not charged with that formally, but they were tried on evidence which brings the case under section 237"(1).
The variation between murder and concealing evidence after the crime is no more than the variation between killing a man jointly with another, sharing his intention, or allowing the other to do the actual killing with the same common intention.
Now what do the proceedings in this case show? The police charge sheet states that the appellant hit the deceased with a hockey stick while his brother (1) Lah. 226, 231.
(2) ; , 848.
1177 only threw stones.
From there we go to his examination under section 342 of the Criminal Procedure Code in the Committal Court.
He is specifically told that the only eye witness in the case accuses him and not his brother of having hit the deceased over the head with a hockey stick.
No one could misunderstand that.
In the Sessions Court we find the same evidence repeated.
No witness suggests that anyone else hit the deceased on the head.
There was no pos sibility of misunderstanding or mistake.
The fact that the appellant did not attempt to confront any of the witnesses with their statements before either the Committing Magistrate or the police on this point shows that the witnesses told a consistent story from the start.
Next, the appellant was examined under section 342 in the Sessions Court and was asked the same questions and was confronted in his examination with the same eye witness.
He was told clearly and unambiguously that the evidence was that he hit the deceased over the head.
Now what was his defence? A curious procedure was adopted, a procedure that has been condemned by the Nagpur High Court in other cases and which we regret to see still persists.
Instead of the accused speaking for himself he made a statement through his advocate.
However, the defence was this: (1) an alibi: "I wasn 't there".
(2) It was dark and the deceased rushed at the appellant (who is now said to have been there despite the alibi), fell down the stairs and broke his head; (3) The deceased was the aggressor and the appellant struck him in self defence.
There is no suggestion here that the other accused hit the deceased or that anyone other than the appellant did.
The appellant places it beyond doubt that he knew that the case against him was that he is said to have struck the fatal blow.
Next, what was the cross examination of the only eye witness? There was no suggestion that she was mistaken in her identity, whereas she was crossexamined about this very matter of self defence and questions were put to show that the deceased 1178 and not his brother had threatened the appellant with his fist.
In the High Court the plea of alibi was dropped and the only argument advanced was self defence.
There was no hint of prejudice even in the grounds of appeal.
There was no pretence in the arguments that the appellant did not know he was being accused of having hit the deceased.
On the contrary, there was a clear admission in the High Court that he did hit the man but that he acted in self defence.
As the appellant knew that the case against him was that he is the one who is said to have struck the fatal blow, and as he was told in the charge that the offence he is said to have committed was that of murder and was informed of the date and place and person, we find it impossible to infer prejudice.
As the Privy Council said in Atta Mohammad vs Emperor(1) I "He appeared by an advocate on the appeal and had been legally defended at the trial, and it is as clear as possible that, with full knowledge of the course which the trial had taken, neither the appellant himself nor those who represented him bad any sense whatever of the injustice that is now urged or any idea of his having been deprived of the opportunity of knowing the charge on which he was tried or of raising defences appropriate to that charge".
We would hold that there was no prejudice and that the conviction is not invalid because of the nature of the charge.
We now come to the merits, and the question is whether this is a case under section 302 or under the second part of section 304 of the Indian Penal Code.
The injury was inflicted with a hockey stick.
The head was fractured but the deceased lived for ten days.
Therefore, the doctor in whose care the patient was (1) [1929] L.R. 57 I.A. 71, 74. 1179 till he died places the injury no higher than "likely" to cause death.
The learned Sessions Judge exonerated the appellant of any intention to kill and the learned High Court Judges say that they agree with his findings.
If there was no intention to kill, then it can be murder only if (1) the accused knew that the injury inflicted would be likely to cause death or (2) that it would be sufficient in the ordinary course of nature to cause death or (3) that the accused knew that the act must in all probability cause death.
If the case cannot be placed as high as that and the act is only likely to cause death and there is no special knowledge, the offence comes under the second part of section 304 of the Indian Penal Code.
The doctor thought that it was only likely to cause death.
All blows on the head do not necessarily cause death, and as the deceased lived for ten days, we are unable to deduce from the nature of the injury and from the mere fact of death that the appellant had, or should have had, the special knowledge that section 300 of the Indian Penal Code requires.
Admittedly, there was no premeditation and there was a sudden fight, so we are unable to ascribe the necessary knowledge to the appellant; nor was the injury sufficient in the ordinary course of nature to cause death.
So the offence falls under the second part of section 304 of the Indian Penal Code.
On the question of sentence.
There was no enmity according to the finding of the learned Sessions Judge.
The appellant did not go there armed with a stick.
He was in love with the deceased 's sister who reciprocated his affection but could not marry him be cause her husband had turned her out in England ,and she had no divorce.
The deceased, who was the girl 's brother, resented this.
The appellant went to the house and asked the sister to come down.
The 1180 brother came instead and there was a quarrel.
The appellant slapped the deceased across the face.
The deceased, who was a big and strong man, shook his fist in the appellant 's face and the appellant snatched a hockey stick from his younger brother Ronnie and hit the deceased one blow over the bead and two blows on the hips.
In the circumstances, we think five years ' rigorous imprisonment will suffice.
This appeal comes before us on a reference owing to a conflict between two decisions of this Court, Nanak Chand vs The State of Punjab(1) and Suraj Pal vs The State of U. P. (2).
Where there is a charge against an accused under section 302, read with section 149, if section 149 of the Indian Penal Code is inapplicable to the facts, can the accused be convicted under section 302 without a separate charge?
In the first case, it was held that the omission to have a specific charge under section 302 amounted to an illegality.
Section 149 creates a specific offence and without applying its provisions a member of an unlawful assembly could not be made liable for the offence committed not by him but by another member of that assembly.
Therefore the case is not similar to the one where there is a charge under section 302, read with section 34 of the Indian Penal Code.
When section 149 is ruled out, the liability for murder ceases to be constructive; it becomes direct and there must be a separate charge therefor under section 302 of the Indian Penal Code.
This was the line of reasoning in Nanak Chand 's case.
In Suraj Pal 's case, the same line is taken but the absence of a specific charge (1) ; (2) ; 1181 is treated as a serious lacuna merely; and not regarded as an illegality.
This conflict does not arise in the case before us where the offence charged against two brothers, William and Ronnie for the murder of Donald was under section 302, read with section 34 of the Indian Penal Code.
Ronnie was acquitted.
But William was found guilty and sentenced to transportation for life.
As pointed out by Lord Sumner in his classic judgment in Barendra Kumar Ghosh vs The King Emperor(1), there is much difference in the scope and applicability of sections 34 and 149, though they have some resemblance and are to some extent overlapping.
The two sections are again compared and contrasted in Karnail Singh and another vs The State of Punjab(2).
Section 34 does not by itself create any offence, whereas it has been held that section 149 does.
In a charge under section 34, there is active participation in the commission of the criminal act; under section 149, the liability arises by reason of 'the membership of the unlawful assembly with a common object, and there may be no active participation at all in the perpetration or commission of the crime.
The overlapping arises in those cases where two or more persons commit a murder in furtherance of the common intention, but it is not possible to say which of them was responsible for the fatal injury, or whether any one injury by itself was responsible for the death.
There may also be a case where it is known that out of the assailants one in particular was responsible for the fatal injury and the others are sought to be made liable for the result owing to the common intention involved.
It is, however, necessary having regard to the (1) [1924] L.R. 52 I.A. 40.
(2) 1182 lengthy arguments addressed to us, to consider the main question arising on the reference.
Though the two cases which gave rise to this reference were cases relating to section 149 of the Indian Penal Code and not to section 34 of the Indian Penal Code, as the Present case is, the order of reference was occasioned by the fact that in Nanak Chand 's case it was stated specifically that the parallel case under section 34 also stood on the same footing.
In our attempt to resolve the conflict, we covered a wide area of sections and decisions.
A detailed discussion of all the decisions cited at the Bar is not of much use as it is not possible to gather from a study of those cases anything very decisive by way of any guiding principle.
But a few of them, more important than the rest, must be noticed.
The Criminal Procedure Code does not use the word "illegality".
Even defects or violations that vitiate the proceedings and render them void are spoken of only as irregularities in section 530.
The word illegality was used almost for the first time in the judgment of the Privy Council, L.R. 28 Indian Appeals 257 (familiarly known as Subramania Aiyar 's case), where they speak of a contravention of section 234 of the Code, resulting in a misjoinder of charges, as an illegality.
The idea that it was a mere irregularity was repelled in these words: "Their Lordships are unable to regard the disobedience to an express provision as to a mode of trial as a mere irregularity.
Such a phrase as irregularity is not appropriate to the illegality of trying an accused person for many different offences at the same time, and those offences being spread over a longer period than by law could have been joined together in one indictment.
The illustration of the section itself sufficiently shows what was meant".
Again, they say: ". . it would be an extraordinary extension of such a branch of administering the criminal law to say that when the Code positively enacts that such a trial as that which has taken place here shall not be permitted that this contravention of the Code comes 1183 within the description of error, omission, or irregu larity".
Subsequently, however, there have been systematic attempts to explain away the said decision and restrict its scope to narrow limits.
This was possibly because it was realised even by the Judicial Committee itself that the view taken by them to the effect that a violation of the mandatory provisions of the Code would be an illegality was rather an extreme one.
It may be pointed out that even in that case the question of prejudice was not entirely absent from their Lordships ' minds.
Both sides referred to it in the course of the arguments, and the Lord Chancellor alludes to the prejudice inherent in the trial on a multitude of charges.
The exact effect of this inclusion may require consideration in an appropriate case.
Before dealing with the other relevant sections of the Code, let us examine some of the later decisions of the Privy Council which seem to indicate a swing of the pendulum to the other side.
In Abdul Rahman vs The King Emperor(1), there was a violation of section 360 of the Code which provides that the deposition of each witness shall be read over to him in the presence of the accused or his pleader.
The High Court held that this was a mere irregularity, and confirmed the conviction as no failure of justice had resulted.
It was contended on appeal before the Privy Council that the section was obligatory, and that non compliance with such a mandatory provision was illegal, on the principle laid down in Subramania Aiyar 's case(2).
But their Lordships rejected this contention pointing out that in the earlier case the procedure adopted was one which the Code positively prohibited, and it was possible that it might have worked actual injustice to the accused; and they confirmed the conviction.
The question was again raised in Babulal Choukhani vs The King Emperor(3) (1) [1926] L.R. 54 I.A. 96.
(2) [1901] L.R. 28 I.A. 257.
(3) [1938] 65 I.A. 158.
1184 as to what would be an illegality as distinguished from an irregularity.
Lord Wright who delivered the judgment of the Board assumed that an infringement of section 239(b) of the Code would be an illegality, and proceeded to state that the question did not, however, arise, and it was hence unnecessary to discuss the precise scope of what was decided in Subramania Aiyar 's case(1).
The matter cropped up once again in Pulukuri Kotayya and others vs KingEmperor (2) where there was a breach of the statutory requirement found in section 162 of the Code, inasmuch as the accused were not supplied with copies of the statements first recorded by a police officer for cross examining the prosecution witnesses.
The defect was recognized to be a matter of gravity, and if the statements bad been completely destroyed, or if there had been a total refusal to supply copies to the accused, the convictions were liable to be quashed.
But in the case before them, as the statements were made available, though too late to be effective, and the Circle Inspector 's notes of the examination of witnesses were put into the hands of the accused, it was taken to be an irregularity merely.
Referring to the contention that the breach of a direct and important provision of the Code cannot be cured but must lead to the quashing of the conviction, Sir John Beaumont observed: ". .
In their Lordships ' opinion, this argument is based on too narrow a view of the operation of section 537.
When a trial is conducted in a manner different from that prescribed by the Code (as in N. A. Subramania Iyer 's case(1)), the trial is bad, and no question of curing an irregularity arises; but if the trial is conducted substantially in the manner prescribed by the Code, but some irregularity occurs in the course of such conduct, the irregularity can be cured under section 537, and nonetheless so because the irregularity involves, as must nearly always be the case, a breach of one or more of the very comprehen sive provisions of the Code.
The distinction drawn in many of the cases in India between an illegality and (1) [1901] L. R. 28 I.A. 257.
(2) [1947] L.R. 74 I.A. 65. 1185 ail irregularity is one of degree rather than of kind.
This view finds support in the decision of their Lordships ' Board in Abdul Rahman vs The King Emperor (1) where failure to comply with section 360 of the Code of Criminal Procedure was held to be cured by sections 535 and 537.
The present case falls under section 537, and their Lordships hold the trial valid notwithstanding the breach of section 162".
Of course, lack of competency of jurisdiction, absence of a complaint by the proper person or authority specified, want of sanction prescribed as a condition precedent for a prosecution, in short, defects that strike at the very root of jurisdiction stand on a separate footing, and the proceedings taken in disregard or disobedience would be illegal.
The difficulty arises only when we have to consider the other provisions in the Code Which regulate procedure and which are found in a mendatory form, positive or negative.
It is in this class of cases that the distinction becomes important and material.
The scope of the decision in Subramania Aiyar 's case(2) has ' become so circumscribed that it is dobutful if it applies to the generality of cases of omissions and defects that come before the courts, excepting where they bring about the result that the trial was conducted in a manner different from that prescribed by the Code.
Let us now turn our attention to the relevant sections of the Code bearing on the requirement of a charge, the omission of a charge and the effect thereof.
Section 233 provides as follows: "For every distinct offence of which any person is accused there shall be a separate charge, and every such charge shall be tried separately, except in the cases mentioned in sections 234, 235, 236 and 239".
A power to alter or add to a charge, at any time before judgment is pronounced, is conferred on a court under section 227.
Sections 228 to 231 provide for the steps to be taken consequent on such alteration.
Section 225 shows what would be the effect of any errors in the framing of a charge.
It runs as follows: (1) [1926] L.R. 51 I.A. 96.
(2) [1901] L.R. 28 I.A. 257.
1186 "No error in stating either the offence or the particulars required to be stated in the charge, and no omission to state the offence or those particulars, shall be regarded at any stage of the case as material, unless the accused was in fact misled by such error or omission, and it has occasioned a failure of justice".
Section 232(1) of the Code of Criminal Procedure refers more specifically to the effect of such error where an appellate Court or the High Court in revision or in confirmation proceedings, notices such an error and is in the following terms: "If any Appellate Court, or the High Court in the exercise of its powers of revision or of its powers under Chapter XXVII, is of opinion that any person convicted of an offence was misled in defence by the absence of a charge or by an error in the charge, it shall direct a new trial to be had upon a charge framed in whatever manner it thinks fit".
Then we have section 237, dealing with a case where an accused charged with one offence for which he might have been charged under the provisions of section 236 could be convicted of a different offence.
This applies only to cases where it is doubtful which of several offences the facts which can be proved will constitute.
Begu 's case(1) is an example; the conviction was under section 201 of the Indian Penal Code for causing the disappearance of evidence relating to a murder, though the charge was under section 302 of the Indian Penal Code.
Viscount Haldane observes: ".
A man may be convicted of an offence, although there has been no charge in respect of it, if the evidence is such as to establish a charge that might have been made.
That is what happened here.
The three men who were sentenced to rigorous imprisonment were convicted of making away with the evidence of the crime by assisting in taking away the body.
They were not charged with that formally, but they were tried on evidence which brings the case under section 237".
(1) 11925] L.R. 52 I.A. 191.
1187 Finally, we come to sections 535 and 537 of the Code.
The former is in these terms: " (1) No finding or sentence pronounced or passed shall be deemed invalid merely on the ground that no charge was framed, unless, in the opinion of the Court of appeal or revision, a failure of justice has in fact been occasioned thereby.
(2) If the Court of appeal or revision thinks that a failure of justice has been occasioned by an omission to frame a charge, it shall order that a charge be framed, and that the trial be recommenced from the point immediately after the framing of the charge".
The latter runs thus: "Subject to the provisions hereinbefore contained, no finding, sentence or order passed by a Court of competent Jurisdiction shall be reversed or altered under Chapter XXVII or on appeal or revision on account (a) of any error, omission or irregularity in the complaint, summons, warrant, charge, proclamation, order, judgment or other proceedings before or during trial or in any inquiry or other proceedings under this Code, or (b). . . . . . (c) of the omission to revise any list of jurors or assessors in accordance with section 324, or (d) of any misdirection in any charge to a jury, unless such error, omission, irregularity or misdirection has in fact occasioned a failure of justice".
A case of complete absence of a charge is covered by section 535, whereas an error or omission in a charge is dealt with by section 537.
The consequences seem to be slightly different.
Where there is no charge, it is for the court to determine whether there is any failure of justice.
But in the latter, where there is mere error or omission in the charge, the court is also bound to have regard to the fact whether the objection could and should have been raised at an earlier stage in the proceedings.
The sections referred to indicate that in the generality of cases the omission to frame a charge is 150 1188 not per se fatal.
We are unable, therefore, to accept as sound the very broad proposition advanced for the appellants by Mr. Umrigar that where there is no charge, the conviction would be illegal, prejudice or no prejudice.
On the other hand, it is suggested that the wording of section 535 of the Code of Criminal Procedure is sufficiently wide to cover every case of 'no charge '.
It is said that it applies also to the case of a trial in which there has been no charge of any kind even from the very outset.
We are unable to agree that section 535 of the Code of Criminal Procedure is to be construed in such an unlimited sense.
It may be noticed that this group of sections relating to absence of a charge, namely, sections 225, 226 and 232 and the powers exercisable thereunder ' are with reference to a trial which has already commenced or taken place.
They would, therefore, normally relate to errors or omissions which occur in a trial that has validly commenced.
There may be cases where, a trial which proceeds without any kind of charge at the outset can be said to be a trial wholly contrary to what is prescribed by the Code.
By way of illustration the following classes of cases may be mentioned: (a) Where there is no charge at all as required by the Code from start to finish from the Committing Magistrate 's court to the end of the Sessions trial; the Code contemplates in section 226 the possibility of a committal without any charge and it is not impossible to conceive of an extreme case where the Sessions trial also proceeds without any formal charge which has to be in writing and read out and explained to the accused (section 210(2) and section 251 (A) (4) and section 227).
The Code requires that there should be a charge and it should be in writing.
A deliberate breach of this basic requirement cannot be cured by the assertion that everything was orally explained to the accused and the assessors or jurors, and there was 1189 no possible or probable prejudice.
(b) Where the conviction is for a totally different offence from the one charged and not covered by sections 236 and 237 of the Code.
On a charge for a minor offence, there can be no conviction for a major offence, e.g., grievous hurt or rioting and murder.
The omission to frame a separate and specific charge in such cases will be an incurable irregularity amounting to an illegality.
Sections 34, 114 and 149 of the Indian Penal Code provide for criminal liability viewed from different angles as regards actual participants, accessories and men actuated by a common object or a common intention; and the charge is a rolled up one, involving the direct liability and the constructive liability without specifying who are directly liable and who are sought to be made constructively liable.
In most of the cases of this kind, evidence is normally given from the outset as to who was primarily responsible for the act which brought about the offence and such evidence is of course relevant.
After all, in our considering whether the defect is illegal or merely irregular, we shall have to take into account several factors, such as the form and the language of the mandatory provisions, the scheme and the object to be achieved, the nature of the violation, etc.
Dealing with the question whether a provision in a statute is mandatory or directory, Lord Penzance observed in Howard vs Bodington(1).
"There may be many provisions in Acts of Parliament which, although they are not strictly obeyed, yet do not appear to the court to be of that material importance to the subject matter to which they refer, as that the legislature could have intended that the non observance of them should be followed by a total failure of the whole proceedings.
On the other hand, there are (1) 1190 some provisions in respect of which the court would take an opposite view, and would feel that they are matters which must be strictly obeyed, otherwise the whole proceedings that subsequently follow must come to an end".
These words can be applied mutatis mutandis to cases where there is no charge at all.
The gravity of the defect will have to be considered to determine if it falls within one class or the other.
Is it a mere unimportant mistake in procedure or is it substantial and vital? The answer will depend largely on the facts and circumstances of each case.
If it is so grave that prejudice will necessarily be implied or imported, it may be described as an illegality.
If the seriousness of the omission is of a lesser degree, it will be an irregularity and prejudice by way of failure of justice will have to be established.
This judgment should not be understood by the subordinate courts as sanctioning a deliberate disobedience to the mandatory requirements of the Code, or as giving any license to proceed with trials without an appropriate charge.
The omission to frame a charge is a grave defect and should be vigilantly guarded against.
In some cases, it may be so serious that by itself it would vitiate a trial and render it illegal, prejudice to the accused being taken for granted.
Coming now to the facts of the present case; William was on terms of intimacy with Beryl P.W. 13.
She was the sister of Donald Smythe.
The accused was practically living with her in her house.
The brother did not like their intimacy and was making attempts to separate Beryl from the accused.
On the evening of the day of the occurrence, Donald and his mother went to Beryl 's house, There was a quarrel 1191 between them and the accused was asked to get away.
She did not come but Donald came down into the courtyard.
There was a heated exchange of words.
The accused slapped Donald on the cheek.
Donald lifted his fist.
The accused gave one blow on his head with a hockey stick with the result that his skull was fractured.
Donald died in the hospital ten days later.
A plea of alibi was given up in the High Court.
The suggestion that Donald fell down and sustained the head injury while descending the stairs was ruled out by the evidence of the eye witnesses.
Nothing was established to justify any exercise of the right of private defence.
On these facts, which have been proved, the only question that arises is whether the appellant is guilty of murder under section 302 of the Indian Penal Code, or guilty only of culpable homicide, not amounting to murder, under the second part of section 304.
The High Court did not address itself to the nature of the offence.
It is obvious that the appellant did not intend to kill the deceased.
The evidence of the doctor is that the injury was likely to result in fatal consequences.
This by itself is not enough to bring the case within the scope of section 300.
There is nothing to warrant us to attribute to the appellant knowledge that the injury was liable to cause death or that it was so imminently dangerous that it must in all probability cause death.
The elements specified in section 300 of the Indian Penal Code are thus wanting.
We take the view, considering all the circumstances that the offence is the lesser one.
The appellant is acquitted of the charge of murder but is convicted under the second part of section 304, and sentenced to five years ' rigorous imprisonment.
IMAM J.
The appellant was charged with murder and nothing short of it, although it was stated in the charge that the offence was committed by him in furtherance of a common intention.
If the evidence failed to prove that the offence committed by him was in furtherance of a common intention, it would be nonetheless his offence, namely, murder, if his act in law amounted to murder.
The law does not require in such a case that a separate charge for murder should be framed, because the charge of murder was already on the record.
Strictly speaking, on the facts of the present case, the question raised by the reference does not arise.
Since it has been raised, it must be considered.
In Nanak Chand '8 case the view taken was that when an accused is charged under section 302 read with section 149 of the Indian Penal Code, it is illegal to convict him under section 302 of the Indian Penal Code without a charge having been framed against him under that section.
It was also held that if this was only an irregularity then on the facts of the case, the accused was misled in his defence.
In Suraj Pal 's case, in similar circumstances, it was held that failure to frame a charge under section 302 was a serious lacuna and the conviction was set aside on the ground that the accused had been prejudiced.
A careful examination of these two cases does not reveal any substantial conflict between them.
As I understand the provisions of the Code of Criminal Procedure, a separate procedure is set out for various class of cases triable by a court exercising powers under the Code.
So far as the framing of a charge is concerned, the Code expressly states the kind of cases in which no charge is to be framed.
In trial of warrant cases, cases before a Court of Sessions and a High Court, a charge must be framed.
Failure to frame a charge in such cases would be a contravention of the mandatory provisions of the Code.
Would such contravention amount to an illegality? Prima 1193 facie a conviction of an accused person for an offence with which he had not been charged but for which he ought to have been charged, is invalid.
It is said that by virtue of the provisions of sections 535 and 537 of the Code failure to frame a charge or an omission or irregularity in a charge, which is framed, does not by itself invalidate the conviction, unless the Court is satisfied that in fact a failure of justice has resulted.
It is, therefore, necessary to examine how far these provisions of the Code override its provisions relating to the framing of charges.
Section 233 of the Code expressly states that for every distinct offence of which any person is accused there shall be a separate charge and every such charge shall be tried separately, except in the cases mentioned in sections 234, 235, 236 and 239.
There is no ambiguity in the language of this section.
While it insists upon a separate charge for every distinct offence it permits a single trial on several charges in the cases mentioned in sections 234, 235, 236 and 239.
Section 233 is a mandatory provision and the force of its direction is not weakened by the fact that another provision of the Code does permit a conviction of an accused for an offence with which he had not been charged.
In such a case no question of illegality or irregularity arises, as the conviction is expressly authorized by the Code.
The conviction is valid because of the statute itself and not because of section 535.
On the charge framed, after it has been explained to the accused, the plea of guilty or not guilty is recorded.
If the accused pleads guilty, certain consequences follow.
If he pleads not guilty, the trial must proceed according to law.
Is the framing of a charge and the recording of the plea of the accused merely a ritual or a fundamental provision of the Code concerning procedure 1194 in a criminal trial? I think it is the latter.
Are the express provisions of the Code as to the manner in which a trial is to proceed to be ignored, or considered as satisfied, merely because the Court explained to the accused as to what he was being tried for?
I a prehend not.
For to do so is to replace the provisions of the Code by a procedure unwarranted by the statute itself.
In my opinion, a total absence of a charge from start to finish in a case where the law requires a charge to be framed, is a contravention of the provisions of the Code as to the mode of trial and a conviction of the accused of an offence in such a case is invalid and the question of prejudice does Dot arise.
None of the decisions of the Privy Council suggest that in such a case the conviction will be deemed to be valid by virtue of the provisions of section 535, unless the Court is satisfied that there has been a failure of justice.
In any event, the Code expressly provides that in such cases the conviction need not be set aside, unless, in fact, a failure of justice has resulted.
Under the provisions of section 232 of the Code an appellate Court or a High Court exercising its powers of revision or its powers under Chapter XXVII, must direct a new trial of a case in which an accused person has been convicted of an offence with which he had not been charged, if it is satisfied that he had been misled in his defence by the absence of a charge.
In such a case a court is bound to act according to its provisions.
It is the provision of section 535 to which reference must be made in order to ascertain whether that which was invalid shall be deemed to be valid, unless the court was satisfied that there had been a failure of justice.
I regard with concern, if not with dismay, a too liberal application of its provisions to all cases in which there is an absence of a charge, 1195 although a charge ought to have been framed.
It is difficult to lay down any hard and fast rule as to when the provisions of section 535 will or will not be applicable.
The facts of each case, as they arise, will have to be carefully considered in order to decide that that which was prima facie invalid is deemed to be valid by virtue of its provisions.
There may be cases where the omission to frame a charge was merely a technical defect in which case section 535 would apply.
On the other band, there may be cases where failure to frame a charge affects the mode of trial or it is such a substantial contravention of the provisions of the Code relating to the framing of charges that prejudice may be inferred at once and the conviction which was prima facie invalid continued to be so.
In a criminal trial innocence of an accused is presumed,unless there is a statutory presumption against him, and the prosecution must prove that the accused is guilty of the offence for which he is being tried.
The prosecution is in possession of all the evidence upon which it relies to establish its case against the accused.
It has the privilege to ask the Court to frame charges with respect to the offences which it wishes to establish against the accused.
On the Court itself a duty is cast to frame charges for offences which, on the evidence, appear to it prima facie to have been committed.
If in spite of this a charge under section 302 read with 149 of the Indian Penal Code only is framed against an accused person and not under section 302 of the Indian Penal Code, it will be reasonable to suppose that neither the prosecu tion nor the Court considered the evidence sufficient to prove that murder was committed by the accused and the omission to frame a charge under section 302 must be regarded as a deliberate act of the Court by way of notice to the accused that he was not being tried for that offence.
It would not be a case of mere omission to frame a charge.
If, therefore, the accused is convicted under section 302, I would consider his conviction as invalid, as he was misled in his defence.
In conclusion I would point out that the provisions of the Code of Criminal Procedure are meant to be 151 1196 obeyed.
Contravention of its provisions are unnecessary and neither the prosecution nor the Courts of trial should ignore its provisions in the hope that they might find shelter under sections 535 and 537 of the Code.
Where the contravention is substantial and a retrial becomes necessary, public time is wasted and the accused is put to unnecessary harassment and expense.
| The appellant and his brother were put up for trial on charges under section 302 read with section 34 of the Indian Penal Code.
The appellant was specifically charged with murder in prosecution of the common intention.
There was evidence to show that he and not his brother had struck the fatal blow.
The brother was acquitted and the appellant was convicted under section 302 and sentenced to transportation for life.
The High Court upheld the conviction and sentence and dismissed the appeal.
The question was whether the omission to frame an alternative charge under section 302 simpliciter was an illegality that vitiated the trial and invalidated the conviction and whether there was a conflict of decisions of this Court on the matter in controversy.
Held per curiam, that the omission to frame an alternative charge under section 302 in the facts and circumstances of the case was not an illegality that vitiated the trial but was a curable irregularity as it had not occasioned any prejudice to the appellant and the conviction was not liable to be set aside.
That section 34 of the Indian Penal Code by itself does not create any offence and where, as in the present case, it is possible to ascertain who struck the fatal blow, the fact that another was also sought to be made liable does not invalidate a conviction for murder unless there was prejudice.
That the expression 'illegality ' used in Nanak Chand 's case must be read with reference to the facts of that case where the court 1141 found prejudice, and the apparent conflict of view between the judgment in that case and that in Suraj Pal 's case had really no bearing on the present one.
Nanak Chand vs The State of Punjab ([1955] 1 S.C.R. 1201), and SurajPal vs The State of U.P. ([1955] 1 S.C.R. 1332), explained.
That the Code does not use the word 'illegality ' nor define 'irregularity ' and 'illegality ' can only mean an incurable irregularity, incurable because of prejudice leading to a failure of justice.
The question of prejudice is a question of fact to be decided by the court in each particular case.
That the offence committed by the appellant fell under the second part of section 304 of the Indian Penal Code and not section 302 and the conviction must be altered to one under that section.
N. A. Subramania Iyer vs King Emperor ([1901] L.R. 28 I. A. 257), explained.
Babulal Choukhani vs The King Emperor ([1938] L.R. 65 I. A. 158), Pulukuri Kotayya vs King Emperor ([1947] L.R. 74 I.A. 65), Abdul Rahman vs King Emperor ([1926] L.R. 54 I. A. 96), Atta Mohammad vs King Emperor ([1929] L.R. 57 I.A. 71), Karnail Singh vs The State of Punjab ([1954] S.C.R. 904) and Begu vs KingEmperor ([1925] I.L.R. , referred to.
Per section R. DAS, ACTING C.J. and BOSE J.
Like all procedural laws the Code of Criminal Procedure is designed to subserve the ends of justice and not to frustrate them by more technicalities.
It regards some of its provisions as vital but others not, and a breach of the latter is a curable irregularity unless the accused is prejudiced thereby.
It places errors in the charge, or even a total absence of a charge in the curable class.
This is made clear by sections 535 and 537 of the Code.
The object of the charge is to give the accused notice of the matter he is charged with and does not touch jurisdiction.
If, therefore, the necessary information is conveyed to him in other ways and there is no prejudice, the trial is not invalidated by the mere fact that the charge was not formally reduced to writing.
The essential part of this part of the law is not any technical formula of words but the reality, whether the matter was explained to the accused and whether he understood what he was being tried for.
It is not correct to say that section 535 of the Code has no application to a case in which there is no charge at all or that it cannot apply except where sections 237 and 238 apply or that it is governed by section 233.
Sections 237, 238, 535 and 537 should not be read disjunctively.
They cover every possible case that relates to the charge and they place all failures to observe the rules about the charge in the category of curable irregularities.
Sections 535 and 537 apply to every case in which there is a 1142 departure from the rules set out in Chapter XIX ranging from error, omissions and irregularities in charges that are framed, down to charges that might have been framed and were not and include a total omission to frame a charge at all at any stage of the trial.
In judging a question of prejudice, as of guilt, courts must act with a broad vision and look to the substance and not to technicalities; and their main concern should be to see whether the accused had a fair trial, whether he knew what he was being tried for, whether the main facts sought to be established against him were explained to him fairly and clearly and whether he was given a full and fair chance to defend himself.
There is no conflict of view between Nanak Chand vs The State of Punjab and Suraj Pal vs The State of U.P. and a close consideration of the reasons given in Nanak Chand 's case show that there was in fact no difference of opinion as regards cases where there is a charge to start with.
Neither case, however, deals with the position where there is no charge at all.
The remarks made in Nanak Chand 's case must be read in the perspective indicated and expressions which appear to travel wider do not give a correct exposition of the law.
The effect of charging two persons with murder committed in pursuance of a common intention under section 34 of the Indian Penal Code is that the accused is unmistakably told that he participated in the crime.
Where it cannot be ascertained who struck the fatal blow no conviction can follow unless a common intention is proved.
But the converse does not hold good.
Per JAGANNADHADAS and CHANDRASEKHARA AIYAR JJ.
(IMAM J. agreeing).
Sections 226, 227, 232(1), 237, 535 and 537 indicate that in the generality of cases the omission to frame a charge is not per se fatal.
It is not, therefore, correct to say that where there is no charge the conviction must be illegal, prejudice or no prejudice.
Nor is it correct to say that section 535 is sufficiently wide to apply to every case where there is no charge of any kind from the outset.
The section cannot be construed in such an unlimited sense and must normally be read in the same context as sections 225,226 and 232, that is, with reference to a trial that validly commenced, for there may be cases where a trial without any kind of charge from the outset will be wholly contrary to the provisions of the Code and as such illegal without the necessity of a positive finding of pre judice.
The provisions of section 535 mainly apply to cases of inadvertence to frame a charge induced by the belief that the matter on record is sufficient to warrant the conviction for a particular offence without express specification and where the facts proved constitute a separate and distinct offence but closely relevant to and springing out of the same set of facts connected with the one charged.
The Code requires that in a sessions trial there should be a 1143 charge in writing.
A deliberate breach of this basic requirement cannot be covered by the assertion that every thing was orally explained to the accused, the assessors or jurors and there was no prejudice.
So also where the conviction is for a totally different offence from the one charged and not covered by sections 236 and 237 of the Code, the omission to frame a separate charge would be an incurable irregularity amounting to illegality.
In cases coming under sections 34, 114 and 149 of the Indian Penal Code the charge against persons actuated by a common intention is a rolled up one.
It involves direct liability and constructive liability without distinct specification.
The absence of a charge under one or other of the various heads of criminal Liability for the offence in such cases is not fatal and a conviction for the substantive offence, without a charge, can be set aside only where there is prejudice.
In considering whether a defect is illegal or merely irregular, several facts will have to be considered, including its gravity to determine if it falls within one class or the other.
The answer must depend on the facts and circumstances of each case.
If the defect is so grave that prejudice would necessarily be implied, it is an illegality.
If less serious, it will be an irregularity and prejudice by way of failure of justice must be established.
Howard vs Bodington ([1877] , referred to.
Per IMAM J. On the facts of the present case the question raised by the reference does not arise.
There is no substantial conflict of view between the two decisions of this court in Nanak Chand 's case and Suraj Pal 's case.
Section 233 of the Code is a mandatory provision and the force of its direction is not weakened by the fact that another provision of the Code permits the conviction of the accused for an offence with which he had not been charged.
The total absence of a charge from the beginning to the end where it is incumbent that a charge must be framed is a contravention of the Code regarding the mode of trial it prescribes and a conviction of the accused in such a case is invalid and no question of prejudice can arise.
In cases, however, where a charge is framed but there is an omission or irregularity but the mode of trial is not affected the Code provides that the conviction may be set aside if, in fact, a failure of justice as resulted.
It is difficult to lay down any hard and fast rule as to the applicability of section 535.
That will depend on the facts of each case.
|
iminal Appeal No. 25 of 1954.
Appeal under Article 134(1) (c) of the Constitution from the judgment and order dated the 12th January 1954 of the Patna High Court in Criminal Miscellaneous Case No. 10 of 1953.
M. C. Setalvad, Attorney General of India and Mahabir Prasad, Advocate General of Bihar (Balbhadra Prasad Sinha and P. G. Gokhale, with them) for the appellant.
Purshottam Prikamdas, (R. Patnaik, with him) for the respondent.
November 8.
The Judgment of the Court was delivered by BHAGWATI J.
This appeal with certificate under article 134(1)(c) of the Constitution arises out of an application under section 2 of the Contempt of Courts 121 956 Act (XXXII of 1952) and section 8 of the (XXXVII of 1850) read with article 227 of the Constitution filed by the respondent against the appellant in the High Court of Judicature at Patna and raises an important question as to whether the Commissioner appointed under Act XXXVII of 1850 is a Court.
The respondent is a Member of the Bihar Civil Service (Executive Branch).
The State Government received reports to the effect that the respondent bad been guilty of serious misconduct and corrupt practices in the discharge of his official duties while employed as Sub Divisional Officer at Aurangabad and they accordinly decided that an inquiry into the truth of.
the various charges against him should be made under the provisions of the (Act XXXVII of 1850, hereinafter referred to as the Act) and Mr. Anjani Kumar Saran who was the then Additional District and Sessions Judge, Gaya, and was thereafter the District and Sessions Judge of that place was appointed Commissioner under the Act for making the inquiry.
Gaya was fixed as the venue of the inquiry and the State Government also ordered that, during the pendency of the inquiry, the respondent will remain under suspension.
The Government made the appointment aforesaid after obtaining the concurrence of the High Court on its administrative side which was obtained on the condition that an extra temporary post of Additional District and Sessions Judge was created by the Government for the period Mr. Saran was occupied with the inquiry.
The appointment was made on the 2nd June 1952 and it was expected that Mr. Saran would be able to complete the inquiry during a period of three months.
The respondent, however, adopted dilatory tactics.
He made various representations to the Government, one on the 6th June 1952 demanding that a Judge of the High Court be appointed as Commissioner under the Act to make the inquiry against him and that inquiry be made at Patna and not at Gaya, another on the 10th July 1952 protesting against the appointment of Mr. Saran 957 as Commissioner to hold the inquiry against him and demanding that a ' confirmed District and Sessions Judge be appointed as Commissioner in his place, and ' a third on the 17th November 1952 in which he requested the Government to appoint three Commissioners instead of one for holding the inquiry against him and also to pay the entire cost of his defence at the same rates at which the Special Public Prosecutor engaged by the Government was being paid and also to reimburse other incidental expenses to be incurred by him.
All these representations were turned down by the Government.
Being thus thwarted in his attempts to put off the inquiry on some pretext or the other, the respondent tried to evade the same and failed and neglected to reply to the queries made from him by the Commissioner.
The Commissioner also could not communicate to him the orders passed by him from time to time because the respondent did not stay at the headquarters and did not leave his proper address for communication either at Gaya or at Motihari.
On the 24th November 1952 the Commissioner passed an order calling upon the parties to attend the hearing of the proceedings before him on the 8th December 1952 and forwarded a copy of this order to the appellant for communication to the respondent.
The District Magistrates of Champaran and Gaya who were requested to serve a true copy of the order upon the respondent could not do so as he was available neither at Motihari nor at Gaya and it was with great difficulty that he could be traced at Patna and the order served upon him.
On the 18th December 1952, the Commissioner passed another order recording that he was feeling great difficulty in contacting the respondent and in communicating his orders to him.
He observed that this was a highly undesirable state of affairs and that it was necessary that his orders should be communicated to the res pondent as early as possible.
A copy of this order was forwarded by the Commissioner to the appellant along with his letter dated the 20th December 1952 for information and doing the needful.
The appellant thereafter wrote the letter complained against to 958 the Commissioner on the 26th December 1952 being D.O. No. II/3C 306/52A 11614 which ran as under: "Dear Mr. Saran, I am desired to refer to your memo No. 8266 dated the 26th November 1952 and to say that Government are anxious not to allow Mr. Jyoti Narayan to adopt dilatory tactics and delay the progress of the inquiry against him.
I am to request you to be vigilant against such tactics adopted by Mr. Narayan.
Yours sincerely, (Sd.) B. N. Sinha".
The Commissioner acknowledged receipt of this letter by his D.O. letter No. 244, dated the 5th January 1953 stating that he would not allow the respondent to adopt any dilatory tactics and delay the progress of the inquiry against him.
On the 2nd February 1953, the respondent filed a petition before the Commissioner stating inter alia that he had not been able to engage any lawyer or counsel for want of necessary papers and copies and prayed for an adjournment of the inquiry.
He also prayed for starting a contempt of Court proceeding against the appellant but the Commissioner rejected both his prayers.
The order which was passed by the Commissioner on these applications may as well be set out in extenso inasmuch as it has a bearing on the question whether the appellant was guilty of contempt of Court for having addressed the letter complained against to him: "3 2 53.
Another point raised in the first petition of the accused was that Mr. B.N. Sinha, Deputy Secretary to Government in addressing his D.O. letter No. 11614, dated the 26th of December, 1952, was guilty of contempt, because he had interfered in my judicial discretion.
I do not find anything in this letter from which it can be inferred that the author of the letter intended to influence me in the exercise of my judicial function.
This letter was sent to me in reply to my memo No. 8266 dated 26 11 1952 whereby I had forwarded a copy of my order dated 24 11 1952 for communication to Mr. Narayan.
Mr. 959 B.N. Sinha wrote in his letter dated the 26th of December 1952 that Government are anxious not to allow Mr. Jyoti Narayan to adopt dilatory tactics and to delay the progress of the inquiry.
Now it is to be noted that Mr. Narayan in paragraph 11 of his petition has himself charged the State Government for delaying the inquiry and thereby causing harassment to him.
Therefore, it is obvious that both parties, that is, the State and the accused are anxious that the inquiry should be expedited so what Mr. B.N. Sinha meant by writing the D.O. was that the inquiry should be expedited.
This cannot by any stretch of imagination be construed to mean that the aforesaid officer in any way tried to influence me in the discharge of my judicial functions.
For these reasons I rejected the two prayers contained in the first petition of Mr. J. Narayan".
The respondent thereafter started proceedings in, contempt against the appellant in the High Court of Judicature at Patna.
A Rule was issued by the High Court against the appellant which was heard and finally disposed of on the 12th June 1954.
The High Court was of the opinion that the Commissioner appointed under Act XXXVII of 1850 was a Court, that the Court was subordinate to the High Court, that the letter complained against amounted to a contempt of Court and that the appellant was guilty of such contempt.
It accordingly sentenced the appellant to pay a fine of Rs. 250 and in default to undergo simple imprisonment for a period of one month.
The appellant obtained a Certificate under Article 134(1), (e) of the Constitution from the High Court.
The Certificate was, however, limited to the question as to whether the Commissioner appointed under the Act is a Court.
At the hearing before us, the appellant filed a petition for urging additional grounds which included inter alia the ground that the High Court erred in holding that the Commissioner appointed under the Act is a Court subordinate to the High Court within the meaning of the for the mere reason that its orders are open to be reviewed 960 judicially in exercise of the power vested in the High Court under article 227 of the Constitution and also the ground that the High Court erred in holding that the letter complained against tended to interfere with or obstruct the course of justice and constituted contempt of Court.
The learned Attorney General for the appellant contended in the first instance that the Commissioner appointed under the Act is not a Court.
He next contended that even if he is a Court, he is not a Court subordinate to the High Court within the meaning of the .
He lastly contended that the letter complained against did not tend to interfere with or obstruct the course of justice and did not constitute contempt of Court.
Prior to the enactment of the , there was in existence in India the Contempt of Courts Act, 1926 (XII of 1926).
The various States also had their corresponding enactments.
The Contempt of Courts Act, 1926 (XII of 1926) and the corresponding enactments in the States of Hyderabad, Madhya Bharat, Mysore, Pepsu, Rajasthan and Travancore Cochin and the Saurashtra Ordinance II of 1948 were repealed by the and a uniform Act to define and limit the powers of certain Courts in punishing contempts of Courts was enacted which extended to the whole of India except the State of Jammu and Kashmir.
In section 2 of the Act, "High Court" was defined as meaning the High Court for a Part A State or a Part B State and including the Court of the Judicial Commissioner in a Part C State.
Section 3 of the Act enacted: "3.
(1) Subject to the provisions of sub section (2) every High Court shall have and exercise the same jurisdiction, powers and authority, in accordance with the same procedure and practice, in respect of contempts of Courts subordinate to it as it has and exercises in respect of contempts of itself.
(2) No High Court shall take cognisance of a contempt alleged to have been committed in respect of a Court subordinate to it where such contempt is an 961 offence punishable under the Indian Penal Code (Act XLV of 1860)".
The word "Court" was not defined in the Act and ' the expression "Courts subordinate to the High Courts" would prima facie mean the Courts of law subordinate to the High Courts in the hierarchy of Courts established for the purpose of administration of justice throughout the Union.
It would be relevant, however, to notice the definitions of "Court" available elsewhere.
Coke on Littleton and Stroud defined the word "Court" as the place where justice is judicially administered.
According to Stephen, "In every Court, there must be at least three constituent parts the actor, reus and judex; the actor or plaintiff, who complains of an injury done; the reus, or defendant, who is called upon to make satisfaction for it; and the judex, or judicial power, which is to examine the truth of the fact, and to determine the law arising upon that fact, and if any injury appears to have been done, to ascertain, and by its officers to apply, the remedy".
Section 3 of the Indian Evidence Act (I of 1872) defines "Court" as including all Judges and Magistrates, and all persons, except arbitrators.
legally authorised to take evidence.
This definition, however, has been held to be not exhaustive but framed only for the purpose of Indian Evidence Act and is not to be extended where such an extension is not warranted.
Sections 19 and 20 of the Indian Penal Code (Act XLV of 1860) define the words "Court" and the "Court of Justice" as under: "Section 19.
The word 'Judge ' denotes not only every person who is officially designated.
as a Judge, but also every person who is empowered by law to give, in any legal proceeding, civil or criminal, a definitive judgment, or a judgment which, if not appealed against would be definitive, or a judgment which, if confirmed by some other authority would be definitive, or who is one of a body of persons, which body of persons is empowered by law to give such a judgment.
962 Section 20.
The words "Court of Justice" denote a Judge who is empowered by law to act judicially alone, or a body of Judges which is empowered by law to act judicially as a body, when such Judge or body of Judges is acting judicially".
The pronouncement of a definitive judgment is thus considered the essential sine qua non of a Court and unless and until a binding and authoritative judgment can be pronounced by a person or body of persons it cannot be predicated that he or they constitute a Court.
The Privy Council in the case of Shell Co. of Australia vs Fedral Commissioner of Taxation(1) thus defined "Judicial Power" at page 295: "Is this right? What is "judicial power"? Their Lordships are of opinion that one of the best definitions is that given by Griffith, C. J. in Huddart, Parker & Co. vs Moorehead(2) where he says: "I am of opinion that the words judicial power ' as used in section 71 of the Constitution mean the power which every sovereign authority must of necessity have to decide controversies between its subjects, or between itself and its subjects, whether the rights relate to life, liberty or property.
The exercise of this power does not begin until some tribunal which has power to give a binding and authoritative decision (whether subject to appeal or not) is called upon to take action".
Their Lordships further enumerated at page 297 certain negative propositions in relation to this subject: "1.
A tribunal is not necessarily a Court in this strict sense because it gives a final decision; 2.
Nor because it hears witnesses on oath; 3.
Nor because two or more contending parties appear before it between whom it has to decide; 4.
Nor because it gives decisions which affect the rights of subjects; 5.
Nor because there is an appeal to a Court; 6.
Nor because it is a body to which a matter is referred by another body.
See Rex vs Electricity Commissioners(3)" (1) (2) ; , 357.
(3) 963 and observed at page 298: "An administrative tribunal may act judicially, but still remain an administrative tribunal as distinguished from a Court, strictly so called.
Mere externals do not make a direction to an administrative officer by an ad hoc tribunal an exercise by a Court of Judicial power".
The same principle was reiterated by this Court in Bharat Bank Limited vs Employees of Bharat Bank Ltd.(1) and Maqbool Hussain vs The State of Bombay(1) where the test of a judicial tribunal as laid down in a passage from Cooper vs Wilson(1) was adopted by this Court: "A true judicial decision presupposes an existing dispute between two or more parties, and then involves four requisites: (I) The presentation (not necessarily orally) of their case by the parties to the dispute; (2) if the dispute between them is a question of fact, the ascertainment of the fact by means of evidence adduced by the parties to the dispute and, often with the assistance of argument by or on behalf of the parties on the evidence; (3) if the dispute between them is a question of law, the submission of legal arguments by the parties; and (4) a decision which disposes of the whole matter by a finding upon the facts in dispute and an application of the law of the land to the facts so found, including where required a ruling upon any disputed question of law".
Maqbool Hussain 's case, above referred to, was followed by this Court in section A. Venkataraman vs The Union of India and, Another(4) where a Constitution Bench of this Court also laid down that both finality and authoritativeness were the essential tests of a judicial pronouncement.
It is clear, therefore, that in order to constitute a Court in the strict sense of the term, an essential condition is that the Court should have, apart from having some of the trappings of a judicial tribunal, power to give a decision or a definitive judgment which has finality and authoritativeness which are (1) ; (2) (1953] S.C.R. 730.
(3) , 340.
(4) ; 122 964 the essential tests of a judicial pronouncement.
It was, however, urged by Shri Purshottam Tircamdas for the respondent that the word "Court" should not be limited to a Court of Justice or a Court of law but should be construed in a wide sense, including within the connotation, other Courts which, though not Courts of Justice, were nevertheless Courts according to law and be relied upon a decision of the Court of Appeal in England in Royal Aquarium and Summer and Winter Garden Society Ltd. vs Parkinson(1) and the observations of Fry, L.J. at page 446 therein: "I do not desire to attempt any definition of a "court".
It is obvious that, according to our law, a court may perform various functions.
Parliament is a court.
Its duties as a whole are deliberative and legislative: the duties of a part of it only are judicial.
It is nevertheless a court.
There are many other courts which, though not Courts of Justice, are nevertheless courts according to our law.
There are, for instance, courts of investigation, like the coroner 's court.
In my judgment, therefore, the existence of the immunity claimed does not depend upon the question whether the subject matter of consideration is a Court of Justice, but whether it is a Court in law.
Wherever you find a Court in law, to that the law attaches certain privileges, among which is the immunity in question".
The question involved in that case was whether the defendant was entitled to absolute immunity from action for anything done by him while performing his duty as a member of the County Council in dealing with the applications for licences for music and dancing.
It was contended on behalf of the defendant that he was exercising a judicial function when he spoke the words complained of and therefore was entitled to absolute immunity in respect of anything he said.
The argument that "wherever you find a Court in law, to that the law attaches certain privileges among which is the immunity in question" was used on behalf of the defendant and Fry, L. J. dealt with the same as under at page 447: 965 "It was said that the existence of this immunity is based on considerations of public policy, and that, as a matter of public policy, wherever a body has to decide questions, and in so doing has to act judicially, it must be held that there is a judicial proceeding to which this immunity ought to attach.
It seems to me that the sense in which the word "judicial" is used in that argument is this: it is used as meaning that the proceedings are such as ought to be conducted with the fairness and impartiality which characterize proceedings in Courts of Justice, and are proper to the functions of a judge, not that the members of the supposed body are members of a Court.
Consider to what lengths the doctrine would extend, if this immunity were applied to every body which is bound to decide judicially in the sense of deciding fairly and impartially.
It would apply to assessment committees, boards of guardians, to the Inns of Court when considering the conduct of one of their members, to the General Medical Council when considering questions affecting the position of a medical man, and to all arbitrators.
Is it necessary, on grounds of public policy, that the doctrine of immunity should be carried as far as this? I say not.
I say that there is ample protection afforded in such cases by the ordinary law of privilege.
I find no necessity or propriety in carrying the doctrine so far as this argument requires".
Lord Esher, M. R. expressed himself as follows while dealing with this argument at page 442: "It is true that, in respect of statements made in the course of proceedings before a Court of Justice, whether by judge, or counsel, or witnesses, there is an absolute immunity from liability to an action.
The ground of that rule is public policy.
It is applicable to all kinds of Courts of Justice; but the doctrine has been carried further; and it seems that this immunity applies wherever there is an authorized inquiry which, though not before a Court of Justice, is before a tribunal which has similar attributes.
In the case of Dawkins vs Lord Rokeby(1) the doctrine was extended (1) L.R. 8 Q.B. 255; , 966 to a military court of inquiry.
It was so extended on the ground that the case was one of an authorized inquiry before a tribunal acting judicially, that is to say, in a manner as nearly as possible similar to that in which a Court of Justice acts in respect of an inquiry before it.
This doctrine has never been extended further than to Courts of Justice and tribunals acting in a manner similar to that in which such Courts act.
Then can it be said that a meeting of the county council, when engaged in considering applications for licences for music and dancing, is such a tribunal? It is difficult to say who are to be considered as judges acting judicially in such a case".
The case of Dawkins vs Lord Rokeby(1) was a case where immunity was claimed by a witness who had given evidence before a military Court of inquiry.
The case went to the House of Lords and the Lord Chancellor, in his speech at page 754, in observed: "Now, my Lords, adopting the expressions of the learned Judges with regard to what I take to be the settled law as to the protection of witnesses in judicial proceedings, I certainly am of opinion that upon all principles, and certainly upon all considerations of convenience and of public policy, the same protection which is extended to a witness in a judicial proceeding who has been examined on oath ought to be extended, and must be extended, to a military man who is called before a Court of Inquiry of this kind for the purpose of testifying there upon a matter of military discipline connected with the army".
Both these cases, the one before the Court of Appeal and the other before the House of Lords, were concerned with the extension of the principle of immunity of members of a tribunal or witnesses in judicial proceedings and the Courts logically extended the principle of immunity beyond the Courts of Justice to tribunals or bodies of persons functioning in a manner and according to procedure which was assimilated to a judicial inquiry.
The extension of the (1) L.R. 8 Q.B. 255; 967 immunity to such tribunals or bodies would not, however, constitute them Courts of Justice or Courts of law.
The position is thus summarised in the following passage in Halsbury 's Laws of England, Hailsham Edition, Volume 8, page 526: "Many bodies are not courts, although they have to decide questions, and in so doing have to act judicially, in the sense that the proceedings must be conducted with fairness and impartiality, such as assessment committees, guardians committees,, the Court of referees constituted under the Unemployment Insurance Acts to decide claims made on the insurance funds, the benchers of the Inns of Court when con sidering the conduct of one of their members, the General Medical Council, when considering questions affecting the position of a medical man".
We must, therefore, fall back upon the tests laid down above for determining what is a Court strictly so called within the connotation of the term as used in the .
It would be appropriate at this stage to note the relevant provisions of the (XXXVII of 1850) which would fall to be considered for determining whether the Commissioner appointed under the Act is a Court or not.
The Act was passed for regulating inquiries into the behaviour of public servants and the preamble runs: "Whereas it is expedient to amend the law for regulating inquiries into the behaviour of public servants not removable from their appointments without the sanction of Government, and to make the same uniform throughout India; It is enacted as follows: " Section 2 requires the articles of charges to be drawn out and a formal and public inquiry to be ordered whenever the Government shall be of opinion that there are good grounds for making a formal and public inquiry into the truth of any imputation of misbehaviour by any such person.
The inquiry may be committed under section 3 either to the Court, 968 Board or other authorities to which the person accused is subordinate or to any other person or persons specially appointed by the Government, Commissioners for the purpose.
Sections 4 to 7 contain provisions in regard to the conduct of the prosecution and section 8 prescribes the powers of the Commissioners.
This section has been particularly relied upon as constituting the Commissioners a Court, and runs as under: "Section 8.
The commissioners shall have the same power of punishing contempts and obstructions to their proceedings, as is given to Civil and Criminal Courts by the Code of Criminal Procedure, 1898, and shall have the same powers for the summons of witnesses, and for compelling the production of documents, and for the discharge of their duty under the commission, and shall be entitled to the same protection as the Zila and City Judges, except that all process to cause the attendance of witnesses or other compulsory process, shall be served through and executed by the Zila or City Judge in whose jurisdiction the witness or other person resides, on whom the process is to be served, and if he resides within Calcutta, Madras or Bombay, then through the Supreme Court of Judicature thereto.
When the commission has been issued to a Court, or other person or persons having power to issue such process in the exercise of their ordinary authority, they may also use all such power for the purposes of the commission".
Section 9 prescribes a penalty for disobedience to process issued as aforesaid for the purpose of the commission and sections 10 to 20 prescribe the procedure to be followed in the conduct of the inquiry.
It ,may be noted that this procedure is assimilated as far as possible to the conduct of a prosecution in a Criminal Court of law and the person accused is given the fullest opportunity to enter upon his defence and lead evidence in order to clear himself of the charges levelled against him.
Sections 21 and 22 lay down the functions of the Commissioners in regard to the report to be made by them to the Government of their proceedings under the commission and the powers of 969 the Government to pass final orders on such reports.
These sections have an important bearing on the question before us and they enact: "Section 21.
After the close of the inquiry the commissioners shall forthwith report to Government their proceedings under the commission, and shall send with the record thereof their opinion upon each of the articles of charge separately, with such observations as they think fit on the whole case.
Section 22.
The Government, on consideration of the report of the commissioners, may order them to take further evidence, or give further explanation of their opinions.
It many also order additional articles of charge to be framed, in which case the inquiry into the truth of such additional articles shall be made in the same manner as is herein directed with respect to the original charges.
When special commissioners have been appointed, the Government may also, if it thinks fit, refer the report of the commissioners to the Court or other authority to which the person accused is subordinate, for their opinion on the case; and will finally pass such orders thereon as appear just and consistent with its powers in such cases".
These provisions were considered by this Court in the case of S.A. Venkataraman vs The Union of India and Another(1).
The question that arose for consideration there, was whether an inquiry made and concluded under the Act amounted to prosecution and punishment for an offence as contemplated under article 20(2) of the Constitution.
Articles of charge bad been framed against the petitioner in that case and evidence had been led both by the prosecutor and by the defence and witnesses on both sides were examined on oath and cross examined and re examined in the usual manner.
The Commissioner bad found, on a consideration of the evidence, that some of the charges had been proved against the petitioner and had submitted a report to that effect to the Government.
The President had accepted the opinion of the Commissioner and, in view of the findings on (1) ; 970 the several charges arrived at by the latter, was pro visionally of the opinion that the petitioner should be dismissed.
Opportunity was given to the petitioner under Article 311(2) of the Constitution to show cause against the action proposed to be taken in regard to him and after considering his representation and after consultation with the Union Public Service Commission, the President finally decided to impose the penalty of dismissal upon him and he was accordingly dismissed.
After his dismissal, the police submitted a charge sheet against him before the Special Judge, Sessions Court, Delhi, charging him with offences under sections 161 and 165 of the Indian Penal Code and section 5(2) of the Prevention of Corruption Act and upon that summons were issued by the learned Judge directing the petitioner to appear before his Court.
The petitioner thereupon challenged the legality of this proceeding in a writ petition contending, that the proceedings were without jurisdiction inasmuch as they amounted to a fresh prosecu tion, for offences for which he had been prosecuted and punished already.
While considering whether under the circumstances there had been a violation of the fundamental right of the petitioner under Article 20(2) of the Constitution, this Court, scrutinised the provisions of the Act and the position of the Commissioner appointed, thereunder.
Justice Mukherjea, as he then was, delivered the judgment of the Court and observed at page 1159: "As the law stands at present, the only purpose, for which an enquiry under Act XXXVII ' of 1850 could be made, is to help the Government to come to a definite conclusion regarding the misbehaviour of a public servant and thus enable it to determine provisionally the punishment which should be imposed upon him, prior to giving him a reasonable opportunity of showing cause, as is required under article 311(2) of the Constitution.
An enquiry under this Act is not at all compulsory and it is quite open to the Government to adopt any other method if it so chooses.
It is a matter of convenience merely and 971 nothing else.
It is against this background that we will have to examine the material provisions of the of 1850 and see whether from the nature and result of the enquiry which the Act contemplates it is at all possible to say that the proceedings taken or concluded under the Act amount to prosecution and punishment for a criminal offence."; and at page 1160: "A Commissioner appointed under this Act has no duty to investigate any offence which is punishable under the Indian Penal Code or the Prevention of Corruption Act and he has absolutely no jurisdiction to do so.
The subject matter of investigation by him is the truth or otherwise of the imputation of misbehaviour made against a public servant and it is only as instances of misbehaviour that the several articles of charge are investigated, upon which disciplinary action might be taken by the Government if it so chooses.
The mere fact that the word "prosecution" has been used, would not make the proceeding before the Commissioner one for prosecution of an offence.
As the Commissioner has to form his opinion upon legal evidence, be has been given the power to summon witnesses, administer oath to them and also to compel production of relevant documents.
These may be some of the trappings of a judicial tribunal, but they cannot make the proceeding anything more than a mere fact finding enquiry.
This is conclusively established by the provisions of sections 21 and 22 of the Act.
At the close of the enquiry, the Commissioner has to submit a report to the Government regarding his finding on each one of the charges made.
This is a mere expression of opinion and it lacks both finality and authoritativeness which are the essential tests of a judicial pronouncement.
The opinion is not even binding on the Government.
Under section 22 of the Act, the Government can, after receipt of the report, call upon the Commissioner to take further evidence or give further explanation of his opinion.
When Special Commissioners are appointed, their report could be referred to the court or other authority 123 972 to which the officer concerned is subordinate for further advice and after taking the opinion of the different authorities and persons, the Government has to decide finally what action it should take".
The Court was no doubt concerned in that case with finding whether the inquiry before the Commissioner was tantamount to a prosecution of the petitioner.
While considering the same, however, the position of the Commissioner was discussed and the conclusion to which the Court came was that he was a mere fact finding authority, that the report made by the Commissioner to the Government was merely his expression of opinion and it lacked both finality and auth oritativeness which are the essential tests of a judicial pronouncement.
This conclusion is sufficient to establish that the Commissioner appointed under the Act was not a Court and his report or findings were not a definitive judgment or a judicial pronouncement inasmuch as they were not binding and authoritative and lacked finality.
We are also of the same opinion.
Apart from the above considerations which weighed with the Court in that case, we have also the provisions of section 8 of the Act itself which go to show that the Commissioners are given certain powers 'of the Civil and Military Courts in regard to punishing contempts and obstruction to their proceedings, summoning of witnesses, compelling the production of documents and for service of their process as also the same protection as Zila and City Judges.
The very fact that this provision had got to be enacted shows that the position of the Commissioners was not assimilated to that of Judges and that they did not constitute Courts of Justice or Courts of law but were mere fact finding tribunals deriving whatever powers they could exercise under the very terms of the Act which created them.
The power of punishing contempts and obstruction to their, proceedings as is given to Civil and Criminal Courts by the Code of Criminal Procedure, 1898 was also similar in its nature and the very nature and extent of the power indicated that they were not Courts in the ordinary sense of the term.
No such provision would have been 973 uted Courts of Justice or Courts of law and it is no argument to say that these provisions were enacted even though they were not strictly necessary merely for the sake of abundant caution or clarification of the position.
We are of the opinion that the Commissioner appointed under the Act, having regard to the circumstances above set out, does not constitute a Court within the meaning of the term as used in the .
Our attention was, however, drawn by, Shri Purshottam Tricamdas to a decision of a Division Bench of the Punjab High Court in Kapur Singh vs Jagat Narain(1).
That was a case directly in point and on all fours with the case before us.
The learned Chief Justice of the Punjab High Court bad been appointed a Commissioner under the Act in the matter of an inquiry against Sardar Kapur Singh, I.C.S., and Lala Jagat Narain, the editor, printer and publisher of ail Urdu Daily newspaper published at Jullundur called The Hindu Samachar, was called upon to show cause why he should not be punished under section 3 of with regard to a leading article which appeared in his name in the issue of the paper dated the 12th March 1951.
A preliminary objection was taken on his behalf that the Court had no jurisdiction to take proceedings against him for contempt and the argument was that the Court of the Commissioner appointed to hold an inquiry under the Act was not a Court and in any event was not a Court subordinate to the High Court.
Mr. Justice Falshaw who delivered the judgment of the Court observed at page 50 in connection with this argument: "The itself seems clearly to indicate that a Commissioner or Commissioners appointed under the Act constitute a Court as they are given all the powers of a Court regarding the summoning of witnesses and other matters, and the only ground on which the learned counsel for the respondent could base his argument that the Commissioner does not constitute a Court was that he can (1) A.I.R. 1951 Punjab 49. 974 give no final decision, but merely has to draw up a report giving his findings on the charge or charges against the respondent, which is to be forwarded to the Government.
In my opinion, however, this fact alone is not sufficient to make the Commissioner or Commissioners any thing other than a Court and it is to be noted that the definition of Court in section 3, Evidence Act, is very wide indeed as it reads: " 'Court ' includes all Judges and Magistrate and all persons, except arbitrators, legally authorised to take evidence".
The learned Judges there relied upon the definition of Court given in section 3 of the Indian Evidence Act which, as has already been noted, is framed only for the purposes of the Act and is not to be extended where such an extension is not warranted.
This definition does not help in the determination of the question whether the Commissioners appointed under the Act constitute a Court and the attention of the learned Judges was not drawn to the position that finality and authoritativeness are the essential tests of a judicial pronouncement.
We are of the opinion that the decision reached by the learned Judges of the Punjab High Court in that case was wrong and cannot help the respondent.
Our attention was also drawn to another decision of the Nagpur High Court in M. V. Rajwade vs Dr. section M. Hassan(1).
The question which came to be considered by the Court in that case was whether a commission appointed under the was a, Court within the meaning of section 3 of the , and, while considering the provisions of that Act, the learned Judges of the Nagpur High Court incidentally considered the provisions of the .
They rightly observed that "the term 'Court ' has not been defined in the .
The Act, however, does contemplate a 'Court of Justice ' which as defined in section 20, Indian Penal Code, 1860, denotes 'a judge who is empowered by law to act judicially '.
The least that is required of a Court is the capacity to deliver a "definitive judg (1) A.I.R. 1954 Nag.
975 ment" and unless this power vests in a tribunal in any particular case, the mere fact that the procedure adopted by it is of a legal character and it has the power to administer an oath will not impart to it the status of a Court", and came to the conclusion that the commission appointed under the is not a Court within the meaning of the Contempt of 'Courts Act, 1952.
The learned Judges were merely considering the provisions of the and were not concerned with the construction of the provisions of the and whatever observations they made in regard to the provisions of the latter Act by way of comparing the same with the provisions of the former which they were there considering would not have the effect of putting on the provisions of the latter Act a construction which would be any avail to the respondent before us.
The ratio which was adopted by the learned Judges was quite correct but it appears that they digressed into a consideration of the provisions of the in order to emphasize the character and position of the commission appointed under the even though it was not strictly necessary for the purpose of arriving at their decision, though it must be mentioned that while discussing the nature and function of the commission they expressed themselves correctly as under: "The Commission governed by the is appointed by the State Government "for the information of its own mind", in order that it should not act, in exercise of its executive power, "otherwise than in accordance with the dictates of justice & equity" in ordering a departmental enquiry against its officers.
It is, therefore, a fact finding body meant only to instruct the mind of the Government without producing any document of a judicial nature".
We are of the opinion that neither of these cases which have been relied upon by Shri Purshottam Tricamdas is of any help to the respondent or detracts 976 from the true position as we have laid down above.
The only conclusion to which we can come on a consideration of all the relevant provisions of the Act is that the Commissioner appointed under the Act is not a Court within the meaning of the .
In view of the conclusion reached above, we do not think it necessary to go into the question whether the Commissioner appointed under the Act is a Court subordinate to the High Court within the meaning of the .
Nor do we think it necessary to express any opinion as to whether the letter complained against constituted a contempt of Court.
We may, however, note in passing that the circum stances under which the letter came to be addressed by the appellant to the Commissioner, the terms thereof and the order which was passed by the Commissioner on the application made by the respondent to proceed against the appellant in contempt on date the 2nd February 1953 lend support to the argument which was advanced on behalf of the appellant that the letter complained against did not constitute contempt of Court.
The result, therefore, is that the appeal will be allowed, the order passed against the appellant by the Court below will be set aside and the original Criminal Miscellaneous Petition No. 10 of 1953 filed by the respondent in the High Court of Judicature at Patna will stand dismissed.
The fine if paid will be refunded.
| Held, that a Commissioner appointed under the (XXVII of 1850) is not a court within the meaning of the (XXXII of 1952).
Shell Co. of Australia vs Federal Commissioner of Taxation ([1931] A.C. 275), Huddart,Parker & Co. vs Moorehead ([1909] ; , Rex vs Electricity Commissioners ([1924] 1 K.B. 171), Bharat Bank Limited vs Employees of Bharat Bank Ltd. ([1950] S.C.R. 459), Maqbool Hussain vs The State of Bombay ([1953] S.C.R. 730), Cooper vs Wilson ([1937] 2 K.B. 309), section A, Venkataraman vs The Union of India and Another ([1954] S.C.R. 1150), Royal Aquarium and Summer and Winter Garden Society Ltd. vs Parkinson ([1892] 1 Q.B. 431), Dawkins vs Lord Rokeby ([1873] L.R. 8 Q.B. 265), Kapur Singh vs Jagat Narain (A.I.R. 1951 Punjab 49) and M. V. Bajwade vs Dr. section M. Hassan, (A.I.R. , referred to.
|
il Appeals Nos. 245 and 202 of 1953.
Appeal under Article 132(1) of the Constitution of India from the judgment and order dated the 27th January 1953 of the Calcutta High Court in Matter No. 139 of 1952.
Ranadeb Chaudhry, Anil Kumar Das Gupta and Sukumar Ghose, for the appellant.
S.M. Bose, Advocate General, ' for West Bengal (B. Sen and P. K. Bose, with him) for the respondent.
December 23.
The Judgment of the Court was delivered by JAGANNADHADAS J.
This is an appeal by leave of the High Court of Calcutta under article 132(1) of the Constitution.
The appellant before us was the 1333 Registrar and Accountant General of the High Court at Calcutta on its Original Side.
He was appointed to the post by the Chief Justice of the High Court on the 4th March, 1948 and confirmed therein on the 15th of November, 1948.
He was dismissed therefrom with effect from the 1st September, 1951, by an order of the Chief Justice dated the 3rd September, 1951.
There were various charges against him and Mr. Justice Das Gupta was deputed by order of the Chief Justice dated the 28th May, 1651, to make an ' enquiry and submit a report.
Mr. Justice Das Gupta made a full enquiry and submitted his report on the 11th August, 1951, in which he exonerated the appellant in respect of some of the charges but found him guilty in respect of the other charges.
The learned Judge expressed his conclusion as follows: "Mr. Bose (the appellant) must be held to be guilty of misconduct and dishonest conduct and (that) he is unfit to hold the office of Registrar of the Original Side of this Court".
The Chief Justice issued to the appellant a notice on the 16th August, 1951, intimating that be agreed with the report after careful consideration thereof and asking him to show cause why he should Dot be dismissed from his post.
The appellant was given a hearing by the Chief Justice on the 31st August, 1951.
The order dated the 3rd September, 1951, of the Chief Justice dismissing the appellant from his office, a copy of which was served on him, runs as follows: "A full and thorough enquiry was held by Mr. Justice K. C. Das Gupta into the charges made against Sri P. K. Bose the Registrar of the Original Side of this Court.
Sri P. K. Bose was represented by eminent Counsel and every opportunity was given to him to meet the charges and put forward his explanation and defence.
The learned Judge however in a full and very carefully considered report found Sri P. K. Bose guilty of serious charges involving moral turpitude and dishonesty and further he was of opinion that Sri P. K. Bose was by reason thereof unfit to hold the said office of Registrar.
I considered this report and the evidence most 1334 anxiously and found myself in entire agreement with the learned Judge.
Sri P. K. Bose was, in my view, clearly guilty of the matter comprised in the charges specified by ' Mr. Justice K. C. Das Gupta.
I considered that prima facie the conduct of Sri P. K. Bose warranted dismissal and I therefore gave him notice under article 311(2) of the Constitution of India to show cause against the action proposed against him, namely, dismissal.
On the 31st august, 1951, Sri P.K. Bose showed cause before me and I heard Sri Sachin Chaudhuri his counsel and Sri P. K. Bose personally.
In all the circumstances this is not a case in which I can properly show any leniency.
Sri P. K. Bose has abused the trust and confidence reposed in him and has been found guilty of serious malpractices and dishonesty.
Conduct such as this of an officer of the status of the Registrar of the Original Side of this Court is unpardonable and must be dealt with severely.
I there fore dismiss Sri P. K. Bose from his office as Registrar of the Original Side of the Court, the dismissal to take effect from the 1st September, 1951.
Let a copy of this order be served on Sri P. K. Bose".
On the 25th January, 1952, the appellant submitted a petition to the Governor of West Bengal for cancellation of the above order.
He received intimation dated the 9th July, 1952, that the "Governor declines to interfere on his behalf".
Thereupon he filed an application to the Chief Justice for review of the prior order of dismissal.
It may be mentioned that it was Chief Justice, Sir Arthur Trevor Harries, who had initiated the proceedings against the appellant and passed the order of dismissal.
He retired in June, 1952.
The application for review was made to the successor Chief Justice, Shri P. B. Chakravarti, on the 11th September, 1952.
This application was rejected on the 16th September, 1952.
Thereafter on the 24th November, 1952, i.e., more than an year after the order of dismissal, a writ application was filed on the Original Side of the High Court under article 226 of the Constitution against the Hon 'ble 1335 the Chief Justice of the High Court "for calling upon him to bring up the records of the proceedings relating to his dismissal in order that justice may be done by quashing or otherwise dealing with the said proceedings and the said order dated the 3rd September, 1951, purporting to terminate his services and for directions being given to the Chief Justice to desist from giving effect to or acting in any manner under the said order".
On the presentation of the application the learned Judge on the Original Side, Mr. Justice Bose, issued a rule nisi calling upon the Hon 'ble the Chief Justice to show cause why an order in the nature of a writ as asked for should not be made.
This order was duly served and on its return the learned Judge made an order referring the hearing of the application to a Special Bench of three Judges as per the rules of the Court.
Accordingly the petition was, under the directions of the Chief Justice, heard by three learned Judges of the High Court, who after elaborate hearing and consideration of the points urged on behalf of the appellant dismissed the application.
Leave to appeal to this Court was, however, granted by them under article 132(1) on the ground that the case involves substantial questions of law relating to interpretation of the Constitution.
The main points that have been urged by the appellant before us, as before the High Court, are that (1)the Chief Justice of the High Court had no power under the law to dismiss him; (2)even if he had the power, he could not delegate the enquiry into the charges, to another Judge but should have enquired into the same himself; and (3)in any case the order of dismissal could not have been passed in the absence of previous consultation with the Public Service Commission of the State as provided under article 320 of the Constitution.
On behalf of the respondent, i.e., the Hon 'ble the Chief Justice of the High Court at Calcutta, the learned Advocate General of West Bengal has 1336 appeared before us.
In addition to controverting the correctness of the above contentions raised on behalf of the appellant, he strongly urged that (1)no writ could issue from the High Court against its own Chief Justice; (2)the order of the Chief Justice, the validity of which is being challenged, is a purely administrative order against which no application for writ is maintainable; and (3)this was not a case in which having regard to all the circumstances, any application by way of a writ should have been entertained.
The points urged on behalf of the appellant may first be taken up.
The most important out of them is the one relating to the authority of the Chief Justice to pass the order of dismissal as against the appellant.
It is beyond dispute that the Chief Justice is the authority for appointing the appellant.
It was in fact the Chief Justice who appointed the appellant and confirmed him.
But it is strongly urged that he had not the power to dismiss.
This argument is based on the assumption that the appellant falls within the category of public servants who are governed by the Civil Services (Classification, Control and Appeal) Rules, (hereinafter referred to as the Civil Services Rules) of the year 1930 as amended from time to time and that the said rules continue to apply, to an officer holding the post which he did, even after the Government of India Act, 1935, and later the Constitution of India of 1950 successively came into force.
I the argument recognises the fact that dismissal is a matter which falls within conditions of service of a public servant as held by the Privy Council in North West Frontier Province vs Suraj Narain Anand(1) and that the power of making rules relating to conditions of service of the staff of the High Courts is vested in the Chief Justice of the Court under section 242(4) taken with section 241 of the Government of India Act, 1935, as also under article 229(2) of the Constitution of India, 1950.
But (1) [1948] L.R. 75 I.A. 843.
1337 it is said that no such rules have been framed by the Chief Justice, and that therefore by virtue of section 276 of the Government of India Act, 1935, and article 313 of the Constitution, the Civil Services Rules continued to apply to him, It is necessary to examine the correctness of these assumptions.
The Civil Services Rules were framed by the Secretary of State in Council under powers vested in him by section 96 B(2) of the Government of India Act, 1915, as amended in 1919.
These rules were framed on the 19th June, 1930, and published on the 21st June, 1930.
It is desirable therefore to consider the position relating to the staff of the High Courts before that date.
It is not disputed that the said position was governed by the Letters Patent of the High Court.
Clause 8 of the Letters Patent of 1865 as amended in 1919, which continues to be operative, as also clause 4 thereof, are relevant for the present purpose.
They are as follows: "8.
We do hereby authorize and empower the Chief Justice of the said High Court of Judicature at Fort William in Bengal, from time to time, as occasion may require, and subject to any rules and restrictions which may be prescribed by the Governor General in Council, to appoint so many and such clerks and other ministerial officers as shall be found necessary for the administration of justice, and the due execution of all the powers and authorities granted and committed to the said High Court by these Our Letters Patent.
And it is Our further will and pleasure and We do hereby for Us, Our heirs and successors give grant, direct, and appoint, that all and every the officers and clerks to be appointed as aforesaid shall have and receive respectively such reasonable salaries as the Chief Justice shall, from time to time, appoint for each office and place respectively, and as the Governor General in Council shall approve of.
Provided always, and it is Our will and pleasure, that all and every the officers and clerks to be appointed as aforesaid shall be resident within the limits of the jurisdiction of the said Court, so long as they shall hold their respective offices; but 1338 this proviso shall not interfere with or prejudice the right of any officer or clerk to avail himself of leave of absence under any rules prescribed by the Governor General in Council, and to absent himself from the said limits during the term of such leave, in accordance with the said rules".
We do hereby appoint and ordain, that every clerk and ministerial officer of the said High Court of Judicature at Fort William in Bengal, appointed by virtue of the said Letters Patent of the Fourteenth of May, One thousand eight hundred and sixty two, shall continue to hold and enjoy his office and employment, with the salary thereunto annexed, until he be removed from such office and employment; and he shall be subject to the like power of removal, regulations, and provisions if he were appointed by virtue of these Letters Patent".
It will be noticed that clause 8 specifically vests in the Chief Justice the power of appointment, but makes no mention of the power of removal or of making regulations or provisions.
But it is obvious from the last portion of clause 4 that such power was taken to be implicit under clause 8 and presumably as arising from the power of appointment.
It may be mentioned that under clause 10 of the Charter of the Supreme Court of Calcutta issued in 1774, the said Court also was in specific terms "authorized and empowered from time to time, as occasion may require, to appoint so many and such clerks and other ministerial officers as shall be found necessary for the administration of justice".
The power of removal or of taking other disciplinary action as regards such appointees was not in terms granted.
But there is historical evidence to show that the power of appointment conferred under the Charter was always understood as comprising the above powers.
Sir Charles Wood, the then Secretary of State for India in paragraph 10 of his dispatch to the Governor General dated the 17th May, 1862, (on the formation of the new High Courts) stated as follows: "The Supreme Court exercises an authority entirely independent of the Government in respect of 1339 its ministerial officers".
It is this power and authority along with other judicial power and authority that was succeeded to by the High Courts (on their formation in supersession of the Supreme and Sadar Courts) by virtue of section 9 of the Indian High Courts Act, in the following terms.
"Each of the High Courts to be established under the Act shall have and exercise all jurisdiction and every power and authority whatsoever in any manner vested in any of the Courts . . . abolished under this Act . . " Thus it is clear that both under the Charter of the Supreme Court as well as under the Letters Patent of the High Court, the power of appointment was throughout understood as vesting in the High Court or the Chief Justice, the complete administrative and disciplinary control over its staff, including the power of dismissal.
There can be no doubt that this position continued at least until the Government of India Act, 1915.
Now, section 106 of the Government of India Act, 1915, in terms continued the above by providing that the jurisdiction of the High Court would "include all such powers and authority over and in relation to the administration of justice including power to appoint clerks and other ministerial officers of the Court as are vested in them by Letters Patent".
It follows that the position continued to be the same even under the Government of India Act, 1915, at any rate up to 1930, when the Civil Services Rules came into operation.
All the powers under the Letters Patent were, however, subject to alteration by competent legislative authority by virtue of clause 44 of the Letters Patent.
Clause 8 of the Letters Patent itself provided that the power of appointment of the Chief Justice was to be "subject to rules and restrictions which may be prescribed by the Governor General in Council".
Now, the Civil Services Rules were made by the Secretary of State in Council under section 96 B of the Government of India Act, 1915.
It is the case of the appellant that though the 169 1340 Civil Services Rules framed by virtue of delegated power under the Act could not override the specific power of appointment vested in the Chief Justice by virtue of section 106 thereof, they would override the alleged implications of that power such as the power of dismissal and power to frame rules relating to conditions of service in so far as they are specifically provided for under the Civil Services Rules.
It is further urged that the said situation continues up to date by virtue of section 276 of the Government of India Act, 1935 and article 313 of the Constitution, Now, the appellant is a person who was appointed in 1948 and dismissed in 1951.
It is, therefore, desirable in the first instance to examine the situation under the Government of India Act, 1935 and under the Constitution of 1950 on the assumption that the Civil Services Rules made a change in the prior situation so far as the High Court staff is concerned and applied thereto between 1930 and 1935.
Under the Government of India Act, 1935, the position relating to the Civil Services of the Crown in India is contained in a number of general provisions in Chapter 11 of Part X thereof Section 240(1) reiterates what was first statutorily declared by section 96 B of the 1915 Act, viz., that except as expressly provided by the Act every, person who is a member of a civil service of the Crown in India, or holds any civil post under the Crown in India, holds office during His Majesty 's pleasure.
Section 241 provides for the recruitment and conditions of service of such persons and prescribes the various authorities who can make the appointments and frame the rules relating to conditions of service.
Section 242(4), in so far as it is relevant for the present purpose, provides that section 241 in its application to appointments to and to persons serving on the staff attached to a High Court shall have effect as if, in the case of a High Court, for any reference to the Governor in paragraph (b) of section (1), in paragraph (a) of sub section (2) and in sub section (5), there was substituted a reference to the Chief Justice of the Court.
Making the necessary substitutions as prescribed 1341 above, the statutory provisions in the Government of India Act, 1935, relating to recruitment and conditions of service of the staff of the High Court may be read as follows: "(1) Appointments to the Civil Services and civil posts under the Crown in India in relation to the staff attached to the High Court shall be made by the Chief Justice or such person as he may direct.
(2)The conditions of service of persons serving.
His Majesty in relation to the staff attached to the High Court shall be made by the Chief Justice of the High Court or by some person or persons authorised by him to make the rules for the purpose.
Provided that (a)the Governor may in his discretion require that in such cases as he may in his discretion direct no person not already attached to the court shall be appointed to any office connected with the Court save after consultation with the Provincial Public Service Commission; (b)rules made under sub section (2) by a Chief Justice shall,, so far as they relate to salaries, allowances, leave or pensions, require the approval of the Governor".
These sections, while keeping intact the power of ap pointment of the members of the staff of the High Court with the Chief Justice as contained in the Letters Patent, provide, statutorily for the first time and in express terms what was implicit in clause 8 of the Letters Patent, viz., that the power to regulate and frame rules relating to conditions of service governing such staff is also vested in the Chief Justice subject however to two limitations indicated by the provisos mentioned above.
The corresponding provisions in the present Constitution relating to the powers of the Chief Justice in relation to the recruitment and service conditions of the staff of the High Court are almost identical and are contained in article 229.
They are as follows: "229.
(1) Appointments of officers and servants of a High Court shall be made by the Chief Justice of 1342 the Court or such other Judge or officer of the Court as he may direct: Provided that the Governor of the State in which the High Court has its principal seat may by rule require that in such cases as may be specified in the rule no person not already attached to the Court shall be appointed to any office connected with the Court save after consultation with the State Public Service Commission.
(2)Subject to the provisions of any law made by the Legislature of the State, the conditions of service of officers and servants of a High Court shall be such as may be prescribed by rules made by the Chief Justice of the Court or by some other Judge or officer of the Court authorised by the Chief Justice to make rules for the purpose: Provided that the rules made under this clause, shall, so far as they relate to salaries, allowances, leave or pensions, require the approval of the Governor of the State in which the Court has its principal seat".
It does not appear from the record that any rules have been made by the Chief Justice of the Calcutta High Court, at any rate, in so far as they may be applicable to the Registrar of the Original Side of the High Court.
On the assumption, therefore, that the Civil Services Rules applied to the case of a person in his position between 1930 and 1935, it has got to be seen whether they continue to be so applicable.
The relevant provisions in this behalf are section 276 of the Government of India Act, 1935, and article 313 of the Constitution.
They are as follows: "Section 276: Until other provision is made under the appropriate provisions of this Part of this Act, any rules made under the Government of India Act relating to the Civil Services of, or civil posts under, the Crown in India which were in force immediately before the commencement of Part III of this Act, shall, notwithstanding the repeal of that Act, continue in force so far as consistent with this Act, and shall be deemed to be rules made under the appropriate provisions of this Act".
1343 "Article 313: Until other provision is made in this behalf under this Constitution, all the laws in force immediately before the commencement of this Constitution and applicable to any public service or any post which continues to exist after the commencement of this Constitution, as an all India service or as service or post under the Union or a State shall continue in force so far as consistent with the provi sions of this Constitution".
Now, it has to be observed that the continuance, under section 276 of the Government of India Act, 1935, of the Civil Services Rules, could only be in so far as such continuance may be consistent with the new Act.
Further in their application to the High Court staff, the rules are to be deemed to be rules made under the appropriate provisions of the Act.
The rules, therefore, must be deemed to be rules made by the Chief Justice consistently with the scheme and the provisions of the Act relating to the High Court staff which specifically vest in him the powers of appointment and of the regulation of conditions of service including the power of dismissal.
Such continuance, therefore, can only operate by a process of adaptation implicitly Authorised by the very terms of section 276.
It would follow that, in their continued application to the High Court staff, the word "Governor" has to be read as substituted by the word "Chief Justice" wherever necessary in the same way as section 242(4) of the Act requires the provisions of section 241 to be read as though any reference to the Governor therein is substituted by a reference to the Chief Justice of the High Court.
The continued application of the Civil Services Rules without such adaptation would result in the anomalous position, that although the 1935 Act specifically vests in the Chief Justice the power of appointment and of framing rules regulating conditions of service including the power of dismissal and hence thereby indicates the Chief Justice as the authority having the power to exercise disciplinary control, be has no such disciplinary control merely because he did not choose to make any fresh rules and was content with the continued appli 1344 cation of the old rules.
Now, the relevant provision in the Civil Services Rules which deals with disciplinary action including dismissal is rule 52 thereof.
That rule shows that "the Governor General in Council or Local Government of a Governor 's Province may impose any of the penalties specified in rule 49 (which includes dismissal) on any person included in any of the classes I to 5 specified in rule 14 who is serving under the administrative control of the Governor General in Council or the Local Government, as the case may be".
This rule, if it originally applied to the High Court staff, must after 1935 be read by substituting "Chief Justice" in the place of "the Local Government" wherever it occurs therein and making other consequential alterations.
Thus read, there can be no doubt that as from the commencement of the Government of India Act, 1935, the power of dismissal of a member of the High Court staff including, a person in the position of the appellant, Would vest in the Chief Justice.
This would be so even apart from the normal implication of the power of appointment specifically recognised under the Act.
It follows that even on the assumption that Civil Services Rules applied between 1930 and 1935 to the High Court staff their continuance after 1935 makes a change in the dismissing authority and the power of dismissal is vested in the Chief Justice.
That being the correct position prior to 1950, the Constitution has made no change in this respect and article 313 would also continue rule 52 of the Civil Services Rules as above adapted.
It would, therefore, follow that, at any rate, from the time of passing of the Government of India Act, 1935, as also under the Constitu tion, the power of dismissal vests in the Chief Justice notwithstanding that no specific rules have been made in this behalf by the Chief Justice.
It must be mentioned, at this stage, that so far as the power of dismissal is concerned, the position under the Constitution of 1950 is not open to any argument or doubt.
Article 229(1) which in terms vests the power of appointment in the Chief Justice is equally effective to vest in him the power of dis 1345 missal.
This results from section 16 of the General Clauses Act which by virtue of article 367(1) of the Constitution applies to the construction of the word "appointment" in article 229(1).
Section 16 of the General Clauses Act clearly provides that the power of "appointment" includes the power "to suspend or dismiss".
In view of the clear conclusion we have arrived at as above, we do not consider it necessary to deal with the arguments addressed to us on both sides as to the applicability or otherwise of the Civil Services Rules to the High Court staff, including a person in the position of the appellant, and we express no opinion thereon.
The main contention, therefore, of the appellant as to the competency of the Chief Justice to pass the order of dismissal against him fails.
The further subordinate objections that have been raised remain to be considered.
The first objection that has been urged is that even if the Chief Justice had the power to dismiss, he was not, in exercise of that power, competent to delegate to another Judge the enquiry into the charges but should have made the enquiry himself.
This contention proceeds on a misapprehension of the nature of the power.
As pointed out in Barnard vs National Dock Labour Board(1) at page 40, it is true that "no judicial tribunal can delegate its functions unless it is enabled to do so expressly or by necessary implication".
But the exercise of the power to appoint or dismiss an officer is the exercise not of a judicial power but of an administrative power.
It is nonetheless so, by reason of the fact that an opportunity to show cause and an enquiry simulating judicial standards have to precede the exercise thereof It is well recognised that a statutory functionary exercising such a power cannot be said to have delegated his functions merely by deputing a responsible and competent official to enquire and report.
That is the ordinary mode of exercise of any administrative power.
What cannot be delegated except where the law specifically so provides is the ultimate responsibility for the exercise (1) ; , 40.
1846 of such power.
As pointed out by the House of Lords in Board of Education vs Rice(1), a functionary who has to decide an administrative matter, of the nature involved in this case, can obtain the material on which he is to act in such manner as may be feasible and convenient, provided only the affected party "has a fair opportunity to correct or contradict any relevant and prejudicial material".
The following passage from the speech of Lord Chancellor in Local Government Board V. Arlidge (2) is apposite and in structive.
"My Lords, I concur in this view of the position of an administrative body to which the decision of a question in dispute between parties has been entrusted.
The result of its enquiry must, as I have said, be taken, in the absence of directions in the statute to the contrary, to be intended to be reached by its ordinary procedure.
In the case of the Local Government Board it is not doubtful what this pro cedure is.
The Minister at the head of the Board is directly responsible to Parliament like other Ministers.
He is responsible not only for what he himself does but for all that is done in his department.
The volume of work entrusted to him is very great and he cannot do the great bulk of it himself.
He is expected to obtain his materials vicariously through his officials, and he has discharged his duty if he sees that they obtain these materials for him properly.
To try to extend his duty beyond this and to insist that he and other members of the Board should do everything personally would be to impair his efficiency.
Unlike a Judge in a Court he is not only at liberty but is compelled to rely on the assistance of his staff".
In view of the above clear statement of the law the objection to the validity of the dismissal on the ground that the delegation of the enquiry amounts to the delegation of the power itself is without any substance and must be rejected.
The second objection that has been taken is that even if the power of dismissal is vested in the Chief Justice, the appellant was entitled to the protection (1) , 182.
(2) ,133. 1347 of article 320(3)(c) of the Constitution.
It is urged that the dismissal in the absence of consultation with the Public Service Commission of the State was invalid.
There can be no doubt that members of the staff in other Government departments of the Union or the State are normally entitled to the protection of the three constitutional safeguards provided in articles 311(1), 311(2) and 320(3) (c).
Article 320(3) (e) so far as it is relevant for the present purpose, runs as follows: "The Union Public Service Commission or the State Public Service Commission, as the case may be, shall be consulted on all disciplinary matters affecting a person serving under the Government of India or the Government of a State in a civil capacity, including memorials or petitions relating to such matters".
The phrase "all disciplinary matters affecting a person" is sufficiently comprehensive to include any kind of disciplinary action proposed to be taken in respect of a particular person.
The question for consideration, therefore, is whether a person belonging to the staff of a High Court is within the scope of the phrase (Ca person serving under the Government of India or the Government of a State in a civil capacity".
The learned Judges of the High Court were of the opinion that article 320(3) can have no application to the present case.
In their view the provisions of article 320(3) would be inconsistent with the power vested in the Chief Justice of a High Court under article 229, as regards the appointment of officers and ser vants of a High Court and hence also of dismissal or removal and as regards the framing of rules prescribing conditions of service of such officers or servants.
They also point out that the proviso to article 229(1) indicates the requirement that the State Public Service Commission should be consulted only in respect of the specific cases of future appointments and that too if the Governor of the State so requires by rule.
They take this and the fact that under the Constitution the provisions relating to High Court staff are taken out of Part XIV relating to the services, as imply 170 1348 ing, that in the exercise of the powers vested in the Chief Justice under article 229, consultation with the State Public Service Commission in respect of any other matter must be taken to have been excluded.
This reasoning is not without force.
Undoubtedly there is much to be said for the view that article 320(3) taken as a whole is inconsistent with article 229.
But it is possible to treat the requirement of prior consultation under article 320(3) (c) which relates to disciplinary action against individual Government employees and which is in the nature of an important constitutional safeguard for individual government employees as standing on a somewhat different footing from that under article 320(3) (a) or (b), which relate to general matters relating to recruitments, appointments, etc.
Prior consultation in respect of individual cases may not be considered necessarily inconsistent with the actual exercise of the overriding power of the Chief Justice in such cases.
While, therefore, recognising the force of the view taken by the High Court, it appears desirable to consider the requirement under article 320(3)(c) taken by itself with reference to the actual terms thereof, in view of the importance of this provision as a constitutional safeguard in cases to which it applies.
A scrutiny of the provisions in Chapter I of Part XIV of the Constitution relating to the services shows that the various articles in this Chapter designate the services to which the articles relate by a variety of terminology.
Under article 309, the appropriate Legislature is vested with the power to regulate recruitment and conditions of service "of persons appointed to public services and posts in connection with the affairs of the Union or of any State".
Under article 310 "every person who is a member of a civil service of the Union or holds any civil, post under a State" holds office during the pleasure of the President or, as the case may be, of the Governor or of the Rajpramukh of the State.
Under article 311 the two constitutional safeguards, viz., (1) of not being liable to be dismissed or removed or reduced in rank until he has been given a reasonable opportunity 1349 of showing cause against the action proposed to be taken in regard to him, and (2) of not being liable to be dismissed or removed by ail authority subordinate to that by which he was appointed, are available to "a person who is a member of a civil service of the Union or of a civil service of a State, or holds a civil post under the Union or a State".
Under article 320(3)(c) however, the requirement of con sultation with the appropriate Public Service Commission on disciplinary matters is available to "a person serving under the Government of India or the Government of a State in a civil capacity".
A close scrutiny of the terminology so used shows a marked departure in the language of article 320 (3) (c) from that in articles 310 and 311.
Officers and members of the staff attached to a High Court clearly fall within the scope of the phrase "persons appointed to public services and posts in connection with the affairs of the State" and also of the phrase "a person who is a member of a civil service of a State" as used in articles 3lO and 311.
The salaries of these persons are paid out of the State funds as appears from article 229(3) which provides that the administrative expenses of a High Court including all salaries, allowances and pensions payable to or in respect of officers and servants of the High Court, are chargeable upon the Consolidated Fund of a State.
The item relating to such administrative expenses has to form part of the annual financial statement to be presented to the State Legislative Assembly under article 202 and estimates thereof can form the subject matter of the discussion in the Legislature under article 203(1).
They must, therefore, be taken "to hold posts in connection with the affairs of the State and to be members of the civil service of the State".
But can it be said that members of the High Court staff are "persons serving under the Government of a State in a civil capacity" which is the phrase used in article 320(3) (c).
The use of different terminology in the various articles was not likely to have been accidental.
It is to be noticed that even article 320 in its various clauses uses different phrases.
Article 320(1) refers to "appoint 1350 ments to the services of the Union and the services of the State" and the proviso to article 320(3) refers to "services and posts in connection with the affairs of the Union and to services and posts in connection with the affairs of the State".
It appears, therefore, not unlikely that in using somewhat different phraseology, the intention was to demarcate the staff of the High Courts from the other civil services of the Union or the State.
The phrase "persons serving under the Government of India or the Government of a State" seems to have reference to such persons in respect of whom the administrative control is vested in the respective executive Governments functioning in the name of the President or of the Governor or of a Rajpramukh.
The officers and staff of the High Court cannot be said to fall within the scope of the above phrase because in respect of them the administrative control is clearly vested in the Chief Justice, who under the Constitution, has the power of appointment and removal and of making rules for the con ditions of services.
Articles 53, 77, 154 and 166 of the Constitution show that while the executive power of the Union or the State is vested, respectively, in the President or the Governor and that executive action is to be taken in their respective names, such action is the action of the Government of India or the Government of a State.
But the administrative action of the Chief Justice is outside the scope of these articles.
It appears therefore that in using the phrase "Government of India and Government of a State" in article 320(3) (c), the Constitution had in view the above mentioned demarcation.
A close comparison of the terminology used in the corresponding provisions of the Government of India Act of 1935 also seems to confirm this demarcation.
Section 290 (1) of the said Act refers to "every person who is a member of a civil service of the Crown in India or holds any civil post under the Crown in India" while section 266(3)(c) relates to "a person serving His Majesty in a civil capacity in India".
A perusal of the main paragraph of sub section (3) of section 266 clearly shows that it has reference to three cate 1351 gories of services (1) Secretary of States services, (2) Federal services under the Governor General, and (3) Provincial Services under the Governor.
In the context of this section, the comprehensive phrase "serving His Majesty" seems to have been used as comprising only the above three services and should be exclusive of the staff of the High Court.
The fact that different phrases have been used in the relevant sections of the Government of India Act and the Constitution,,, relating to the constitutional safeguards in this behalf appears to be meant to emphasise the differentiation of the services of the High Court from other services, and to place the matter beyond any doubt as regards the non applicability thereto of this constitutional protection.
It may be noticed that while the constitutional safeguards under article 311 are available to every person in the civil service, the safeguard in article 320(3)(c) is one capable of being taken away by regulations to be made by the President or Governor.
The Constitution itself appears, therefore, to have classed this safeguard on a different footing.
This may well have been intended not to apply to the High Courts.
Therefore both on the ground that article 320(3)(c) would be contrary to the implication of article 229 and on the ground that the language thereof is not applicable to the High Court staff, we are of the opinion that for the dismissal of the appellant by the Chief Justice, prior consultation with the Public Service Commission was not necessary.
We accordingly hold that the appellant was not entitled to the protection under article 320(3)(c).
It follows that none of the three contentions raised on behalf of the appellant, i.e., (1) as to the power of the Chief Justice to dismiss him, (2) as to his competence to delegate the enquiry to Mr. Justice Das Gupta, and (3) as to his obligation to consult the State Public Service Commission, have been substantiated.
This application must accordingly fail on the merits.
This would be enough to dispose of the case against the appellant.
The learned Judges of the High Court have also dealt at some length with the question as 1352 to the maintainability of an application for a writ in a case of this kind and of the availability of any remedy by way of a writ against the action of the Chief Justice, whether administrative or judicial.
Arguments in this behalf have also been strongly urged before us by the learned Advocate General of West Bengal.
In the view, however, that we have taken as to the contentions raised before us regarding the validity of the order of dismissal, we do not feel called upon to enter into the discussion relating to the availability of the writ.
We express no opinion on the questions so raised.
We consider it, however, desirable to say that our view that the exercise of power of dismissal of a civil servant is the exercise of administrative power may not necessarily preclude the availability of remedy under article 226 of the Constitution in an appropriate case.
That is a question on which we express no opinion one way or the other in this case.
In the result the appeal must be dismissed with costs.
Along with this appeal, the appellant filed an application to this Court for leave under article 136 to appeal against the orders dated the 3rd September, 1951, and 16th September, 1952, dismissing him from service and declining to review it.
In view of our judgment just delivered, that application must also be rejected.
| The appellant was appointed in March 1948 by the Chief Justice of the Calcutta High Court as Registrar and Accountant General of the High Court on its original side and confirmed therein in November 1948.
He was dismissed from that post with effect from 1st September 1951 by the Chief Justice by his order dated 3rd September 1951.
There were various charges against the appellant and Mr. Justice Das Gupta was deputed by the Chief Justice to make an enquiry and submit a report.
Mr. Justice Das Gupta made a full enquiry and submitted a report in which he exonerated the appellant in respect of some of the charges but found him guilty in respect of other charges.
His conclusion was that the appellant must be held guilty of misconduct and dishonest conduct and that he was unfit to hold the office of Registrar of the Original Side of the Calcutta High Court.
The Chief Justice issued notice to the appellant intimating that he agreed with the report and asked him to show cause why he should not be dismissed from his post.
After be was given an opportunity to show cause, the appellant was dismissed by an order of the Chief Justice.
The appellant 's petition to the Governor for the cancellation of the above order was dismissed.
Subsequently his application for review to the Chief Justice of the prior order of dismissal and a writ petition under article 226 of the Constitution filed in the High Court in respect of his dismissal were also dismissed one after the other.
The appellant obtained leave to appeal to the Supreme Court.
The three main points for consideration by the Supreme Court were: 1.
Whether the Chief Justice of the High Court had no power to dismiss the appellant; 2.
Even if the Chief Justice had such power whether be could not delegate the enquiry into the charges to another Judge but should have made the enquiry himself; and 168 1332 3.
Whether the order of dismissal by the Chief Justice could have been passed without previous consultation with the Public Services Commission as provided by article 320 of the Constitution.
Held (1) that the Chief Justice was competent to dismiss the appellant because both by virtue of the provisions of clause 8 of the Letters Patent of the Calcutta High Court read with clause 4 of the same as well as articles 229(1), 313 and 367(1) of the Constitution read with section 16 of the General Clauses Act, the power of appointment includes the power of dismissal; (2) the objection to the validity of dismissal on the ground that the delegation of enquiry amounted to a delegation of power is without substance because the exercise of power to appoint or dismiss an officer is the exercise not of a judicial power but of an administrative power and it is well settled that a statutory functionary exercising such a power cannot be said to have delegated his function merely because he has deputed a responsible and competent official to enquire and report; and (3) it was not necessary to have the previous consultation with the Public Service Commission for the dismissal of the appellant by the Chief Justice because article 320(3) of the Constitution taken as a whole is inconsistent with article 229 of the Constitution and also because the language thereof is not applicable to the High Court Staff.
North West Frontier Province vs Suraj Narain Anand ([1948] L.R. 75 I.A. 343), Barnard vs National Dock Labour Board, ([1953] 2 Q.B. 18, 40), Board of Education vs Bice ([1911] A.C. 179), and Local Government Board vs Arlidge ([1915] A.C. 120), referred to.
|
il Appeals Nos. 22 and 22 A and 301 of 1955.
Appeals by special leave from the judgment and order dated the 4th July 1952 of the Labour Appellate Tribunal of India, Lucknow in Appeals Nos. 391 and 392 of 1951 arising out of the Award dated the 1st November 1951 of the Adjudicator and Additional Regional Conciliation Officer, Kanpur in Case No. 53 of 1951.
G.S. Pathak, (Rameshwar Nath and Rajinder Narain), for the appellants in all the appeals.
G. C. Mathur, for the respondent in C. A. Nos. 22 and 22 A and respondent No. 4 in C. A. No. 301 of 1955.
K. B. Asthana and C. P. Lal, for the respondent No. 3 in C. A. No. 301 of 1955.
December 23.
The Judgment of the Court was delivered by BOSE J.
We are concerned here with three appeals.
They arise out of a dispute between the J.K. Iron and Steel Company Limited and the Iron and Steel Mazdoor Union.
We will call them the 1317 Company and the Mazdoor Union respectively.
The facts are as follows.
The Company had its factory and other works at Kanpur in Uttar Pradesh.
On 10 4 1948 the Ministry of Commerce in the Government of India ordered the Company to shift its Jute Baling Hoops factory from Kanpur to Calcutta.
As no land was available in Calcutta no effect could be given to this order till the year 1950 51.
On 19 3 1951 the Iron and Steel Controller ordered the Company to stop the rolling of jute baling hoops at once.
Accordingly, the production of these hoops was stopped from that date.
At the same time there was scarcity of scrap iron and the Company 's case is that forced it to reduce the working of its furnace from three shifts a day to one.
The Company states that because of these two causes it was obliged to retrench its staff.
Therefore, it issued the following notice dated 15 5 1951 to 128 of its workers: "Consequent to transfer of the Rolling Mill to Calcutta and want of scrap to Furnace Department in full, the services of the persons as per list attached are dispensed with from today.
Their wages and other dues in full settlement will be paid after 2 P.m.
" Twenty five of the 128 accepted their wages and other dues in full settlement but the remaining 103 refused.
Their cause was accordingly espoused by the Mazdoor Union which made an application to the Regional Conciliation Officer at Kanpur on 16 5 1951 complaining that the retrenchment was illegal and asking that the workmen be reinstated with full payment of their wages for the period they were out of work.
This was forwarded to the Government of Uttar Pradesh and on 28 6 1951 the Governor of that State referred the following issue to the Regional Conciliation Officer at Kanpur under sections 3, 4 and 8 of the U.P. for adjudication: "Whether the retrenchment of the workmen 1318 given in the Annexure by Messrs J. K. Iron and Steel Co. Ltd ' Kanpur, is unjustified? If so, to what relief are the workmen entitled?" The parties filed their written statements on 14 7 1951 and the Company filed a rejoinder on 20 7 1951.
The Adjudicator thereupon took evidence, oral and documentary, and gave his award on 1 11 1951.
But before that was done the case of one of the workmen (Kapil Deo Singh) was withdrawn and that left 102 for him to deal with.
The Adjudicator reached the following conclusions.
The Mazdoor Union had contended that the retrenchment was not in good faith.
The Adjudicator held that it was and that there was neither harassment nor victimisation.
So also on the question about the shortage of scrap he held that there was a shortage but that it was only temporary and that it was not likely to last for more than 8 or 9 months.
He then referred to the Standing Orders and said that the Company was not entitled to resort to retrenchment except as a last resort and that in the circumstances of the present case these workmen should (1) have been offered the option of employment in the new set up at Calcutta; and (2) those that did not want it should have been laid off in rotation instead of being retrenched.
He accordingly ordered that should be done and drew up a graduated scale ,of compensation.
We observe in passing that the expression used throughout has been "played off".
The reason for that is that is the phrase used in the Standing Orders and in the copy of the Act and Model Standing Orders reproduced by the U. P. De partment of Labour in its Annual Review of Activities.
But it seems to us that was due to printer 's error at some stage which has been repeated in various places.
The correct expression is "lay off".
That is the expression used and defined in the Act.
The Standing Orders should have used the same phrase.
Apart from the definition in the Act, "lay off " is a well known industrial term meaning, according to the Oxford Dictionary, "a period during which 1319 a workman is temporarily discharged".
We will use the correct expression in this judgment.
Both sides appealed to the Labour Appellate Tribunal.
The decision, there was as follows.
The Tribunal upheld the finding that there was in fact a shortage of scrap iron and also agreed with the Adjudicator that was only likely to be temporary.
Then it held, apparently as a matter of law, that under the Standing Orders it is not permissible to retrench workmen and deprive them of their maintenance when there is only a temporary shortage of material, whatever the duration of the shortage; all that the employer can do in a case like that is to lay them off.
The Tribunal also upheld the finding that the Hoop Mill was in the course of transfer to Calcutta consequent on the orders of Government, but they held that there was nothing on the record to show which of the 105 persons (it should be 102) whose cases they were considering were "specifically engaged in the Hoop Mills and had become surplus by reason of the transfer to Calcutta".
This is one of the findings attacked before us by the Company on the ground that the Tribunal has failed to realize that the Company 's operations must be considered as a whole and that because of the interdependence of its various departments a closure of one section, coupled with a shortage of materials in another, is bound to affect its all round working and therefore the question of retrenchment cannot be looked at from the narrow point of view of only one department but must be viewed in its all round setting.
We will deal with this later.
Another of the Tribunal 's findings on the "transfer" aspect of the case was that a cut in profits is not in itself a good ground for retrenchment.
It held that retrenchment can only be made when there is a total closure of the mill "or when for any such other reason the workmen become surplus".
The final conclusion of the Tribunal was that the retrenchment was "wholly unjustified".
Accordingly, it set aside the retrenchments and held that the 1320 affected workmen will be deemed to be "still in service".
and directed that they be reinstated.
The appeal of the Mazdoor Union was partly allowed and that of the Company dismissed.
This impelled the Company.
to do the following things: (1)to file a writ petition in the Allahabad High Court on 4 8 1952.
This was dismissed by that Court on 9 4 1953 and Civil Appeal No. 301 of 1955 is the appeal to us against that order; (2)to file two appeals to this Court against the order of the Labour Appellate Tribunal.
These appeals are Civil Appeal No. 22 of 1955 and Civil Appeal No. 22 A of 1955.
This judgment covers all three appeals.
Mr. G. C. Mathur, who appeared for the Mazdoor Union, raised a preliminary objection against the Company 's appeals based on the following facts.
The Company had appealed to this Court against the Labour Appellate Tribunal 's decision on 26 8 1952.
The petition was summarily dismissed on 10 9 1952.
Counsel contended that barred the present appeals: Civil Appeal 22 A of 1955 because it is an appeal against the very order that is now under appeal, and Civil Appeal 301 of 1955 on the basis of res judicata because it raises the same points as were raised in the petition for special leave which was dismissed.
We rejected this objection because the previous petition for appeal does not appear to have been dismissed on the merits but on two technical grounds.
It is true the order of dismissal is general but the office note states (1) that no certified copy of the decision appealed against was filed though Order 13, rule 4, of the Rules of the Supreme Court, requires that and (2) that the reliefs sought in the petition for special leave and in the writ petition before the High Court are the same.
It is evident that formed the basis of the order of dismissal especially as it is the usual practice not to entertain an appeal here when a similar matter is pending in the High Court, 1321 Before we come to the merits it will be necessary to set out the grounds on which the High Court proceeded.
The learned Judges were concerned with a writ for certiorari and so naturally focussed their attention on questions of jurisdiction rather than on the merits.
They considered that the Adjudicator ' was free to take into consideration all matters bearing on the question of retrenchment and to consider whether it was "absolutely necessary" to retrench the workmen.
They looked at Standing Order 16(a) and decided that the Adjudicator had jurisdiction to determine the scope and meaning of this Order and that he and the Labour Appellate Tribunal were competent to hold that these orders meant that the Company was not entitled to take what the learned Judges called the "extreme step of retrenchment" so long as it was possible for it to "lay off " the workmen.
That at once raises questions about the scope and authority of an adjudicator under the .
But that, we feel is now settled by authority.
The Federal Court held in Western India Automobile Association vs Industrial Tribunal, Bombay(1) that adjudication does not mean adjudication according to the strict law of master and servant and held that an adjudicator 's award may contain provisions for settlement of a dispute which no Court could order if it was bound by ordinary law.
They held that Industrial Tribunals are not fettered by these limitations and held further that an adjudicator has jurisdiction to investigate disputes about discharge and dismissal and, where necessary, to direct reinstatement.
That decision was followed with approval by this Court in State of Madras vs C. P. Sarathy(2) and it was again pointed out that the scope of an adjudication under the is much wider than that of an arbitrator making an award.
It would be pointless to cover the same ground; so we must take that now as settled law.
All the same, wide as their powers are, these Tri (1) , 345.
(2) , 348, 1322 bunals are not absolute and there are limitations to the ambit of their authority.
In Bharat Bank Ltd. vs Employees of Bharat Bank Ltd.(1) this Court held by a majority that though these Tribunals are not Courts in the strict sense of the term they have to discharge quasi judicial functions and as such are subject to the overriding Jurisdiction of this Court under article 136 of the Constitution.
Their powers are derived from the statute that creates them and they have to function within the limits imposed there and to act according to its provisions.
Those provisions invest them with many of the "trappings" of a court and deprive them of arbitrary or absolute discretion and power.
There is, in our opinion, an even deeper reason which is hinted at in the judgment of Mahajan J. (as he then was) at page 500 where he says that "benevolent despotism is foreign to a democratic Constitution".
That, in our opinion, is the heart of the matter.
When the Constitution of India converted this country into a great sovereign, democratic, republic, it did not invest it with the mere trappings of democracy and leave it with merely its outward forms of behaviour but invested it with the real thing, the true kernel of which is the ultimate authority of the Courts to restrain all exercise of absolute and arbitrary power, not only by the executive and by officials and lesser tribunals but also by the legislatures and even by Parliament itself.
The Constitution established a "Rule of Law" in this land and that carries with it restraints and restrictions that are foreign to despotic power.
Despite this, however, the Courts must always exercise caution and see that they do not substitute their own judgment and discretion for that of these Tribunals, for, as Mahajan, J. said in Bharat Bank Ltd. vs Employees of Bharat Bank Ltd.(1) the overriding powers of this Court under article 136 are exceptional; and he went on to point out that "extraordinary Powers of this character can only be justifiably used here there has been a grave miscarriage of justice or where the procedure adopted by (1) ; , 497.
1323 the Tribunal is such that it offends against all notions of legal procedure".
Now the position in the present case is this.
The Tribunals are directed by section 7 of the to adjudicate industrial disputes "in accordance with the provisions of the Act" and section 11 directs them to follow "such procedure as may be prescribed".
The procedure for the Uttar Pradesh Tribunals is laid down by the U.P. State Industrial Tribunal Standing Orders, 1951.
Very broadly it follows the pattern of the civil Courts.
Once the reference is made by Government, the Tribunal has to take the pleadings of the parties in writing and to draw up issues.
Then it takes evidence, hears arguments and finally pronounces its "judgment" "in open Court".
It is evident from this that though these tribunals are not bound by all the technicalities of civil Courts, they must nevertheless follow the same general pattern.
Now the only point of requiring pleadings and issues is to ascertain the real dis pute between the parties, to narrow the area of conflict and to see just where the two sides differ.
It is not open to the Tribunals to fly off at a tangent and, disregarding the pleadings, to reach any conclusions that they think are just and proper.
What exactly was the dispute in the present case? The broad conflict was of course about the retrenchment and the Tribunal was asked to decide whether the retrenchment of these 103 persons was unjustified; but that by itself left the issue much too broad, so it was necessary to "particularise" and that was done in the pleadings.
The Company justified its action on two grounds: (1) because of the shortage of scrap and (2) because of the stoppage of work in the Hoop Department consequent on the orders of Government.
But none of the persons retrenched came from the Hoop Department and the Company explained that was because of the interdependence of its various departments and, taking the retrenchments in groups, department by department, it explained just why reduction was effected in those particular places.
In 167 1324 this way, it dealt serially with the retrenchments in(1) the Scrap Department, (2) the Cast Iron Foundry,(3) the Punching and Pressing Department, (4) the Watch and Ward Department and (5) the Clerical Department.
The Company also made the following assertions, (1) that retrenchment is a necessary incidence of an industry and that the discretion of the management should not be interfered with; (2) that it is the exclusive function of the management to determine the size of its working force and (3) that the employer must be the sole judge as to how economically or efficiently its business is to be run.
The Mazdoor Union retorted that the retrenchments were not done in good faith.
It denied that there was any shortage of scrap but admitted the interdependence of the various departments and used that fact as an argument to indicate the Company 's bad faith.
The Union said the very fact that there had been no retrenchment in the department that was directly affected, namely the Hooping Department, and that there was no retrenchment in certain allied departments that would have been the first to be bit, had there been any real shortage of scrap, showed that the reasons given by the Company for the retrenchment were untrue.
In particular, the Union pointed out that there had been no retrenchment in the following departments which, according to it, would have been the hardest hit had there been any truth in the Company 's case namely, (1) the Furnace Department, (2) Rolling Mill Department, (3) Workshop, (4) Painting and Bundling, (5) Works and Maintenance.
Then, as regards the Foundry Department and the Scrap Department where there bad been retrenchments, the Union said that these departments bad sub sections and yet there were no retrenchments in the sub sections that would have been hit if the Company 's allegations were true.
The Union gave no reply to the Company 's assertions about its right to retrench in the absence of bad faith , its right to determine the size of its work 1325 ing force and its right to judge of the economy and efficiency of its business.
The Company filed a written rejoinder and explained in detail why there had been no retrenchments in the places where, according to the Union, there should have been on the facts alleged by the Company and it again explained why it had retrenched workers in the departments which, according to the Union, ought to have been the hardest hit.
This explanation again brought out the interdependence of the various departments.
Instead of drawing up issues, as it is required to do by Standing Order 22 of 1951, and determining just where the parties disagreed, the Adjudicator at once proceeded to record evidence and entered upon a rambling enquiry which embraced questions which had not been raised at all.
On the only point on which the parties were really at issue, namely the good faith of the management, the findings were in favour of the Company.
So also the Adjudicator accepted the Company 's assertion about its right to determine the size of its labour force and to effect retrenchment where necessary subject only to the proviso which the Adjudicator added, namely that this must be done in good faith; and indeed the Mazdoor Union had not challenged these assertions in its written statement.
The Adjudicator said "It is however an accepted principle that such changes as are being done by the management now form a part of managerial discretion and cannot be interfered with unless it is coloured with the element of victimisation or unfair labour practice".
But despite this, and despite his findings about good faith, the Adjudicator considered that, in spite of it all "the right of the workmen has to be safeguarded to certain extent".
What is left of the right if the "accepted principle" be what he says it is and if there is no victimisation or bad faith, he did not proceed to explain.
If the principle he enunciated and accepted is sound, then the only rights they have are to complain of 1326 bad faith, victimisation and so forth.
However, feeling under a compulsion to safeguard these unexplained rights he had recourse to Standing Order 16(a) and ignored Standing Orders 19 and 20.
The "accepted principle" to which the Adjudicator refers in the passage quoted above is implicit in Standing Orders 19(a) and 20(a).
They deal with the termination of service by an industrial establishment and prescribe a certain quantum of notice in writing, and then comes this important proviso in Standing Order 19 (a) "Provided that if a permanent workman feels that he has been discharged for reasons not connected with his employment or that the reason of discharge communicated to him is not genuine, he may make an appeal to the Labour Commissioner.
The decision of the Labour Commissioner. . . shall be binding on both the parties".
Reading the body of Standing Order 19 (a) along with the proviso in the light of the "accepted principle", it is evident that the only right the workman has, when his services are lawfully terminated after service of due notice and so forth, is to question the order on only two grounds (1)that he has been discharged for reasons not connected with his employment, and (2)that the reason of discharge communicated to him is not genuine.
There is nothing in these Standing Orders to indicate that retrenchment is a measure of last resort and that an employer must continue to lay off his workmen however uneconomical that may be to the business; still less that he must lay them off in rotation and thus affect other workmen who would not be affected by a legitimate order of retrenchment.
That cuts at the root of the "accepted principle".
In any event, the ground on which the adjudicator proceeded was not a matter in dispute between the parties because it was not raised in their pleadings and could not have been put in issue bad the Adjudicator troubled to draw up issues as he should have done.
As Mahajan, J. said, adjudicators and tribu 1327 nals cannot act as benevolent despots and that is exactly what it comes to when an adjudicator, after setting out, correctly in our opinion the Company 's rights, holds against the Union on the only grounds that it did raise and then proceeds to give an award, not only on grounds that are not raised but on grounds that fly in the face of the very principles that he enunciated; and that only because he felt that he was under a compulsion to "safeguard" the workmen to "a certain extent".
Both sides appealed to the Labour Appellate Tribunal and the second ground of the appeal lodged, by the Mazdoor Union was "that the award of the learned Adjudicator is quite arbitrary" which, of course, is exactly what it was And so also ground No. 9: "That the learned Adjudicator has gone beyond his jurisdiction in awarding relief on a question not, referred to it by Government".
That again we feel is justified.
What was referred was the question of the justification for retrenchment of certain specified workmen.
What was awarded was the laying off of persons whose cases were not even considered, that is to say, when the Adjudicator directed laying off in rotation, his order necessarily affected persons who had neither been laid off nor retrenched and whose cases not even the Union had in mind.
It is to be observed that the Mazdoor Union complains about this part of the order in ground No. 11 though on a different ground.
The Company also appealed against the Adjudicator 's order and grounds Nos. 6, 9 and 24 of their appeal are directed against that part of the order that deals with the lay off of the workmen.
Among other reasons advanced is that this will adversely affect others who are not retrenched.
The other grounds repeat what was said in the company 's written statement though in different language.
The Labour Appellate Tribunal contrasted Standing Order 15(a) with Standing Order 16(a) but also ignored Standing Orders 19(a) and 20 which are the 1328 only ones that really apply to this case.
It upheld the finding of the Adjudicator that there was a shortage of scrap but held that as the shortage was for only 6 months retrenchment was not justified.
In point of fact, the Labour Appellate Tribunal is wrong about the six months.
It was under the impression that the Adjudicator had come to that conclusion.
But what the Adjudicator said was that the shortage at best was for a period of 8 or 9 months.
The passage which the Appellate Tribunal quotes is not the finding of the Adjudicator but the argument advanced on behalf of the Company.
The full passage runs thus: "Shri Mahalingam stated that Standing order 16(a) which provides for a lay off of a maximum period of 12 days in a month contemplates a temporary shortage of very short duration.
It could not apply to shortage of raw materials lasting for more than 6 months and hence the Company 's right to retrench is not affected by the aforesaid Standing Order".
The Appellate Tribunal quoted the portion we have underlined but ignored the rest of the sentence and the part that went before and concluded that the portion underlined was a part of the Adjudicator 's findings.
However, even if we assume that the Tribunal would have reached the same conclusion if it had realised that the shortage was for as long as 8 or 9 months, the error into which it has fallen is that the question of retrenchment cannot be made to depend on the duration of the shortage or even on the fact that those retrenched will be thrown out of employment but on the effect that an omission to retrench will have on the business.
In some cases, laying off even for 6 or 8 or 9 months might make the Company bankrupt, therefore, if the Appellate Tribunal considered that it had power to stop retrenchment for reasons other than those given in the proviso to Standing Order 19(a) it was bound to look into the Company 's finances and determine the question of justification on that basis.
The only question referred was the retrenchment justified? and we find it 1329 impossible to see how that can be determined without considering the question of good faith which in turn would largely depend on the finances of the Company, on the adverse effect that retention would have on the business and on whether retention would mean the deadweight of an uneconomic surplus and so forth.
Next, when the Appellate Tribunal turned its attention to the transfer of the Hoop Mill to Calcutta, it agreed that would have been a good ground for retrenching those who were specifically engaged in the Hoop Mill but not the others.
But this takes an impossibly narrow view and ignores the over all working of a business concern and the repercussions that a transfer of this kind would have on other parts of the business.
It totally ignores the pleadings of the parties and, like the adjudicator, bases its conclusion on some airy view of what it considers would be a good thing for the workmen.
That is not a decision "given in accordance with the Act" and is as much open to objection on that score as the award of the Adjudicator.
It is pertinent at this stage to refer to a decision of this Court reported in Muir Mills Co. vs Suti Mills Mazdoor Union, Kanpur(1) where Bhagwati, J. delivering the judgment of the Court said "The considerations of social justice imported by the Labour Appellate Tribunal in arriving at the decision in favour of the respondent were not only irrelevant but untenable".
In the present case also we are of opinion that the Adjudicator and the Labour Appellate Tribunal had adopted the attitude of benevolent despots and have based their conclusions on irrelevant considerations and have ignored the real questions that arose for decision and the issues that arose out of the pleadings of the parties.
It would not be right for us to substitute our judgment and discretion for that of the Adjudicator and the Tribunal: accordingly, as we are of opinion that the.
real questions that were in dispute between the (1) ; , 1001.
1330 parties were neither appreciated nor considered we have no alternative but to remit the matter to the Labour Appellate Tribunal for a proper decision after drawing up issues that arise out of the pleadingS, considering them and deciding the dispute accordingly, with liberty of course to remit the case to the Adjudicator for a retrial or for the taking of further evidence if it is of the opinion that the omission to draw up issues and focus attention on the points that seem to be in dispute has had the result of shutting out evidence that might otherwise have been led.
An agreement said to have been reached between the parties on 7 9 1953 was placed before us towards the end of the arguments but we have not looked at it because counsel for the Mazdoor Union said it did not cover the case of these retrenched workers.
The Company insisted that it did.
We were not prepared to investigate that dispute at that late stage but we make it plain that the Labour Appellate Tribunal will be at liberty to consider it or not as it deems right after hearing what both sides have to say about it.
The award and the decision of the Labour Appellate Tribunal are set aside and the case is remitted to the Labour Appellate Tribunal for a re bearing of the appeals filed before it and for a fresh decision in the light of the foregoing observations.
We will, however, have to make some interim arrangement for payment of what may be termed a sort of subsistence allowance to the affected workmen during the pendency of those further proceedings.
As there is no agreement between the parties on the subject, we leave it to the Labour Appellate Tribunal or the Adjudicator, as the case may be, to make suitable orders in this respect.
There will be no order, about costs as neither party is to blame for what has happened.
| Held, that adjudication by an adjudicator under the does not mean adjudication according to the strict law of master and servant and that an adjudicator 's award may contain provisions for the settlement of a dispute which no court could order if it was bound by ordinary law.
Thus the scope of an adjudication under the is much wider than that of an arbitrator making an award.
Industrial Tribunals are not fettered by such limitations and an adjudicator has jurisdiction to investigate disputes about discharge and dismissal and where necessary, to direct reinstatement.
Nevertheless, wide as their powers are, these Tribunals are not absolute and there are limitations to the ambit of their authority.
Though they are not courts in the strict sense of the term, they have to discharge quasi judicial functions and as such are subject to the overriding jurisdiction of the Supreme Court under article 136 of the Constitution.
Their powers are derived from the statute that creates them and they have to function within the limits imposed there and to act according to its provisions.
Those provisions invest them with many of the trappings" of a court and deprive them of arbitrary or absolute discretion and power.
Benevolent despotism is foreign to a democratic Constitution.
When the Constitution of India converted this country into a sovereign, democratic, republic, it did not invest it with the mere trappings of democracy but invested it, with the real thing, the true kernel of which is the ultimate authority of the courts to restrain all exercise of absolute and arbitrary power not only by the executive and by officials and lesser tribunals but also by the legislatures and even by Parliament itself.
The Constitution established a "Rule of Law" in this land and that carries with it restraints and restrictions that are foreign to despotic power.
The courts, however, must always exercise caution and should not substitute their own judgment and discretion for that of such tribunals.
166 1316 In view of sections 7 and 11 of the and U.P. State Industrial Tribunal Standing Orders 1951 these Tribunals, though not bound by all the technicalities of Civil Courts must nevertheless follow the general pattern of the Civil Courts in the matter of taking the pleadings of the parties in writing and the drawing up of issues.
It is not open to the Tribunals to disregard the pleadings and to reach any conclusion that they think are just and proper.
The Supreme Court remitted the case to the Labour Appellate Tribunal for a rehearing of the appeals as the Adjudicator and the Labour Appellate Tribunal had adopted the attitude of benevolent despots and had based their conclusion on irrelevant considerations and ignored the real questions that arose for decision and the issues that arose out of the pleadings of the parties.
Western India Automobile Association vs Industrial Tribunal, Bombay ([1949] F.C.R. 321, 345), State of Madras vs C. P. Sarathy, ([1953] S.C.R. 334, 348), Bharat Bank Ltd. vs Employees of Bharat Bank Ltd., ([1950] S.C.R. 459, 497), Muir Mills Co. vs Suti Mills Mazdoor Union, Kanpur ([1955] 1 S.C.R. 991, 1001), referred to.
|
Appeal No. 107 of 1953.
Appeal by special leave from the judgment and decree dated the 7th February 1949 of the Patna High Court in appeal from original decrees No. 230 and 268 of 1945 arising out of the decree dated the 9th 3 day of August 1945 of the Second Court of Subordinate Judge at Monghyr in Title Suit No. 40 of 1943.
P. K. Chatterjee, for the appellants.
Tarachand Brijmohanlal, B. C. Misra and section Barneshwar Prasad, for respondents Nos.
3 to 6, 20 to 25 and 27 to 39.
January 16.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
The properties which are the subject matter of this litigation are agricultural lands of the extent of 18 acres 23 cents situate in Mauza Chowki.
They originally belonged to Khiran Rai, Firangi Rai and others, and were usufructuarily mortgaged by them on 10 8 1900 to Babunath Prasad and Babu Misri Lal under two sudbharna deeds, Exhibits 2 and 3, for a sum of Rs. 1,600.
The defendants of the first party are the representatives of these mortgagees.
In execution of a money decree passed against the mortgagors, 9 acres 6 cents out of the above lands were brought to sale on 11 6 1907 and purchased by Rameshwar Prasad Singh, the undivided uncle of the first plaintiff.
On 23 12 1913 the remaining extent of 9 acres 17 cents was purchased by the.
first plaintiff from the mortgagors, and thus, the plaintiffs who were members of a joint Hindu family became entitled to all the interests of the mortgagors in the suit lands.
In 1943 they deposited under section 83 of the Transfer of Property Act the amounts due on the mortgage deeds, Exhibits 2 and 3, in the court of the District Munsif, Monghyr.
The defendants of the first party withdrew the amount, and the mortgages thus became redeemed.
When the plaintiffs attempted to take khas or actual possession of the lands, they were obstructed by the defendants of the second party who claimed occupancy rights therein.
The plaintiffs then instituted the suit out of which the present appeal arises, in the court of the Subordinate Judge, Monghyr, for recovery of possession of the lands from the second party defendants.
4 The plaintiffs alleged that the lands were 'kamat khudkast ' which had been in the personal enjoyment of Khiran Rai and Firangi Rai and thereafter of the mortgagees and the defendants of the first party by virtue of the sudbharna deeds, Exhibits 2 and 3, that the second party defendants claimed rights as occupancy raiyats under a settlement by the mortgagees, that the settlement was not real or bona fide, and was not binding on the mortgagors.
In the alternative, the plaintiffs claimed damages against the defendants of the first party, if it was found that the second party bad acquired occupancy rights under a settle ment from them.
Both sets of defendants denied that the lands were kamat lands, or that the defendants of the first party settled the defendants of the second party as raiyats on the land.
They pleaded that the latter had been in possession even prior to the mortgages, Exhibits 2 and 3, under a settlement with the mortgagors, and that accordingly the plaintiffs were entitled neither to possession from the second party nor damages from the first party.
The Subordinate Judge of Mongbyr who tried the suit, held that the lands were private lands of the proprietors, that the defendants of the second party or their predecessors in title bad not been inducted on the lands by the mortgagors, that they were put into possession by the mortgagees only under the lease deed, Exhibit 2(a) dated 27th May 1905, that they were mere creatures of the first party, and that the settlement was not bona fide and not binding on the plaintiffs.
He accordingly granted a decree in favour of the plaintiffs in ejectment.
Against this judgment, there was an appeal by the defendants to the High Court of Patna, which agreed with the Subordinate Judge that the defendants of the second party were inducted into possession only in 1905 under the lease deed, Exhibit 2(a), and that they were not raiyats settled by the mortgagors prior to 1900.
But the learned Judges held that the suit lands were not proved to be 'sir ' or private lands, that the second party defendants were not the creatures of the first party, that the lease deed, Exhibit 2(a) was a 5 bona fide transaction, and that the recognition of the defendants of the second party by the mortgagees as tenants would confer occupancy rights on them.
In the result, the suit was dismissed.
The plaintiffs appeal.
It may be stated that the alternative claim for damages against the first party was abandoned by the plaintiffs, and the only relief now claimed is possession of lands as against the second party.
Mr. Misra, counsel for the first party, had accordingly nothing to say about the merits of the controversy between the appellants and the second party defendants, and merely pressed for his costs being awarded.
It was the second party appearing by counsel Mr. Tarachand Brijmohan Lal, that vigorously contested the appeal.
The substantial question that arises for our decision is whether the lands in dispute are private lands of the proprietor.
Section 120(2) of the Bihar Tenancy Act VIII of 1885, hereinafter referred to as the Act, enacts a presumption that "land is not a proprietor 's private land, until the contrary is shown".
And further, there was a cadastral survey in 1908, and in the final notification published under section 103 A of the Act, the lands were recorded as in the possession of the second party defendants, whose status was described as 'kaimi ' or settled raiyats.
Under section 103 B(3), "every entry in a record of rights so published shall be evidence of the matter referred to in such entry, and shall be presumed to be correct until it is proved by evidence to be incorrect".
The result of both these provisions is that the burden is on the proprietor clearly to establish that the lands are his private lands.
Some oral evidence has been adduced by both sides as to the character of the lands, but it is too vague, recent and interested to be of much value, and the question therefore falls primarily to be decided on the 'documentary evidence in the case.
The earliest document bearing on the question is Exhibit 1, which is a mortgage deed executed by the previous owners, Firangi Rai and others, to Harbans Narain Singh on the 10th April, 1893 over a portion 6 of the suit lands.
Therein, it is recited that the mortgagors "mortgage, hypothecate and render liable the properties constituting the proprietory mukarri interest, with all the zamindari rights and claims including the khudkasht kamat lands".
The word 'khudkasht ' means personal cultivation, and that is a neutral expression, which might include both private lands and bakasht lands, that is to say, raiyati lands, which had come into the possession of the proprietor by surrender, abandonment or otherwise.
But the word 'kamat ' has a definite connotation, and means private lands.
Vide section 116 of the Bihar Tenancy Act.
If the recital in Exhibit I is to be accepted as correct, the lands were on that date in the personal cultivation of the proprietor as private lands.
Exhibits 2 and 3 are the sudbharna deeds dated 10 8 1900 under which the first party defendants got into possession of the suit lands.
They are in the same terms, and recite the at the mortgagees are to enter into possession and occupation of lands, " cultivate or cause to be cultivated the same for their self satisfaction", and that after the expiry of the period fixed for redemption, the mortgagors are to pay the mortgage amounts in one lump and take back the properties "in our sir and khas possession".
The word 'sir ' is synonymous with 'kamat ' and 'ziraat ', and means private lands of the proprietor.
(Vide section 116).
These recitals are of considerable importance, as they occur in deeds inter parties.
The respondents are right in contending that they cannot be regarded as admissions by the mortgagees as the deeds were executed by the mortgagors; but they are certainly admissible under section 13 of the Evidence Act as assertions of title, and as it is under these documents that the first party defendants claim, their probative value as against them and as against the second party defendants who claim under them is high.
Exhibit I (b) is a simple mortgage executed by Firangi Rai and others on 21 12 1901 in favour of one Chhotu Singh over some properties forming part of the suit lands.
It also contains the recital that these properties are kamat khudkasht lands.
There 7 is finally the lease deed executed in favour of the first party by the defendants of the second party, Exhibit 2(a) under which the latter came into possession of the lands.
It recites that the lands had been in the exclusive cultivation of Babu Nath Prasad and Babu Misri Lal, that the lessees will give up possession of the lands at the end of the term which was a period of 2 years,, and that the lessors will be "competent to bring the lands mentioned in this kabuliat under their exclusive cultivation".
As these documents are ante litem motam, and as some of them, are inter parties and extend over a considerable period of time, they form cogent and strong evidence that the lands are private lands.
Now, what is the evidence adduced by the defendants to rebut the inference to be drawn from them? None.
They simply trust to the presumptions in their favour enacted in sections 120(2) and 103 B of the Act to non suit the plaintiffs.
But these are rebuttable presumptions, and they have, in our opinion, been rebutted by the evidence in the suit, which is all one way.
It was argued for the respondents that even if the evidence referred to above was accepted, that would be insufficient under section 120 of the Act to support a finding that the lands were private lands.
Section 120 runs as follows: "(1) The Revenue Officer shall record as a proprietor 's private land (a) land, which is proved to have been cultivated as khamar, ziraat , sir, nij, nijjot or kamat by the propriet or, himself with his own stock or by his own servants or by hired labour for twelve continuous years immediately before the passing of this Act, and (b) cultivated land which is recognised by village usage as proprietor 's khamar, ziraat, sir, nij, nijjot or kamat.
(2) In determining whether any other land ought to be recorded as a proprietor 's private land, the officer shall have regard to local custom, and to the question whether the land was, before the second day 8 of March, 1883, specifically let as proprietor 's private land, and to any other evidence that may be produced; but shall presume that land is not a proprietor 's private land until the contrary is shown.
(3)If any question arises in a Civil Court as to whether land is or is not a proprietor 's private land, the Court shall have regard to the rules laid down in this section for the guidance of Revenue Officers".
The contention of the respondents is that under this section before lands could be held to be private, it must be shown that they had been cultivated as private lands for 12 years prior to the date of the Act, and that as the evidence in the case went back only to 1893, the requirements of the section were not satisfied.
This argument proceeds on a misconception about the true scope of section 120.
That section does not enact that no land shall be recorded as private, unless it is proved to have been cultivated as private land for 12 years prior to the date of the Act.
It only provides that when that is proved, it shall be recorded as private land.
But when no such evidence is forthcoming, it does not preclude that fact from being established by "any other evidence that may be produced", if that is relevant and admissible under the provisions of the Evidence Act.
That was the view taken in Maharaja Kesho Prasad Singh vs Parmeshri Prasad Singh(1), and on appeal, the Privy Council agreed with it in Bindeshwari Prasad Singh vs Maharaja Kesho Prasad Singh(2).
The position, therefore, is that section 120 merely enacts certain rules of evidence to be followed in an enquiry as to whether a disputed land is 'ziraat '.
When in such enquiry the facts mentioned in section 120(1) are established, the law raises a presumptio juris et de jure that the lands are private.
But where such evidence is not available, that fact can still be estab lished by otber and satisfactory evidence.
What has to be decided therefore is whether the evidence actually adduced by the plaintiffs in the present case is (1) Patna 414.
(2) [1926] 53 I.A. 164, 9 sufficient to discharge the burden which the law casts on them and to prove that the lands are 'kamat ' or 'sir ' lands.
For the reasons already given, weare of opinion that it is sufficient to justify a findidg in the affirmative.
Strong reliance was placed by the respondents on Exhibits F 1 and F 1(1) which are khatians relating to the suit lands published on 7 12 1909 recording them as in the possession of the defendants of the second party as 'kaimi ' and on the presumption under section 103 B that that entry is correct.
This presumption, it is contended, is particularly strong in the present case, because the predecessors in title of the plaintiffs were parties to the proceedings and contested the same, and that the record of rights was made after considering their objections.
The plaintiffs, however, denied that they were parties to the proceedings, and contended that they were taken behind their back by the mortgagees and the second party defendants acting in collusion with a view to defeat their rights.
Exhibits A 1 and A 1(1) are certified copies of the objection petitions stated to have been filed by the mortgagors under section 103 A of the Act, and they purport to have been signed by one Chulai Mahto as karpardaz of some of the mortgagors.
The plaintiffs deny the genuineness of the signatures in Exhibits A 1 and A 1(1) and also the authority of Chulai Mahto to represent the mortgagors.
There is no evidence that the signatures on Exhibits A 1 and A 1 (1) are true, but the defendants rely on the presumption enacted in section 90 of the Evidence Act in favour of their genuineness.
But Exhibits A 1 and A 1 (I) are merely certified copies of the objection petitions filed before the Survey Officer and not the originals, and it was held in Basant vs Brijraj(1) that the presumption enacted in the section can be raised only with reference to original documents and not to copies thereof.
There is the further difficulty in the way of the respondents that the documents are signed by Chulai Mahto as agent, and there is no proof that he was an agent, (1) [1935] 62 I.A. 180.
10 and section 90 does not authorise the raising of a presumption as to the existence of authority on the part of Chulai Mahto to represent the mortgagors.
It is again to be noted that the objection on the merits raised in Exhibits A 1 and A 1(1) that the lands are bakasht lands in the possession of mortgagees is not one which it was to the interests of the mortgagors to put forward, as, if accepted, it would preclude them from admitting tenants in respect of them, without conferring on them the status of settled raiyats and occupancy rights under section 21 of the Act.
It was only if the lands were private lands that the proprietor would be entitled to cultivate them personally, and that was the claim which they had been making consistently from 1893 onwards.
The claim put forward in Exhibits A 1 and and A 1(1) is destructive of the rights claimed all along by the mortgagors, and amounts to an admission that the lands are not private and raises the doubt that the petitions were not really inspired by them.
It should also be mentioned that at the hearing of the petition, no evidence was adduced by the mortgagors, and the decision of the Survey Officer was given practically ex parte.
The mortgagees were parties to the proceedings, and they did not appear and produce the mortgage deeds, Exhibits 2 and 3, under which they got into possession, and which described the lands as 'sir '.
It was to the interests of the mortgagees that the 'lands should be held to be 'sir ', and it was further their duty to defend the title of the mortgagors as against the claim made by the tenants that they were raiyati lands.
Why then did they not produce Exhibits 2 and 3 at the hearing? The recitals in the lease deed, Exhibit 2(a) which was executed by the defendants of the second party, were inconsistent with their claim that the lands were raiyati.
Why did they not produce it at the hearing ? Thereis therefore much to be said for the contention ofthe appellants that the proceedings evidenced by Exhibits A 1 and A 1(1) were collusive in character.
But even assuming that they were real, that 11 would not materially affect the result, as the true effect of a record of rights under section 103 A is not to create rights where none existed but simply to raise a presumption under section 103 B that such ' rights exist, and that presumption is one liable to be rebutted.
There is a long line of authorities that a person who attacks a record made under section 103 A as incorrect discharges the burden which the law casts on him under section 103 B by showing that it was not justified on the materials on which it is based.
Vide Bogha Mower vs Ram Lakhan(1) and Eakub Ali vs Muhammad Ali(2).
And where., as here, no evidence was placed before the authorities who made the record, he has only to produce evidence which satisfies the court that the entry is erroneous.
Whether the question is considered with reference to the presumption under section 120(2) or section 103 B, the position is the same.
The plaintiffs who claim that the lands are kamat have to establish it by clear and satisfactory evidence.
If the evidence adduced by them is sufficient, as we have held it is, to establish it, the presumption under section 103 B equally with that under section 120(2 becomes displaced.
In the result, we are of opinion that the suit lands are the private lands of the proprietor.
It was next contended that even if the lands were private lands, that would not prevent the acquis tion of occupancy rights by the tenants under Chapter V, as the restriction provided in section 116 in that behalf did not apply on the facts of the present case, and that in consequence no relief in ejectment could be granted.
Section 116 enacts, omitting what is not material, that "nothing in Chapter V shall confer a right of occupancy in a proprietor 's private land where any such land is held under a lease for a term of years or under a lease from year to year".
, In the present case,, the tenants got into possession under Exhibit 2(a), which was a lease for two years, and they would therefore be precluded from acquiring occupancy rights by virtue of that demise.
But it is argued that the tenants continued in possession of (1) (2) 12 the holdings even after the expiry of the term under Exhibit 2(a), paid the rent to the mortgagees who recognised them as tenants, and that their status therefore was not that of tenants holding under a lease for a term or from year to year, and that accordingly there was no impediment to their acquiring occupancy rights under Chapter V.
The point has not been argued whether, as Exhibit 2(a) is an agricultural lease, the tenants who held over after the expiry of the period fixed therein, should not be con, sidered to hold as tenants from year to year, on the principle enacted in sections 106 and 116 of the Transfer of Property Act.
We shall proceed on the footing that on the findings of the High Court that the tenants were riot the creatures or servants of the mortgagees, and that they had been in continuous possession paying rent to them, section 116 did not debar them from acquiring rights under Chapter V.
But the question is whether they acquired such rights under that Chapter.
Section 21 provides that every person who is a settled raiyat in a village shall have a right of occupancy in all land for the time being held by him as a raiyat in that village.
Section 20 defines a settled raiyat as a person who holds continuously land for a period of 12 years in any village.
Section 5(2) defines 'raiyat ' as a person who has acquired a right to bold land for the purpose of cultivating it by himself or members of his family or servants or partners, and section 5 (3) provides that "a person shall not be deemed to be a raiyat unless he holds land either immediately under a proprietor or immediately under a tenure bolder".
The position therefore is that before a person can claim occupancy rights under section 21, he must establish that he is a raiyat as defined in sections 5(2) and 5(3), and as the defendants of the second party acquired the right to hold the lands for the purpose of cultivation from the first party mortgagees and not under the mortgagors, they are not raiyats as defided in section 5(3), and can claim no rights under section 21.
On behalf of the tenants, it was contended that as under section 58 of the Transfer of Property Act a 13 mortgage is a transfer of interest in land, the mortgagee is the owner of that interest and therefore a proprietor for the purpose of section 5(3).
Section 3(2) defines a proprietor as meaning a person owning whether in trust or for his own benefit an estate or part of an estate.
A mortgagee is no doubt the transferee of an interest in immovable property, and may in a loose sense be said to be the owner of that interest.
But the definition of a proprietor requires that he should own the estate or part thereof and not merely an interest therein.
It would be a contradiction in terms to say of a mortgagee that he owns the estate over which he owns an interest.
As observed in Ghose on the Law of Mortgage in India, Volume I, page 77, "Interest which passes to the mortgagee is not the ownership or dominion which, notwithstanding the mortgage, resides in the mortgagor".
The question whether for purposes of section 21 of the Act a tenant from a mortgagee can be held to be a raiyat as defined in section 5(3) was considered by this Court in Mahabir Gope and others vs Harban8 Narain Singh and others(1), and it was held that a mortgagee is neither a proprietor nor a tenure holder, and a tenant inducted by him on the lands is not a raiyat within the definition of those terms under the Act.
That decision governs this case.
The contention of the respondents that the mortgagees could be considered as tenure holders within section 5(3) is equally untenable.
Section 5(1) defines a tenure holder as meaning a person who has acquired a right to hold lands for collecting rents or for bringing them into cultivation by establishing tenants thereon.
In the present case, the lands were under the personal cultivation of the mortgagors at the time when they were mortgaged under Exhibits 2 and 3.
There were then no raiyats on the land and no 'question of transferring the right to collect rent from them.
The respondents relied on the terms in Exhibits 2 and 3 that the mortgagees might cultivate the lands or cause them to be cultivated at their pleasure, as authorising the establishment of tenants.
But that (1) , 781.
14 clause would apply only if the lands had to be brought afresh under cultivation, and that was not the position here.
As the mortgagees are neither proprietors nor tenure holders as defined in the Act, the tenants holding under them could not claim to be raiyats as defined in sections.5(2) and 5(3), and no occupancy rights could therefore be acquired by them under section 21 of the Act.
It was next contended that the mortgagees had the power under section 76 of the Transfer of Property Act to induct tenants on the land for purposes of cultivation, that such a transaction.
would be binding on the mortgagors, and that its effect would be to confer on the tenants the status of raiyats and that they would get occupancy rights under section 21 of the Act.
The decisions in Manjhil Lal Biswa Nath Sah Deo vs Mahiuddin(1), Rajendra Nath vs Dinu Prodhan(2) and Pramatha Nath vs Sashi Bhu8an(3) were relied on in support of this contention.
This argument proceeds on a confusion of two wholly independent concepts distinct in their origin and different in their legal incidents.
The law is that a person cannot confer on another any right higher than what he himself possesses, and therefore, a lease created by a usufructuary mortgagee would normally terminate on the redemption of the mortgage.
Section 76(a) enacts an exception to this rule.
If the lease is one which could have been made by the owner in the course of prudent management, it would be binding on the mortgagors, notwithstanding that the mortgage has been redeemed.
Even in such a case, the operation of the lease cannot extend beyond the period for which it was granted.
In the present case, assuming that the mortgagees bad the power under section 76(a) of the Transfer of Property Act to continue the lessees under Exhibit 2(a) as tenants on the lands after the termination of the period fixed therein that would confer on them at best the status of tenants from year to year and not give them the right to continue in possession after the termination of the agricultural year during which the redemption (1) (2) A.I.R. 1930 Cal.
(3)A.I.R. 15 takes place.
In this view, the power of the mortgagee under section 76(a) of the Transfer of Property Act to induct tenants in the usual course of management would not avail the respondents to claim occupancy rights over the lands.
Turning next to the provisions of the Bihar Tenancy Act, section 21 confers on settled raiyats a permanent right of occupancy, provided the conditions mentioned in that section are satisfied.
But this right is a creature of the statute, and cannot be claimed apart from its provisions.
A mortgagee is, as already stated, neither a proprietor nor a tenure holder, and a person settled by him on the land does not enjoy the status of a raiyat under sections 5(2) and 5(3).
He is therefore not a person entitled under the terms of the statute to any occupancy rights.
Thus, if the respondents cannot resist the suit for ejectment either by reason of section 76(a) of the Transfer of Property Act or section 21 of the Bihar Tenancy Act, it is difficult to see how they could get such a right as the result of the interaction of both those sections.
In Manjhil Lal Biswa Nath Sah Deo vs Mahiuddin(1), the suit was by a mortgagor after redemption to recover possession of lands, which had been leased by the mortgagee.
The proprietor claimed that the lands were zirait; but the finding, however, was that they were raiyat lands, and that the mortgagee had inducted tenants into possession in the usual course of management.
It was held that the tenants could not be ejected.
The decision was expressly based on the fact that the lands were raiyati lands, and the learned Judges distinguished the cases in Mahadeo Prasad Sahu vs Gajadhar Prasad Sahu(2 ) and Jogeshwar Mazumdar vs Abed Mahomed Sirkar (3) on the ground that the lands which were the subject of mortgage therein were zerait lands.
This decision does not support the broad proposition for which the respondents contend, and is really against them, as the mortgage in the present case is of 'kamat ' lands.
In Rajendra Nath vs Dinu Prodhan(4), the facts were (1) (2) (3) (4) A.I.R. 1930 Cal.
16 similar to those in Manjhil Lal Biswa Nath Sah Deo vs Mahiuddin(1), except that the lands do not appear to have been raiyati lands.
In holding that the mortgagor was not entitled to possession, Guha, J. observed that the mortgage deed did not stand in the way of the tenants being settled by the mortgagee, and that when they were so settled, they had well defined rights under the Act, and could not be ejected.
If section 5(3) of the Act did not apply and it would not, unless the letting was by the proprietor or tenureholder it is not stated what other provision of law operated to confer occupancy rights on the tenant.
The learned Judge then referred to Binad Lal Pakrashi vs Kalu Pramanik(2 ) as furnishing the principle on which the decision should rest.
There, a tenant was put into possession by a person who claimed to be the proprietor, and though it subsequently turned out that he was not, it was held that the letting by him conferred on the tenant the status of a raiyat.
As pointed out in Peary Mohun Mondal vs Radhika Mohun Hazra(3) and Krishna Nath Chakrabarty vs Mahomed Wafiz(4) the basis of the decision in Binad Lal Pakrashi vs Kalu Pramanik(2) was that the word "proprietor" in section 5(3) would include a defacto as well as a de jure proprietor, and a tenant who is bona fide inducted into possession by him would have the status of a raiyat.
This decision makes an inroad on the general principle that no one can confer a better right than what he has got, and later decisions have generally shown a disposition to confine its application within narrow limits.
But even on its own ground, it can have no application when the person who admits a tenant is not, as required by section 5 (3), a proprietor de facto or de jure, but a mortgagee.
The principle of the decision in Binad Lal Pakraski vs Kalu Pramanik(2) does not therefore support the conclusion in Rajendra Nath vs Dinu Prodhan(5) that a tenant admitted by a mortgagee into possession acquires the status of a raiyat.
(1) , (2) Cal.
(3) (4) (5)A.I.R. 17 In Pramtha Nath vs Sashi Bhusan(1), a permanent lease was granted by a mortgagee after he had obtained a decree for foreclosure.
Subsequently, that decree was recalled in a suit by the Official Receiver ' representing one of the mortgagors and a fresh decree for redemption was passed.
After redemption, the Official Receiver received rent from the lessee treating him as a tenant on the land.
A transferee from the Official Receiver having subsequently instituted a suit in ejectment against the tenant, it was held that the latter bad acquired a right of occupancy under section 21 of the Act, and that the relief for khas possession could not be granted as against him.
Notwithstanding that some of the observations in the judgment are widely expressed, the ground of the decision really is that when the Official Receiver accepted rent from the tenant, that amounted to an affirmance of the lease by him, and that would have the effect of bringing section 5(3) directly into play and conferring on the tenant the status of a raiyat.
The decisions discussed above do not lay down any acceptable principle that a lease by a mortgagee which is protected by section 76(a) of the Transfer of Property Act, operates by itself to confer a right of occupancy on the tenant under section 21 of the Act.
Some argument was founded by the respondents on the clause in Exhibits 2 and 3 that the mortgagee could get the lands cultivated.
It was contended that this clause conferred authority on the mortgagee to settle raiyats on the lands, and that the tenants admitted in pursuance of this authority would be in the same position as if they had been admitted by the proprietor and the conditions of section 5(3) would be satisfied.
But then, the lands are private lands, and the clause in question is followed by the provision that on redemption the mortgagors would be entitled to resume "sir and khas possession", and that would be rendered nugatory if the deed is construed as authorising the mortgagees to settle tenants on the lands with the status of raiyats.
The authority to get lands cultivated can only mean (1) A.I.R. 1937 Cal. 763.
3 18 getting them cultivated through hired labour as contemplated in the definition of 'private lands '.
We are clearly of opinion that the mortgage deed conferred no authority on the mortgagees to admit tenants so as to confer on them rights of occupancy.
In the result, we must old that the defendants of the second party have failed to establish that they have any rights of occupancy over the suit lands, and that the plaintiffs are accordingly entitled to a decree in ejectment, with future mesne profits as claimed in the plaint.
This appeal is allowed, the decree of the lower court is set aside, and that of the Subordinate Judge of Monghyr restored as against 2nd party defendants with costs throughout.
The suit as against the first party defendants is dismissed, but in the circumstances, there will be no order as to costs.
| The appellants were the purchasers of the mortgagors ' interests in the agricultural lands in suit and deposited the amounts due on the mortgages in court under section 83 of the Transfer of Property Act, which were withdrawn by the representatives of the mortgagees and the mortgages were redeemed.
They were obstructed in taking khas possession of the lands by tenants who were recorded as "settledraiyats" in the finally published record of rights and brought the suit for recovery of possession from the tenants and, alternatively, for damages against the representatives of the mortgagees.
The subordinate Judge found that the lands were the private lands of the proprietors and the tenants were inducted not by them but by the mortgagees in possession by a lease for a term which was neither bona fide nor binding on the appellants and passed a decree in ejectment.
On appeal, the High Court held that the lands were not the private lands of the mortgagors, the lease was bona fide and the recognition of the lessees as tenants by the mortgagees conferred on them rights of occupancy in the suit lands and dismissed the suit.
The respondents relied on the presumptions under sections 103 B and 120(2) of the Bihar Tenancy Act and contended that the recognition by the mort gagees of their tenancy right had the effect of conferring on them the rights of occupancy under the Act.
Held, that an entry in the record of rights published under section 103 A of the Bihar Tenancy Act does not create rights but merely raises a presumption under section 103 B of the Act that such Tights exist, which can be rebutted if it can be shown that the materials on which it was based do not justify it.
Bogha Mower vs Ram Lakhan, ([1917] and Bakub Ali vs Muhammad Ali ([1928] , referred to.
That where, as in the present case, no evidence was produced before the authority who made the record, one has only to produce 2 such evidence as satisfies the court in order to rebut the presumption.
This is equally true with regard to the presumption enacted by section 120(2) of the Act with regard to the proprietor 's private land.
That section 120 of the Bihar Tenancy Act merely enacts certain rules of evidence for determining whether a disputed land is the proprietor 's "private" land.
It does not preclude the proprietor, even if he cannot prove that he cultivated the land as such for 12 years prior to the date of the Act, from adducing other evidence to show that the land is his private land.
Kisho Prashad Singh vs Parmeshri Prasad Singh, ([1923] I.L.R. 2 Pat. 414) and Bindeshwari Prasad Singh vs Kisho Prasad Singh ([1926] L.R. 53 I.A. 164), relied on.
That as the mortgagees were neither proprietors nor tenure holders as defined by the Bihar Tenancy Act, persons inducted by them could not be raiyats within the meaning of section 5(3) of the Act so as to acquire any rights of occupancy under section 21 of the Act.
Mahabir Gope vs Harbans Narain Singh ([1952] S.C.R. 775), applied.
Nor could the provisions of section 76 (a) of the Transfer of Property Act be of any avail.
Assuming that the lease granted by the mortgagees continued even after termination of the period fixed therein, that could confer on the lessees no more than the status of tenants from year to year, in which case, their possession would cease with the termination of the agricultural year during which the mortgages were redeemed.
Rajendra Nath vs Dinu Prodhan (A.I.R. , disap proved.
Binod Lal Pakrashi vs Kalu Pramanik ([1893] I.L.R. 20 Cal.
708), doubted and held inapplicable.
Pramatha Noth vs Sashi Bhusan (A.I.R. , distinguished.
Case law discussed.
Held further, that there is no presumption of genuineness in favour of certified copies of documents under section 90 of the Evidence Act, nor does that section authorise the raising of a presumption as to the existence of authority of an agent to act for another.
Basant vs Brijraj ([1935] L.R. 62 I.A. 180), referred to.
|
646 of 1954.
Petition under Article 32 of the Constitution of India.
C. R. Jagadisan, Naunit Lal and T. V. Balakrishnan, (T. V. Balakrishnan, with the permission of the court) for the petitioners.
C. K. Daphtary, Solicitor Genral of India, (G. N. Joshi, B. Ganapathy lyer and R. H. Dhebar, with him) for the respondents.
December 20.
BHAGWATI J.
This petition under Article 32 of the Constitution also raises the question about the constitutionality of section 5(1) of the Taxation on Income Investigation Commission Act, 1947 (XXX of 1947).
1250 The facts which led to the filing of this petition may be shortly stated.
Sir M. Ct.
Muthiah Chettiar who carried on a flourishing banking business in India and foreign countries died in or about 1929 leaving behind him two sons M. Ct. M. Chidambaram Chettiar (since deceased) and M. Ct. M. Muthiah Chettiar, petitioner 3, and his widow Devanai Achi.
M. Ct.
M. Chidambaram Chettiar continued the ancestral banking business and also started several commercial enterprises.
He died by an accident while traveling in a plane in the year 1954 leaving behind him his two sons, the petitioners 1 & 2.
Devanai Achi had predeceased him.
The petitioners 1 & 2 are the legal representatives of the deceased M. Ct. M. Chidambaram Chettiar and also the representatives of their grandmother Devanai Achi.
The Central Government, in exercise of its powers under section 5(1) of Act XXX of 1947, referred to the Income tax Investigation Commission R. C. Nos.
516, 517 and 518 relating to M. Ct. M. Chidambaram Chettiar, M. Ct.
M. Muthiah Chettiar, petitioner 3, and Devanai Achi.
The Commission, after holding an enquiry in all the three cases, recorded their findings and held that an aggregate sum of Rs. 10,07,322 4 3 represented the undisclosed income during the investigation period and directed distribution of this sum over the several years in the manner indicated by them in Schedule A to their report.
This report was submitted by the Commission to the Government on the 26th August 1952.
The Central Government considered the report and, purporting to act under section 8(2) of the Act directed by their order No. 74 (26) I.T./52 dated the 16th September 1952 that appropriate action under the Indian Income tax Act be taken against the assessees with a view to assess or re assess the income which had escaped assessment for the years 1940 41 to 1948 49.
In pursuance of the said directions of the Central Government the Income tax Officer, City Circle 1, Madras, issued notices under section 34 of the Indian Income tax Act and made the reassessment for the 1251 years 1940 41, 1941 42 and 1943 44 to 1948 49 based upon the findings of the Commission which were treated as final and conclusive.
The assessment orders for the years 1940 41, 1941 42 and 1948 49 were served on the assessees on the 20th February 1954.
Assessment orders for the years 1943 44 to 1947 48 were served on the 12th May 1954.
There assessment order for the year 1942 43 was Dot made though notices under section 34 of the Indian Income tax Act had been issued by the Income tax Officer on the assessees on the 19th March 1954.
It appears that these re assessment proceedings for the year 1942 43 are yet pending and no assessment order in respect of that year has yet been served on the petitioners.
In regard to the assessment orders which were served on the 20th February 1954, the petitioners preferred on the 18th May 1954 applications to the Commissioner of Income tax, Madras, under section 8(5) of the Act for references to the High Court on questions of law arising out of those re assessment orders passed by the Income tax Officer.
Similar applications were preferred thereafter in respect of the re assessment orders which were served on the petitioners on the 12th May 1954.
These applications are still pending.
On the 6th December 1954, the petitioners filed the present petition contending that the provisions of the Act XXX of 1947 were illegal, ultra vires and unconstitutional mainly on the ground that they were violative of the fundamental right guaranteed under article 14 of the Constitution.
The grounds urged in support of this contention were not felicitously expressed.
The petitioners appear to have mixed up the contentions which could be urged as a result of our judgments in Suraj Mall Mohta vs A. V. Visvanatha Sastri and Another(1) and Shree Meenakshi Mills Ltd. vs A. V. Visvanatha Sastri and Another(2).
They contended in the first instance that after the amendment of section 34 of the Indian Income tax Act by Act XXXIII of 1954, which inter (1)[1955] 1 S.C.R. 448. 158 (2) 1252 alia, added sub sections (1 A) to (1 D) to section 34, the provisions of section 5(1) of the Act became discriminatory, as on a reading of both the enactments, Act XXX of 1947 and the Income tax Act as amended in 1954 showed that they applied to the same category of persons and there was nothing in section 5 (1) of the Act or any other provision of the said Act disclosing any valid or reasonable classification.
The provisions of Act XXX of 1947 could not, therefore,be sustained on the ground of classification to avoid the mischief of article 14 of the Constitution.
The petitioners obviously relied upon our decision in Shree Meenakshi Mill 's case, supra, in support of this contention.
The petitioners thereafter proceeded to set out their alternative contention based upon our decision in Suraj Mall Mohta 's case, supra, though it was not so stated in express terms.
They contended that Act XXX of 1947 enabled the Central Government to discriminate between one person and another inasmuch as they were authorised to pick and choose cases of persons who fell within the group of those who had substantially evaded taxation on income, that the act of the Government in referring some evaders to the Commission was wholly arbitrary and there was nothing to eliminate the possibility of a favouritism or a discrimination against an individual by sending or not sending cases to the Commission as between two persons both of whom might be within the group of those who have evaded the payment of tax to a sub stantial extent.
They further contended that the procedure prescribed under the impugned Act was substantially more prejuducial and more drastic to the assessee than the procedure prescribed under the Indian Income tax Act.
There was no reasonableness or justification that one person should have the advantage of the procedure prescribed by the Indian Income tax Act while another person similarly situated should be deprived of it.
They, therefore, contended that section 5(1) of the Act was discriminatory and violative of article 14 of the Constitution and asked for the issue of a writ of 1253 certiorari or any other appropriate writ, direction or order quashing the report of the Income tax Investigation Commission dated the 29th August 1952 enclosed as Annexure A to the petition and the assessment orders of the Income tax Officer for the years 1940 41, 1941 42, and 1943 44 to 1948 49 as being unconstitutional, null and void and also of a writ of prohibition calling upon the Commissioner of Income tax, Madras, respondent 1 and the Income tax Officer, City Circle 1, Madras, respondent 2 or their subordinate officers to forbear from implementing the findings of the Investigation Commission with regard to the year 1942 43.
This petition was heard along with Civil Appeals Nos. 21 and 22 of 1954, A. Thangal Kunju Musaliar vs M. Venkitachalam Potti & Another and M. Venkitachalam Potti & Another vs A. Thangal Kunju Musaliar(1), which also raised inter alia the cognate question about the constitutionality of section 5(1) of the Travancore Act XIV of 1124 which was in pari materia with section 5(1) of Act XXX of 1947.
In regard to the question whether there is a rational basis of classification to be found in the enactment of section 5(1) of the Act, the preamble and the relevant provisions of Act XXX of 1947 are the same as were considered by us in considering this question in relation to the Travancore Act XIV of 1124, The words "substantial extent" also have been used in both the Acts and in the present case as in the cases of the Travancore petitioners concerned in the Evasion Cases Nos.
I and 2 of 1125 (M.E.), Gauri Shanker, Secretary, Income tax Investigation Commission made an affidavit dated the 21st September 1955 wherein he set out the events and circumstances under which Act XXX of 1947 came to be passed.
In paragraph 4 of that affidavit he stated: "It was found that during the period of the last war large fortunes had been made by businessmen.
Controls imposed by Government on prices and distribution, were often evaded and secret profits were made and kept outside the books and often kept invested in shares and real property acquired in the (1) ; 1254 names of benamidars or in cash purchases of gold, silver and jewellery.
The machinery of Income tax administration was unable to cope with the large number of complex cases that had to be dealt with, during the war years and a few years after its termination.
As there had been a large scale evasion of tax during this period, it became necessary in the public interests to investigate cases of evasion of in come tax and bring under assessment huge profit that had escaped assessment.
As a preliminary step in this direction, a demonetisation Ordinance was passed in January 1946 sterilising the High Denomination Notes in which secret profits earned during the war years had been partly kept and calling for a statement regarding the source of such profits.
This was followed by the Income tax Investigation Commission Bill.
In view of the prolonged and complicated enquiries that bad to be made to unearth these secret war profits and bring them under assessment a special Commission was constituted to enquire into the profits made since 1939 but which had escaped assessment.
I say that what is intended to investigate is evasion of payment of taxation which could reasonably be called "Substantial" and therefore the classification is real classification.
The statute merely leaves the selective application of the law to be made by the executive authorities in accordance with the standards indicated in the Act itself".
This affidavit furnished the background and the surrounding circumstances obtaining at the time when Act XXX of 1947 was enacted and if this background is taken into account it would be obvious that the substantial evaders of payment of income tax whose cases were referred by the Central Government to the Commission formed a class by themselves and there was a rational basis of classification in the enactment of section 5(1) of the Act.
The argument that the terms of section 5(1) enabled the Central Government to pick and choose the cases of particular individuals falling within that category leaving the cases of other persons falling within the same category to be dealt with in accord 1255 ance with the provisions of section 34(1) of the Indian Income tax Act as it stood prior to the amendment of 1948 has been already dealt with in our judgment in A. Thangal Kunju Musaliar vs M. Venkitachalam Potti & Another, supra, while dealing with the corresponding provisions of section 5(1) of the Travancore Act XIV of 1124 and section 47 of the Travancore Act XXIII of 1121 and we have pointed out that so far as the Indian Income tax Act as it was in existence on the 18th April 1947 (which was the date on which Act XXX of 1947 received the assent of the Governor General) stood unamended by Act XLVIII of 1948, the cases of persons who fell within the category of substantial evaders of incometax within the meaning of section 5(1) of the Act could not have been dealt with under the provisions of section 34(1) of the Indian Income tax Act and, therefore, there was no discrimination and no violation of the fundamental right guaranteed under article 14 of the Constitution.
The other argument that the selection of the persons whose cases were to be referred by the Central Government for investigation to the Commission was left to the unguided and uncontrolled discretion of the executive or the administrative officials also has been dealt with in that judgment and we need not repeat our reasons for rejecting the same.
If the provisions of section 34(1) of the Indian Income tax Act as it stood unamended by Act XLVIII of 1948 (which corresponded with the provisions of section 47 of the Travancore Act XXIII of 1121) had been the only provisions to be considered we would have reached the same conclusion as we did in A. Thangal Kunju Musaliar vs M. Venkitachalam Potti& Another, supra.
The position, however, in the present case is materially affected by reason of the two amendments which were made in section 34 of the Indian Income tax Act, one in 1948 by the enactment of Act XLVIII of 1948 and the other in 1954 by the enactment of Act XXXIII of 1954.
Section 34 as amended by Act XLVIII of 1948 read as under; 1256 "Section 34 (1): If (a) the Income tax Officer has reason to believe that by reason of the omission or failure on the part of an assessee to make a return of his income under section 22 for any year or to disclose fully and truly all material facts necessary for his assessment for that year, income, profits or gains chargeable to income tax have escaped assessment for that year, or have been under assessed or assessed at too low a, rate, or have been made the subject of excessive relief under the Act, or excessive loss or depreciation allowance has been computed, or (b) notwithstanding that there has been no omission or failure as mentioned in clause (a) on the part of the assessee, the Income tax Officer has in consequence of information in his possession reason to believe that income, profits or gains chargeable to income tax have escaped assessment for any year, or have been under assessed, or assessed at too low a rate, or have been made the subject of excessive relief under this Act, or that excessive loss or depreciation allowance has been computed, he may in cases falling under clause (a) at any time within eight years and in cases falling under clause (b) at any time within four years of the end of that year, serve on the assessee, or, if the assessee is a company, on the principal officer thereof, a notice containing all or any of the requirements which may be included in a notice under sub section (2) of section 22 and may proceed to assess or re assess such income, profits or gains or recompute the loss or depreciation allowance; and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub section: Act XXXIII of 1954 introduced into section 34 sub sections (1 A) to (1 D).
Section 34(1 A) which is material for our purposes provided: "Section 34 (1 A): If, in the case of any assessee, the Income tax Officer has reason to believe (i) that income, profits or gains chargeable to income tax have escaped assessment for any year in 1257 respect of which the relevant previous year falls wholly or partly within the period beginning on the 1st day of September, 1939, and ending on the 31st day of March, 1946; and, (ii)that the income, profits or gains which have so escaped assessment for any such year or years amount, or are likely to amount, to one lakh of rupees or more; he may, notwithstanding that the period of eight years or, as the case may be, four years specified in sub section (1) has expired in respect thereof, serve on the assessee, or, if the assessee is a company, on the principal officer thereof, a notice containing all or any of the requirements which may be included in a notice under sub section (2) of section 22, and may proceed to assess or re assess the income, profits or gains of the assessee for all or any of the years referred to in clause (i), and thereupon the provisions of this Act (excepting those contained in clauses (i) and (iii) of the proviso to sub section (1) and in sub sections (2) and (3) of this section) shall, so far as may be, apply accordingly: Provided that the Income tax Officer shall not issue a notice under this sub section unless he has recorded his reasons for doing so, and the Central Board of Revenue is satisfied on such reasons recorded that it is a fit case for the issue of such notice: Provided further that no such notice shall be issued after the 31st day of March, 1956".
Amended section 34(1) of the Indian Income tax Act was substantially different from the old section 34(1) which was in operation up to the 8th September 1948.
The words "if in consequence of definite information which has come into his possession the Income tax Officer discovers that income, profits or gains chargeable to income tax have escaped assessment in any year " which appear in the old section were substituted by the words "If the Incometax Officer has reason to believe that by reason of the omission or failure on the part of the assessee . . . income, profits or gains chargeable to income tax have escaped assessment ".
The 1258 requisites of (i) "definite" information (ii) which had " come into" possession of the Income tax Officer and in consequence of which (iii) he "discovers" that income, profits or gains chargeable to income tax had escaped assessment, were no longer necessary and the only thing which was required to enable the Incometax Officer to take proceedings under section 34(1) as amended was that he should have reason to believe that by reason of the omission or failure on the part of the assessee income, profits or gains chargeable to income tax had escaped assessment for a particular year.
Whereas before this amended section 34(1) came to be substituted for the old section 34(1) there was no comparison between the provisions of section 5(1) of Act XXX of 1947 and section 34(1) of the Indian Income tax Act as it then stood, the provisions of section 34(1) as amended after the 8th September 1948 could stand comparison with the provisions of section 5(1) of Act XXX of 1947 and the cases which were covered by section 5(1) of Act XXX of 1947 could be dealt with under the procedure laid down in section 34(1) of the Indian Income tax Act.
After the 8th September 1948, therefore, even in the case of substantial evaders of income tax who were a distinct class by themselves intended to be treated by the drastic and summary procedure laid down by Act XXX of 1947, some cases that were already referred by the Central Government for investigation by the Commission could be dealt with under that Act and other cases, though falling within the same class or category, could be dealt with under the procedure prescribed in the amended section 34(1) of the Indian Income tax Act.
The persons who were thus dealt with under section 34(1) of the Indian Incometax Act had available to them the whole procedure laid down in that Act including the right to inspect documents and the right to question the findings of fact arrived at by the Income tax Officer by the procedure of appeal and revision and ultimate scrutiny by the Income tax Appellate Tribunal which was denied to those persons whose cases had been referred by the Central Government for investigation by the 1259 Commission under section 5(1) of Act XXX of 1947.
The juxtaposition of dates is also very instructive.
It may be noted that in Act XXX of 1947 as it was originally enacted, the period up to which the Central Government could make the references to the Commission for investigation was laid down in section 5(1) of the Act to be 30th June 1948.
This period was extended to the 1st September 1948 by the Taxation on Income (Investigation Commission) Second Amendment Act, 1948 (XLIX of 1948).
Act XLIX of 1948 was passed by the Central Legislature and received the assent of the Governor General on the 8th September 1948, the same day on which Act XLVIII of 1948 which amended section 34(1) of the Indian Income tax Act also received the assent of the Governor General.
Both these Acts, viz., Act XLVIII of 1948 and Act XLIX of 1948 were passed simultaneously and obviously with a view to bring the provisions of section 5(1) of Act XXX of 1947 and section 34(1) of the Indian Income tax Act in tune with each other.
It appears to have been realized that the substantial evaders of income tax in respect of whom the Central Government had prima facie reasons for believing that they had to a substantial extent evaded payment of taxation on income could not have their cases referred for investigation by the Commission after the 30th June 1948, that having been the time limit originally prescribed in section 5(1) of the Act.
It also appears to have been felt that the period could not possibly be extended beyond the 1st September 1948 with the result that apart from the cases of substantial evaders of income tax which were referred by the Central Government for investi gation to the Commission up to the 1st September 1948 there would be a large number of such cases which though they could not be referred for investigation to the Commission would have to be dealt with under the ordinary provisions for taxation of income that had escaped assessment available in section 34 and the cognate sections of the Indian Income tax Act.
As section 34(1) then stood, the requisites of 159 1260 definite information coming into the possession of the Income tax Officer in consequence of which be discovered that income, profits or gains chargeable to income tax had escaped assessment would certainly not have availed the Government in tracking down these substantial evaders of income tax and it appears, therefore, to have been thought necessary that section 34(1) of the Indian Income tax Act should be amended so as to enable the Income tax Officer to take proceedings thereunder if he had reason to believe that by reason of omission or failure on the part of the assessee. . income, profits or gains chargeable to income tax had escaped assessment for the relevant period.
An amendment of section 34(1) in this manner would enable Government to pass on the requisite information which they had obtained in regard to the substantial evaders of income tax to the Income tax Officers concerned and ask the Income tax Officers to take proceedings against those evaders of income tax under the amended section 34(1) of the Indian Income tax Act.
That appears to have been the real object of the amendment of section 34(1) of the Indian Income tax Act with effect from the 8th September 1948.
The Commission would proceed with the references which were made to them up to the 1st September 1948 and the Income tax Officers concerned would take the requisite proceedings under section 34(1) of the Indian Income tax Act as amended after the 8th September 1948 against all persons whose income, profits or gains had escaped assessment including substantial evaders of income tax whose cases would certainly have been referred by the Central Government for investigation to the Commis sion if it had been possible for them to do so before the first September 1948.
After the 8th September 1948, there were two procedures simultaneously in operation, the one under Act XXX of 1947 and the other under the Indian Income tax Act with reference to persons who fell within the same class or category, viz., that of the substantial evaders of income tax.
After the 8th September 1948, therefore, some persons who fell within the class of substantial evaders of 1261 income tax were dealt with under the drastic and summary procedure prescribed under Act XXX of 1947, while other persons who fell within the same class of substantial evaders of income tax could be dealt with under the procedure prescribed in the Indian Income tax Act after service of notice upon them under the amended section 34(1) of the Act.
Different persons, though falling under the same class or category of substantial evaders of income tax, would, therefore, be subject to different procedures, one a summary and drastic procedure and the other a normal procedure which gave to the assessees various rights which were denied to those who were specially treated under the procedure prescribed in Act XXX of 1947.
The legislative competence being there, these provisions, though discriminatory, could not have been challenged before the advent of the Constitution.
When, however, the Constitution came into force on the 26th January 1950, the citizens obtained the fundamental rights enshrined in Part III of the Constitution including the right to equality of laws and equal protection of laws enacted in article 14 thereof, and whatever may have been the position before the 26th January 1950, it was open to the persons alleged to belong to the class of substantial evaders thereafter to ask as to why some of them were subjected to the summary and drastic procedure prescribed in Act XXX of 1947 and others were subjected to the normal procedure prescribed in section 34 and the cognate sections of the Indian Income tax Act, the procedure prescribed in Act XXX of 1947 being obviously discriminatory and, therefore, violative of the fundamental right guaranteed under article 14 of the Constitution.
It would be no answer to suggest that those substantial evaders whose cases were referred by the Central Government for investigation by the Commission before the 1st September 1948 formed a class by themselves leaving others though belonging to the same class or category of substantial evaders of 1262 income tax to be dealt with by the ordinary procedure prescribed in the Indian Income tax Act without infringing the fundamental right guaranteed under article 14 of the Constitution.
A similar argument had been, advanced before us by the learned Attorney General appearing for the Commission in Shree Meenakshi Mills case, supra.
The ground which he had urged was "that the class of persons dealt with under section 5(1) of Act XXX of 1947 was not only the class of substantial tax dodgers but it was a class of persons whose cases the Central Government, by 1st September, 1948, had referred to the Commission and that class had thus become determined finally on that date, and that class of persons could be dealt with by the Investigation Commission under the drastic procedure of Act XXX of 1947 while section 34 of the Indian Income tax Act as amended empowered the Income tax Officer to deal with cases other than those whose cases had been referred under section 5(1) to the Investigation Commission . . " Mahajan, C. J. who delivered the judgment of the Court dealt with this argument at page 795(1) as under: "As regards the first contention canvassed by the learned Attorney General it seems to us that it cannot stand scrutiny.
, The class of persons alleged to have been dealt with by section 5(1) of the impugned Act was comprised of those unsocial elements in society who during recent years prior to the passing of the Act had made substantial profits and bad evaded payment of tax on those profits and whose cases were referred to the Investigation Commission before 1st September, 1948.
Assuming that evasion of tax to a substantial amount could form a basis of classification at all for imposing a drastic procedure ' on that class, the inclusion of only such of them whose cases had been referred before 1st September, 1948, into a class for being dealt with by the drastic procedure, leaving other tax evaders to be dealt with under the ordinary law will be a clear discrimination for the reference of the case within a particular time (1) , 795.
1263 has no special or rational nexus with the necessity for drastic procedure. .
These observations were made to repel the particular argument of the learned Attorney General but they did not lay down that in fact section 5(1) was confined to such a limited class.
We are further supported in this view by the fact that by the later amendment of section 34 of the Indian Income tax Act effected by Act XXXIII of 1954, the time limit for the issue of notice under section 34(1 A) of the Indian Income tax Act has been fixed as the 31st day of March 1956.
It is, therefore, clear that the period originally fixed for the reference of the cases of substantial evaders of income tax for investigation by the Commission, viz. 30th June, 1948 or the extended period, viz., I St September, 1948 pro vided in section 5(1) of Act XXX of 1947 or the period fixed by the new section 34(1 A) of the Indian Income tax Act, viz., 31st day of March 1956 was not a necessary attribute of the class of substantial evaders of income tax but was merely an accident and a measure of administrative convenience and was not an element in the formation of the particular class of substantial evaders of income tax.
It follows, therefore, that after the inauguration of the Constitution on the 26th January, 1950, the persons whose cases were referred for investigation by Central Government to the Commission up to the 1st September, 1948 could, to use the words of Mabaian C. J. in Shree Meenakshi Mills case, supra, at page 794ask: ". . why are we now being dealt with by the discriminatory and drastic procedure of Act XXX of 1947 when those similarly situated as ourselves can be dealt with by the Income tax Officer under the amended provisions of section 34 of the Act? Even if we once bore a distinctive label that distinction no longer subsists and the label now borne by us is the same as is borne by persons who can be dealt with under section 34 of the Act as amended; in other words, there is nothing uncommon either in properties or in characteristics between us and those evaders of 1264 income tax who are to be discovered by the Incometax Officer under the provisions of amended section 34".
We may also add, adopting the same phraseology, that in our judgment, no satisfactory answer can be returned to this query because the field on which the amended section 34(1) operated from and after the 26th January 1950 included the strip of territory which was also occupied by section 5(1) of Act XXX of 1947 and two substantially different laws of procedure, one being more prejudicial to the assessee than the other, could not be allowed to operate on the same field in view of the guarantee of article 14 of the Constitution.
The result, therefore, is that barring the cases of persons which were already concluded by reports made by the Commission and the directions given by the Central Government under section 8(2) of Act XXX of 1947 culminating in the assessment or reassessment of the escaped income, those cases which were pending on the 26th January 1950 for investigation before the Commission as also the assessment or reassessment proceedings which were pending on the 26th January 1950 before the Income tax Officers concerned in pursuance of the directions given by the Central Government under section 8(2) of the Act would be hit by article 14 of the Constitution and would be invalidated.
The R. C. Cases 516, 517 and 518 relating to M. Ct. M. Chidambaram Chettiar, M. Ct.
Muthiah Chettiar and Devanai Achi were pending before the Commission on the 26th January 1950, the report therein not having been made by the Commission till the 26th August 1952 and the Commission had, after the 26th January 1950, no jurisdiction to complete the investigation and make their report, the whole procedure being violative of the fundamental right guaranteed to the petitioners under article 14 of the Constitution.
This position was not in terms argued before us by the learned counsel for the petitioners.
It was urged in the first instance that the case was governed by our decision in Shree, Meenakshi Mills ' case, supra, on 1265 the basis that by reason of the applications to the Commissioner of Income tax, Madras, made by the petitioners under section 8(5) of the Act for reference to the High Court on questions of law arising out of the Income tax Officer 's re assessment orders above referred to, the proceedings under Act XXX of 1947 had not become final and the petitioners were, therefore, entitled to relief on the ratio of our judgment in that case.
Reliance was placed in support of this position on the provisions of section 8(4) of the Act: "In all assessment or re assessment proceedings taken in pursuance of a direction under sub section (2), the findings recorded by the Commission on the case or on the points referred to it shall, subject to the provisions of sub sections (5) and (6), be final; but no proceedings taken in pursuance of such direction shall be a bar to the initiation of proceedings under section 34 of the Indian Income tax Act,1922 (XI of 1922)".
Sub section (5) has reference to, the application made by the assessee to the Commissioner of Income tax to refer to the High Court any question of law arising out of the assessment or re assessment orders and sub section (6) has reference to the power of the Commission either of their own motion or on the application of the person concerned or of the Central Government to correct clerical or arithmetical mistakes in their report or errors therein arising from any accidental slip or omission. . .
These provisions contained in sub sections (5) and (6), however, would not make the findings recorded by the Commission any the less final.
These findings were invested with finality subject to this that if the High Court, on reference under sub section (5), gave any opinion which would require a revision of those findings or if any clerical or arithmetical mistakes were found or errors were detected arising from accidental slip or omission within the meaning of sub section (6) which also required some alterations in the findings, these findings would be divested of their finality and would have to be revised accordingly.
The assessment or re assessment orders made by the Income 1266 tax Officers based upon those findings would also be binding on the assessees subject only to the result of the reference, if any, made to the High Court on questions of law arising out of such orders.
If this was the true position, it could not be urged that by reason of the pendency of the applications for reference to the High Court the proceedings under Act XXX of 1947 had not been concluded against the petitioners and it could not also be urged that when Act XXXIII of 1954 was enacted introducing section 34(1 A) in the Income tax Act with effect from the 19th July 1954, the R.C. Cases 516 to 518 were pending and the whole proceedings under Act XXX of 1947 against the petitioners were invalidated.
As a matter of fact the report had been made by the Commission against the petitioners as early as the 26th August 1952, the Central Government had given the directions under section 8 (2) for re assessment of the petitioners on the 16th September 1952 and the re assessment orders for all the years except the year 1942 43 had been made by the Income tax Officer against them by the 12th May 1954 which was long before the Act XXXIII of 1954 came into operation.
All these re assessments had thus become binding on the petitioners and were not affected by the mere pendency of the applications for reference to the High Court made by them to the Commissioner of Incometax, Madras, under section 8(5) of the Act.
There is also a further point to be considered in this connection and it is that whatever discriminatory procedure the petitioners were subjected to by reason of the reference of their cases by the Central Government to the Commission under section 5(1) of the Act had been completed long before the Act XXXIII of 1954 came into operation and the only further procedure which they would be subjected under the provisions of Act XXX of 1947 would be that of a reference to the High Court on questions of law arising out of the orders of re assessment if these applications were granted either by the Commissioner of Income tax, Madras, or by the High Court on further application.
In the event of such reference being 1267 made, the petitioners had the additional advantage of having their references heard by the High Court in a Bench constituted of not less than three Judges as contrasted with the normal procedure obtaining under sections 66 and 66 A of the Indian Income tax Act under which the references could be beard a Division Bench of the High Court.
Whatever was, therefore, the procedure to which the petitioners would be subjected under Act XXX of 1947, after the coming into operation of Act XXXIII of 1954 it was, instead of being prejudicial to them, really advantageous to them, and following our decisions in the cases of Syed Qasim Razvi vs The State of Hyderabad and Others(1) and Habeeh Mohamed vs The State of Hyderabad(2), we are of the opinion that the further proceedings, if any, which could be taken under the provisions of Act XXX of 1947 would not be at all discriminatory and violative of the fundamental right guaranteed under article 14 of the Constitution.
The only relief which the petitioners would have been entitled to in that event would have been one in regard to the re assessment proceedings for the year 1942 43 which were pending before the Incometax Officer by virtue of the notice under section 34 issued by him to the petitioners on the 19th March 1954.
Reliance was placed upon a decision of the Allahabad High Court reported in Gangadhar Baijnath and others vs Income tax Investigation Commission, etc.(3) in support of this position.
The learned Solicitor General did not contest this position but undertook on behalf of the Income tax authorities that they will not proceed against the petitioners for the re assessment for the year 1942 43 in pursuance of the notice under section 34 served upon them in that behalf.
This would have been the only relief to which the petitioners would have become entitled on the main contention urged by them in their petition.
The petitioners are, however, entitled to succeed on the alternative contentions which were raised by them as (1) (2) ; (3) A.I.R. 1955 All.
160 1268 the result of the conclusion which we have reached above in regard to the proceedings pending before the Commission having become discriminatory after the 26th January 1950 by reason of section 5(1) of the Act having become unconstitutional after the inauguration of the Constitution,on that date.
In the result, the petitioners will be entitled to the issue of a writ of certiorari quashing the report of the Income tax Investigation Commission dated the 29th August 1952 and the assessment orders of the Incometax Officer for the years 1940 41, 1941 42 and 1943 44 to 1948 49 as being unconstitutional, null and void, and also to the issue of a writ of prohibition against the respondents from implementing the findings of the Investigation Commission referred to above with regard to the ear 1942 43 and we do order that such writs do issue against the respondents accordingly.
The respondents will pay the petitioners ' costs of this petition.
JAGANNADHADAS J.
This petition raises the question whether section 5(1) of the Taxation on Income (Investigation Commission) Act, 1947 (Act XXX of 1947) (hereinafter referred to as the Investigation Commission Act) is unconstitutional as offending article 14 of the Constitution and has therefore become void on the coming into force of the Constitution on the 26th January, 1950.
This question was specifically left open in the two previous decisions of this Court, viz. in Suraj Mall Mohta & Co. vs A. Y. Visvanatha Sastri(1) and Shree Meenakshi Mills Ltd. vs A. V. Visvanatha Sastri(2).
Almost the identical question arose in the Travancore Appeals(3) in which judgment has just now been delivered.
The provision with which we were concerned in those appeals is section 5(1) of Travancore Act XIV of 1924 which is almost in identical terms as section 5(1) of the Investigation Commission Act.
We have held that this section of the Travancore Act did not, on the coming (1) ; (2) (3) A. Thangal Kunju Musaliar Y. Authorised Official, I. T. ; 1269 into operation of the Constitution, violate article 14 thereof and that it accordingly continued to be valid.
This result was based on the following conclusions.
(a) The expression "a person who has to a substantial extent evaded payment of taxation on income" has to be interpreted having regard to the background or the circumstances that preceded at the time the section came to be enacted and which were disclosed in the affidavit filed in this Court by the Secretary of the Investigation Commission and so interpreted the word "substantial" indicates with reasonable certainty the class of persons intended to be subjected to the drastic procedure of the Act.
(b) The selective application of the law to persons in this class cannot be considered invalid since the selection is guided by the very objective set out in section 5(1) itself (c) The fact that some persons may escape the ap plication of the law is not necessarily destructive of the efficacy of the provision.
It was also held, on a comparison with section 47 of the Travancore Act XXIII of 1121, corresponding to section 34 of the Indian Income tax Act, 1922 (XI of 1922) as it stood prior to its amendment in 1948, that the persons who fall under the class of substantial evaders of income tax within the meaning of section 5(1) of the Investigation Commission Act were not intended to be and could not have been dealt with under the provisions of section 47 of the Travancore Act XXIII of 1121 and that therefore there would be no discriminatory application of two parallel statutory provisions.
In the present case, however, the majority of the Court has taken the view that section 5(1) of the Investigation Commission Act has become unconstitutional by the date of the Constitution in comparison with section 34 of the Income tax Act as amended in 1948.
It was pointed out that section 47 of the Travancore Act XXIII of 1121 which was the same as section 34 of the Income tax Act as it stood from 1939 to 1948 did not undergo any amendment by the date of the Constitution but continued as be 1270 fore and it is said that this makes a difference.
I feel constrained, however, with the utmost respect, to hold, on a careful consideration that there is no room for making any such distinction which is relevant for the purposes if this question.
Undoubtedly it is true that section 34 of the Income tax Act as it stood prior to 1948 is more restrictive in its operation than the same section as amended in 1948.
But I am unable to see how the class falling under section 5(11) of the Investigation Commission Act is still not different from that which falls within amended section 34 of the Income tax Act.
Under section 5 (1) of the Investigation Commission Act the requirement is that the Central Government has "prima facie reasons for believing that a person has to a substantial extent evaded payment of taxation on income".
This is quite different from the criterion applicable under the amended section 34 of the Income tax Act.
In the first place, section 34 of the Income tax Act relates to cases of evasion however small, while section 5(1) of the Investigation Commission Act relates only to large scale evaders comprised within the term "substantial evasion".
Secondly, the belief of the Government as to the existence of evasion need not satisfy any rigorous standard because it need not be based on any material directly connected with the suspected evasion.
It is enough if it is a "prima facie reason to believe" which having regard to the scheme of the Act would cover cases in which tell tale appearances may call for probing and effective investigation.
This may well be no more than "well grounded reason to suspect".
This is quite different from the standard of "reason to believe" required of the Income tax Officer under section 34 of the Income tax Act.
"Prima facie reason to believe" and "reason to believe" are as different from each other as "prima facie proof" and "proof".
Therefore "reason to believe" is something definitely higher than "reason to suspect".
Indeed it is difficult to compare the standards required under the two sections.
Though no doubt the power exercisable by the Central Government under,, section 5(1) of the 1271 Investigation Commission Act and that exercisable by the Income tax Officer under section 34 of the Income tax Act have this in common that both have reference to "reason to believe", the standard of belief and the basis of belief is expressed in such different terminology that it is not possible to compare the two and equate the two as being the same.
Nor indeed can it be posited that every case of the class comprised in section 5(1) of the Investigation Commis sion Act must necessarily fall within section 34 of the Income tax Act.
Apart, however, from any question as to the comparison between the two sections and as to the standards and basis of the belief required, once it is accepted (as has been done in the Travancore Appeals(1) ) that substantial evasion is a definite legal standard determinative of a distinct class, it is clear that the class comprised thereunder is not identical with the class comprised under section 34 of the, Income tax Act.
In the alternative, it is a select group of a wider class.
If the smaller grouping is on a rational basis relevant to the policy of the Act, it would form a distinct class by itself for purposes of article 14.
It is necessary at this stage to bear in mind the entire scope of the Investigation Commission Act in order to determine what the class is which is contemplated and covered by it.
Five main features may be noticed of the scheme of the Investigation Commission Act.
(1) It relates only to those in respect of whom the Government have ".prima facie reason to believe that there has been substantial evasion of tax".
(2) The belief does not result straightaway in proceedings for reassessment (unlike under section 34 of the Income tax Act) but the question of reassessment (i.e., reopening of the assessment) depends on investigation into the correctness of that belief.
The first step in the scheme is section 5(2) which contemplates that the investigation may result in substantial (1) A. Thangal Kunju Musaliar vs Authorised official I.T.; , 1272 evasion not being revealed.
If so the further proceedings would be dropped on a report by the Commission to that effect.
Hence no reassessment starts in such a case.
(3) An effective procedure for investigation is provided to bring out all the necessary and relevant facts and material to substantiate the evasion and quantum thereof (4) Proceedings for reassessment are taken only on the emergence of such material and on a report to that effect and that too on a further direction by the Government as to the exact nature of the proceedings to be taken and as to the exact period to be covered falling within the limits of 31st December, 1938 and 1st September, 1948.
(See sections 8(2) and 5(3) of the Investigation Commission Act).
(5) A reference could be made by the Government to the Commission only up to a specified date line statutorily determined.
If all these facts which are essential part of the scheme under the Investigation Commission Act are borne in mind it becomes apparent that the class contemplated under section 5(1) of the Investigation Commission Act for reassessment is totally different from that which could be got at either under section 34 of the Income tax Act as it stood between 1939 and 1948 or as it stands since 1948.
One has only to compare the provisions in the Income tax Act relating to the means by which the normal income tax authorities can get information or obtain material which might lead to a reopening of the assessment under section 34 of the Income tax Act to appreciate that the class contemplated under section 5(1) of the Investigation Commission Act cannot be the same.
The only provisions in the income tax law for the purpose are sections 37, 38 and 39 of the Incometax Act.
The primary scheme of the Income tax Act is that the basic materials for the assessment are the returns and the accounts or other evidence to be furnished by the assessee himself (sections 22 and 23 of the Income tax Act) or the checking material that may be available from the returns and the accounts 1273 of other assessees who have transactions with this assessee.
It may also consist of information received from other public authorities, etc., as well as the examination of persons appearing to have interconnected transactions.
The Income tax Officer has not the power to probe into suspicious features or obtain and seize material in verification or support thereof.
All that normally he can do, where there is room for grave suspicion is to reject the accounts and make his assessment on the basis of "best judgment" ,(see section 23(4) of the Income tax Act) which cannot be sustained if it is a wild guess based on mere suspicion.
Now, the whole scheme of the Investigation Commission Act is obviously inspired by the realisation that the normal machinery available to the Income tax Officer for the reassessment of large scale suppressed income is not adequate.
All the same, the Legislature realising that drastic investigation into the affairs of assessees on seemingly well grounded suspicions might result in serious encroachment of personal liberties, has not chosen to vest the Income tax Officer with any such powers of investigation and has confined this drastic procedure to evasion of income during the period commencing 1st January, 1939 to the 1st September, 1948 (vide sections 8(2) and 5(3) of the Investigation Commission Act) and limited the same to cases of substantial evasion.
In considering, therefore, what is the ambit of the class contemplated by section 5(1) of the Investigation Commission Act, it is necessary to remember these features of the scheme.
It would follow that the class comprised in section 5 (1) is the class of substantial evaders whose evasion appeared 'to the Government to call for a high powered machinery for effective investigation, not available to an ordinary Income tax Officer functioning under section 34 of the Income tax Act.
So understood it is quite clear, to my mind, that section 5(1) of the Investigation Commission Act relates to a class totally different from what can be brought in under section 34 of the Income tax Act as it, either stood before, or stands after, 1948.
That this class was 1274 really contemplated to be distinct is also indicated by the following provision of section 8(4) of the Investigation Commission Act.
"No proceedings taken in pursuance of such direction (direction made under section 8(2) for reassessment) shall be a bar to the initiation of proceedings under section 34 of the Indian Income tax Act".
This seems to indicate the possibility of concurrent assessment proceedings as against any particular assessee under section 34 of the Income tax Act as also under section 8(2) of the Investigation Commission Act.
The idea appears to be that section 34 proceedings may go on in respect of such income of the assessee the escaping of which comes to the knowledge of the officer by the normal procedure, and that the reassessment under the Investigation Commission Act is expected to be in respect of such evaded income which is to be discovered only as a result of regular and effective investigation.
It has been suggested in the course of arguments that no objection could be taken to Government taking only sufficient powers for investigation in appropriate cases, without any question arising as to discrimination or classification but that this cannot justify discriminatory procedure as regards actual reassessment.
That raises a different aspect of the matter which will be presently dealt with.
Assuming however that substantial evaders contemplated under section 5(1) of the Investigation Commission Act fall also within the larger class of evaders who fall within the class contemplated by section 34 of the Income tax Act as it stands, what follows? The selective group under section 5(1) of the Investigation Commission Act is determined with reference to the criteria (1) that they are substantial evaders of income tax, and (2) that they are assessees within the period 1939 to 1948 which is well known to be the period of war profits and black marketing and in respect of whom the Government get information before 1st September, 1948, justifying investigation.
This is by itself a well defined class and the 1275 classification has a reasonable relation to the object to be achieved, viz., the catching up of the escaped black market war profits, for assessment.
It is to be assumed that the Government would have made their references to the Investigation Commission of all the cases of persons about whom they have the requisite belief or information before 1st September, 1948.
If there are any war profiteers of that period against whom there was no information by then and against whom information becomes available later, it will be probably found that the information so received is not such as to enable the ordinary Income tax Officer to rope him in.
It may turn out that he has evaded once for all.
But even if, in some cases, the Incometax Officer could by the ordinary process get the escaped income of such assessees for reassessment, that by itself is no ground for thinking that a classification of substantial war profiteers who have evaded income tax and against whom there was information up to a specified date is not in itself a valid classification.
It is well recognised that a classification otherwise reasonable is not invalid by reason of the classi fication not being comprehensive.
In Joseph Patsone vs Commonwealth of Pennsylvania(1) the Supreme Court of the United States of America laid down that "a state may classify with reference to the evil to be prevented, and that if the class discriminated against is or reasonably might be considered to define those from whom the evil mainly is to be feared, it properly may be picked out.
A. lack of abstract symmetry does not matter.
The question is a practical one dependent upon experience. . .
It is not enough to invalidate the law that others may do the same thing and go unpunished, if, as a matter of fact, it is found that the danger is characteristic of the class named".
Again in West Coast Hotel Co. vs Ernest Parrish(2) the same Court stated "This Court has frequently held that the legisla (1) , 144; ; , 543.
(2) ; , 400: ; , 718.
161 1276 tive authority, acting within its proper field, is not bound to extend it 's regulation to all cases which it might possibly reach.
The legislature 'is free to recognize degrees of harm and it may confine its restrictions to those classes of cases where the need is deemed to be clearest '.
If 'the law presumably hits the evil where it is most felt, it is not to be overthrown because there are other instances to which it might have been applied '.
There is no 'doctrinaire requirement ' that the legislation should be couched in all embracing terms".
It is substantially the above view of permissible classification for the purposes of article 14 that has been recognised by this Court in Sakhawat Ali vs The State of Orissa(1) where this Court laid down as follows: "Legislation enacted for the achievement of a particular object or purpose need not be all embracing.
It is for the legislature to determine what categories it would embrace within the scope of legislation and merely because certain categories which would stand on the same footing as those which are covered by the legislation are left out would not render legislation which has been enacted in any manner discriminatory and violative of the fundamental right guaranteed by article 14 of the Constitution".
Even if therefore section 34 of the Income tax Act as amended in 1948 is wide enough in its ambit to catch up any and every case which could be dealt with under section 5(1) of the Investigation Commission Act, it is still a distinctive and selective group out of a larger group and is a class by itself determined with reference to the criteria above indicated.
It is no objection to the constitutionality of that classification that some out of them who may have been left out may be taken up later for being proceeded against under the amended section 34 of the Income tax Act.
The class falling within the scope of the Investigation Commission Act is a class closed with reference to the date line, 1st September, 1948, and it appears to me difficult to envisage the possibility of any member (1) , 1010.
1277 of that class being available to be dealt with by the Income tax Officer under the amended section 34 of the Income tax Act which came into operation from after that date line except by imputing mala fides to the Government in the selective application of section 5(1) of the Investigation Commission Act.
It is true that the date line was changed by legislature from 30th June, 1948 to 1st September, 1948.
But it was an essential part of the whole scheme of the legislation that there was to be no reference beyond a dateline to be fixed by the legislature, so as to limit the application of the Act.
Hence it is also an attribute of the class contemplated by the Act.
I am aware that there are observations in Suraj Mall Mohta 's case(1) and Shree Meenakshi Mills ' case(2) which appear not to have accepted the idea of the class being with reference to a date line.
But the actual decision in Suraj Mall Mohta 's case(1) was based on the distinction between section 5(4) and section 5(1) of the Investigation Commission Act and the consequential parallelism between the class falling under section 5(4), of the Investigation Commission Act and section 34(1) of the Income tax Act.
In Meenakshi Mills ' case(2) the decision was rested on the parallelism between section 5(1) of the Investigation Commission Act and section 34(1) of the Income tax Act as amended in 1954.
The decision in neither of these cases was based on any final determination of the scope of the class contemplated by section 5(1) of the Investigation Commission Act.
The actual decisions in those cases are of course binding but not necessarily all the reasoning therein.
Besides, with great respect, the relevancy of the date line in section 5(1) as having been related to the then contemplated date for the lapse, in 1948, of the controls under the Essential Supplies (Temporary Powers) Act, 1946 (Act XXIV of 1946) was not noticed.
The principle of Sakhawat Alis case(3) was not also by then laid down by this Court (that case having been decided later in November, 1954).
(1) ; (2) (3) , 1010, 1278 Further, even if the date line is not an essential part of the classification under section 5(1) of the Investigation Commission Act, the other four essential features of the scheme of the class contemplated in section 5(1) as set out by me above are by themselves enough to constitute a complete and rational differentiation of the class comprised under section 5(1) of the Investigation Commission Act from that under section 34(1) of the Income tax Act as amended in 1948.
If on such a classification some cases of substantial evasion happen to have escaped the machinery of the Investigation Commission Act, that would not invalidate the classification on the principle accepted in Sakhawat Ali 's case(1).
I am in any case unable to visualise the reasonable possibility of any person falling within the category contemplated under section 5(1) of the Investigation Commission Act, being taken up for reassessment under section 34 of the Income tax Act as amended in 1948 and consequently of two parallel reassessment proceedings relating to such persons remaining pending by the 26th January, 1950, so as to bring about discriminatory operation between them and to render section 5(1) of the Investigation Commission Act ultra Vires in respect of such pending matters.
It appears to me, therefore, that section 5(1) of the Investigation Commission Act and the other sections following thereupon cannot be declared unconstitutional on the ground of absence of reasonable classification.
One other matter has been relied upon as being relevant.
It was pointed out that the amendment of section 34 of the Income tax Act in 1948 was simultaneous with the amendment of section 5(3) of the Investigation Commission Act, extending the time for a reference under section 5(1) by the Central Government up to the 1st September, 1948.
It has been suggested that this clearly shows the intention of the legislature to the effect that after the 1st September, 1948, all cases which might have fallen under section 5(1) of the Investigation Commission Act are left to be dealt with under section 34 of the (1) , 1010.
1279 Act as amended.
It appears to me with respect that there is no basis for this inference.
On the other hand it appears to me (if what I have said above as being the scheme of the Investigation Commission Act is correct) that the legislature deliberately limited the application of the Investigation Commission Act by a date line, realising the seriousness of its continued operation.
It did not want to perpetuate the drastic provisions thereof to any new cases in view of the fact that the official war period ended and controls had been lessened by the above date line, if not totally abolished.
It may be mentioned that by proclamation, the war situation was formally terminated as from the 1st April, 1946, and that the Control Orders under the Defence of India Act ceased to be operative from the 1st October, 1946, and that the Essential Supplies (Temporary Powers) Act, 1946, was passed in substitution thereof This 1946 Act was intended originally to be in operation only until March, 1948.
(See Joylal Agarwala vs The State(1).
The date line of 1st September, 1948, in section 5(1) seems to be related to this situation.
It appears to me that with the full consciousness that any new cases of the same category, if any, are not likely to be caught up under the normal procedure, the legislature merely purported by virtue of the amended section 34 of the Incometax Act to remove certain lacuna in the normal machinery, which had been noticed and reported upon by the income tax administration and by the Investigation Commission, with reference to section 34 as it stood between 1939 to 1948.
(See paragraph 22 of the General Report of the Income tax Investigation Commission issued in 1948 making its recommendations for the improvement of the machinery at page 8 of that report and Appendix A thereto which would show that amendment of section 34 was not connected with the extension of the date for making references under section 5(1) of the Investigation Commission Act).
I am unable, therefore, to assume that the simultaneous enactment of section 34 of the Incometax Act and the amendment of Investigation Com (1) ; , 130.
1280 mission Act in 1948 have a bearing on the question at issue.
Undoubtedly the re assessment proceedings under the Investigation Commission Act appear to deprive the assessee of certain procedural advantages.
He is deprived of an appeal on facts to the Appellate Assistant Commissioner and to the Income, tax Appellate Tribunal.
He is given the right of appeal only on points of law by means of a reference to the High Court.
But such reference is to be heard by a Bench of not less than three Judges.
Now, once there is a valid classification the nature and extent of the actual discrimination which results under the scheme of legislation relating thereto is largely a question of policy, which the courts have nothing to do with, except possibly where the discrimination has no reasonable relation to the policy and purpose of the classification.
The policy underlying the Investigation Commission Act is, as already stated, to catch up for reassessment large scale evasions of income tax of the war period.
It is obvious that having regard to the magnitude of the interests that would be in volved therein, it was quite legitimate that the matters concerned therewith, should be entrusted to a highly qualified and high powered authority, and not to the ordinary machinery.
No grievance can be made if the legislature thought fit not to entrust the responsibility for fact finding to the normal machinery involving lesser qualifications and experience.
It is true that the investigation might have been placed in the bands of one authority and the fact finding on the material so gathered in the hands of another authority or that at least there might have been provided one appeal on facts also to a high placed authority like the High Court.
It may also appear somewhat disquieting that the same body is invested both with the power of investigation and the power of fact finding and that there is no appeal provided as against its findings on facts.
But these are all matters of policy and cannot be said to be either unreasonable or unrelated to the purpose and policy of the classification.
Investigation is a com 1281 prehensive term and it will be seen that the investigation procedure itself under the Act is in two stages, one before the authorised official at which the assessee is not entitled to be represented and the other before the Investigation Commission at which the assessee is entitled to be represented by a pleader, a registered accountant or an authorised employee (vide section 7(3) and the proviso thereto).
These two stages may be taken roughly, though not necessarily, to indicate two parts of the investigation, (1) the process of probing into the evasion and collecting the material in support of it, and (2) arriving at conclusions with reference to the material so collected and presented.
The latter is the judicial part at which the Commission is directed under section 7(2) to follow the principles of the Indian Evidence Act and to give the assessee a reasonable opportunity of rebutting evidence and generally to act in accordance with the principles of natural justice.
The procedure relating to this stage is assimilated to a judicial enquiry in a larger measure than is the procedure before the Income tax Officer or the Appellate Assistant Commissioner, in respect of whose proceedings there is no provision that they must follow as far as practicable the principles of the Indian Evidence Act, (See section 23 of the Income tax Act).
It is wellsettled that the assessment proceedings by the Income tax Officer under section 23 of the Incometax Act and hence also under section 34 therefore not regulated by the technical standards of evidence though of course they cannot be based on caprice or suspicion.
It would, therefore, appear that according to the scheme of the Investigation Commission Act, the judicial part of it approximates much more to judicial standards than the assessment proceedings by the income tax authorities and that though in theory there is a combination of the func tions of an investigator and the judge in the Investigation Commission, in normal practice it is likely to be kept distinct by the appointment of an authorised official to conduct the first portion.
It is also to be remembered that the combination of the investigator 1282 and judge is inherent even in the normal income tax machinery where the Income tax Officer and the Assistant Income tax Commissioner are in the nature of Judges interested in their own cause.
It has been suggested that there is something opposed to ordinary canons of judicial procedure or natural justice in the matter of making relevant documents available to the assesee in the proceedings before the Investigation Commission.
It appears to me, with respect, that this is based on a misapprehension.
It is true that section 7(4) of the Investigation Commission Act says: "No person shall be entitled to inspect, call for, or obtain copies of, any documents, statement or papers or materials furnished to, obtained by or produced before the Commission or any authorised official in any proceedings under this Act; but the Commission, and after the Commission has ceased to exist ,such authority as the Central Government may in this behalf appoint, may, in its discretion, allow such inspection and furnish such copies to any person", and section 6(8) of the Investigation Commission Act says: "All material gathered by the Commission or the authorised official and materials accompanying the reference under sub section (1) of section 5 may be brought on record at such stage as the Commission may think fit".
But these provisions have to be read subject to the proviso to section 7(4) and to the opening part of section 7(2) of the Investigation Commission Act.
The proviso to section 7(4) is as follows: "Provided that, for the purpose of enabling the person whose case or points in whose case is or are being investigated to rebut any evidence brought on the record against him, he shall, on application made in this behalf and on payment of such fees as may be prescribed by Rules made under this Act, be furnished with certified copies of documents, statements, papers and materials brought on the record by the Commission".
Further, the opening part of section 7(2) says: 1283 "In making an investigation under clause (b) of section 3, the Commission shall act in accordance with the principles of natural justice, shall follow as far as practicable the principles of the , and shall give the person whose case is being investigated a reasonable opportunity of rebutting any evidence adduced against him. . .
The above provisions preclude the possibility of the Commission pushing in into the final record on which the report is to be based any ex parte material to which the assessee has had no access.
These also preclude the possibility of depriving him of the use of any relevant material in the Commission 's possession which the assessee may call for.
All that section 7(4) implies is that the assessee is not entitled to a roving inspection of the material gathered by the Investigation Commission in the course of investigation, which may relate to the affairs of various other persons.
Such a provision is not opposed to natural justice for even in the matter of criminal judicial trials the accused is not entitled to a roving inspection of the material gathered by the police during investigation.
(I may notice, with very great respect, that the observation in Suraj Mall Mohta 's case(1) at page 464 that "the proceedings before the Income tax Officer are judicial proceedings and (that therefore) all the incidents of such judicial proceedings have to be observed, i.e., in other words, the assessee should be entitled to inspect the record and all relevant documents" seems to have failed to note that section 37(1) specifically limits the judicial character of the proceedings to the purposes covered by sections 193, 196 and 228 of the Indian Penal Code and also that the said section vests in the Income tax authorities, the powers of a court only for specified purposes).
If, therefore ' in view of all these circumstances the Legislature thought fit to entrust the combined responsibility for investigation and fact finding to a single high powered and highly qualified body consisting of three members of whom one is or has been a Judge of the High Court and made their findings of (1) ; 162 162 1284 fact final, without providing for access to the regular heirarchy of appeals to the Assistant Commissioner and a Bench of two members of the Income tax Appellate Tribunal, there appears to be nothing unreasonable therein.
On the other hand there are counter,balancing features with reference to the composition of the Commission and the statutory standards by which the judicial part of its proceedings have to be governed.
I am, therefore, unable to feel that the discrimination brought about in the procedure relating to assessment calls for any such adverse reaction as to be a reasonable basis for founding thereon an inference of unconstitutional inequality.
However, as I have already said above, this appears to be ultimately a question of policy.
Once the classification is found to be justified and reasonably related to the clearly underlying policy of the Investigation Commission Act, I am unable to feel that section 5(1) of the Investigation Commission Act can be struck down as ultra vires in relation to its supposed concurrent operation with section 34 of the Income tax Act as amended in 1948.
I hold, therefore, that section 5(1) of the Investigation Commission Act was not hit by article 14 of the Constitution notwithstanding amendment of section 34 of the Income tax Act in 1948 and that it continued to be valid.
On all other points urged on behalf of the petitioners, I agree with the view expressed in the judgment delivered by my learned brother Justice Bhagwati on behalf of the majority of the Court.
It is therefore, unnecessary for me to deal with them.
In the result, in my opinion, this petition must be dismissed with costs except as regards the incomplete reassessment for 1942 43 for which the learned Solicitor General has given an undertaking not to proceed with it under the provisions of the Investigation Commission Act, as stated in the judgment of my learned brother.
ORDER BY THE COURT: In accordance with the Judgment of the majority the petition is allowed and it is ordered that a writ of certiorari do issue quashing the 1285 report of the Income tax Investigation Commission dated the 26th August 1952 and the assessment orders of the Income Tax Officer for the years 1940 41, 1941 42 and 1943 44 to 1948 49, and that a writ of prohibition do issue against the respondents restraining them from implementing the findings of the investigation Commission with regard to the year 1942 43.
The respondents do pay the petitioners ' costs of their petition.
| Held (Per section R. DAs, ACTING C.J., VIVIAN BOSE, BHAGWATI and B.P. SINHA, JJ.
JAGANNADHADAS J., dissenting) that section 5(1) of the Taxation on Income (investigation Commission) Act, 1947 (Act XXX of 1947) is ultra vires the Constitution as it is discriminatory and violative of the fundamental right guaranteed by article 14 of the Constitution by reason of two amendments which were made in section 34 of the Indian Income Tax Act, 1922 (Act XI of 1922) one in 1948 by the enactment of the Income Tax and Business Profits Tax 1248 (Amendment) Act, 1948 (Act XLVIII of 1948) and the other in 1954 by the enactment of the Indian Income Tax (Amendment) Act, 1954 (Act XXXIII of 1954).
If the provisions of section 34(1) of the Indian Income tax Act as it stood before its amendment by Act XLVIII of 1948 had been the only provisions to be considered, the Court would have reached the same conclusion as it did in A. Thangal Kunju Musaliar vs M. Venkitachalam Potti & Anr., ([1955] 2 S.C.R. 1196), but the position was materially affected by reason of two amendments made in that section by two Acts, one in 1948 and the other in 1954.
Amended section 34(1) of the Indian Income tax Act was substantially different from the old section 34(1) which was in operation up to the 8th September 1948.
The words "if in consequence of definite information which has come into his possession the lncome tax.
Officer discovers that income, profits or gains chargeable to income tax have escaped assessment in any year. . . which appear in the old section were substituted by the words "if the Income tax Officer has reason to believe that by reason of the omission or failure on the part of the assessee. . income, profits or gains chargeable to income tax have escaped The requisites of (i)"definite" information (ii) which had " come into" possession of the Income tax Officer and in consequence of which (iii) he "discovers" that income, profits or gains chargeable to income tax bad escaped assessment, were no longer necessary and the only thing which was required to enable the Income tax Officer to take proceedings under section 34(1) as amended was that he should have reason to believe that by reason of the omission or failure on the part of the assesses income, profits or gains chargeable to income tax had escaped assessment for a particular year.
Whereas before this amended section 34(1) came to be substituted for the old section 34(1) there was no com parison between the provisions of section 5(1) of Act XXX of 1947 and section 34(1) of the Indian Income tax Act as it then stood, the provisions of section 34(1) as amended after the 8th September 1948 could stand comparison with the provisions of section 5(1) of Act XXX of 1947 and the cases which were covered by section 5(1) of Act XXX of 1947 could be dealt with under the procedure laid down in section 34(1) of the Indian Income tax Act.
After the 8th September 1948, therefore, even in the case of substantial evaders of income tax who were a distinct class by themselves intended to be treated by the drastic and summary procedure laid down by Act XXX of 1947, some cases that were already referred by the Central Government for investigation by the Commission could be dealt with under that Act and other cases, though falling within the same class or category, could be dealt with under the procedure prescribed in the amended section 34(1) of the Indian Income tax Act.
The persons who were thus dealt with under section 34(1) of the Indian Income tax Act had available to them the whole procedure laid down in that Act including the right to inspect documents and the right to question the findings of fact arrived at 1249 by the Income tax Officer by the procedure of appeal and revision and ultimate scrutiny by the Income tax Appellate Tribunal which was denied to those persons whose cases had been referred by the Central Government for investigation by the Commission under s.5(1) of Act XXX of 1947.
Different persons, though falling under the same class or category of substantial evaders of income tax, would, therefore, be subject to different procedures, one a summary and drastic procedure and the other a normal procedure which gave to the assessees various rights which were denied to those who were specially treated under the procedure prescribed in Act XXX of 1947.
Per JAGANNADHADAS J.
The class of persons falling under section 5(1) of the Taxation on Income (Investigation Commission) Act, 1947 (Act XXX of 1947) is totally different from that which falls within amended section 34 of the Indian Income Tax Act 1922 (Act XI of 1922) and therefore section 5(1) of Act XXX of 1947 is not unconstitutional as offending article 14 of the Constitution.
Suraj Mall Mohta vs A. V. Visvanatha Sasttrii and Another ([1955] 1 S.C.R. 448), Shree Meenakshi Mills Ltd. vs A. V. Visvanatha Sastri and Another ([1955] 1 S.C.R. 787), A. Thangal Kunju Musaliar vs M. Venkitachalam Potti & Anr.
and M. Venkitachalam Potti & Anr.
vs A. Thangal Kunju Musaliar, ([1955] 2 S.C.R. 1196), Syed Qasim Bazvi vs The State of Hyderabad and Others ([1953] S.C.R. 581), Habeeb Mohamed vs The State of Hyderabad ([1953] S.C.R. 661) and Gangadhar Baijnath and others vs Income tax Investigation Commission, etc.
(A.I.R. 1955 All. 515), referred to.
|
Criminal Appeal No. 104 of 1955.
Appeal by special leave from the judgment and order ' dated September 9, 1953, of the Patna High Court in Jury Reference No. I of 1952 arising out of the ReferencE made on February 16, 1952, by the Assistant Sessions Judge, 2nd Court, Chapra, in connection with Sessions Trial No. 81 of 1951.
section P. Verma, for the appellants Nos. 2 and 3.
B. K. Saran and R. C. Prasad, for the respondent.
January 30.
The Judgment of the Court was delivered by BHAGWATI J.
The appellants Nos. 2 and 3, who are the surviving appellants after the death of appellant No. 1 during the pendency of this appeal, were charged with having committed offences under sections 435 and 436 of the Indian Penal Code and were tried by the Second Assistant Sessions Judge of Saran, Chapra, with the aid of a jury.
The jury returned a majority verdict that both of them were guilty of the offences under those sections.
The Assistant Sessions Judge disagreed with the said verdict and made a reference to the High Court of Judicature at Patna, 275 under section 307 of the Code of Criminal Procedure.
The said reference was heard by a Division Bench of that High Court.
The learned judges of the High Court overruled the contentions which were urged before them in regard to the charge to the jury being defective and further held that the reference was, in the circumstances, not competent.
They, however, without anything more accepted the majority verdict and held the appellants guilty of the offences under sections 435 and 436 of the Indian Penal Code and sentenced them to six months ' rigorous imprisonment each.
The appellants obtained from this Court special leave to appeal under article 136 of the Constitution and hence this appeal.
The facts leading up to this appeal may be shortly stated as follows: There was a dispute between the parties as to title to plot No. 1100 of village Rampur, Tengrahi.
One Kailash Rai claimed to be the owner of that plot and also claimed to be in possession of a Palani standing in a portion of that plot as also of a Punjaul, i.e., a haystack in its vicinity.
There had been proceedings under section 144 of the Code of Criminal Procedure in regard to this area leading up to a title ,suit being T.S. No. 58/8 of 1948 /50 filed by Kailash Rai against the appellants in regard to the same.
A decree had been pawed on December 16, 1950, in that title suit dismissing the claim of Kailash Rai.
An appeal had been filed by Kailash Rai against that decree and that appeal was pending at the date of the occurrence.
On March 4, 1951, Kailash Rai was sitting in the Palani and at about 3 to 4 p.m. a mob consisting of about 100 to 125 persons including the appellants all armed with lathes, bhallas and pharsas came to the Palani and began to demolish the same.
Kailash Rai remonstrated and the deceased appellant No. 1, ordered that the Palai should be set on fire.
The appellant No. 2 thereupon set fire to the Palani with a match stick and the appellant No. 3 set fire to the Punjaul.
The first information report of this occurrence was lodged at Gopalganj Police Station at 8 p.m. the same night.
The officer in charge of Gopalganj Police Station investigated the case and 276 challaned the appellants charging them with having committed, offences under sections 435 and 436 of the Indian Penal Code.
The Committing Court found a prima facie case made out against the appellants and sent them up for trial by the Assistant Sessions Judge, Second Court, Chapra, who tried them by a jury.
The jury returned a majority verdict of guilty against the appellants.
The Assistant Sessions Judge, however, disagreed with that verdict and made a reference to the High Court stating in the letter of reference that on the evidence recorded before him the appellants had been in possession of the Palani and the Punjaul but were dispossessed of the same some time prior to the passing of the decree in the title suit on December 16,1950, and were therefore justified in taking steps for recovery of possession thereof from Kailash Rai on March 4, 195 1, and if in that process the appellants set fire to the Palani and the Punjaul they were only destroying their own property and were not guilty of the offence of committing mischief by fire as alleged by the prosecution.
The Assistant Sessions Judge tried to analyse the working of the minds of the jury in arriving at the verdict which they did and though he agreed with the alleged finding of fact reached by the jury in regard to the possession of the Palani and the Punjaul, disagreed with the law as allegedly applied by the jury and therefore disagreed with the majority verdict.
When the reference was heard before the High Court, the counsel for the appellants only contended that the charge addressed by the Assistant Sessions Judge to the jury was defective and he did not invite the High Court, as he should have done, to consider the entire evidence and to acquit or convict the appellants of the offences of which the jury could have convicted them upon the charges framed and placed before it, after giving due weight to the opinions of the learned Sessions Judge and the jury as required by a. 307 (3) of the Code of Criminal Procedure.
The High Court, therefore, only considered the objections which had been urged by the learned counsel for the appellants before it in regard to the charge being defective and 277 overruled them, accepted the majority verdict, convicted the appellants and sentenced them as above.
We are of opinion that in so doing the High Court was clearly in error and acted in violation of the provisions of section 307 (3) of the Code of Criminal Procedure.
Section 307 (3) provides: In dealing with the case so submitted the High Court may exercise any of the powers which it may exercise on an appeal, and subject thereto it shall, after considering the entire evidence and after giving due weight to the opinions of the Sessions Judge and the jury, acquit or convict such accused of any offence of which the jury could have convicted him upon the charge framed and placed before it; and, if it convicts him, may pass such sentence a,% might have been passed by the Court of Sessions.
" We had occasion to consider this provision in Akhlakali Hayatalli vs The State of Bombay(1) where we approved of the following observations of their Lordships of the Privy Council in Ramanugrah Singh vs The Emperor(2): " The powers of the High Court in dealing with the reference are contained in sub section (3).
It may exercise any of the powers.
which it might exercise upon an appeal, and this includes the power to call fresh evidence conferred by section 428.
The Court must consider the whole case and give due weight to the opinions of the Sessions Judge and jury, and then acquit or convict the accused.
In their Lordships ' view, the paramount consideration in the High Court must be whether the ends of justice require that.
the verdict of the jury should be set aside.
In general, if the evidence is such that it can properly support a verdict either of guilty, or. not guilty according to the view taken of it by the trial Court, and if the jury take one view of the evidence and the, judge thinks that they should have taken the other, the view of the jury must prevail, since they are the judges of fact.
In such a case a reference is not justified, and it is only by accepting their view that the High Court can give due weight to the opinion of the jury.
It, however, (I) ; 442.
(2) A.I.R. 1946 P.C. 151, 154.
278 the High Court considers that upon the evidence no reasonable body of men could have reached the conclusion arrived at by the jury, then the reference was justified and the ends of justice required that the verdict be disregarded.
" This wag pronounced by us to be the correct method of approach in a reference under section 307 of the Code of Criminal Procedure.
It was incumbent on the High Court when the reference was heard by it to consider the entire evidence and come to its own conclusion whether the evidence was such that it could properly support the verdict of guilty against the appellants.
If the High Court came to the conclusion that the evidence was such that it was possible for the jury to take the view that it did even though the judge thought that they should have taken another view the reference would not have been justified and the High Court should have accepted the opinion of the jury.
If the High Court was however of opinion upon the evidence that no reasonable body of men could have reached the conclusion arrived at by the jury the reference would have been quite justified and the ends of justice required that the verdict should be disregarded.
The High Court, however, only considered the arguments in regard to the defect in the charge to the jury addressed before it by the learned counsel for the appellants and did not consider the entire evidence which was on the record before it.
In not having done so, we are clearly of opinion that it violated the provisions of section 307 (3) of the Code of Criminal Procedure.
We are accordingly of opinion that the judgment of the High Court accepting the majority verdict and convicting the appellants and sentencing them as above without considering the entire evidence was clearly wrong and the conviction of the appellants and the sentences passed upon them should be set aside.
We were invited by learned counsel for the parties appearing before us to consider the entire evidence for ourselves and come to the conclusion which, according to the provisions of section 307 (3) of the Code of Criminal Procedure, I he High Court should have done.
We do 279 not think that is the proper procedure to adopt and we therefore allow the appeal, and remand this matter to the High Court to act in accordance with the provisions of section 307 (3) of the Code of Criminal Procedure and deal with the same in accordance with law.
The appellants Will continue on the same bail as before.
Appeal allowed.
| The appellants were charged under sections, 435 and 436 of the Indian Penal Code and were tried by a jury, who returned a majority verdict of guilty.
The Assistant Sessions judge disagreed with the said verdict and made a reference to the High Court.
At the hearing of the reference the counsel for the appellants only contended that the charge to the jury was defective, and did not place the entire evidence before the judges, who only considered the objections ' urged, and nothing more, and held the 35 274 reference to be incompetent and found the appellants guilty and convicted them.
Held, that in a reference under section 307 of the Code of Criminal Procedure it was the duty of counsel to place, and it was incumbent on the High Court to consider, the entire evidence and the charge as framed and placed before the jury and to come to its own conclusion, after giving due weight to the opinion of the trial judge and the verdict of the jury, and to acquit or convict the accused of the offences of which the jury could have convicted or acquitted him.
It was wrong of the ' High Court to pass judgment without considering the entire evidence.
It is not proper for the Supreme Court to adopt the procedure of considering the entire evidence and come to a conclusion which according to the provisions of s.307(3) of the Code of Criminal Procedure the High Court should have done.
Akhlakali Hayatalli vs The State of Bombay, (1954) S.C.R. 435 and Ramanugrah Singh vs The Emperor, A.I.R. T946 P.C. 151, referred to.
|
396 of 1955.
Under Article 32 of the Constitution for a writ in the nature of Habeas Corpus.
R. Patnaik, for the petitioner.
M. C. Setalvad, Attorney General of India, C. K. Daphtary, Solicitor General of India, Raja Jaswant Singh, Advocate General, Jammu and Kashmir ( P. A. Mehta and R. H. Dhebar, with them) for the respondent.
M. C. Setalvad, Attorney General of India (P. A. Mehta and R. H. Dhebar, with him) for the Intervener.
December 20.
The Judgment of the Court was delivered by SINHA J.
This application for a writ of habeas corpus is directed against the State of Jammu and Kashmir which has by its order dated the 4th October, 1955, directed the detention of the petitioner under section 3 of the Jammu and Kashmir Preven 1103 tive Detention Act, (Jammu and Kashmir Act IV of 2011), hereinafter to be referred to as "the Act".
Originally the sole respondent impleaded was the State of Jammu and Kashmir.
After a rule nisi was issued to the respondent, the Union of India intervened because the petitioner had challenged the validity of the Constitution (Application to Jammu and Kashmir) Order, 1954.
The petitioner, P. L. Lakhanpal, aged approximately 28 years, describing himself as the Chairman, End Kashmir Dispute Committee, has moved this Court against the order of the State detaining him in Kothi Bagh sub jail in Srinagar.
The application is based on the following allegations.
The petitioner is normally a resident of 9821, Nawabganj, Delhi 6.
He went to Kashmir on a permit on the 24th September this year "on a study cum pleasure trip".
He has been evincing keen interest in Kashmir politics since the year 1946, when as General Secretary of the Congress Socialist Party, Lahore, be was closely associated with the "Quit Kashmir movement".
Last year he wrote a book entitled I 'Communist Conspiracy in Kashmir", copies of which had been seized by the Delhi Police but were subsequently released.
The petitioner in the book aforesaid, as also elsewhere in the press and on the platform, claims to have been making "trenchant criticism of the Kashmir cabinet headed by Bakshi Ghulam Mohammed and also of the Government of India 's policy in regard to Kashmir".
He claims to be known as the supporter of Sheikh Mohd. Abdullah, the former Prime Minister of Kashmir, and to have expressed the opinion that he "has been the victim of a heinous conspiracy motivated by lust for power between the communists and the rightists on the one hand and Bakshi Ghulam Mohammed, the present Kashmir Prime Minister, on the other".
He also claims to have been advocating the cause of the ex Prime Minister aforesaid of Kashmir whose detention has been severely criticized by him.
He has "also publicly exposed and denounced the brutal excesses committed by the police and authorities under the Bakshi Government throughout 1104 the State".
He has characterized the State Constituent Assembly as having forfeited the confidence of the people.
He claims to have "declared that the Bakshi cabinet, which in his view is dominated by the communists, is the corruptest, the most tyrannical and the most hated Government that the State has ever had".
Similar views were expressed by him in telegrams said to have been sent to the Sadar i Riyasat of Jammu and Kashmir, to the President of India and to the Prime Minister of India.
He claims to have organized a "persistent campaign to secure support for his views on Kashmir among the public and leaders of political thought".
The aforesaid activities of the petitioner, he further claims, have "provoked a bitter controversy between him and the Indian Prime Minister".
In this connection he makes reference to certain statements said to have been made by the Prime Minister of India which it is not necessary to detail here except the following: "During the last few months, however, I have become aware of his (the petitioner 's) activities and have inquired into them.
These inquiries led me to the conclusion that these activities are of a most objectionable character which can only help the enemies of our country".
The petitioner also claims to be the General Secretary of the World Democratic Peace Congress.
In this connection he makes certain other allegations against the Prime Minister of India which are not relevant to the case.
He also makes a grievance that it was reported in a daily newspaper of Srinagar called Khidmat that the present Prime Minister of Jammu and Kashmir had described him as "a traitor and an enemy of the nation".
He then describes his activities during three days in Srinagar meeting people from various walks of life, including editors of the newspapers and members of the State Assembly.
On the 29th September, he says, be left Srinagar for Anantnag in the company of the alleged leader of the opposition in the Assembly and President of the Jammu and Kashmir Plebiscite Front, named Mirza Afzal Mohd. Beg, who, it may be added, has also 1105 been in detention under the orders of the Jammu and Kashmir Government, as stated by the Advocate General of that State.
At Anantnag he claims to have spent two days as the guest of Mr. Beg meeting people of the town and neighbouring areas "listening to their harrowing tales of woe".
On the 30th September be "addressed an informal meeting of the Plebiscite Front Workers at Mr. Beg 's residence".
He came back to Srinagar on the 1st October and left for Sopore on the 2nd October.
There he addressed an informal gathering of a few hundred workers on the same lines as he had done at Anantnag.
On the 3rd October he personally banded to the P.A. to the Chief Secretary of Jammu and Kashmir an application seeking permission for an interview with Sheikh Abdullah in the Kud jail where he has been in detention.
During his stay in Srinagar, he states, he made unsuccessful attempts to contact the State Prime Minister for a meeting.
In the afternoon of the 4th October be held a press conference at which he "made a written statement" complaining of "such barbaric brutalities, such insecurity of life, property and honour and such callousness on the part of the administration as are evidenced in your valley only go to show that the Bakshi Government is just another name for legalized lawless, disorder, corruption and nepotism".
In the early hours of the morning of the 5th October the Superintendent of Police, Srinagar, read out to him the order of detention passed by the Cabinet and took him into custody and detained him in the sub jail Kothi Bagh.
The order of detention (Annexure "D" at page 20 of the paperbook) is in these terms: "GOVERNMENT OF JAMMU AND KASHMIR CHIEF SECRETARIAT (GENERAL DEPARTMENT) Subject: Detention of P. L. Lakhanpal, Chairman, End Kashmir Dispute Committee at present residing in Kashmir Guest House, Lal Chowk, Amira Kadal, Srinagar, under section 3(1)(a)(i) of the Jammu and Kashmir Preventive Detention Act, 2011.
1106 Read: Memorandum No. IS 164 D/55 dated 4 10 1955, from the Minister Incharge, Law and Order.
Order No. 1644 C of 1955 Dated 4th October, 1955.
The Government having considered the facts stated in the memo of the Minister Incharge, Law and Order are satisfied that it is necessary to detain P. L. Lakhanpal, Chairman, End Kashmir Dispute Committee at present residing in Kashmir Guest House, Lal Chowk, Amira Kadal, Srinagar, with a view to preventing him from acting in any manner prejudicial to the security of the State.
Accordingly the Government hereby accord sanction to the Order annexed hereto and authorize the Chief Secretary to Government to issue the same over his signature.
By Order of the Cabinet, , Sd.
G.M. Bakshi Prime Minister".
The order actually 'served on the petitioner is an annexure to the cabinet order (Annexure 'E ' at page 21 of the paper book) which is in these terms: "GOVERNMENT OF JAMMU AND KASHMIR.
Annexure to Cabinet Order No. 1644 C of 1955, dated 4 10 1955.
O r d e r.
Whereas the Government are satisfied with respect to P. L. Lakhanpal, Chairman, End Kashmir Dispute Committee, at present residing in Kashmir Guest House, Lal Chowk, Amirakadal, Srinagar that with a view to preventing him from acting in a manner prejudicial to the security of the State it is necessary to make an order directing that the said P. L.Lakhanpal be detained: Now, therefore in exercise of the powers conferred by sub section (1) of section 3 of the Jammu and Kashmir Preventive Detention Act, 2011, the Government are pleased to order that the said P. L. 1107 Lakhanpal be detained in sub jail, Kothibagh, Srinagar; Notice of this Order shall be given to the said P. L. Lakhanpal by reading over the same to him.
By order of Government.
Ghulam Ahmad Chief Secretary to Government".
It is this order which the petitioner challenges as "malicious, mala fide, vague and capricious, illegally depriving the petitioner of his fundamental right to life and personal liberty guaranteed under article 21 of the Constitution as extended to the State of Jammu and Kashmir".
The order of the petitioner 's detention is also challenged as unwarranted and illegal as the order sent to the jail authorities does not bear the signature of the Prime Minister of Jammu and Kashmir and also because the petitioner has not been supplied, in spite of demands made by him, with the grounds on which the order of his detention is based, "in clear violation of his fundamental rights guaranteed under clause (5) of article 22 of the Con stitution as extended to the State of Jammu and Kashmir by the Constitution (Application to Jammu and Kashmir) Order, 1954".
The State has filed an answer to the petitioner 's affidavit in support of his petition.
The affidavit filed on behalf of the State is sworn to by Shri Pirzada Ghulam Ahmad, Chief Secretary to the Government.
In this affidavit he denies that the petitioner had come to Kashmir on a study cum pleasure trip as alleged by him.
He further states that the petitioner during his stay in Kashmir "actually engaged him self in activities prejudicial to the security of the State" and that the Government was "satisfied that it is not in the public interest to communicate to the petitioner the grounds of the said detention order".
The affidavit further states that the petitioner 's "detention was ordered by the Cabinet not for any collateral purpose but because the Government was satisfied that the activities of the petitioner were calculated to prejudice the security of the State" 140 1108 The allegations of improper motive and mala fides made by the petitioner are denied as wholly "unfounded and baseless".
It is also denied that the petitioner 's detention was illegal or that the provisions of the Act under which the order had been passed were unconstitutional.
The affidavit ends by stating that it is apprehended that if the petitioner were to be released, he is "likely to indulge further in activities which would greatly jeopardize the security of the State" and that the detention order had been made solely with a view to preventing the petitioner from doing any further mischief.
The Act impugned in this case provides that it shall remain in force for a period of five years from the date of its commencement.
The relevant portion of section 3 is in these terms: (1) The Government may (a) if satisfied with respect to any person that with a view to preventing him from acting in any manner prejudicial to (i) the security of the State; or. . it is necessary so to do, make an order directing that such person be detained".
The main attack against the orders served upon the petitioner is against the following paragraph in the order dated the 7th October 1955: "Now, therefore, the Government, in exercise of the powers conferred by the proviso to sub section (1) of section 8 of the said Act, hereby declare that it would be against the public interest to communicate to the said P. L. Lakhanpal the grounds on which the detention order has been made".
That part of the order of detention passed against the petitioner is in consonance with section 8 of the Act which is in these terms: "(1) When a person is detained in pursuance of a detention order, the authority making the order shall, as soon as may be, communicate to him the grounds on which the order has been made, and shall afford him the earliest opportunity of making a representation against the order to the Government; Provided that nothing contained in this sub sec 1109 tion shall apply to the case of any person detained with a view to preventing him from acting in any manner prejudicial to the security of the State if the Government by order issued in this behalf declares that it would be against the public interest to communicate to him the grounds on which the detention order has been made.
(2)Nothing in sub section (1) shall require the authority to disclose facts which it considers to be against the public interest to disclose".
The proviso to the section just quoted makes provision for such cases as come within the purview of section 3(1) (a) (i) of the Act; that is to say, a person in the position of the petitioner who has been detained for preventing him from acting in any manner prejudicial to the security of the State of Jammu and Kashmir is outside the general rule laid down in section 8(1) if the Government declares as it has done in this case, that it would be against the public inte rest to communicate to him the grounds on which the detention order has been made.
It is not contended that the orders served upon the petitioner are not justified by the terms of the section quoted above.
But it has been argued by the learned counsel for the petitioner that the terms of the section are unconstitutional inasmuch as they are inconsistent with the provisions of articles 21 and 22 of the Constitution and are therefore to the extent of such in consistency void in view of the provisions of article 13 of the Constitution.
This argument presupposes that the petitioner can invoke the aid of those articles.
It has not been contended on behalf of the petitioner that apart from the provisions of Part III of the Constitution the petitioner has any fundamental rights guaranteed to him, Therefore, if articles 21 and 22 are out of the way, as will presently appear, the argument is without any force.
The Constitution does not apply to the State of Jammu and Kashmir in its entirety.
On the 14th May, 1954, the President of India in exercise of the powers conferred by clause (1) of article 370 of the Constitution made and promulgated with the concur 1110 rence of the Government of the State of Jammu and Kashmir, the Constitution (Application to Jammu and Kashmir) Order, 1954 (which shall be described hereinafter as "The Order").
It came into force on the same day and superseded the Constitution (Application to Jammu and Kashmir) Order, 1950.
By its terms the Order provides that in addition to articles I and 370, the specified provisions of the Consti tution shall apply to the State of Jammu and Kashmir subject to the exceptions and modifications indicated therein.
In so far as those exceptions and modifications are relevant to our present purpose, it is provided that in clauses (4) and (7) of article 22 "The Legislature of the State of Jammu and Kashmir" shall be substituted for "Parliament", so that the Legislature of the State of Jammu and Kashmir is competent to legislate in respect of preventive detention.
In article 35, clause (c) has been added, which is in these terms: "No law with respect to preventive detention made by the Legislature of the State of Jammu and Kashmir, whether before or after the commencement of the Constitution (Application to Jammu and Kashmir) Order, 1954, shall be void on the ground that it is inconsistent with any of the provisions of this Part, but any such law shall, to the extent of such inconsistency, cease to have effect on the expiration of five years from the commencement of the said Order, except as respects things done or omitted to be done before the expiration thereof".
The effect of this modification in article 35 of the Constitution is that such of the provisions of the Act as are inconsistent with Part III of the Constitution shall be valid until the expiration of five years from the commencement of the Order.
This is an exception which has been engrafted on the Constitution in respect of fundamental rights relating to personal liberty for the limited period of five years.
The Act itself has a limited life of five years.
Thus the exception aforesaid is co extensive with the life of the Act itself.
Hence, so long as the Act continues in force in its present form, the provisions of articles 21 and 22 in 1111 so far as they are inconsistent with the Act are out of the way of the respondent and the petitioner cannot take advantage of those provisions.
Therefore, there is no question of the provisions of section 8 of the Act being unconstitutional by reason of their being inconsistent with articles 21 and 22 of the Constitution; and consequently article 13 is of no assistance to the petitioner.
We have assumed that article 32 of the Constitution under which this application has been made to this Court is available to the petitioner, though the Attorney General who appeared to show cause on behalf of the respondents, ' went to the length of suggesting that even the benefit of article 32 of the Constitution is not available to the petitioner.
As he did not raise this point by way of a preliminary objection and as we did not hear the petitioner 's counsel on this aspect of the case, because in our view clause (c) added to article 35 of the Constitution by the President 's Order was enough to deprive the petitioner of the benefit of articles 21 and 22 at least, we have not thought it necessary to examine and pronounce upon that extreme proposition.
Realizing the difficulty in the petitioner 's way in view of the provisions of clause (c) added as a afore said to article 35 of the Constitution, the learned counsel for the petitioner faintly suggested that clause (c) of article 35 added by the President 's Order was itself bad inasmuch as, so the argument further ran, that provision was in excess of the powers conferred on the President by article 370 of the Constitution.
No attempt was made on behalf of the petitioner to show how the Order promulgated by the President was in excess of his powers under article 370 of the Constitution.
It was not contended that that article did not authorise the President to promulgate the Order.
What was suggested was that in promulgating the Order which the President was authorized to make under article 370 he had exceeded his powers.
Beyond saying so, no tangible reason was adduced in support of this extreme position.
It is manifest that article 370(1)(c) and (d) authorizes the President by Order 1112 to specify the exceptions and modifications to the provisions of the Constitution (other than articles I and 370) subject to which the Constitution shall apply to the State of Jammu and Kashmir.
Clause (c) as indicated above has been added to article 35 of the Constitution only so far as the State of Jammu and Kashmir is concerned.
Section 8 of the Act is not in excess of or inconsistent with the provisions of clause (c) so added to article 35 of the Constitution.
That being so the orders as served upon the petitioner are not inconsistent with or in excess of such provisions of Part III of the Constitution as apply to the State of Jammu and Kashmir.
It must therefore be held that the petitioner was not entitled to know the grounds upon which he had been detained beyond what is disclosed in the order itself It was argued that the order of detention served on the petitioner or the order sent to the officer in charge of the jail where he was detained, did not bear the signature of the Prime Minister of Jammu and Kashmir.
But no provisions of any law have been brought to our notice which require that the Prime Minister himself should have signed the copy of the order to be served on the detenu or the copy of the order which was forwarded to the officer in charge of the jail.
Even the long petition submitted by the petitioner which is not characterized by sobriety of language or strict accuracy does not contain any the least suggestion to that effect; and no material in sup port of it has been shown to us.
We cannot, therefore, take notice of such an irresponsible and unfounded suggestion.
It must therefore be held that all the grounds of law urged or suggested in support of the petition are without any substance.
We may add that we did not call upon the Attorney General who appeard on behalf of the respondents to show cause with reference to the allegations of the order impugned being malicious or wanting in bona fides because no foundation had been laid in the petition on the facts stated in the affidavit which could lead us even remotely to make such an inference, 1113 For the reasons aforesaid it must be held that there is no merit in the application and the rule is accordingly discharged, and the application is dismissed.
| The petitioner was detained in Kothibagh sub jail in Srinagar by the order of Jammu and Kashmir Government under the provisions of section 3(1)(a)(i) of the Jammu and Kashmir Preventive Detention Act, 2011, 1102 The petitioner challenged the order of detention on the grounds, inter alia, (i) that it encroached on his fundamental right to life and personal liberty guaranteed to him under article 21 of the Constitution as extended to the State of Jammu and Kashmir, (ii) that it violated his fundamental right guaranteed to him under clause (5) to article 22 of the Constitution as extended to Jammu and Kashmir State inasmuch as the petitioner was not supplied with the grounds on which the order of detention was based.
It was contended that section 8(1) Proviso, of Jammu and Kashmir Preventive Detention Act, 2011, under which the grounds of detention were not supplied to him, was unconstitutional as being inconsistent with articles 21 and 22 of the Constitution and thus void to the extent of that inconsistency in view of the provisions of article 13 of the Constitution.
Held (overruling the contention) that section 8 (1) Proviso is not unconstitutional in view of the provisions of Constitution (Application to Jammu and Kashmir) Order, 1954 which supersedes the Constitution (Jammu and Kashmir) Order, 1950, and of clause (c) which has been added to article 35 of the Constitution.
The effect of the modification of article 35 by the addition of clause (c) thereto is that such of the provisions of the Act as are inconsistent with Part III of the Constitution shall be valid until the expiration of five years from the commencement of the Order.
|
iminal Appeals Nos. 53 and 54 of 1956.
Appeals by special leave from the judgment and order dated May 31, 1955, of the Patna High Court in Criminal Revision No. 102 of 1955, arising out of the judgment and order dated January 10, 1955, of the Court of the Sessions Judge of Manbhum Singhbhum of Purulia in Criminal Re vision No. 43 of 1954.
Mahabir Prasad, Advocate General of Bihar, Tarakesh.
war Nath and section P. Verma, for the appellant in Appeal No, 53 and for respondent No, 3 in Appeal No. 54, 281 H. J. Umrigar and A. G. Ratnaparkhi, for the appellant in Appeal No. 54.
Jai Gopal Sethi and Govind Saran Singh, for the respondents in Appeal No. 53 and for respondents ' Nos. 1 and 2 in Appeal No. 54.
January 31.
The Judgment of the Court was delivered by JAGANNADHADAS J.
These appeals arise out of an order of discharge passed by the Subordinate Judge Magistrate of Dhanbad under section 494 of the Code of Criminal Procedure on his consenting to the withdrawal of the Public Prosecutor from a prosecution pending before him in so far as it was against the appellant.
Mahesh Desai, one of the accused therein.
The prosecution was launched on the first information of one Ram Naresh Pandey as against 28 persons about the commission of the murder of one Nand Kumar Chaubey, a peon of a colliery in Bagdigi, committed in the course of a serious riot on February 20, 1954.
This was said to have resulted from differences between two rival labour unions in connection with a strike.
The prosecution as against most of the other persons is under various sections of the Indian Penal Code including section 302, on the ground of their actual participation in the commission of the murder.
But as against the appellant, Mahesh Desai, it is only under section 302 /109 of the Indian Penal Code, the part ascribed to him in the first information report being that he abetted the murder by reason of certain speeches and exhortations at meetings or group talks the day previous to the murder.
The application for withdrawal as against the appellant was made on December 6, 1954, when the matter was pending before the Magistrate in the committal stage and before any evidence was actually taken.
It was made by the Public Prosecutor on the ground that" on the evidence available it would not be just and expedient to proceed with the prosecution of Sri Mahesh Desai and that therefore it was necessary to withdraw the case against Sri Mahesh Desai only ".
It was elicited in the course of the arguments before the learned Magistrate.
that the position of the Public 36 282 Prosecutor was, that the evidence regarding the complicity of this accused was meagre and that there WAS only, a single item of evidence of a dubious nature against him.
which was not likely to establish a prima facie case.
The learned Magistrate dealt with the ,matter in a fairly reasoned order and was of the opinion that there was no reason to withhold the consent that was applied for.
He accordingly discharged the accused.
That order was upheld by 'the learned Sessions Judge on, revision petition against it filed jointly by the first informant in the case and by the, widow of the murdered person.
These private parties pursued the matter further and applied to the High Court ' in revision.
The learned Chief Justice who dealt with it was of the opinion that the consent should not have been granted.
Accordingly, he set it aside.
The learned Chief Justice recognised that normally in a matter of this kind the High Court should not interfere.
But he felt called upon to set aside the order on the ground that ,there ' wag ' no judicial exercise of discretion in the present case.
" He, therefore, directed that the Magistrate should record the evidence and then consider whether it establishes a prima facie case against the appellant, Mahesh Desai.
The Advocate General of the State has come up before this Court against the order of the learned Chief Justice.
Leave was granted because it was urged that the view taken by the learned Chief Justice was based on an erroneous appreciation of the legally permissible approach in a matter of this kind and that the decision of the learned Chief Justice was likely to have repercussions in the State beyond what was involved in the particular case.
The aggrieved party, Mahesh Desai, also has come up by special leave and both these appeals are disposed of by this judgment.
The,question of law involved may be gathered from the following extracts from the learned Chief Justice 's judgment. " 'This is not a case where there is no evidence; on the contrary, this is a case where there is evidence which require 's judicial consideration. .
The procedure which the learned Special Magistrate followed was 283 tantamount to considering the sufficiency or otherwise of evidence before the evidence has been heard. .
The function of the Court would be surrendered to the Public Prosecutor.
not think that section 494 of the Code of Criminal Procedure justifies, such a procedure.
The legal question that arises from the above is whether where an application for withdrawal under section 494 of the Code of Criminal Procedure is made 'on the ground of insufficiency or meagreness of reliable evidence that is available, it is an improper exercise of discretion for the Court to grant consent 'before evidence is taken, if it was reasonably satisfied, otherwise, that the evidence, if actually taken, is, not likely to result in conviction.
Section 494 of the Code of Criminal Procedure runs as follows: " Any Public Prosecutor may, with the consent of the Court, in cases tried by jury.
before the returns of the verdict, and in other cases; before the judgment is pronounced, withdraw from the prosecutions of any person either generally or in respect of any one or more of the offences for which he is tried; and upon such withdrawal, (a)if it is made before a charge has been framed, the accused shall be discharged in respect of such offence or offences; (b)if it is made after a charge has been framed, or when under this Code no charge is required, he shall be acquitted in respect of such offence or offences".
The section is an enabling one and vests in the Public Prosecutor the discretion to apply to the Court for its consent to withdraw from the prosecution of any person.
The consent, ' if granted; has to be, followed up by his discharge or acquittal, as the case may be.
The section gives no indication as to the, grounds on which the Public Prosecutor may make the ' application, or the considerations on, which the Court is to grant its consent.
There can be no doubt, how ever, that the resultant order, on the granting of the consent, being an order of I discharge ' or 'acuittal ', would attract the applicability of correction by; the 284 High Court under es. 435, 436 and 439 or 417 of the Code of Criminal Procedure.
The function of the Court, therefore, in granting its consent may well be ,taken to be a judicial function.
It follows that in granting the consent the Court must exercise a judicial discretion.
But it does not follow that the discretion is to be exercised only with reference to material gathered by the judicial method.
Otherwise the apparently wide language of section 494 would become considerably narrowed down in its application.
In understanding and applying the section, two main features thereof have to be kept in mind, The initiative is that of the Public Prosecutor and what the Court has to do is only to give its consent and not to determine any matter judicially.
As ;the Privy Council has pointed out in Bawa Faqir Singh vs The King Emperor(1) " It (section 494 of the Code of Criminal Procedure) gives a general executive discretion (to the Public Prosecutor) to withdraw from the prosecution subject to the consent of the Court,, which may be determined on many possible grounds.
" The judicial function, therefore, implicit in the exercise of the judicial discretion for granting the consent would normally mean that the Court has to satisfy itself that the executive function of the Public Prosecutor has not been improperly exercised, or that it is not an attempt to interfere with the normal course of justice for illegitimate reasons or purposes.
In this context it is right to remember that the Public Prosecutor (though an executive officer as stated by the Privy Council in Bawa Faqir Singh vs The King Emperor(1)) is, in a larger sense, also an officer of the Court and that he is bound to assist the Court with his fairly considered view and the Court is entitled to have the benefit of the fair exercise of his function.
It has also to be appreciated that in this country, the scheme of the administration of criminal justice is that the primary responsibility of prosecuting serious offences (which are classified as cognizable offences) is on the executive authorities.
Once information of the commission of any such offence reaches the constituted (1) (1938) L. R. 65 I. A. 388, 395.
285 authorities, the investigation, including collection of the requisite evidence, and the prosecution for the offence with reference to such evidence, are the functions of the executive.
But the Magistrate also has his allotted functions in the course of these stages.
For instance, in the course of investigation, a person arrested must be brought before him within 24 hours (section 61 of the Code of Criminal Procedure).
Continuance of the arrested person in detention for purposes of investigation from time to time has to be authorised by him (section 167).
A search can be conducted on the issue of warrant by him (section 96).
Statements of witnesses and confessions may be recorded by him (section 164).
In an appropriate case he can order investigation or; further investigation (sections 155(2) and 202).
In all these matters he exercises discretionary functions in respect of which the initiative is that of the executive but the responsibility is his.
His discretion in such matters has necessarily to be exercised with reference to such material as is by then available and is not a prima facie judicial determination of any specific issue,.
The Magistrate 's functions in these matters are not only supplementary,.
at a higher level, to those of the executive but are intended to prevent abuse.
Section 494 requiring the consent of the Court for withdrawal by the Public Prosecutor is more in line with this scheme, than with the provisions of the Code relating to inquiries and trials by Court.
It cannot be taken to place on the Court the responsibility for a prima facie determination of a triable issue.
For instance the discharge that results therefrom need not always conform to the standard of " no prima facie case " under sections 209(1) and 253(1) or of " groundlessness " under sections 209(2) and 253(2).
This is not to say that a consent is to be lightly given on the application of the Public, Prosecutor, without a careful and proper scrutiny of the grounds on which the application for consent is made.
A large number of cases from the various High Courts have been cited before us.
We have carefully gone through them.
All of them recognise that the 286 function of the Magistrate in giving consent is a judcial one open to correction.
But in some of them there is no sufficient appreciation of the respective positions of the Public prosecutor and the Court, in the discharge, of their functions under section 494 as we conceive.
them to be.
There is, however, a general concurrence at least in the, later cases that the.
application for consent may legitimately be made by the Public Prosecutor for reasons not confined to the judicial prospects of the prosecution.
[See The King vs Moule Bux(1) and.
The King vs Parmanand(2).] If so, it is clear that, what the Court has to determine, for the exercise of its discretion in granting or withholding consent, is not a triable issue on judicial evidence.
Learned counsel for the respondents has strenuously urged before us that while this may be so where the consent is applied for on other grounds, or for other reasons, the position would not be the same, where the application for consent is made on the ground of No. evidence or no adequate or reliable evidence.
It is urged that in such a case, the Court can exercise its, judicial function, only with, reference to judicially recorded evidence as in one or other of the appropriate situations contemplated by the Code for ' judicial inquiry or trial.
If this argument means anything it must mean that in such a situation the Court before granting consent must hold a kind of preliminary inquiry into the relevant evidence in much the same way as, for instance '.
when a Magistrate acting under section 202 of the Code of Criminal Procedure may direct or it must mean that no consent can at all be given on such a ground and that the Court must proceed with the prosecution, and either discharge or acquit under one or other of the other sections in the Code enabling hereunto.
It appears to us that this would be engrafting, on the, wide terms of section 494 an exception or & proviso limited to such a case.
In our opinion, this would not be a permissible construction of the section.
We are, therefore, unable, with great respect, to subscribe to the view taken by the learned Chief (1) A.I.R. 1949 Pat '233 (F.B.).
(2) A.I.R. 1949 Pat.
222, 226 (F.B.).
287 Justice whose judgment is under appeal, that where the application is on the ground of inadequacy of evidence requiring judicial consideration, it would be manifestly improper for the Court to consent to withdrawal before ' recording the evidence and taking 'it into consideration.
We are not to be understood, however, as implying that such evidence as may already have been recorded by the, time the application is made is not to be looked into and considered in such cases, in order to determine the impropriety of the withdrawal as amounting to abuse or an improper interference with the normal course of justice.
Learned counsel for the respondents has raised a fresh point before us for maintaining the order of the High Court setting aside the discharge of the appellant by the Magistrate.
The point being purely one of law, we have allowed it to be argued.
His contention is that in a case triable by a Court of Session, an application by the Public Prosecutor for withdrawal with the consent of the Court does not lie in the committal stage. ' He lays emphasis on the wording of section 494 which says that " in cases tried by jury, any Public, Prosecutor may, with the consent of the Court, withdraw from the prosecution of any person before the return of the verdict.
" This, according to him, clearly implies that such withdrawal cannot be made until the case reaches the trial stage in the Sessions Court.
He also relies on the further phrase in the section " either generally or in respect of any one or more of the offenses for which he is tried.
" The use ' of the word 'tried ' in this phrase.
confirms, according to him, the contention that it is only when the case reaches the stage of trial that section 494 can be availed of.
He draws our attention to a passage in Archbold 's Criminal Pleading, Evidence and Practice (32nd Ed.),pp.
108, 109, section 12, that "a nolle prosequi to stay proceedings upon an indictment or information pending in any Court may be entered, by leave of the Attorney General, at the instance of either the prosecutor or the defendant at any time after the bill of indictment is signed, and before judgment.
" He urges that it is this principle that has been recognised in the first portion 288 of section 494 of the Code of Criminal Procedure.
It appears to us that the analogy of the English practice would be misleading as an aid to the construction of section 494.
The scheme of our Criminal Procedure Code is substantially different.
The provision corresponding to the power of the Attorney General to enter nolle prosequi is section 333 of the Code of Criminal Procedure which refers to jury trials in High Court.
The procedure under section 494 does not correspond to it.
The phrase " in other cases before the judgment is pronounced " in section 494 would, in the context, clearly apply to all cases other than those tried by jury.
Now, there can be no doubt that at least as regards these other cases, when the consent for withdrawal is given by the Court, the result is either a discharge or an acquittal, according to the stage to which that case has reached, having regard to the two alternatives (a) and (b) of section 494 of the Code of Criminal Procedure.
It follows that at least in every class of cases other than those tried by jury, the withdrawal can be at any stage of the entire proceedings.
This would include also the stage of preliminary inquiry in a Sessions case triable without a jury.
But if the argument of the learned counsel for the respondents is accepted, that power cannot be exerciser at the preliminary inquiry stage, only as regards cases which must lead to a jury trial.
We can find no conceivable reason for any such discrimination having been intended and prescribed by the Code.
We are unable to construe section 494 as involving any such limitation.
The wording is perfectly wide and general and would apply to all classes of cases which are capable of terminating either in a discharge or in an acquittal, according to the stage at which the section is invoked.
The whole argument of the learned counsel is based upon the use of the word ,tried ' and he ehaphasises the 'well known distinction between 'inquiry ' and 'trial ' in the scheme of the Code.
Our attention has also been drawn to the definition of the word 'inquiry ' in section 4 (k) of the Code which runs as follows: " 'Inquiry includes every inquiry other than a trial conducted under this Code by a Magistrate or Court.
" 289 There is hardly anything in this definition which throws light on the question whether the word 'trial ', is used in the relevant section in a limited sense as excluding an inquiry.
The word 'trial ' is not defined in the Code. 'Trial ' according to Stroud 's Judicial Dictionary means "the conclusion, by a competent tribunal, of questions in issue in legal proceedings, whether civil or criminal"(1) and according to Wharton 's Law Lexicon means "the hearing of a cause, civil or criminal, before a judge who has jurisdiction over it, according to the laws of the land"(2).
The words 'tried ' and 'trial ' appear to have no fixed or universal meaning.
No doubt, in quite a number of sections in ' the Code to which our attention has been drawn the words 'tried ' and trial ' have been used in the sense of reference to a stage after the inquiry.
That meaning attaches to the words in those sections having regard to the context in which they are used. ' There is no reason why where these words are used in another context in the Code, they should necessarily be limited in their connotation and significance.
They are words which must be considered with regard to the particular context in which they are used and with regard to the, scheme and purpose of the provision under consideration.
An argument has also been advanced by the learned Counsel for the respondents before us by referring to the word "judgment" in the phrase "in other cases before the judgment is pronounced" in section 494 as indicating that the phrase "in other oases" can refer only to proceedings which end in a regular judgment and not in any interim order like commitment.
Here again the difficulty in the way of the contention of the learned Counsel being accepted, is that the word "judgment" is not defined.
It is a word of general import and means only "judicial determination or decision of a Court".
(See Wharton 's Law Lexicon, 14th Ed., p. 545).
There is no reason to think in the context of this section that it is not applicable to an order of committal which terminates the proceeding so far as the inquiring Court (1) Stroud 's judicial Dictionary, 3rd Ed., VOl.
(2) Wharton 's Law Lexicon, 14th Ed., p. 101.
37 290 is concerned.
It may be, that in the context of Chapter XXVI of the Code judgment may have a limited meaning.
In any view, even if 'judgment, in this context is to be understood in a limited sense, it does not follow that an application during preliminary inquiry which is necessarily prior to judgment in the trial is excluded.
The history of section 494 of the present Code of Criminal Procedure (Act V of 1898) confirms the above view.
The provision for withdrawal by the Public Prosecutor with the consent of the Court appears, for the first time, in the Code of Criminal Procedure,; 1872 (Act X of 1872) as section 61 thereof and runs as follows: The public prosecutor may, with the consent of the Court withdraw any charge against any person in any case of which he is 'Charge; and upon such withdrawal, if it, is made whilst the case is under inquiry, the accused person shall be discharged.
If it is made when he is under trial, the accused person shall be acquitted.
" In the next Code of 1882 (Act X of 1882) this appears as section 494 thereof and runs as follows: "Any Public Prosecutor appointed by the Covernor General in Council or the Local Government may, with the consent of the Courts, in cases tried by jury before the return of the verdict, and in other cases before the judgment is pronounced, withdraw from the prosecution.
of any person; and, upon such withdrawal, (a) if it is made before a charge has been framed, the accused shall 'be discharged; (b) if it is made after a charge has been framed, or when under this Code, no charge is required, he shall be acquitted.
" It may be noticed that there has been a complete redrafting of the section which brings about two alterations.
this section seems to have remained as such in the 1898 Code (Act V of 1898).
The next modification in the section appears to have been made by Act XVIII of 1923 which inserted the phrase "either generally or in respect of any one or more of the offences for which he is tried" in the appropriate place 291 in section 494 as it stood in the 1882 Code (in addition to omitting ' the phrase "appointed by the Governor General in Council or Local Government").
The present section 494 is the corresponding section in the 1882 Code as so altered.
It will be thus seen there are altogether three substantial changes in between 1872 and 1923 in the corresponding section 61 of the 1872 Code.
The first two changes made in 1882 were obviously intended to indicate that the result by way of discharge or acquittal should depend not on the distinction between inquiry and trial but, on the fact of a charge having been framed or not having been framed.
The second was to clarif that the application can be made generally up to tie point when judgment is pronounced but to provide for an exception thereto in respect of cases which in fact have gone up for a jury trial, in which case the applicati on can be made only up to the point of time before the verdict is pronounced.
The third change in 1923 was to make it clear that the withdrawal need not be in respect of the entire case against a particular individual but in respect of one or more only of the charges for which he is being prosecuted.
These three changes, therefore, were introduced for spcific purposes which are obvious.
The section as it originally stood in 1872 was quite wide enough to cover all classes of cases not excluding even jury cases when it is in the stage of preliminary inquiry.
There is absolutely no reason to think that these successive, changes were intended to exclude such a preliminary inquiry from the scope of section 494 as it has finally emerged.
It may also be mentioned that the words " inquiry ' and 'trial ' were both defined in the Code of 1872 but that the definition of the word 'trial ' was omitted, in the 1882 Code and that latter on in the 1898 Code the definition of the word inquiry ' was slightly altered by adding the ,phrase "Other than a trial" leaving the, word 'trial ' undefined.
These various legislative changes from time to time with reference to s, 494 and the ' definition of the 'word inquiry ' confirm the view above taken that section 494 is wide enough to cover every kind of inquiry and trial and that the word trial ' in the, section 292 has not been used in any limited sense.
Substantially the same view has been taken in Giribala Dasee vs Madar Gazi (1) and Viswanadham vs Madan Singh(2) and we are in agreement with the reasoning therein as regards this question.
As regards the merits of the appeals, the matter lies in a short compass.
AB already stated the application by the Public Prosecutor was made before any evidence was taken in the committal stage.
The only materials then available to the Public Prosecutor or to the Court were the contents of the first information report and any statements of witnesses that may have been taken by the police during investigation.
What is alleged against the appellant, Mahesh Desai, in the first information report can be gathered from the following: "These persons, viz., Mahesh Desai and others,regularly held meetings and advocated for closing Bagdigi cable plant and coke plant and assaulting the "dalals '.
Yesterday, Friday morning when some labourers were going to resume their work in 8 No. pit, at Lodna the striking labourers created disturbance there and the labourers of that place who were going to resume work could not do so.
At about 11 a. m. Mahesh Desai the leader of the Koyala Mazdoor Panchayat came to Bagdigi and told the labourers of this place to stop all work, to hold on to their posts and to see that no one worked.
At the instance of Mahesh Desai the labourers stopped the work.
Last night at about 11 30 p.m. when I was in my quarter at Lodna, Jadubans Tiwary, the overman of Bagdigi Colliery, said that Sheoji Singh and Ramdhar Singh 'had told him that in the evening at about 6 30 p.m. Mahesh Desai came to Bagdigi Mahabir Asthan Chala, collected 120 to 125 labourers and held a meeting and Mahesh Desai said that he had come to know that the company and its dalals would take some labourers to pit No. 10 this morning to resume the work and they would get the work resumed by them.
In this ' morning Phagu Dusadh, Jalo Dusadh, Chamari Dusadh and others were (sic) took part.
Mahesh Desai said to (1) Cal. 233.
(2) I.L.R. 293 them " You go to your respective works and see that no one works there happen what may.
You remain, prepared in every respect.
The labourers of Lodna will also come to your help.
The police will not be able to do any harm to you ".
The meeting dispersed at about 7 30 o 'clock.
Mahesh Desai went by his Jeep from Mahabir Asthan to pit No. 10 and told the labourers there to stick to their strike.
Then Phagu, Jalo and Haricharan Dusadh of Bagdigi began to talk with him near the Jeep.
Jadubans Tewary heard Mahesh Desai saying " It is necessary for us to finish the dalals for achieving victory.
You remain prepared for this".
Saying this he boarded his Jeep and at the end Mahesh Desai said to Phagu, Haricharan and Jalo Dusadh " Finish all.
What will happen will be seen ".
Thereafter Mahesh Desai went away by his Jeep and Phagu.
Jalo and Haricharaa came back.
" The first information report continues to state what all happened the next day by way of rioting, etc.
in the course of which Phagu, Jalo and Haricharan Dusadh, along with others were said to have chased Nand Kumar Chaubey and wherein Phaou gave a pharsa blow and Haricharan a lathi blow to him and Nand Kumar Chaubey fell down dead.
In the closing portion of the first information report the informant states as follows: I make this statement before you that (having, instigated) yesterday evening in the meeting and having instigated Phagu Dusadh, Jalo Dusadh and Haricharan Dusadh near pit No. 10, and having got a mob of about one thousand persons collected to day in the morning by Harbans Singh and other workers of his union Mahesh Desai got the murder of Nand Kumar Chaubey committed by Phagu Dusadh, Jalo Dusadh and Haricharan Dusadh to day at 8 15 a.m. with lathi and pharsa.
" It is clear from this that what is ascribed to Mahesh Desai is that he is alleged to have exhorted the laborers once in the morning at 11 a.m. and again in the night at 6 30 p.m. as also at 7 30 p.m.
As regards the exhortation at 11 a. m. it is not quite clear from the first information report whether the 294 informant speak,% to his personal knowledge or what he heard from the labourers.
As regards what is said to have transpired at 6 30 p.m. and 7 30 p.m., it appears to be reasonably clear that the person who gave the information to the informant was Jadubans Tiwary and that his information itself was probably based on what Sheoji Singh and Ramdhar Singh had told him.
It would be seen, therefore, that the prosecution must depend upon the evidence of Jadubans Tiwary, and possibly of Sheoji Singh and Ramdhar Singh and that what these three persons could speak to was at best only as to the exhortation made by Mahesh Desai at the various stages.
Presumably, these witnesses were examined by the police in the course of the investigation.
Now, on this material, we find it difficult to appreciate why the opinion arrived at by both the trial court and the Sessions Court that the ' view taken of that material by the Public Prosecutor, viz., that it was meagre evidence on which no conviction could be asked for, should be said to be so improper that the consent of the Court under section 494 of the Code of Criminal Procedure has to be withheld.
Even the private complainant who was allowed to participate in these proceedings in all its stages, does not, in his objection petition, or revision petitions, indicate the availability of any other material or better material.
Nor, could the complainant 's counsel, in the course of arguments before us inform us that there was any additional material available.
In the situation, therefore, excepting for the view that no order to withdraw should be passed in such cases either as a matter of law or as a matter of propriety but that the matter should be disposed of only after the evidence, is judicially taken, we apprehend that the learned Chief Justice himself would not have felt called upon to interfere with the order of the Magistrate in the exercise of his revisional jurisdiction.
, We are, therefore, clearly of the opinion, for all the above reasons, that the order of the High Court should be set aside and the appeals allowed.
Accordingly, the order of the trial court is hereby restored.
295 There was some question raised before us as to whether the private complainants could be allowed, ' to participate in these proceedings at the various stages.
Nothing that we have said is intended to indicate that the private complainant has a locus standi.
It is unfortunate that this prosecution which is still pending at its very early stages has got to be proceeded with against all the rest of the accused, after the lapse of nearly three years from the date of the murder.
It is to be hoped that the proceedings which must follow will be speeded up.
Appeals allowed.
| By section 494 Of the Code of Criminal Procedure, 1898: " Any Public Prosecutor may, with the consent of the Court, in cases tried by jury before the return of the verdict, and in other cases before the judgment is pronounced, withdraw from the prosecution of any person either generally or in respect of any one or more of the offences for which he is tried, ' and upon such withdrawal, (a) if it is made before a charge has been framed, the accused shall be discharged in respect of such offence or offences ; (b) if it is made after a charge has been framed, or when under this Code no charge is required, he shall be acquitted in respect of such offence or offences.
" The prosecution of M. and others was launched on the first information of the first respondent, and when the matter was pending before the Magistrate in the, committal stage and before any evidence was actually taken, and 'application for the withdrawal of M. from the prosecution was made by the Public Prosecutor under section 494 Of the Code of Criminal Procedure on the ground that " on the evidence available it would not :be just and expedient to proceed with the prosecution of M." The Magistrate was of the opinion that there was no reason to withhold the consent that was applied for and accordingly he discharged the accused.
This order was upheld by the Sessions judge, but on 280 revision, filed by the respondents, the High Court set aside the order and directed the Magistrate to record the evidence and then consider whether it established a Prima facie case against the accused.
The State appealed against the order of the High Court by special leave, while the respondents sought to support the order on the grounds (1) that where the application for withdrawal of the prosecution is made on the ground of no evidence or no adequate or reliable evidence the Magistrate must hold a preliminary enquiry into the relevant evidence, and (2) that in a case tried by jury by a Court of Session, an application by the Public Prosecutor under section 594 Of the Code does not lie in the committal stage.
Held : (1) Though the function of the Court in giving the consent under section 594 of the Code is a judicial one, it is not necessary that the discretion is to be exercised only with reference to material gathered by the judicial method, and what the Court has to do is to satisfy itself that the executive function of the Public Prosecutor in applying for, withdrawal of the prosecution has not been improperly exercised, or that it is not an attempt to interfere with the normal course of justice for illegitimate reasons or purposes.
(2) The word " tried " in section 494 Of the Code is not used in any limited sense and the section is wide enough to cover every kind of inquiry and trial, and applicable to all cases which are capable of terminating either in a discharge or in an acquittal according to the stage at which the application for withdrawal is made.
An order of committal which terminates the proceeding so far as the inquiring Court is concerned is a " judgment " within the meaning of section 494 of the Code of Criminal Procedure.
Giribala Dasee vs Mader Gazi, Cal 233, and Viswanadham vs Madan Singh,, I.L.R. , approved.
|
iminal Appeal No. 64 of 1955.
26 of 1952.
V. N. Sethi, for the appellant.
R. Ganapathy Iyer and R. H. Dhebar, for the respondent.
December 22.
BOSE J.
The only question in this appeal is whether the High Court bad in mind the principles 1287 we have enunciated about interference under section 417 of the Criminal Procedure Code when it allowed the appeal filed by the State against the acquittal of the appellant.
It is, in our opinion, well settled that it is not enough for the High Court to take a different view of the evidence; there must also be substantial and compelling reasons for holding that the trial Court was wrong: Amar Singh vs State of Punjab(1) and if the trial Court takes a reasonable view of the facts of the case, interference under section 417 is not justifiable unless there are really strong reasons for reversing that view: Surajpal Singh vs State(2).
The appellant was prosecuted under sections 302 and 447 of the Indian Penal Code for the murder of Aher Jetha Sida.
It is not necessary at the moment to set out the facts.
It is enough to say that the High Court based its conviction on a retracted confession plus certain circumstances which the learned Judges regarded as corroborative.
The learned Sessions Judge excluded the confession on the ground that it was neither voluntary nor true.
The learned Judge 's reasoning about its falsity is weak.
We do not think there is material on which a positive finding about its falsity can be reached but *hen he says that he is not satisfied that it was made voluntarily we find it impossible to hold that is a view which a judicial mind acting fairly could not reasonably reach.
The facts about that are as follows.
The offence was committed during the night of the 18th/19th May 1952.
The police were informed on the 19th morning at 9 30.
The police station was only 4 miles distant and they started investigation immediately.
The appellant was arrested on the 20th.
They are Bhura, Dewayat and Kana.
The investigating officer was not examined, so he could not be asked about this and the point could not be developed further.
But the appellant did cross examine some of the prosecution witnesses (1) ; , 423.
(2) ; , 201, 1288 about this and elicited contradictory replies.
Kana, P.W. 4, said "I was not arrested.
Dewayat, Barat Lakhmansingh was arrested first. .
All the three of us were released the same evening.
Dewayat, P.W. 5, denied that either he or any of the others were arrested and Maya, P.W. 15, said the same thing but Meraman, P.W. 11, insisted that Dewayat was arrested.
In the absence of the SubInspector it is difficult to say definitely that the appellant is wrong.
It is evident that the others were at least suspected, especially as one of the points made against the appellant is that he was seen sharpening an axe on the evening of the murder and Meraman, P.W. II, says that not only was the appellant sharpening an axe but so was Dewayat.
If this was a matter of suspicion against the appellant it must equally have been so against Dewayat and accordingly there is nothing improbable in the appellant 's statement about these other arrests; and as the SubInspector was not there to clear up the matter it is only fair to accept what the appellant says.
The appellant was sent to a Magistrate at 8 p.m. on the 21st for the recording of a confession but the Magistrate did not record it till the 3rd of June.
He was examined as P.W. 21 and explained that be gave the appellant ten days for reflection.
The length of time is unusual but no objection about its fairness to the accused could reasonably have been raised bad it not been for the fact that the judicial lock up is in charge of a police guard which is under the direct control, orders and supervision of the very SubInspector who had conducted the investigation and had earlier suspected and, according to the accused, actually arrested three other persons; and two of them are now called as prosecution witnesses to depose against the appellant about a matter on which the prosecution lay great importance, namely the sharpening of an axe.
The danger that they might exaggerate their stories or give false evidence in their anxiety to avert further suspicion from themselves is 1289 one that cannot be overlooked.
But apart from that.
This is the description of the judicial look up which the Magistrate who recorded the confession (P.W. 21) gives us: "A police guard is on 24 hours duty at the Bhanwad Judicial lock UP.
The prisoner is so placed within the compound wall that he can see the police all the 24 hours through the bars and can talk.
These police officers are under the police Sub Inspector.
A peon is working as warder.
He stays there on duty by day.
At night he is not there.
Clerk Jailor does not remain present there.
The police lock up is within the ail itself.
Inside the jail gate is the police lock up.
The police can go into the police lock up when they choose".
Now the appellant repudiated his confession at the earliest opportunity.
He told the Committing Court on 12 12 1952 in a written statement that "After my arrest by the police I was sent to jail.
At night time the police, having arrived at the jail, threatened me to make confession before Court as they directed.
The police frightened me with beating if I did not confess.
As a result of which, through fright, I have made a false confession as directed by the police and which I now deny".
And in his examination under section 342, Criminal Procedure Code, he said "I have made the confession because the police were threatening to beat me in the jail.
He repeated these statements in the Sessions Court.
He said he was beaten at the time of his arrest and then after he had been sent to the jail he said "I was daily threatened.
They said 'confess the offence of murder.
We shall get you on remand.
You will live as an impotent man '.
On the morning of the 3rd date, they took me to a big police officer after administering extraordinary threats.
Only now I come to know that he is the Magistrate". , Now it may be possible to take two views of this statement but there are two important factors in every criminal trial that weigh heavily in favour of an accused person,: I one is that the accused is entitled 1290 to the benefit of every reasonable doubt and the other.
, an off shoot of the same principle, that when an accused person offers a reasonable explanation of his conduct, then, even though be cannot prove his assertions, they should ordinarily be accepted unless the circumstances indicate that they are false.
What the appellant said in this case is not impossible; such things do happen and it is understandable that the police, frustrated in their endeavour to find the culprit among three other persons, should make an all out endeavour to make sure of the fourth.
We do not say that happened here.
But that it might have happened is obvious, and when the police absent themselves from the witness box and forestall attempts at cross examination, we find it impossible to hold that a judge acting judicially, and hearing in mind the important principles that we have outlined above, can be said to have reached an unreasonable or an unfair conclusion when he deduces from these circumstances that there is a reasonable probability that the appellant 's story is true and that therefore the confession was not voluntary.
The only reason that the learned High Court Judges give for displacing this conclusion is that "in Saurashtra. . though judicial and police lock ups are placed under a common guard the judicial lock ups are in charge of Magistrates and are looked after by their clerks and peons, who are assigned the duties of jailors and warders respectively" and they conclude "It is therefore difficult to say that the police could have effectively threatened him".
But what the learned Judges overlook is the fact that this control is only effective during the day and that at night neither the peon nor the clerk is there; and even during the day the "clerk cum jailor does not remain present there".
The appellant said in his written statement that "at night time the police, having arrived at the jail, threatened me, etc".
There is nothing on the record to displace this statement.
Had the Sub Inspector or some policeman been examined as a witness and had the appellant omitted to 1291 cross examine him about this, that might have raised an inference that what the accused said was only an afterthought.
But here we find that this defence about the involuntary nature of the confession due to threats by the police was raised at the outset, even in the Committing Magistrate 's Court, and was persisted in throughout and the appellant did what he could to build up this part of his case by cross examining the only official witness who did appear, namely the Magistrate who recorded the confession; and he succeeded in establishing that there was ample opportunity for coercion and threat.
The fact that this defence was raised in the Committal Court should have put the prosecution on its guard and the absence of refutation in the Sessions Court is a matter that can legitimately be used in the appellant 's favour.
In the circumstances, we do not think the High Court has squarely met the learned Sessions Judge 's reasoning and shown that there are compel ling reasons for holding that he was wrong; on the contrary, the learned Sessions Judge 's hesitation is grounded on well established judicial principles.
Now the law is clear that a confession cannot be used against an accused person unless the Court is satisfied that it was voluntary and at that stage the question whether it is true or false does not arise.
It is abhorrent to our notions of justice and fair play, and is also dangerous, to allow a man to be convicted on the strength of a confession unless it is made voluntarily and unless he realises that anything he says may be used against him; and any attempt by a person in authority to bully a person into making a confession or any threat or coercion would it once invalidate it if the fear was still operating on his mind at the time he makes the confession and if it "would appear to him reasonable for supposing that by making it he would gain any advantage or avoid any evil of a temporal nature in reference to the proceedings against him": section 24 of the Indian Evidence Act.
That is why the recording of a confession is hedged around with so many safeguards and is the 163 1292 reason why magistrates ordinarily allow a period for reflection and why an accused person is remanded to jail custody and is put out of the reach of the investigating police before he is asked to make his confession.
But the force of these precautions is destroyed when, instead of isolating the accused from the investigating police, he is for all practical purposes sent back to them for a period of ten days.
It can be accepted that this was done in good faith and we also think that the police acted properly in sending the appellant up for the recording of his confession on the 21st; they could not have anticipated this long remand to so called "jail custody".
But that is hardly the point.
The fact remains that the remand was made and that opened up the very kind of opportunities which the rules and prudence say should be guarded against; and, as the police are as human as others, a reasonable apprehension can be entertained that they would be less than human if they did not avail themselves of such a chance.
It will now be necessary to set out the facts.
The murdered man is one Jetha.
He married Sunder, P.W. 3, about three years before he was killed, but we gather that she had not gone to live with her husband; anyway, she was living in the appellant 's village Shiva with her people at the time of the occurrence and this afforded the pair opportunities for a long continued course of illicit amours, chances which it seems they were not slow to seize.
The husband lived in a village Kalawad which is three miles distant.
At the time of the murder arrangements were being made for Sunder to go to her husband and preparations for the ceremonial appropriate to such occasions were in the course of progress.
Both Courts hold that the motive is proved; and that can be accepted.
Next comes the evidence about the sharpening of the axe on the evening of the 18th at Kana 's house in the village Shiva.
The axe was produced in Court and Dewayat (P.W. 5) tells us that it was blunt.
Now there is nothing suspicious or unusual in a villager sharpening a blunt axe and, as we have pointed out, Meraman (P.W. 11) says that Dewayat was also sharpening an axe at the same time and place; and Dewayat is one of the other three against whom suspicion was directed; also, the fact that the axe was sharpened in this open way in the presence of a number of persons, including two strangers to the village, (the two Satwara witnesses, P.Ws. 9 and 10), points to innocence rather than guilt.
But the prosecution do not rely on this alone.
Their witnesses say that when the appellant was asked why he was sharpening his axe (Dewayat does not seem to have been put a similar question though he was doing the same thing) he replied that he wanted to offer a green coconut to Lord Shanker.
All the witnesses are agreed that this has no special significance and that they attributed no sinister meaning to it at the time.
It has acquired significance only in the light of after events.
Even here, there seems to us to be some danger that what the appellant really said has got mixed up, with what these witnesses say and, no doubt, honestly believe he said.
We say this because Sunder, P.W. 3, and her mother Vali, P.W. 2 tell us that the appellant came to the mother that evening and offered her eight annas in lieu of a coconut.
It seems that this is a customary offering given by relatives when a daughter leaves her parents ' home for her father in law 's place.
A reasonable doubt arises and the appellant is entitled to its benefit.
Next comes the evidence of Samant, P.W. 16, who says that be saw the appellant that night on the outskirts of Kalawad where the murder was committed.
He was wearing a false beard and a mask.
But that is the very question that the Court has to decide.
The only fact that this witness can be said to prove is that be saw a man that night wearing a false beard and mask who looked like the appellant.
Then we come to the recoveries.
The false beard and mask were found buried in the grounds of Dewayat 's house and the appellant is said to have recovered them in the presence of panchas.
But those discoveries are inadmissible in evidence because the police already knew where they were hidden.
Their information was not derived from the appellant but from Dewayat (one of the other suspects).
The way the police came to find this out was this.
Dewayat says that the appellant confessed the murder to him and told him that he had gone there wearing a false beard and a mask and that he had buried these articles 1295 under the Shami tree in the grounds of Dewayat 's bada.
Dewayat says "Next the police called me to go to Kalawad.
At that time Raja had been arrested. .
I was interrogated.
I spoke about the beard at that time.
Then the police came to my field with Raja".
If Meraman (P. W. 11), read with the Confused statement of Kana (P.W. 4), is to be believed, Dewayat was also under arrest either at the time or on the day before.
As the Sub Inspector was not examined, we are unable to clear this up and so are bound to give weight to the criticism of the Sessions Judge where he says "However, Dewayat confesses that his statement was not recorded on the 19th of May 1952 but was recorded on 20 5 1952 only after he was questioned by the police".
In our opinion, not only is this evidence about recovery not admissible but the danger that Samant (P.W. 16) mistook Dewayat, who was also under strong suspicion, or someone else who looked like the appellant, for the appellant, has not been excluded.
Lastly, there is the recovery of the axe.
But this was not hidden.
It was kept behind an earthen jar in the appellant 's house just as an axe might be normally kept in any average household.
The only point of suspicion is that the axe had stains of human blood on it.
But the difficulty we are faced with there is that the extent of the stains and their position is not disclosed.
We have had occasion to comment before on the very slovenly and ineffective way in which some Chemical Analysers do their duty.
This is another case in which what might otherwise have been a valuable piece of evidence has to be disregarded.
The axe was not recovered till the 21st and was standing where it could have been handled by other members of the household.
In any case, villagers frequently have slight cuts or scratches or a prick from a thorn on their persons and a few drops of blood could easily be transferred to an article like an axe without anybody noticing or knowing.
The important thing in a case like this, where everything 1296 is now seen to hang on this one fact, would be the extent of the blood and its position.
The postmortem reveals that the injuries were incised and that the bleeding was profuse.
When everything hangs on this one point, we cannot assume without proof that stains which might be compatible with either guilt or innocence must have been of what we might term the guilty kind.
On a careful examination of the evidence in this case, we are not satisfied that the circumstances disclose "strong and compelling reasons" to set aside the acquittal.
The appeal is allowed.
The conviction and sentence are set aside and the appellant is acquitted.
VENKATARAMA AYYAR J.
I regret I am unable to agree with the judgment just delivered.
The appellant belonged to the village of Katkora, and developed intimacy with an unmarried woman called Sunder in the neighboring village of Shiva.
Subsequently, Sunder was married to one Jetha of Kalawad, a village about 3 miles distant from Shiva.
It had been arranged to take Sunder to her husband 's house on the 19th May 1952, and for that purpose, Sida, the father of Jetha, had come to Shiva on the 18th.
The case of the prosecution was that the appellant was determined to prevent Sunder from joining her husband, and with that object he went to Kalawad on the night of the 18th, and killed Jetha with his axe, when be was asleep.
The murder came to light next morning, and the matter was reported to the police.
The appellant was arrested on 20 5 1952.
On his information the police recovered from his house at Katkora an axe, and the panchnama discloses that it then bad stains of blood which was subsequently found by the Chemical Analyst to be human.
The appellant next showed to the police 1297 a false beard, which was buried under a tree in the village of Shiva.
It is alleged that this was worn by the appellant at the time of the murder.
The Magistrate, however, decided to give him time "to cool down", and put him in judicial lock up.
He then went on duty to another place, and on his return, recorded the confession of the appellant, which is as follows: " I, having gone to his Wadi, have killed him.
I have killed him with axe.
I have killed him for the sake of Sunderbai.
Sunderbai is the wife of Jetha.
I had illicit connection with her.
I have murdered Jetha Sida with the idea of marrying Sunderbai.
I gave him an axe blow on the neck.
At that time I had put on a tunic and a pair of trousers.
I bad a turban on my head.
I had worn artificial beard.
After the murder, the artificial beard buried in the field of Dewanand Mope.
I took the axe to my house".
The appellant retracted this confession before the Committing Magistrate, as made under police beatings and threats.
He was then sent up to the Sessions Court, Halar, to take his trial, which took place with the aid of four assessors.
There was no direct evidence that the appellant had committed the murder.
The circumstantial evidence on which the prosecution sought to establish his guilt consisted of a confession made by him to the Magistrate, the recovery of the axe and the false beard, and the existence of strong motive.
There was, besides, a considerable body of evidence that on the 18th May the appellant was haunting the village of Shiva where Sunder was residing, with an axe in his hand and threats in his tongue.
The assessors were unanimously of the opinion that the appellant was guilty, but the Sessions Judge disagreed with them, and held that the confession was neither true nor voluntary, and that though there were strong grounds for suspecting him, the evidence was not sufficient to convict him, and so acquitted him.
There was an appeal against this judgment by the 1298 State to the High Court of Saurashtra.
The learned Judges, differing from the Sessions Judge, held that the confession was true and voluntary, that there was ample corroboration thereof in the evidence, and that even apart from it, the other facts proved by 'the prosecution were sufficient to establish the guilt of the appellant.
They accordingly set aside the order of acquittal passed by the Sessions Judge, convicted the appellant under section 302 and sentenced him to transportation for life.
It is against this judgment that the present appeal by special leave has been brought.
The question is whether having regard to the principles on which this Court exercises its jurisdiction under article 136, there are grounds for interference in this appeal.
Those principles are well settled and may briefly be recapitulated.
Prior to the abolition of the jurisdiction of the Privy Council, the law of this country did not in general provide for appeals against judgments of the High Courts in criminal matters.
Indeed, the policy of the legislature as expressed in sections 404 and 430 of the Code of Criminal Procedure and departing in this respect from that adopted in the Civil Procedure Code, has been that decisions of courts passed in criminal appeals should be final and subject to specified exceptions, not open to a further appeal on facts.
So far as judgments of the High Courts are concerned, the limitation on further appeal imposed by the Indian statutes could not affect the jurisdiction of the Privy Council to entertain appeals against them in the exercise of the prerogative of the Crown.
That was a power which the Privy Council possessed in respect of orders passed by the courts all over the Dominions, and the limits within which the Judicial Committee exercised that power were thus stated by Lord Watson in In re Abraham Mallory Dillett(1): "The rule has been repeatedly laid down, and has been invariably followed, that Her Majesty will not review or interfere with the course of criminal proceedings, unless it is shown that, by a disregard of (1) [1887] 12 A.G. 459, 467. 1299 the forms of legal process, or by some violation of the principles of natural justice, or otherwise,substantial and grave injustice has been done".
These principles were followed in quite a number of appeals against judgments of Indian courts in criminal matters.
In Dal Singh vs King Emperor(1), the Privy Council, stating the practice of the Judicial Committee in dealing with an appeal in a criminal case., observed: "The general principle is established that the Sovereign in Council does not act, in the exercise of the prerogative right to review the course of justice in criminal cases, in the free fashion of a fully constituted Court of criminal appeal.
A mere mistake on the part of the Court below.
Such questions are, as a general rule, treated as being for the final decision of the Courts below".
In Taba Singh vs Emperor(2) , Lord Buckmaster observed that the responsibility for the administration of criminal justice rested with the courts in India, and that the Board would not interfere "unless there has been some violation of the principles of justice or some disregard of legal principles".
In George Gfeller vs The King(3), which was an appeal from the Supreme Court of Nigeria, Sir George Rankin observed: "Their Lordships have repeated ad nauseam the statement that they do not sit as a Court of Criminal Appeal.
For them to interfere with a criminal sentence there must be something so irregular or so outrageous as to shock the very basis of justice: per Lord Dunedin in Mohindar Singh vs Emperor(4).
Muhammad Nawaz vs Emperor(5) (1) [1917] L.R. 44 I.A. 187, 140.
(2) [1924] I.L.R. (3) A.I.R. 1943 P.C. 211.
(4) [1932] L.R. 59 I.A. 233, 235.
(5) [1941] L.R. 68 I.A. 126, 129.
164 1300 On these principles, the Privy council refused in Macrea, Ex parts(1) leave to appeal on the ground of misdirection to the jury and in Mohindar Singh vs Emperor '(2)on the ground that a wrong view had been taken of the law.
Thus, the law was well settled that the Privy Council would not entertain appeals against judgments in criminal cases, unless there was an error of .
procedure or disregard of legal principles amounting to a denial of fair trial and resulting in grave injustice.
Under the Constitution, the position of the Supreme Court which has taken t he place of the Privy Council is this.
Its jurisdiction as that of the Privy Council in respect of criminal appeals may be classed under two categories, cases where a right of appeal is expressly granted by the Constitution or by the statutes, as for example, articles 132(1) and 134 (1) of the Constitution or section 411 A(4) of the Code of Criminal Procedure, in which the scope of the appeal would depend upon the terms of the enactments which confer the right; and cases ' where it is called upon to exercise its powers under article 136, which corresponds substantially to the prerogative jurisdiction exercised by the Privy Council with reference to which the practice of the Judicial Committee might usefully be referred to for indicating the area of interference.
The question was considered by this Court in Pritam Singh vs The State(3), where the law was thus laid down: "On a careful examination of article 136 along with the preceding article, it seems clear that the wide discretionary power with which this Court is invested under it is to be exercised sparingly and in exceptional cases only .
The Privy Council have tried to lay down from time to time certain principles for granting special leave in criminal cases, which were reviewed by the Federal Court in Kapildeo vs The King(4).
It is sufficient for our purpose to say that though we are not bound to follow them too (1) [1893] L.R. 20 I.A. 90.
(2) [1932] L.R. 59 I.A. 233, 235.
(3) , 458.
(4) A.I R. 1301 rigidly since the reasons constitutional and administrative, which sometimes weighed with the Privy Council, need not Weigh with us, yet some of those principles are useful as furnishing in many cases a sound basis for invoking the discretion of this Court in granting special.
Generally speaking, this Court will not grant special leave, unless it is shown that exceptional and special circumstances exist, that substantial and grave injustice has been done and that the case in question presents features of sufficient gravity to warrant a review of the decision appealed against".
The preceding article referred to in the opening passage is clearly article 134.
Article 134(1) confers a right of appeal to this Court in certain cases, in terms unqualified, on questions both of fact and of law, and if the scope of an appeal under article 136 is to be extended likewise to questions of fact, then article 134(1) would become superfluous.
It is obvious, that the intention of the Constitution in providing for an appeal on facts under articles 134(1) (a) and (b) was to exclude it under article 136, and it strongly supports the conclusion reached in Pritam Singh vs The State(1) that like the Privy Council this, Court would not function as a further court of appeal on facts in criminal cases.
Having regard to the principles enunciated in this decision.
, the question is whether there are sufficient grounds for interfering with the judgment of the High Court in the present appeal.
The point which the learned Judges had to decide in the appeal was whether it was the appellant who had murdered Jetha.
That is a pure question of fact turning on appreciation of evidence.
The High Court has gone into the matter fully, examined the entire evidence ex haustively, and in a judgment which is as closely reasoned as it is elaborate, has come to the conclusion that the guilt of the appellant has been established beyond all reasonable doubt.
Does that decision call for our interference in special appeal?.No, unless this Court is to 'function as a court of appeal on facts.
1302 But then, it is argued that the appeal before the High Court was one against acquittal, that such an appeal was subject to the limitation that there should be compelling reasons for reversing an order of acquittal, and that it would be open to this Court in special appeal to consider whether that limitation bad been duly observed.
Nevertheless, the view was taken at one time in some of the decisions that appeals against acquittals were in a less favoured position than appeals against convictions, and that an order of acquittal should not be interfered with in appeal except "where through the incompetence, stupidity or perversity of certain tribunal such unreasonable or distorted conclusions have been drawn from the evidence so as to produce a positive miscarriage of justice", or were "the lower court has so obstinately blundered or gone wrong as to produce a result mischievous at once to the admi nistration of justice and the interests of the public".
In Sheo Swarup vs King Emperor(5), the question was raised for determination by the Privy Council whether there was any legal basis for the limitation which the above decisions had placed on the right of the State to appeal under section 417.
Answering it in t e negative, Lord Russell observed that there was "no indication in the Code of any limitation or restriction on the High Court in the exercise of its powers as an appellate tribunal", that no distinction was drawn (1) All. 148.(2) All. 212.(3) (4) Rang.312, (5)[1934] L.R. 61 I.A. 398, 403, 404. 1303 "between an appeal from an order of 'acquittal and an appeal from a conviction", and that "no limitation should be placed upon that power unless it be found expressly stated in the Code".
He went on to remark at page 404 that, "the High Court should and will always give proper weight and consideration to such matters as (1) the views of the trial Judge as to the credibility of the witness, (2) the presumption of innocence in favour of the accused, a presumption certainly not weakened by the fact that he has been acquitted at his trial, (3) the right of the accused to the benefit of any doubt, and (4) the slowness of an appellate Court in disturbing a finding of fact arrived at by a Judge who bad the advantage of seeing the witnesses".
These observations, however, do not mean that the scope of appeals against acquittals is different from that of other appeals.
They merely embody the principles applicable to all appeals, civil and criminal, to appeals alike against conviction and acquittal.
If the trial Judge does not accept the evidence adduced by him and dismisses his suit and he appeals, he has the burden still on him to prove on the evidence adduced that the promissory note is genuine, and in discharging that burden he has to show that the judgment appealed against is clearly wrong.
If all he can show is nicely balanced calculations which lead to the equal possibility of the judgment on either the one side or the other being right, he has not succeeded".
1304 has to establish on the evidence that the accused is guilty, and to establish it, it has to satisfy the court that the judgment of the trial court is erroneous.
The oft repeated observation that on acquittal the presumption of innocence becomes reinforced is merely this principle stated in terms of criminal law.
Likewise, the weight to be attached by an appellate court to a finding of the trial court based upon appreciation of oral evidence is the same whether it is given in a civil litigation or a criminal trial.
But generally speaking, it is undesirable to interfere with the findings of fact of the Trial Judge who sees and hears the witnesses and has an opportunity of noting their demeanour, especially in cases where the issue is simple and depends on the credit which attached to one or other of conflicting witnesses. .
In making these observations their Lordships have no desire to restrict the discretion of the Appellate Courts in India in the consideration of evidence".
It is clearly these principles that Lord Russell had in mind when he made the observations at page 404 in Sheo Swarup vs King Emperor2 ') quoted above, and that will be clear from the observation next following: "To state this, however, is only to say that the High Court in its conduct of the appeal should and will act in accordance with rules and principles well known and recognized in the administration of justice".
The scope of the decision in Sheo Swarup vs King Emperor(2) with special reference to the observations discussed above was thus explained by the Privy .Council in Nur Mohammad vs Emperor(3): "Their Lordships were referred, rightly enough to the decision of this Board in the case in Sheo
(1) [1915] L.R. 42 I.A. 110; 118.
(2) [1934] L.R. 61 I.A. 398.
Their Lordships do not think it necessary to read it all again, but would like to observe that there really is only one principle, in the strict use of the word, laid down there; that is that the High Court has full power to review at large all the evidence upon which the order of acquittal was founded, and to reach the conclusion that upon that evidence the order of acquittal should be reversed".
These authorities establish beyond all controversy that an appeal against acquittal under section 417 stands, as regards the powers of an appellate court, on the same footing as appeals against conviction.
If that is the true scope of an appeal under section 417, where then does the doctrine of "compelling reasons" come in? And how do we fit it among the powers of a court under that section? The words compelling reasons" are not a legislative expression.
They are not found in section 417.
As far as I have been able to discover, it was first used in Surajpal Singh and others vs The State(2), wherein it was observed: "It is well established that in an appeal under section 417 of the Criminal Procedure Code, the High Court has full power to review the evidence upon which the order of acquittal was founded, but it is equally well settled that the presumption of innocence of the accused is further reinforced by his acquittal by the trial court, and the findings of the trial court which had the advantage of seeing the witnesses and hearing their evidence can be reversed only for very substantial and compelling reasons".
Do the words "compelling reasons" in the above passage import a limitation on the powers of a court hearing an appeal under section 417 not applicable to a court hearing appeals against conviction?
If they do, then it is merely the old doctrine that appeals against acquittal are in a less favoured position, dressed in a new garb, and the reasons for rejecting it as unsound are as powerful as those which found favour with the Privy Council in Sheo Swarup vs King Em (1) [1934] L.R. 61 I.A. 398.(2) ; , 201.1306 peror(1) and Nur Mohammad vs Emperor(2).
But it is probable that these words were intended to express, as were the similar words of Lord Russell in Sheo Swarup vs King Emperor(1), that the court hearing an appeal under section 417 should observe the rules which all appellate courts should, before coming to a conclusion different from that of the trial court.
If so understood, the expression "compelling reason s" would be open to no comment.
But the expression has been quoted in later judgments, especially of the courts below, as if it laid down that in appeals against acquittal, the standard of proof required of the appellant was far higher than what the law casts on appellants in other appeals, and as the words "compelling reasons" are vague and indefinite to a degree, the result has not seldom been that even when Judges hearing appeals under section 417 were convinced of the guilt of the accused, they refrained from setting aside the order of acquittal owing to the dark and unknown prohibition contained in the expression.
That is the impression which I have formed in the appeals which have come before me.
in this Court.
There is always a danger in taking a phrase, attractive and telling in its context, out of it, and erecting it into a judicial formula as if it laid down a principle universal in its application.
And this danger is all the greater when the phrase is of undefined import, and relates to appreciation of evidence.
It is in the interests of the public that crimes should be punished, and it is with this object that section 417 confers on the State a right to appeal against acquittal.
To fetter this right through such expressions as "compelling reasons" would not merely be to legislate but to defeat the plain intention of the legislature that an accused in an appeal against acquittal should.
have only those rights which the State in an appeal against conviction or a respondent in a civil appeal has, and that he is to enjoy no special protection.
(1) [1934] L.R. 61 I.A. 398.
(2) A.I.R. 1945 P.C. 151.
1307 The fundamental objection to regarding the expression "compelling reasons" as a rigid formula governing the decision of an appeal under section 417 is that it puts a judgment of acquittal, however rendered, in a position of vantage which the law did not accord to it, and throws around the accused who gets an order of acquittal in the trial court a protection which the law did not intend to give him.
In my judgment, this is a situation in which great mischief must result, and the interests of the public must suffer ' If the expression "compelling reasons" does not impose a restriction on the powers of a court hearing an appeal under section 417, and if its true scope is to guide it in arriving at a decision, the question whether this Court can interfere with that decision on the ground that it is erroneous presents no difficulty.
The decision would then be one on a question of fact depending upon the appreciation of evidence, and this court cannot, on the principles enunciated in Pritam Singh vs The State(1) interfere with it.
This position is, in fact, concluded by the decisions in Sheo Swarup vs King Emperor(2) and Nur Mohammad vs Emperor(3).
In Sheo Swarup vs King Emperor(2), the Sessions Judge bad characterised the prosecution witnesses as liars, and disbelieving their evidence had acquitted the accused.
On appeal, the High Court reviewed the evidence, and differing from the trial court as to the weight to be attached to it, convicted the accused.
Declining to interfere with this judgment, the Privy Council observed that even though there was no express mention in the judgment of the High Court that it had considered all the particulars which an appellate court should consider in deciding an appeal, there was "no reason to think that the High Court had failed to take all proper matters into consideration in arriving at their conclusions of fact".
In Nur Mohammad vs Emperor(3), the judgment of the High Court did not disclose that it had considered the matters mentioned by Lord Russell at page 404 (1) ; (2) [1934] L R. 61 I.A. 398, (3) A.I.R 1945 P.C. 151.165 1308 in Sheo Swarup vs King Emperor(1).
Nevertheless, the Privy Council dismissed the appeal observing: "In the present case the High Court judgment shows that they have been at pains to deal in detail with the reasons given by the Sessions Judge for disbelieving the group of witnesses, the Patwari and the other three alleged eye witnesses.
They have dealt in detail with them, showing on the face of their judgment that there is no necessity to presume in this case that they have not done their duty. "
These decisions are authorities for the position that when in an appeal under section 417 the court considers the evidence and comes to its own conclusion the findings recorded by it are not, even when they result in a reversal of the order of acquittal, open to interference in special appeal.
Different considerations would have arisen if the law bad provided a further appeal on facts against those orders of reversal, in which case the appreciation of the evidence by the appellate court would be a matter open to review in the superior court.
That, as already stated, would be the position in an appeal under articles 132 (1) and 134(1) (a) and (b), but where, as in the present, no appeal on facts is provided, the decision of the High Court is not open to review by this Court under article 136 on the ground that there were no compelling reasons for the learned Judges to reverse an order of acquittal.
This is sufficient to entail the dismissal of this appeal.
But, having gone through the evidence, I am of opinion that even on the merits the decision of the High Court is correct.
The evidence against the appellant is wholly circumstantial, and consists mainly of (1) the existence of a strong motive, (2) the conduct of the appellant on the day when the murder was committed, (3) the recovery of a blood stained axe and a false beard at the instance of the appellant, and (4) a confession made by him 'before the Magistrate, P.W. 21, on 3 6 1952.
1309 macy with Sunder, and as she was to be taken on the 19th May 1952 to Kalawad to join her husband, he wanted to do away with him.
The appellant admitted that he had illicit connection with Sunder for some years, and the Sessions Judge also found, basing himself on the prosecution evidence, that the appellant was very much agitated on the night of the 18th.
A number of witnesses deposed that they saw him on 18 5 1952 at Shiva sharpening his axe, and that when questioned, he stated that be was going to offer a green coconut to Mahadevji, "can expression " say the learned Judges "which in common parlance means sacrifice of a head".
The appellant denied that he went to Shiva on the 18th, but his statement was, disbelieved by the Sessions Judge who was impressed by the quality and number of the prosecution witnesses, and both the courts have concurred in accepting their evidence on this point.
As for the recovery of the axe, the appellant admitted it, but he stated in his examination under section 342 that there was no blood on it when he showed it to the police.
The Sessions Judge, was not prepared to accept this statement and observed: "Accused admits that this is his axe.
In light of chemical analysis, there is no doubt that there were stains of human blood on the axe.
It is also mentioned in the Pancbnama, exhibit 21 itself that the Panch had suspected that there were marks of human blood on this axe".
But all the same, he discounted the value of this evi dence, because according to him, in view of certain circumstances "the presence of human blood on the axe is by no means conclusive", and that "at best it raises a suspicion against the accused".
Those circumstances are three: Firstly, the panch who witnessed the recovery at Katkora belonged to Kalawad, and the criticism is that a local panch ought to have been got to witness the same.
The learned Judges of the High Court did not think much of this criticism, as the recovery at Katkora had to be made in pursuance of the statement given by the appellant at Kalawad, 1310 and the police might have reasonably thought that the same panch should be present at both the places.
As the Sessions Judge has accepted the evidence of the panch that there were blood stains at the time of the recovery of the axe, his criticism on this point lacks substance.
Secondly, though the recovery was made on 21 5 1952, it was sent to the medical officer for report only on 27 5 1952, and the delay is suspicious.
It is difficult to follow this criticism.
When once the conclusion is reached that there was blood on the axe when it was recovered, this criticism has no meaning unless it is intended to suggest that the police required some time to wash the blood which was on the axe at the, time of its recovery and to substitute human blood therefore.
There is nothing in the evidence to support a suggestion so grotesque, and as observed by the learned Judges, if the police wanted to substitute blood, they would not have taken so much time over it.
Thirdly, in despatching the blood to the Chemical Analyst, the medical officer sent the parcel containing the blood scrapings to the railway station, not through his own peon or the compounder in the hospital but through the local police, and that, according to the Sessions Judge, is a suspicious circumstance.
As the parcel was received intact by the Chemical Analyst at Bombay, it is difficult to see what the point of the criticism is.
The Sessions Judge himself observes: "I do not believe that the police have intercepted this parcel and they deliberately sent an axe with human blood.
However, there is no doubt that the procedure adopted by the doctor is wrong, and is capable of mischief".
It has not been explained and it is not possible to divine what that mischief could have been in this case.
And who could have been the mischief maker unless it be the police? The Sessions Judge stated that be did not believe the suggestion made against the police, but that nevertheless is the assumption underlying his comment.
"Anxious to wound, afraid to strike" would appropriately describe the situation.
The learned Judges disagreed with the reasoning of 1311 the Sessions Judge, and held that as the appellant had admitted the recovery of the axe and as there was human blood on it at that time, it was clear and cogent evidence pointing to his guilt.
I am unable to find any answer to this reasoning.
Pausing here, it will be seen that in discussing the question of the recovery of the blood stained axe, as indeed throughout the judgment, the learned Sessions Judge has taken up an, attitude of distrust towards the police for which it is difficult to find any justification in the evidence an attitude which, I regret to say, is becoming a growing feature of judgments of subordinate Magistrates.
When at the trial, it appears to the court that a police officer has, in the discharge of his duty, abused his position and acted oppressively, it is no doubt its clear duty to express its stern disapproval of his conduct.
But it is equally its duty not to assume such conduct on the part of the officer gratuitously and as a matter of course, when there is, as in this case, no reasonable basis for it in the evidence or in the circumstances.
The presumption that a person acts honestly applies as much in favour of a police officer as of other persons, and it is not a judicial approach to distrust and suspect him without good grounds therefore.
Such an attitude could do neither credit to the magistracy nor good to the public.
It can only run down the prestige of the police administration.
It is the case of the prosecution that the appellant unearthed a false beard, which he had buried underneath a shami tree in Shiva, and that he had worn it at the time of the murder.
The appellant did not deny the recovery, but stated that it was not he that had uncovered it but the jamadar.
Both the courts below have accepted the version of the prosecution as true, but while the Sessions Judge held that it was not sufficient to implicate the appellant, the learned Judges held otherwise.
P.W. 16 deposed that he saw the appellant at midnight on the 18th May on the outskirts of Kalawad wearing a false beard, and the comment of the Sessions Judge on this evidence is: " I do not see bow this evidence will prove the 1312 prosecution case beyond reasonable doubt.
At best, it will suffice to raise suspicion against the accused".
But if the beard was discovered by the appellant, then surely it is a valuable link in the chain of evidence against him.
Then we come to the confession made by the appellant to P.W. 21.
The Magistrate has deposed that he had satisfied himself that it was voluntary, before he recorded it.
Now, the facts relating to this matter are these, The appellant was, as already stated, arrested on the 20th May and discoveries of the axe and the false beard were made through him, and on the 21st he was sent to the Magistrate with a letter that he desired to make a confession.
The Magistrate has given evidence that he did not record the confession at once, as he wanted the appellant "to cool down", and accordingly gave him ten days to reflect, and committed him to judicial lock up.
There is nothing improper in this, and indeed ' it is a commendable precaution for ensuring that the confession was made voluntary.
From 21 5 1952 to 3 6 1952 the appellant continued in judicial lock up, and this is a circumstance which normally should negative the possibility of there having been a threat or inducement.
But the Sessions Judge declined to attach any weight to it, because both the police lock up and the judicial lock up were situated in the same compound, separated by a distance of 20 feet, and were guarded by the same police officers, and though the judicial lockup had its own warder and clerk jailor, they kept watch only during daytime, and therefore even though the police could have had no access inside the lock up, they had "every opportunity to threaten and bully the accused".
The Sessions Judge accordingly held that the confession was not voluntary.
On appeal, the learned Judges came to a different conclusion.
They considered that the possibility of threats having been uttered through the bars was too remote and unsubstantial to form the 'basis for any 1313 conclusion, and that all the circumstances indicated that the confession was voluntary.
These are the salient points that emerge out of the evidence.
The position may be thus summed up: (1) No special weight attaches to the findings of the Sessions Judge on the around that they are based on the evidence of witnesses whom he had the advantage of seeing in the box, and believed.
The oral evidence was all on the side of the prosecution, and that was substantially accepted by the Sessions Judge.
His judgment is based on the probabilities of the case, and of them, the learned Judges were at least as competent to judge, as he.
(2) The finding of the Sessions Judge in so far as it related to the recovery of bloodstained axe was clearly erroneous, as it did not follow on his reasoning.
(3) As regards the confession, the conclusion of the Sessions Judge rests on nothing tangible, and is largely coloured by a general distrust of the police, not based on evidence or justified by the circumstances.
(4) The learned Judges were of the opinion that even excluding the confession, the other evidence in the case was sufficient to establish the guilt of the appellant.
(5) All the four assessors were of the opinion that the appellant was guilty.
Now, returning to the two questions which have formed the basis of the preceding discussion, (1) what is it that the High Court has to do in exercise of its powers under section 417, having regard to the findings reached by it and set out above, and how does the doctrine of "compelling reasons" bear upon it? (2) What are the grounds on which we can interfere with its decision? A court hearing an appeal under section 417 might be confronted with three possibilities: (i) It might come to the same conclusion as the trial court on the questions in issue, in which case, of course, it should dismiss the appeal; (ii) It might consider that the evidence was not clear and conclusive one way or the other, in which case its duty 1314 as an appellate court would be not to interfere with the judgment appealed against; and (iii) it might come to a conclusion on an appreciation of the evidence opposite to that reached by the court of first instance, in which case it would clearly be its duty in exercise of its powers under section 417 to set aside the order of acquittal.
Wherein does the theory of "compelling reasons" come in the scheme? There is no need for it in the second category, because even apart from it, the same result must, as already stated, follow on the principles applicable to all courts of appeal.
Then, there remains the third category of cases.
If the High Court comes to the conclusion on an appreciation of the evidence that the appellant is guilty, has it, nevertheless, to confirm the order of acquittal on the basis of this theory? Surely not, as that would render the right conferred by section 417 illusory.
It has no independent value as bearing on its powers under section 417.
If that is the true position, it follows on the principles laid down in Sheo Swarup vs King Emperor(1) and Nur Mohammad vs Emperor(2) and in Pritam Singh vs The State(3) that this Court cannot interfere with the orders passed under section 417 merely on the ground that the findings of fact were not justified, having regard to the doctrine of "compelling reasons".
In my opinion, this appeal ought to be dismissed.
ORDER.
BY THE COURT.
In accordance with the Judgment of the majority this Appeal is allowed.
The conviction and sentence are set aside and the Appellant is acquitted.
(1) [1934] L.R. 61 I.A.398.
(2) A.I.R. 1945 P.C. 151.
| Per BOSE, and CHANDRASEKHARA AIYAR JJ.
(VENKATKRAMA AYYAR J. dissenting).
It is well settled that the High Court should not set aside an order of acquittal under section 417 of the Code of Criminal Procedure simply because it differs from the trial Court as to the appreciation of the evidence; there must be substantial and compelling reasons for doing so.
Where the trial Court takes a reason.
able view of the facts of the case, interference is not justifiable unless there are really strong reasons for holding otherwise.
Amar Singh vs State of Punjab ([1953] S.C.R. 418) and Surajpal Singh vs State ([1952] S.C.R. 193), referred to.
The accused in a criminal case must be given the benefit of every reasonable doubt and, therefore, when he offers a reasonable explanation of his conduct, although he cannot prove it, that explanation should ordinarily be accepted unless the circumstances indicate that it is false.
Consequently, in a case where an accused person, charged under SS. 302 and 447 of the Indian Penal Code, repudiated his confession at the earliest opportunity as having been made under Police threats administered to him at night while in jail custody and there was evidence to show that the Police had access to him there, and there was nothing to displace his statement that he was threatened by them, the finding of the Sessions Judge that the confession was not voluntary in character was fair and reasonable and in the absence of any compelling reason the High Court should not have set aside the order of acquittal.
1286 As the evidence otherwise was insufficient to warrant a conviction the accused was acquitted.
Per VENKATARAMA AYYAR J.
This is not a case in which the Supreme Court should interfere under article 136 of the Constitution.
The Constitution by specifically providing for an appeal on facts under article 134(1) intended to exclude it under article 136 and like the Privy Council this Court will not function as a further Court of appeal on facts in criminal cases.
The fact that the appeal in the High Court was one against an order of acquittal makes no difference as the powers of an appellate Court are the same in all appeals, whether against acquittal or against conviction.
Pritam Singh vs The State ([1950] S.C.R. 453), Sheo Swarup vs King Emperor ([1934] L.R. 61 I.A. 398) and Nur Mohammad vs Emperor (A.I.R. , relied on.
The expression "compelling reasons" used in Surajpal Singh 's case should be read only in the context of that case and should not be treated as a rigid formula so as to restrict the powers of the Court, or the right of appeal conferred on the State by section 417 of the Code or to place a judgment of acquittal in a position of vantage and give the accused a protection which the law does not afford to them.
Such a formula can be of use only as guiding principle for the appellate Courts in deter mining questions of fact.
Surajpal Singh vs The State ([1952] S.C.R. 193), considered.
Consequently, the findings arrived at by the High Court were not open to review by this Court under article 136 of the Constitution and as there was evidence apart from the retracted confession to support the view, it had taken on merits, the appeal must be dismissed.
|
Appeal No. 206 of 1955, 63 On appeal from the judgment and order dated the 5th May 1954 of the Patna High Court in Appeal from the Original Order No. 284 of 1951 arising, out of the order dated the llth July 1951 of the Court of Subordinate Judge, Motihari in Misc.
Case No. 30 of 1951.
Veda Vyas, (section K. Kapur and Ganpat Rai, with him) for the appellant.
C.K. Daphtary, Solicitor General of India (K. B. Asthana and C. P. Lal, with him) for respondent NO. 1. 1956.
January 31.
The Judgment of the Court was delivered by BOSE J.
This appeal arises out of certain execution proceedings.
The decree which the appellant, Jainarain Rain Lundia, seeks to execute is one that directsspecific performance of a contract to sell certain shares in a private limited company known as the Ganga Devi Sugar Mills, together with a five annas share in a partnership firm called the Marwari Brothers, on payment of a sum of Rs. 2,45,000.
The facts are as follows.
The partnership firm, known as the Marwari Brothers, was formed on the 29th of February 1936.
The partners consisted of two groups called the Bettia Group and the Padrauna Group.
The Padrauna Group consisted of (1) Kedarnath Khetan and (2) a firm called Surajmal.
These two were the plaintiffs in the suit.
Kedarnath was one of the partners of the Surajmal firm.
The Bettia Group consisted of (1) Gobardhan Das (2) Jainarain Ram Lundia (3) Badri Prasad and (4) Bisheshwar Nath.
On Bisheshwar Nath 's death his son Madan Lal Jhunjhunwalla stepped into his shoes.
These persons were the defendants.
The Marwari Brothers Firm was formed for the purpose of promoting a company for starting a sugar mill in Champaran and for securing the managing agency of the company for itself for a period of ninety years.
This was done.
The capital of the company consisted of Rs. 8,00,000 divided into 800 shares of 64 Rs. 1,000 each.
The shares were distributed as follows.
In the Bettia Group Gobardhan Das and his brother Badri Prasad had 100 shares; Jainarain had 150 and Madan Lal had 100.
The Bettia Group thus had 350 shares between them.
The other group (Padrauna) held the remaining 450 shares.
About five years later the two sets of partners fell out and, as a result, the Bettia Group agreed, on 1 1 1941, to sell a certain number of their shares in the Ganga Devi Sugar Mills Limited to the Padrauna Group along with a certain share in the Marwari Brothers firm.
The exact number of shares agreed to be sold and the extent of the share in the firm was amatter of dispute but that does not concern us at this stage because we are only concerned with the final result embodied in the decree now under execution.
The Padratuna Group sued for specific performance and the dispute was carried as far as the Federal Court.
That Court affirmed the decree of the Calcutta High Court on 6 5 1949.
The substance of the decree was this: 1."It is declared that upon payment and or tender to the defendants appellants Jainarain Ram Lundia and Madan Lal Jhunjhunwala of the sum of Rs. 2,45,000 with interest thereon by the plaintiffs, the plaintiffs are entitled to 250 shares belonging to the said defendants in the Ganga Devi Sugar Mills Limited and five annas share belonging to them in the Marwari Brothers and to all dividends and profits in respect thereof with effect from 1 2 1941 2."And it is further ordered and decreed that against payment or tender by.
the plaintiffs to the said defendants of the said sum of Rs. 2,45,000 with interest as aforesaid the said defendants appel]ants and all proper parties do execute in favour of the plaintiffs proper deed or deeds of transfer or assignment of the said 250 shares in the Ganga Devi Sugar Mills Limited and the said five annas share in the Marwari Brothers This was in slight variation of the first Court 's decree.
The exact variation does not matter.
All 65 that it is necessary to note is that the plaintiffs (that is, the Padrauna Group) tendered the money some time after the first Court 's decree and before the Calcutta High Court 's decree.
The tender was not accepted as the defendants (the Bettia Group) had appealed.
It is admitted that there was no second tender after the High Court 's decree.
After the Federal Court had settled the matter, one of the defendants, Jainarain Ram Lundia, applied to the Calcutta High Court for execution.
The decree was transferred to the Subordinate Judge, Motihari, and the execution proceedings started there on 25 1 1951.
One of the plaintiffs, Kedarnath Khetan, filed an objection petition on 20 3 1951.
That is the objection we are concerned with.
Among other things, one of the objections was that the defendants were not in a position to implement the conditions imposed on them by the decree because the Marwari Brothers firm was dissolved by agreement between the parties before the Federal Court 's decree and was no longer in existence.
The present appeal turns almost entirely on that fact and on the conseq uences that flow from it.
The first Court, that is, the Subordinate Judge 's Court at Motihari to whom the decree bad been transferred, declined to go into this holding that it had no jurisdiction as a transferee Court.
The plaintiff Kedarnath appealed to the High Court and succeeded.
The High Court held that the transferee Court had jurisdiction, that the Marwari Brothers had been dissolved and that because of that the defendants could not execute the decree.
The defendants appealed here.
We will first consider the question of fact, namely, whether the Marwari Brothers was still in existence as a firm at the date of the execution application.
On this point we agree with the High Court that it was not, for the following reasons.
The plaintiff Kedarnath asserted in his objection petition that the firm had been dissolved by agreement between the parties "including the plaintiffs and the defendants".
This fact was not denied by 9 66 the defendant Jainarain Ram Lundia in his rejoinder though the fact was specifically alleged to be within his personal knowledge.
Even if he did not know whether the firm bad been dissolved or not (a fact which cannot be the case for reasons that we shall give later) he was certainly in a position to admit or deny whether the fact was within his personal knowledge.
His silence can therefore only have one meaning.
The defendant 's learned counsel contended before us that the fact had been denied by implication because Kedarnath stated that his side was, and had always been, ready to perform their part of the decree.
Counsel argued that as the plaintiffs contended that performance was not possible after the dissolution of the Marwari Brothers firm this meant that the firm was still in existence.
We reject this contention and remark in passing that this is inconsistent with another argument which was also urged in this Court, namely that the fact of dissolution was no bar to performance on the defendant 's part.
Quite apart from the language of the rejoinder, the defendant Jainarain said in paragraph 15 of his application dated 12 7 1954 made to the High Court for leave to appeal here that "the said Marwari Brothers was in existence on the date of the said conveyance, namely 14th September 1950, and died a natural death on the conveyance of the Ganga Devi Sugar Mills to North Bihar Sugar Mills".
This is a clear admission that the firm was dissolved, at any rate, on 14 9 1950.
The plaintiff 's contention is that it was dissolved much earlier but whether that was so or not will make no difference to this appeal because 14 9 1950 is also before the date of the application for execution.
The defendant 's learned counsel tried to explain this away also.
He said that the defendant did not mean that the firm was dissolved on that date but that as the only purpose for which the firm existed, namely, the managing agency of the Ganga Devi Sugar Mills, had gone the firm could no longer function.
67 In order to understand this, some further facts will be necessary.
While the plaintiff 's appeal was being heard in the High Court, the defendants made an application to that Court on 14 4 1954 asking for permission to adduce further evidence in the shape of a sale deed dated 14 9 1950.
The defendant con , tended that he had only "recently" come to know that the Ganga Devi Sugar Mills had sold all its land, machinery, etc.
to the North Bihar Sugar Mills on 14 9 1950.
This terminated the managing agency, and as the only business of the firm was this managing agency and as that was the only purpose for which the firm was formed, it was no longer able to function.
But he said that this deed would show conclusively that the firm was in existence on that date.
The High Court refused to accept this document because it considered that the only ground on which additional evidence can be admitted in appeal is when the Court is unable to pronounce judgment on the material already before it; as that was not the case here it rejected the document.
We need not decide whether there is any conflict of view between the Privy Council decisions in Kessowji Issur vs G.I.P. Rly.(1) and Parsotim vs Lal Mohar(2) on the one hand and Indrajit Pratap Sahi vs Amar Singh(3) on the other because, even if this evidence were to be admitted and were to be accepted as true, there would still be the defendant 's admission in the High Court that the firm stood dissolved at least on 14 9 1950.
We are not able to construe the statement in any other way.
The plaintiff says that the dissolution was much earlier and that the firm mentioned in the sale deed now sought to be filed was not the same firm but another firm of the same name, but even if the defendant 's version be accepted the fact still remains that even according to his statement there was a dissolution before his application for execution and that therefore the defendants were not in apposition to assign their five annas share (1) [1907] L.R. 31 I.A. 115, 122.
(2) [1931] L.R. 58 I.A. 254.
(3) [1928] L.R. 50 I.A. 183, 190, 191.
68 in the Marwari Brothers firm.
We now have to consider the effect of that.
Much of the argument about this revolved round the question whether the equitable rules that obtain before decree in a suit for specific performance con tinue at the stage of execution.
It is not necessary for us to go into that here because the position in the present case is much simpler.
When a decree imposes obligations on both sides which are so conditioned that performance by one is conditional on performance by the other execution will not be ordered un less the party seeking execution not only offers to .perform his side but, when objection is raised, satisfies the executing Court that he is in a position to do so.
Any other rule would have the effect of varying the conditions of the decree: a thing that an executing Court cannot do.
There may of course be decrees where the obligations imposed on each side are distinct and severable and in such a case each party might well be left to its own execution.
But when the obligations are reciprocal and are interlinked so that they cannot be separated, any attempt to enforce performance unilaterally would be to defeat the directions in the decree and to go behind them which, of course, an executing Court cannot do.
The only question therefore is whether the decree in the present case is of this nature.
We are clear that it is.
The relevant part of the decree has already been quoted.
It directs that "against payment or tender by the plaintiffs. the said defendants. do execute in favour of the plaintiffs proper deed or deeds of transfer of . five annas share in the Marwari Brothers.
This is not a case of two independent and severable directions in the same decree but of one set of reciprocal conditions indissolubly linked together so that they cannot exist without each other.
The fact that it is a decree for specific performance where the decree itself cannot be given unless the side seeking performance is ready and willing to perform his side of the bargain and is in a position to do so, only strengthens the conclusion that that was the meaning 69 and intendment of the language used.
But the principle on which we are founding is not confined to cases of specific performance.
It will apply whenever a decree is so conditioned that the right of one party to seek performance from the other is conditional on his readiness and ability to perform his own obligations.
The reason is, as we have explained, that to hold otherwise would be to permit an executing Court to go behind the decree and vary its terms by splitting up what was fashioned as an indivisible whole into distinct and divisible parts having separate and severable existence without any interrelation between them just as if they had been separate decrees in separate and distinct suits.
Fry on Specific Performance was quoted to us (6th edition, Chapter IV, pages 546 onwards) where the learned author states that relief can often be obtained after judgment along much the same lines as before: thus a party to a contract may, in a proper case, apply for rescission of the contract and so forth.
it was urged by the other side that even if that can be done it can only be done by the Court which passed the decree and not in execution.
We do not intend to examine this because even if these remedies also exist, provided application is made to the proper Court, it does not affect the basic principle in execution that the executing Court must take the decree as it stands and cannot go behind it.
If the decree says that on payment being made some definite and specific thing is to be given to the other side, the executing Court cannot alter that and allow something else to be substituted for the thing ordered to be given.
The learned counsel for the defendant appellant contended that even if the Marwari Brothers had ceased to exist as a firm the plaintiff was still entitled to a five annas share in its assets on dissolution.
But a five annas share in the assets of a dissolved firm which has ceased to exist is a very different thing from a five annas share in a going partnership concern; and to permit this substitution in the decree would be to alter it in a very material particular.
The defendant may or may not have the 70 right to ask the Court which passed the decree to vary it in that way but he can certainly not, ask the executing Court to do so.
The decree must either be executed as it stands in one of the ways allowed by law or not at all.
In the High Court, and also before us, much was made of the fact that the plaintiff had not re tendered the money after the decree was varied by the High Court and it was argued that that precluded him from contesting the defendant 's right to attach his property under Order XXI, rule 32(1), of the Civil Procedure Code.
The remedy provided in Order XXI, rule 32(1), is, of course, one of the remedies available in execution of a decree for specific performance but it can only be used by a person who is entitled to execute the decree, and if, by reason of his own incapacity to perform his part, he is precluded from seeking execution, Order XXI, rule 32 (1), cannot apply.
The only question that remains is whether the executing Court can consider whether the defendant is in a position to perform his part of the decree.
But of course it can.
If the executing Court cannot consider this question who can? The executing Court has to see that the defendant gives the plaintiff the very thing that the decree directs and not something else, so if there is any dispute about its identity or substance nobody but the Court executing the decree can determine it.
It is a matter distinctly relating to the execution, discharge and satisfaction of the decree and so, under section 47 of the Civil Procedure Code, it can only be determined by the Court executing the decree.
And as for the first Court 's conclusion that it could not decide these matters because it was not the Court that passed the decree, it is enough to say, as the High Court did, that section 42 of the Code expressly gives the Court executing a decree sent to it the same powers in executing such decree as if it bad been passed by itself.
The next point urged by the appellant was that as the plaintiff did not raise the present objection before the Federal Court when it passed its decree he 71 is precluded from doing so now.
It is true this would have been a good ground for resisting a decree for specific performance but is no answer to the objection to execution.
The defendant undertook to perform his part when the decree was passed and he must make good that undertaking before he can seek execution because the decree, in view of its language and intendment, must either be executed as a whole or not at all; it cannot be split up into different and un correlated parts and be executed unilaterally.
It may be observed in passing that it was as much the duty of the defendant to seek modification of the contract by the Court which passed the decree, or modification of the terms of the decree later if he did not know these facts at the time, as he says, it was of the plaintiff.
The fact remains that the decree was passed in these terms and it must either be executed as it stands or not at all unless the Court which passed it alters or modifies it.
Then it was argued that this objection to execution should have been taken by the plaintiff in the Calcutta High Court when the defendant asked for transfer of the decree to Motihari and that as that was not done it is too late now.
But here also the answer is the same.
The only question before the Calcutta High Court on the application made to it was whether the decree should be transferred or not.
Whether the plaintiff might or could have taken the objection in the High Court is beside the point because it is evident that he need not have done so on the only issue which the application for transfer raised, namely, whether the decree should be transferred or not; at best it could only be said that the plaintiff had a choice of two forums.
If the appellant 's contention is pushed to its logical conclusion it would mean that whenever a decree is transferred all objection to execution must cease unless the order of the Court directing the transfer expressly enumerates the issues that the transferring Court is at liberty to determine.
In our opinion section 42 of the Civil Procedure Code is a complete answer to this contention.
The appeal fails and is dismissed with costs.
| An executing court cannot go behind a decree so as to vary its terms and when the obligations it imposes on the parties are reciprocal and inseverable, rendering partial execution impossible, the decree must be executed wholly as it stands or not at all.
This is particularly true of a decree for specific performance where the party who seeks execution must satisfy the executing court that he is in a position to perform the obligations which the decree imposes on him.
That in cases where the identity or substance of what the decree directs a party to give to the other is in dispute, the executing court alone has the power to decide it under section 47 of the Code of Civil Procedure and under section 42 of the Code the powers of the court executing a decree on transfer are identical with those of the court which passed the decree.
That although the remedy provided by O. XXI, r. 32(1) of the Code of Civil Procedure is available in execution of a decree for specific performance, it can be used only by a person entitled to execute the decree and if, by reason of his own incapacity to perform his part, he is precluded from seeking execution, 0.
XXI, r. 32(1), can have no application.
Consequently, in a case where, as in the present, the defendant sought to execute a decree for specific performance of a contract but was himself unable to perform one of the obligations the decree imposed on his party, namely, to transfer five annas share in a partnership firm, for the reason that the firm had ceased to exist by dissolution before the date of execution, he was not entitled to execute the decree.
Held further, that the defendant could not be allowed to substitute five annas share in the assets of the dissolved firm instead, as that would amount to an alteration of the decree which the execution court was not competent to make.
|
Appeal No. 122 of 1954.
Appeal under section 109(b) read with section 110, C.P.C. from the judgment and order dated the 28th September 1953 of the Orissa High Court in O.S. No. I of 1953.
P. R. Das and Bakshi Tek Chand, with M. Mohantiand section P. Varma, for the appellant.
M. C. Setalvad, Attorney General of India.
B. Mohapatra, Advocate General of Orissa with section Mohanti and P. G. Gokhale, for the respondent.
February 3.
The Judgment of the Court was delivered by DAS C.J.
This is an appeal from the judgment and decree passed on the 28th September, 1953, by a Bench of the Orissa High Court in an Original Suit which was filed on the 24th November, 1952, in the Court of the Subordinate Judge of Cuttack and was on the 17th January, 1953, transferred to the High Court and marked as Original Suit No. 1 of 1953.
The suit was filed by the plaintiff appellant claiming as the Raja and owner of the Rajgee, known as the Kanika Raj, against the State of Orissa, praying for a declaration that the Orissa Estates Abolition Act, 1951 (hereinafter referred to as "the Abolition Act") was, in its application to the Rajgee of Kanika, invalid, unconstitutional and ultra vires the State Legislature and for an injunction restraining the State of Orissa from taking any action under the said Act.
The suit was instituted evidently under an apprehension that the State of Orissa might issue a notification under section 3(1) of the Abolition Act declaring that the Rajgee of Kanika had passed to and become vested in the State free from all encumbrances.
The High Court dismissed the suit but gave a certificate of fitness for appeal to this court.
Hence the present appeal by the plaintiff.
The plaintiff 's contention before us is that no notification under section 3(1) of the Abolition Act 10 74 can issue because (1) his land is not an "estate" as defined in section 2(g) of the Act, and (2) the plaintiff is not an "intermediary ' within the meaning of section 2(h) thereof.
In answer to this, the AttorneyGeneral, appearing on behalf of the State, makes five Submissions, viz., (a) that on the admitted facts the plaintiff 's land is an "estate" within the meaning of the Abolition Act; (b) that the plaintiff is estopped by the compromise decree passed by the Patna High Court on 2nd May 1945 in F.A. No. 15 of 1941 from contending that his land is not an "estate" within the meaning of the Abolition Act; (c) that the plaintiff 's land has been held as an "estate" ever since 1803; (d) that whatever may have been the position before 1805, the plaintiff 's land became an "estate" by Regulation XII of 1805; and (e) that in any event, the plaintiff 's 'land became an "estate" after 1805 by subsequent acts and conduct of the plaintiff and his predecessors in title.
(a): Under section 3(1) of the Abolition Act, the State Government can declare that a specified "estate" has passed to and has become vested in the State.
It is, therefore, clear that the State Government cannot make any notification with respect to land which is not an "estate".
"Estate" is defined in section 2(g) of the Abolition Act.
The material portion of that definition, as it stood at the date of the institution of the suit, was as follows: `` `estate ' means any land held by an intermediary and included under one entry in any of the general registers of revenue paying lands and revenue, free lands, prepared and maintained under the law for the time being in force by the Collector of a district,. . . . . ' ' In order to be an "estate", the land must be held by an "intermediary" and must be included under one entry in any of the general registers of revenue paying lands and revenue free lands and such general registers must be prepared and maintained under the 75 law for the time being in force.
Section 2(h), as it stood then, by its earlier part, defined an "intermediary", with reference to any "estate", to mean, amongst other things, a proprietor.
The plaintiff certainly claims to be the proprietor of his land.
Therefore, if his land is an "estate", he is clearly an "intermediary".
The case of Biswambhar Singh vs The State of Orissa and Others"), which has been relied on by learned counsel for the plaintiff has no application to the present case, for that case was concerned not with the earlier but with the latter part of the definition of "intermediary".
That the plaintiff 's land is included under one entry in the general register of revenue paying lands is not disputed.
What is contended for is that in order to make such land an "estate" the register must be prepared and maintained under the law for the time being in force.
There is no dispute that "the law for the time being ,in force" means the Bengal Land Registration Act (Bengal Act VII of 1876).
The plaintiff contends that the register in which his land is included under one entry was not prepared or maintained under the Bengal Land Registration Act.
The argument is that it is not only necessary to show that the land is included under one entry in a register but that it is also necessary to show that the register where the entry appears was prepared and maintained under the law.
Under the Bengal Land Registration Act, 1876, land can be included in the register prepared and maintained under that Act only if such land is an "estate" as defined in that Act.
The relevant part of that definition is: "3(2) 'estate ' includes: (a)any land subject to the payment of landrevenue, either immediately or prospectively, for the dis charge of which a separate engagement has been entered into with Government; (b). . . . . . . . . . (c). . . . . . . . . .
It is urged, therefore, that the preparation of a register under that Act means the making of entries in that (1) [1954] S.C.R.842 76 register of lands which are subject to the payment of land revenue for the discharge of which a separate engagement has been entered into.
Land which is not subject to payment of land revenue and for the discharge of which a separate engagement has not been entered into is not an "estate" and cannot be entered in the register prepared and maintained under the Bengal Land Registration Act.
That Act confers powers on the Collector to prepare the register in the manner specified therein and such statutory power, in order to have effect, must be exercised in strict compliance with the provisions of that Act.
The plaintiff maintains that the Rajgee of Kanika was never subject to payment of land revenue for the discharge of which a separate engagement had been entered into by him or his predecessors in title.
That the ancestors of the plaintiff were at one time independent chiefs and that the Rajgee or Killa of, Kanika was in ancient time an independent State are conceded.
Later on, the Rajas of Kanika owed nominal allegiance to the Mahrattas.
Then came the last Mahratta War and the plains of Orissa were conquered by the East India Company.
On 22nd November, 1803, there was an "Engagement" between the East India Company and Raja Balabhadra Bhanja Deo, the then Raja of Killa Kanika.
The East India Company on the same day granted a Kaool Namah to the Raja.
Under the Engagement the Raja agreed, amongst 'Other things, to pay, as annual Peshkush or tribute, 84,840 Kahuns of Cowrees, amounting to Rs. 20,407 12 1 1.
This Engagement was confirmed by clause 10 of the Treaty of Peace concluded on the 17th December, 1803, at Deogan between the East India Company and the Mahrattas which treaty was later on ratified by the GovernorGeneral in 1804.
On the 5th September, 1805, was passed the Bengal Regulation XII of 1805.
Sections 33 to 37 which are material for our present purpose were as follows: "XXXIII.
The Commissioners having granted sanads to certain zamindars, entitling them to hold, 77 their estates at a fixed jama in perpetuity, those sanads are hereby confirmed '.
The following is the list of the names of the zamindars to whom this provision is to be considered applicable: Zamindar of Killah Darpan, Zamindar of Killah Sookindah, Zamindar of Killah Muddoopore.
XXXIV.
The Commissioners having likewise granted a sanad to Futtah Mohmed, jaghirdar of Malood, entitling him and his heirs for ever, in consideration of certain services performed towards the British Government, to hold his lands exempt from assessment, such sanad is hereby confirmed.
First.
The late Board of Commissioners having concluded a settlement of the land revenue with certain zamindars, whose estates are situated chiefly in the hills and jungles, for the payment of a fixed annual quit rent in perpetuity, those engagements are hereby confirmed; and no alteration shall, at any time, be made in the amount of the revenue payable under the engagements in question to Government.
Second.
The following is a list of the mehals to which the provision in the preceding Clause is applicable: Killah Aull, : Killah Humishpore, Killah Cojang, : Killah Miritchpore, Killah Puttra, : Killah Bishenpore.
Third.
The zamindaries of Cordah and Cunka being mehals of the description of those specified in the preceding Clause, a settlement shall be concluded, as soon as circumstances may admit, for the revenue of those mehals on the principle on which a settlement has been concluded with the zamindars of the mehals specified in the preceding Clause.
XXXVI.
All Regulations relating directly or indirectly to the settlement and collection of the public revenue, or to the conduct of the officers employed in the performance of that duty, whether European or native, in the province of Bengal, which are not superseded by the foregoing rules, are hereby extended to, and declared to be in force in the zillah 78 of Cuttack.
Provided, however, that nothing herein contained shall be construed to authorize the division of the lands comprised in any estates in the zillah of Cuttack, in which the succession to the entire estate devolves according to established usage to a single heir: in cases of this nature, the Courts of Justice are to be guided by the provisions contained in Regulation X, 1800.
Provided, also, that nothing herein contained shall be construed to imply, that any part of the said Regulations are for the present to be considered to be in force in certain jungle or hill zamindarries occupied by a rude and uncivilized race of people with the proprietors of which estates engagements were formed by the late Board of Commissioners for the payment of a certain fixed quit rent or tribute to Government.
The following is the list of the names of the mehals to which this exemption from the operation of the general Regulations is to be considered applicable.
Killah Neelgerry, : Killah Toalcherry,Killah Rampore, Killah Bankey, : Killah Attgurh, Killah Hindole, Killah Joormoo, : Killah Kunjur,Killah Teegereah, Killah Nirsing : Killah Kindeapara,:Killah pore, Burrumboh, Killah Augole, : Killah Neahgurh,: Killah Deckenaul.
XXXVII.
The foregoing exemption from the operation of the general Regulations shall likewise, for the present, be considered to be applicable to the lands known by the appellation of the territory of Mohurbunge; but it shall be the duty of the Collector of the zillah to conclude a settlement with the proprietor of the estate for the payment of a fixed annual quit rent, on the principles on which a settlement has been concluded with the other bill or jungle zamindars specified in the preceding section".
It is claimed that there was at no subsequent time any such revenue settlement as was contemplated by 79 section XXXV(3) and that there was no separate engagement for payment of any land revenue at any time thereafter.
The conclusion sought to be drawn in the circumstances is that as Killa Kanika was not subject to payment of land revenue.
, for the discharge of which a separate engagement had been entered into, it was not an "estate" as defined in Bengal Land Registration Act, 1876, and that that being the posi tion, it could not have been validly entered in the register prepared and maintained under the Bengal Land Registration Act.
The action of the Collector in entering Killa Kanika as a revenue paying estate was wholly ultra vires and in the eye of the law such an entry is a nullity and does not exist.
It follows, therefore, that Killa Kanika cannot be regarded as an "estate" within the meaning of the Abolition Act because the general register in which it is included cannot be said to have been validly prepared and maintained under the law for the time being in force.
Section 4 of the Bengal Land Registration Act, 1876, directs the Collector of every district to prepare and keep up the four kinds of registers therein mentioned.
Section 7 lays down that in Part I of the general register of revenue paying lands should be entered the name of every estate which is borne on the revenue roll of the district and certain other particulars relating to every such estate as therein specified.
Therefore, if the name of Killa Kanika was borne on the revenue roll of the district, the Collector would be bound to enter the same in Part I of the general register prepared and kept up by him under section 4.
Section 20 of the Act provides that until the registers by that Act directed to be prepared were so prepared the existing registers then kept up in the office of every Collector should be deemed to be the registers kept up under the Bengal Land Registration Act, 1876.
Prior to 1876, land registers used to be maintained under the Bengal Regulation XLVIII of 1793 as amended by Bengal Regulation VII of 1800.
Existing registers mentioned in section 20 of the Bengal Land Registration Act, 1876, clearly refer to registers kept under those Regulations and the learned 80 Attorney General contends that section 20 gives a statutory validity to the registers kept under those Regulations.
Mr. P. R. Das appearing for the appellant submits that his arguments apply with equal force to the registers kept under the old Regulations referred to above.
According to him, if the Collector entered lands which were not "estate" as defined in the old Regulations, he did not exercise his statutory powers and the entry made by him was a nullity and if any of the existing registers was void as regards a particular entry, then that entry did not exist and could not be transferred to the new register and if it was transferred, such transfer was a nullity and the new register, qua that entry, was void and could not be said to have been prepared and maintained under law.
We are unable to accept the line of reasoning developed by Mr. P. R. Das.
To accede to his contention would be to add words to section 2(g) of the Abolition Act so as to make it applicable to lands which were "validly" included under one entry in any of the general registers "properly" prepared and maintained under the law for the time being in force, that is to say, the Bengal Land Registration Act 1876.
This the court has no power to do.
If section 2(g) defined "estate" as including lands mentioned in the schedule to the Act, then whatever was included in the schedule would be an "estate" within the meaning of the Abolition Act, irrespective of whether such land was or was not an "estate" within the meaning of any other Act.
The same reasoning applies when the definition includes lands entered in the general registers prepared and maintained under the Bengal Land Registration Act, 1876.
Here the reference to the register prepared or kept under the law for the time being in force was meant only to identify the particular register in which the particular land was included under one entry.
Suppose that a )register prepared and maintained under the Bengal Land Registration Act, 1876, included lands which were "estates" within the meaning of the Land Registration Act and also lands which were not 81 "estates" within the meaning of that Act. 'Suppose further that the Orissa Legislature by the Abolition Act intended to include all these lands, properly or improperly included in the register, what language would they then have used? Precisely the language they have used in section 2(g) of the Abolition Act, namely, that an "estate" means any land included in the general registers prepared and maintained under the law for the time being in force.
In other words, the definition covers lands which are factually included in the particular register referred to.
Whether they are "estates" within the meaning of the Bengal Land Registration Act, 1876, and whether they were validly or properly entered according to the provisions of that Act., appears to us to be wholly irrelevant for the purpose of construing section 3 (g) of the Abolition Act.
In our opinion, the contention of the State of Orissa on this point must be accepted.
P. R. Das appearing for the appellant objects to the plea of estoppel being raised, because it has not been included in the Statement of Case filed in the present appeal by the respondent.
Order XVIII of the Rules of this Court deals with the lodging of cases.
Under Rule I no party to an appeal is entitled to be heard by the court unless he has previously lodged his case in the appeal.
Rule 3 lays down how the case is to be prepared and what its contents should be.
Order XIX, Rule 4 provides that the appellant shall not, without the leave of the Court, rely at the hearing on any grounds not specified in the Statement of Case filed by him.
The Privy Council Practice founded on Sheo Singh Rai vs Mussumut Dakho and Moorari Lall(1) and set forth in Bentwich 3rd edition Ruling 63 at page 181 is to the same effect.
There is no rule imposing corresponding disability on the respondent.
Further even with regard to the appellant the Court may, in appropriate cases, give him leave to raise a ground not specified in the Statement of Case.
In the present case there is no question of surprise, for the plea of estoppel was pointedly raised and made the subject matter of an (1) [1878] L.R. 5 I.A. 87.
11 82 issue before the High Court and was elaborately dealt with by the High Court in its Judgment under appeal.
In the circumstances we do not consider it proper to shut out this plea of estoppel.
The plea of estoppel is sought to be founded on the compromise decree, exhibit 'O ' passed by the Patna High Court on 2nd May, 1945, in F. A. No. 15 of 1941.
The compromise decree is utilised in the first place as creating an estoppel by judgment.
In In re.
South American and Mexican Company, Ex parte Bank of England(1), it has been held that a judgment by consent or default is as effective an estoppel between the parties as a judgment whereby the court exercises its mind oil a contested case.
Upholding the judgment of Vaughan Williams, J., Lord Herschell said at page 50: "The truth is, a judgment by consent is intended to put a stop to litigation between the parties just as much as is a judgment which results from the decision of the Court after the matter has been fought out to the end.
And I think it would be very mischievous if one were not to give a fair and reasonable interpretation to such judgments, and were to allow questions that were really involved in the action to be fought over again in a subsequent action".
To the like effect are the following observations of the Judicial Committee in Kinch vs Walcott and others(2): "First of all their Lordships are clear that in relation to this plea of estoppel it is of no advantage to the appellant that the order in the libel action which is said to raise it was a consent order.
For such a purpose an order by consent, not discharged by mutual agreement, and remaining unreduced, is as effective as an order of the Court made otherwise than by consent and not discharged on appeal".
The same principle has been followed by the High Courts in India in a number of reported decisions.
Reference need only be made to the case of Secretary of State, for India in Council vs Ateendranath Das(3), (1) (2) , 493.
(3) Cal.
550, 558.
83 Bhaishanker Nanabhai and others vs Morarji Keshavji and Co.(1) and Raja Kumara Venkata Perumal Raja Bahadur, Minor by guardian Mr. W. A. Varadachariar vs Thatha Ramasamy Chetty and others (2).
In the Calcutta case after referring to the English decisions the High Court observed as follows: "On this authority it becomes absolutely clear that the consent order is as effective as an order passed on contest, not only with reference to the conclusions arrived at in the previous suit but also with regard to every step in the process of reasoning on which the said conclusion is founded.
When we say "every step in the reasoning" we mean the findings on the essential facts on which the judgment or the ultimate conclusion was founded.
In other words the finding which it was necessary to arrive at for the purpose of sustaining the judgment in the particular case will operate as estoppel by judgment".
The correctness of these principles laid down in these decisions is not disputed by Mr. P.R. Das.
Proceeding on the basis that there is such a principle of estoppel by judgment, he contends that the test laid down in the decisions referred to above is whether the judgment in the previous case could have been passed without the determination of the question which was put in issue in the subsequent case, where the plea of estoppel by the previous judgment is raised.
This leads us to a consideration of the facts, which are material to this question.
On the 4th February, 1936, the predecessor in title of the plaintiff brought a suit (O.S. No. 7 of 1936) in the Court of the Subordinate Judge of Cuttack against the Secretary of State for India in Council, praying for a declaration that the plaintiff bad a good and indefeasible title to the beds of certain rivers, by expressed or implied grant from the East India Company, alternatively for a declaration that the plaintiff had acquired an indefeasible right and title to the beds of the said rivers by prescription or adverse possession and for permanent injunction against the defendant restraining him from interfering with the (1) Bom.
283, (2) Mad.
84 rights of the plaintiff in the beds of the said rivers and the churs formed on them.
The suit was founded on, amongst others, the following allegations.
In paragraphs 3 to 6 of the plaint were pleaded that the plaintiff 's ancestors were the rulers of Killa Kanika owing allegiance to the Hindu Gajapati Kings of Orissa and were absolute owners of all lands and waters within the ambit of their territories including the two rivers therein mentioned and that after the fall of the Hindu kingdom in Orissa, and during the Afghan, Moghal and Mahratha occupation of Orissa, the Rulers of Killa Kanika, the ancestors of the plaintiff continued to be the absolute owners of the Killa including the said rivers.
In paragraph 7 of the plaint reference was made to the Engagement and Kaoolnama of 1803, whereby the Raja was said to have been confirmed in his Rajgee or proprietorship of the entire Killa and it was submitted that the said grant was intended to and did, in fact, confirm his title, to the said rivers.
In paragraph 9 of the plaint, it was acknowledged that subsequently the status of the rulers of Killa Kanika was gradually reduced to that of a Zamindar and that.
they were divested of all administrative powers, but it was claimed that nevertheless, their proprietary rights in the Killa consisting of land and water including the disputed rivers remained intact and that the tribute which had been fixed by the engagement of 1803 remained so in perpetuity as Peshkush payable by the proprietors.
In paragraph 33 it was stated that having regard to the fact that prior to the British conquest of Orissa, the plaintiffs predecessors in title had been independent rulers of Killa Kanika and as such had valid title to the said rivers within their territory and that after the British conquest the East India Company confirmed the title of the then Raja of Kanika to whatever had been in the possession of the said Raja prior to the said conquest and maintained him in possession thereof, the plaintiff claimed good and valid title to the beds of the said rivers by an express or implied grant by the said East India Company.
A claim of title to the beds of the said 85 rivers by prescription and adverse possession was also pleaded by way of alternative plea.
The written statement of the Secretary of State was filed on the 29th May, 1936, traversing the allegations in the plaint.
In paragraph 7 it was definitely pleaded that the Raja, with whom engagement had been entered into in 1803, was deposed for miisrule and his status was reduced to that of a Zamindar as a punishment and that it was as an act of mercy that he was allowed to retain the estate without an enhancement of his Peshkush.
It was submitted that in view of the treatment of the estate during the past 100 years, it was idle for the plaintiff to suggest that he retained the rights comparable to those of a Ruling Chief.
Reading the pleadings and the issues raised in the case fairly and as a whole,it appears quite clear that although the Engagement and Kaoolnama of 1803 was referred to as a grant, express or implied, from the East India Company, the plaintiff was, in substance, founding his claim on his antecedent title as the Ruling Chief of Killa Kanika which, according to him, bad been confirmed by the Engagement and Kaoolnama of 1803, which were, therefore, construed as a grant, express or implied, from the East India Company.
That the real issue on which the suit was fought out in the trial court was whether the plaintiff was an independent Ruling Chief and as such entitled to the beds of the rivers passing through his territory or was a mere Zemindar and as such having no such right is apparent from the following passage in the judgment of the Subordinate Judge "It is, therefore, too late now to suggest that the status of the plaintiff in relation to his Killa is something higher than or superior to that of a holder of an estate.
In my view, it is of no consequence, as respects the point now under consideration whether the estate is a permanently settled estate or it is a temporarily settled estate.
The question is whether the plaintiff is the holder of an estate or it is that he owns a State.
But as I have just pointed out, a private individual cannot own a State in the sense a sovereign authority owns the same".
86 After referring to the Regulations of 1805 and 1806, the learned Subordinate Judge proceeded to say: "Thus it is apparent that with the advent of the British the question of status of the plaintiff was never left in any degree of uncertainty.
All these various Regulations taken together will go to establish in an unmistakable term, that the plaintiff 's status in his relation to his Killa, was recognised from the time of the advent of the British in Orissa as that of a Zamindar, i.e., a bolder of an estate.
That being so, in relation to these rivers, or to their beds, the plaintiff 's position shall be nothing more than or superior to that of a riparian owner".
Again referring to the Engagement and Kaoolnama of 1803 the learned Subordinate Judge stated as follows: "Now taking these two documents together, it is difficult to read in them that any grant was made either expressly or impliedly by the sovereign authority in favour of the holder of the Killa.
The main provisions are that the revenue was fixed for ever, and that the holder was asked to be loyal to the Company 's Government.
Thus initially, I have been unable to associate any idea of grant as to be flowing from these engagements.
All that can be said, and perhaps the earned counsel for the plaintiff maintains to that effect, is that what rights the holder of the Killa had, in reference to the Killa, were fully and without any limitation or restriction, recognised.
It is, therefore, that the question will now be set at large for a discussion as to what rights the proprietor of the Killa had at the time when these engagements were made".
It is needless to extract further passages from the judgment.
In the result the learned Subordinate Judge answered the issues against the plaintiff and dismissed the suit.
The plaintiff appealed to the Patna High Court.
A compromise was arrived at between the parties, which was filed in court and the appeal was disposed of in accordance with the terms of the compromise petition.
The principal terms of the compromise petition were as follows: 87 "1.
That it shall be declared that the Crown and for the matter of that, the Province of Orissa, the defendant has the title to the disputed river beds, as described in the schedule of the plaint, and the plaintiff appellant acknowledges the same.
2.That the plaintiff appellant, that is the Proprietor of the Kanika Estate is the rightful owner of the fisheries of the said rivers and the defendant has not nor will have any objection to his unobstructed exclusive permanent enjoyment of the fishery rights in the said rivers at any time whatsoever.
The respondents shall not claim nor the appellant shall be liable to any assessment on that ground, other than what is payable in respect of the permanently settled estate of Killa.
3.That subject to such rights as the Crown or in other words, the Province of Orissa has in the beds of the rivers aforesaid and in the channel of waters flowing thereon, the Proprietor of Kanika Estate that is the plaintiff appellant will have his rights to the ferries over the said rivers which he has been so far enjoying and except when such ferry rights interfere with the Crown 's right in the bed of the rivers and similar rights in the waters on the channel of the rivers for the purpose of navigation and things of the kind, the Province of Orissa will not interfere with nor raise any objection to the plaintiff 's enjoyment of such rights or ferry through the length and breadth of the aforesaid rivers.
4.That such Chars, islands or other accretions formed in the said rivers as have been shown in the Civil Court Commissioner 's map prepared in this suit and now forming a part of the court 's record shall be deemed as part and parcel of the permanently settled estate of Kanika and the defendant will not be entitled to any further assessment in respect thereof.
5.That all future riparian accretions or Chars formed adjoining the banks of the rivers in dispute shall also be always deemed to be part and parcel of the said permanently settled Zamindary of Kanika and shall be so possessed by him without any further payment on assessment of land revenue over and 88 above the land revenue that has been permanently fixed.
6.That all other islands or Chars that may be formed subsequent hereto in the midst of the river being cut off from the banks thereof by waters that are tidal, unfordable and navigable in all seasons of the year shall belong to the defendant and the plaintiff or his successor in interest will have a right to possess and take settlement of the same from the defendant and the latter will have the right to levy assessment of land revenue thereon according to the principles and provisions of law as laid down in Regulation II of 1819 and this assessment will be of force from the time when the islands or Chars will appear and be capable of enjoyment irrespective of the fact whether estate holder does really enjoy it or not ' .
The declaration of the title of the State to the disputed river beds was a clear acknowledgment by the plaintiff of the State 's sovereign rights, which necessarily negatived the sovereign rights which he asserted and claimed for himself.
The declaration that the plaintiff, as the proprietor of the Kanika estate, was the ' rightful owner of fisheries in the said rivers and that the defendant would not claim any assessment on that ground was nothing but a recognition of the plaintiff 's title as the holder of a permanently settled estate.
The same observations apply to clause (3) whereby the plaintiff was declared to have the ferry rights over the said rivers, which were expressly made subject to the rights of the State in the beds of the rivers.
The provision that all future riparian accretions or Chars formed adjoining the banks of the rivers would always be deemed part of the permanently settled Zemindari of Kanika and should be possessed by him without further payment of assessment of land revenue over and above the land revenue that had been permanently fixed clearly acknowledges that the plaintiff accepted the position that he had no rights other than what he had as the holder of a permanently settled estate liable to the payment of land revenue, in contradistinction to 89 tribute fixed in perpetuity.
The provisions of clause (6) of the terms of settlement also point to the same conclusion.
Mr. P. R. Das contends that the issue in the present case is whether the land held by the plaintiff is an "estate" within the meaning of the Bengal Land Registration Act, 1876, whereas the issue in the earlier case was whether the plaintiff 's predecessors had title to the river beds by express or implied grant from the Crown.
This does not appear to us to be a fair reading of the pleadings as a whole.
The plaint in the earlier suit summarised above and the passages culled from the judgment of the trial court clearly indicate that the parties went to trial on the definite and well understood issue that the plaintiff 's claim to the river beds was founded on his anterior title as an independent Ruling Chief of Killa Kanika and that that title had been confirmed by the Engagement and Kaoolnama of 1803, which were, in a loose way, construed as a grant of the river beds, express or implied, by the East India Company.
What the parties understood by the issues on which they went to trial is clearly illustrated by the passages quoted from the judgment.
The fact that the claim in the earlier suit related only to a part of the land, namely the river beds, whereas the present case is that the entire land held by the plaintiff is not an "estate" makes no difference, for the real issue between the parties in the earlier suit was, as it is in the present suit, only concerning his status and the rights flowing therefrom.
To hold in this suit that the plaintiff is not the holder of an estate subject to payment of land revenue for the discharge of which a separate engagement has been entered into, will be to permit the plaintiff to set up a sovereign status for himself, which he actually did in the earlier case but failed to establish in the trial court and which he, by the compromise, expressly abandoned in the appeal court.
In our judgment the compromise decree precludes the plaintiff from re asserting the title, which had been negatived by the compromise decree although it related only to his claim to a part of the lands, namely 12 90 the beds of the rivers therein mentioned.
The compromise decree is also sought to be pleaded by the State against the plaintiff as estoppel by representation.
It is said, that even if the compromise had not the imprimatur of the court, it would, nevertheless, be representation that the plaintiff 's predecessor was the Zemindar of a permanently settled estate.
The compromise consisted of reciprocal concessions, those made by one party being the consideration for those made by the other.
It was on the basis of the concession made by the plaintiff 's predecessor, namely, that he was a Zemindar of a permanently settled estate, that the State gave up the benefit of the decree which had been passed in its favour by the trial court and also the right to levy assessment on the accretions of future Chars.
One of the main considerations for the compromise ,was the clear admission on the part of the plaintiff in that case that his status in respect of Killa Kanika was nothing more than that of a proprietor of a permanently settled estate liable to pay land revenue.
The High Court decided the issue of estoppel against the State on two considerations, namely, (1) that the status of the owner of Killa Kanika was not directly and substantially in issue in the earlier litigation and (2) that there was no clear evidence led on the side of the State to establish that the admission by the plaintiff in that case of his status was the main consideration for the compromise.
We are satisfied that the High Court was in error on both these points.
As already pointed out, the pleadings summarised above and the passages in the judgments quoted above clearly indicate that the status of the plaintiff was the foundation of his claim to the river beds and was consequently directly and substantially in issue in that litigation and was understood to be so by the parties themselves.
On the second ground the terms of the compromise speak for themselves.
It is quite clear that the concessions made by one party were the consideration for those made by the other party and, therefore, it was not necessary to adduce any further evidence, assuming that any evidence was 91 admissible for the purpose.
In our judgment, the finding of the High Court on this issue was clearly erroneous.
Each of the conclusions we have arrived at on the first two points is quite sufficient, by itself, to enable us to dispose of this appeal and it is not necessary for us to deal with or express any opinion on the other three points canvassed before us.
The result, therefore, is that this appeal should be dismissed with costs and we order accordingly.
| The appellant sued the State of Orissa for a declaration that the Orissa Estates Abolition Act of 1951 was in its application to the Kanika Raj, of which he was the Raja and owner, invalid, unconstitutional and ultra vires the State Legislature and for an injunction restraining the State of Orissa from taking any action under the Act.
It was contended, inter alia, that no notification under section 3(1) of the Act vesting the Kanika Raj in the State of Orissa could issue as the Raj was not an estate as defined by section 2 (g) of the Act.
The contrary was asserted by the State of Orissa and its further contention was that the appellant was estopped by a compromise decree between his predecessors in title on the one band and the Secretary of State on the other from denying that the Raj was an estate as defined by the Act.
Held, that the Kanika Raj was an estate as defined by the Orissa Estates Abolition Act of 1951 and the appellant was estopped from denying it by the compromise decree.
That the real intention of the Act in defining 'estate ' as it has done in section 2(g) of the Act, was to include all lands, such as the appellant 's, which were as a matter of fact included ill the register prepared under the Bengal Land Registration Act Of 1876, and in construing the definition it is wholly unnecessary to consider whether such inclusion was valid or proper or in conformity with the meaning of an estate under that Act.
That a judgment by consent is as effective in creating an estoppel between the parties as a judgment on contest and the test is whether the judgment in the previous case could have been passed without the determination of the question which is put in issue in the subsequent case where the plea of estoppel is raised.
Held further, that there is no rule corresponding to Rule 4 of Order XIX of the Supreme Court Rules imposing a similar disability on the respondent, and even with regard to the appellant the court may in appropriate cases, give him leave to raise a ground not specified in the Statement of the Case filed by him.
|
Appeals Nos. 123 to 127 and 135 of 1953.
102 On appeal from the judgment and decree dated the 12th May 1950 of the Patna High Court in Appeal from Original Orders Nos. 266, 267, 268, 271, 274 and 280 of 1948 arising out of the Order dated the 26th June 1948 of the Court of the District Judge, Purulia in Insolvency Cases Nos. 1/44, 13/46, 12/46, 10/46 and 44/41, respectively.
section C. Isaacs (P. K. Chatterjee, with him) for the appellant.
Bhabananda Mukherji, section N. Mukherji and B. N. Ghose, for the respondents.
February 14.
The Judgment of the Court was delivered by CHANDRASEKHARA AIYAR J.
These appeals are by a creditor of six employees in the Tin Plate Co. of India Ltd. who had been adjudged insolvents.
The employees are members in a Provident Fund of the Tin Plate Co. and there were amounts standing to their credit in the said Fund.
The creditor, Mukti Lal Agarwala, filed applications under section 4 of the Insolvency Act for orders that the amounts standing to the credit of the insolvents in the Provident Fund account were their properties and had vested in the court and were available for distribution amongst the creditors.
He sought a direction that the monies may be brought into Court.
The petitions were directed primarily against the Tin Plate Co. Ltd. and the Trustees of the Provident Fund.
They pleaded in answer that the amount standing to the credit of each insolvent in the Provident Fund represented the contributions of the Company and of the employees and that the corpus was a trust fund in the hands of the trustees of the fund; so they were not properties of the insolvents over which they had a disposing power and that they were not debts due to the insolvents.
It was said that according to the rules governing the Provident Fund the monies become payable to the employee or any other member of his family only on the happening of certain contingencies ' such as retirement, discharge, 103 dismissal or death and that till then no right accrued to the insolvent.
It was further urged that the trustees could not be removed from the custody and control of the fund by the Official Receiver.
The Insolvency Court, which was the court of the District Judge at Purulia, heard the petitions and found on a construction of the rules of the Provident Fund that the monies standing to the credit of A & C accounts in the name of each insolvent was his property over which he had a disposing power and hence they were available for distribution among the creditors under the Insolvency Act.
The trustees of the Fund and the Tin Plate Co. carried the matter on appeal to the High Court at Patna and the they were successful.
The learned Judges (V. Ramaswami and Sarjoo Prasad, JJ.) held that under the rules governing the Fund the insolvents had no present disposing power over the monies standing to their credit and that the Fund was really vested in the trustees.
As the amount involved in the several petitions taken together was over Rs. 20,000, the High Court granted leave to the creditors to appeal to this court.
The main contentions urged by Mr. Isaacs on behalf of the appellants were three in number: (a) The monies standing to the credit of each insolvent in the Provident Fund are his property, though payable at a future date and the question of present disposing power arises only for bringing within the scope of the definition what may not otherwise be regarded as "property".
(b) Though the Provident Fund rules speak of a trust Fund and trustees, in reality, there was no transfer of ownership by the employees in favour of the trustees and that there is no trust as such.
(c) In any event, even on the footing that a trust was created over the Fund, the beneficial interest continues in the employees and this interest would vest in the Official Receiver for the benefit of the creditors in insolvency.
We have to examine the soundness of these contentions.
104 The Provident Fund was started on the 1st January, 1929.
The rules and regulations of this Fund are found in the deed of trust dated the 15th July, 1930, marked as Exhibit 1.
These rules, as amended from time to time in certain respects by supplementary deeds, are given in the appendix to this judgment.
On the making of an order of adjudication, the whole of the property of the insolvent shall vest in the court or in a Receiver and shall become divisible among the creditors.
(Section 28 (2) of the ).
The property of the insolvent for the purposes of vesting shall not include any property which is exempted by the Code of Civil Procedure, or by any other enactment for the time being in force from liability to attachment and sale in execution of a decree (section 28(5)).
Section 2(d) of the Act states:" 'Property ' includes any property over which or the profits of which any person has a disposing power which he may exercise for his own benefit".
A person has a disposing power over property which he may exercise for his own benefit, such as a power of appointment conferred on him under a will or a settlement, or the power of a Hindu father who is the manager of a joint Hindu family to sell the shares of his sons in the family property in discharge of their pious obligation to pay off his debts.
In clause (b) of sub section (2) of section 38 of the English Bankruptcy Act, 1914, this power is specified in these words: "The capacity to exercise and to take proceedings for exercising all such powers in or over or in respect of property as might have been exercised by the bankrupt for his own benefit at the commencement of his bankruptcy or before his discharge, except the right of nomination to a vacant ecclesiastical benefice;".
All that we have to find out is whether the amounts standing to the credit of the several subscribers in the fund who have been adjudged insolvents are divisible among their creditors.
If so, they would vest 105 in the court or the Official Receiver and would become available for distribution.
Whether they have any present interest in the monies is the primary question that falls to be considered.
Section 60 of the Civil Procedure Code sets out what property is liable to attachment and sale and what items are not.
The first part of section 60 runs in these terms: "The following property is liable to attachment and sale in execution of a decree namely, lands, houses, or other buildings, goods, money, bank notes, cheques, bills of exchange, hundis, promissory notes, Government securities, bonds or other securities for money, debts, shares in a corporation and, save as hereinafter mentioned, all other saleable property, movable or immovable, belonging to the judgmentdebtor, or over which, or the profits of which, he has a disposing power which he may exercise for his own benefit, whether the same be held in the name of the judgment debtor or by another person in trust for him or on his behalf".
The exempted items do not apply.
Clause (k) deals with funds governed by the Provident Fund Act.
Reference has, however, been made to clause (m) which speaks of "an expectancy of succession by survivorship or other merely contingent or possible right or interest".
Let us now advert to the relevant rules of the Fund.
The object of the Fund as set out in rule 2 is to accumulate for the benefit of the Company 's employees who have joined the Fund certain sums as a future provision for them and for their families.
Under rule 3, any employee, who has completed one year 's service with the Company, shall be eligible for membership.
Rule 4 provides for a declaration as regards the disposition of the Fund in the event of death.
This declaration can be cancelled and changed.
Rule 5 provides that if the declaration becomes obsolete, the trustees could decide who were to be recognized as the next of kin and that payment by them to such person will be an absolute discharge.
Every member shall be allowed to contribute any 11 106 sum not exceeding one twelfth of his or her earnings and such amounts would be credited in the name of each member in an account called 'A ' Account (Rule 6).
At the end of each year, an amount equal to the contribution by the member shall be paid by the Company and credited to another account to be opened in the name of the member and to be denominated his or her 'B ' Account.
An increased contribution by the Company in certain events at particular specified rates is contemplated by rule 7(B).
This further sum will go into a 'C ' account to be opened in the name of each member.
Rule 8 provides that the moneys of the Fund shall be invested by the Trustees in accordance with the provisions from time to time in force under the Indian Income tax (Provident Funds Relief) Act, 1929.
Every year the A, B and C Accounts are to be made up including the income from the investments according to certain calculations.
Then come the important rules 10, 11, 12, 13, 15, 16, 17 & 18.
Though the Fund is intended as a future provision for the employees and their families, the membership is purely voluntary and arises on an application to the Company, the trustees having nothing to do with the admission.
It is only the management of the Fund and the control of its funds which vests in the trustees under rule 1.
There is no transfer of the ownership of the Fund.
The contributions made by the members are not compulsory in their nature.
The monies of the Fund may, no doubt, be invested by the trustees, but the subscriber does not divest himself or herself of control over the Fund in certain respects.
He or she can declare to whom the monies are to be paid in the event of his or her death.
This declaration can be changed at any time.
If the service terminates after fifteen years, the subscriber can get the full amount in the A,B & C Accounts.
If he or she retires with the Company 's consent before completion of fifteen years ' service, he or she can get the amounts standing in A & C Accounts together with a portion in B account.
Dismissal, or misconduct, or resignation without the 107 Company 's consent before completion of the 15 years would still entitle the subscriber to the payment of the moneys in A & C Accounts.
The provision in rule 16 that on the death of any member, the amount will be paid to the next of kin, of course proceeds on the same footing that the property belongs to the subscriber. , Whether the provisions that in the event of the declaration becoming obsolete, or a member becoming insane or demented, the moneys can be paid at the absolute discretion of the trustees to whomsoever they determine to be the next of kin, or hold to be a proper and suitable person to receive payment, are valid is not a question that arises in these appeals.
Retirement or death is not a mere possibility.
It is a contingency that is sure to happen, sooner or later.
Dismissal for misconduct or resignation without consent before 15 years ' service will secure earlier payment.
(Rule 11).
It is reasonably clear from these rules that a subscriber has a present interest in the Fund though the moneys may become payable to him, or his nominee or heirs only in the future.
Even where there is a declaration about the nominee who is to receive payment after the subscriber 's death, the fund would still be the property of the subscriber in the hands of the nominee for the satisfaction of his debts, as there is no present gift to take effect immediately.
It is not easy to see how it could be maintained that the subscribers have no right, title or interest in the fund, or that such interest as they may possess is dependent upon a possible contingency which may or may not occur.
The amount standing to the credit of a subscriber even if payable in future would be a debt due by the Company to him within the meaning of section 60 of the Code and hence liable to attachment and sale.
See Banchharam Majumdar vs Adyanath Bhattacharjee(1).
Rule 17, which provides that on the adjudication of the debtor as an insolvent the amounts standing to his credit in the Fund shall be liable to be forfeited (1) Cal 936.
108 to the Fund, was strongly relied upon by the respondents.
But such a condition or agreement is invalid.
A man may give (in India only by will) property or its income to a donee with a condition that the donee 's interest will cease on bankruptcy and the property will in that event go to another; if insolvency supervenes, the property will not vest in the Official Receiver.
If there is no gift over on the cesser of the donee 's interest, the property will revert to the donee and will vest in the Official Receiver on the donee 's insolvency.
But a person cannot enter into any arrangement or agreement by which his own title will cease in the event of bankruptcy, for it would then be a fraud perpetrated on the Insolvency Law.
This principle has been enunciated in an early English case Wilson vs Greenwood(1) in the following words and adopted in later cases too: "The general distinction seems to be, that the owner of property may, on alienation, qualify the interest of his alienee, by a condition to take effect on bankruptcy; but cannot, by contract or otherwise, qualify his own interest by a like condition, determining or controlling it in the event of his own bankruptcy, to the disappointment or delay of his creditors".
In Re Dugdale(2) we find the following observations of Kay, J. "The liability of the estate to be attached by creditors on a bankruptcy or judgment is an incident of the estate, and no attempt to deprive it of that incident by direct prohibition would be valid.
If a testator, after giving an estate in fee simple to A, were to declare that such estate should not be subject to the bankruptcy laws, that would clearly be inoperative.
I apprehend that this is the test.
An incident of the estate given which cannot be directly taken away or prevented by the donor cannot be taken away indirectly by a condition which would cause the estate to revert to the donor, or by a conditional limitation or executory devise which would (1) , 476; ; , 485.
(2) 176, 182.
109 cause it to shift to another person".
The proposition is thus stated in Williams on Bankruptcyt(1) at page 293: "But the owner of property cannot, by contract or otherwise, qualify his own interest by a condition determining or controlling it in the event of his own bankruptcy to the prejudice of his creditors".
It appears to us to be unnecessary to refer to all the decisions cited and relied upon in the course of the arguments on either side.
A few cases may, however, be dealt with.
The English decisions relied upon by the learned counsel for the appellant do not furnish much guidance.
Ex part Dever.
In re Suse and Sibeth(2) was a case of what is obviously a contingent interest dependent upon a mere possibility.
The decision in Hudson vs Gribble(3) dealt with a different question altogether.
Under a scheme framed by the Municipal Corporation, persons in its service were to contribute to a Fund for the encouragement of thrift among their officers and servants a certain percentage of their salaries to be deducted from time to time from those salaries.
Were they exempt from payment of income tax under the first rule of section 146 of the Income Tax Act, 1842, was answered in the negative.
The point was whether they were exempt because they were "sums payable or chargeable on the salaries by virtue of any Act of Parliament where the same have been really and bona fide paid and borne by the party to be charged".
It is true that Lord Justice Vaughan Williams says at page 525 that the sums contributed never ceased to be the property of the persons from whose salaries or wages they were deducted; and Lord Justice Stirling observes at page 528 "It is obvious that, though the amounts so deducted are not immediately paid to the person employed, they remain his property to a great extent".
Both of them refer to the fact that the subscribers were entitled to get back their contributions upon retiring from the service.
But they were dealing with particular words employed in an Act of Parliament (1) 16th Eaition.
(2) (3) [1903] 1.K.B. 517, 110 and the rules made under a Corporation Act.
General observations of the kind should not be extracted from the context in which they were used and applied to other facts and different language.
Coming to the Indian decisions, D. Palaiya vs T. P. Sen and another(1) is a case where the rules of a provident fund created by the Tata Steel Company were similar to the rules we have before us but the forfeiture clause was construed as applying only to the portion of the amount at the credit of members ' account contributed by the company and it was read to mean that it was inapplicable to the subscribers ' own contributions.
Secretary, Burma Oil Subsidiary Provident Fund (India) Ltd. vs Dadibhar Singh(2) which held against the vesting proceeded upon the footing that there was a trust created in favour of the trustees.
Even if so, what was to happen to the beneficial interest was not dealt with.
The relevant observations are: "The forfeiture does not vest the money in the trustees, the money having already vested in them.
The money cannot be attached as a 'debt ' due to the judgment debtor, because the word 'debt ' as used in section 60 and in 0. 21, R. 46, Civil Procedure Code means an actually existing debt that is a perfected and absolute debt, not merely a sum of money which may or may not become payable at some future time or the payment of which depends upon contingencies which may or may not happen".
The decision of Beaumont,, C. J. and Rangnekar, J. in Gajraj Sheokarandas vs Sir Hukamchand Sarupchand and another(1) does not apply because in that case there was a clause in the articles providing that all moneys received by the East India Cotton Association from its members would be under the absolute control of the Association and could be used by it as if the moneys belonged to it absolutely.
Further the deposit was also subject to certain liens.
Subject to the liability to forfeiture and to the satisfaction of the liens, the deposit with interest was repayable to (1) A.I.R. 1935 Pat. 211.
(2) A.I.R. 1941 Rang.
256, 259.
(3) A.I.R. 1939 Bom.90.
111 the member on his ceasing from any cause to be a member.
The facts were, therefore, very different.
Anandrao alias Adkoba s/o Risaramji vs Vishwanath Watuji Kalar and others(1) is again a case where the money ceased to belong to the employee and the title was in the trustees.
Referring to a Karachi case reported in Ismail Jakaria & Co. vs Burmah Shell Provident Trust Ltd.(2), Bose, J. distinguished it on the ground that there the money was not vested in the trustees but was only handed over to them for the purposes of management, which was not the case before him.
The learned counsel for the respondents strongly relied on Bishwa Nath Sao vs The Official Receiver(3) and argued that there can be no property within the meaning of the Insolvency Act unless the insolvent had a present absolute power of disposal over the same but the decision which is that of a Full Bench and which interpreted the decision of the Privy Council in Sat Narain vs Behari Lal(4) does not support any such position all that was held was that on the insolvency of a father, his power to sell the shares of his sons in the joint family property to discharge the pious obligation vests in the Official Receiver, though the shares themselves do not so vest.
Sufficient has been stated above to show that not withstanding the rules of the Fund in the present case, the subscribers have an interest in the moneys which can vest in the Official Receiver on their adjudication.
Even if we regard the deed creating the fund as a trust deed, notwithstanding that, no ownership has been transferred to the trustees and all that they have got is the right of the management and control, the subscribers, who joined the fund have undoubtedly got a beneficial interest which will vest in the Official Receiver as property liable to attachment and sale under section 60 which uses the language "whether the same be held in the name of the judgment debtor or by another person in interest for him or in his behalf".
(1) A.I.R. 1944 Nag.
(3) Patna 60.
(2) A.I.R. 1942 Sind 47.
(4) [1924] L.R. 52 I.A. 22, 112 The learned Judges of the High Court held that the 'property ' mentioned in the Insolvency Act must be such that the insolvent has an absolute and unconditional present disposing power over the same.
With great respect, this, however, does not seem to be a correct interpretation.
The word 'property ' is used in the widest possible sense which includes even property which may belong to or is vested in another but over which the insolvent has a disposing power which he may exercise for his own benefit; and as pointed out already, this part of the definition has reference obviously to powers of appointment and the power of a Hindu father who is the managing member of a joint family.
The fact that on the date of the adjudicationthe insolvent could not transfer the property doesnot militate against the view that be has a vested interest in the same.
Reference was made to section 56(3) of the which provides that "Where the Court appoints a receiver, it may remove the person in whose possession or custody any such property as aforesaid is from the possession or custody thereof: Provided that nothing in this section shall be deemed to authorise the court to remove from the possession or custody of property any person whom the insolvent has not a present right so to remove".
This has no relevancy to the point at issue.
Whenever possession and custody could be taken by the Receiver, the person in whose possession and custody the property is can be evicted.
If possession or custody could not be taken, still the right of the insolvent will vest in the Official Receiver.
Mention has been made of three accounts in the Fund called A, B and C; the first represents monies contributed by the subscriber, the second consists of monies paid by the Company and the third represents what may be roughly described as bonus which represents deferred wages.
The learned counsel for the appellant confined the relief he wanted to the .amounts standing to the credit of each subscriber in his A and C Accounts and conceded that the B Account monies would stand on a different footing.
In 113 fact, even in the Insolvency Court the creditor concerned himself only with the A & C Accounts.
Mr. Isaacs contended at first that he was entitled to an order that the monies in the A & C Accounts should be brought to the Insolvency Court but later he abandoned this contention.
For the respondents, it was urged that under section 10 of the Employees ' Provident Funds Act, 1952, which came into force after these proceedings were instituted, there could be no attachment.
This again is a question which is outside the scope of the present proceedings.
Once it is held that the right, title and interest of the insolvents in the A & C Accounts with the Fund vest in the Official Receiver, it is for him under the directions of the Insolvency Court to take steps to realize the same, in whatever manner the law allows him to do.
The learned counsel for the respondents handed to us a paper showing which of the respondents was still in service and which have been discharged, their dates of appointments and of joining the posts.
Mohibulla, Anjab Alli and Hasimulla, respondents insolvents in Civil Appeal No. 124, Civil Appeal No. 127 and Civil Appeal No. 126, have been shown as discharged from service.
A.M. Joseph, Rasid Alli alias Tasim Alli, and Baldev Singh, respondents in Civil Appeals 135, 125 and 123, joined the Fund in 1933, 1932 and 1936 respectively and are still in service.
In the result, the appeals are partly allowed and there will be a declaration that the right, title and interest of the above mentioned insolvents in the moneys standing to their credit in A & C Accounts respectively will vest in the Official Receiver.
In other respects the appeals will stand dismissed.
The Tin Plate Co. which is the respondent No. 2, will pay to the appellant his costs here and in the High Court.
But the costs in this Court will be limited only to one set.
APPENDIX.
This Indenture made the fifteenth day of July, one thousand nine hundred and thirty BETWEEN THE 15 114 TINPLATE COMPANY OF INDIA LIMITED a Joint Stock Company with Limited Liability duly incorporated under the Indian Companies Act and having its Registered Office at No. 4, Bankshall Street in the City of Calcutta (hereinafter called "the Company" of the first part HARRY DOUGHLAS TOWNEND CHARLES ROLAND HATFIELD AND JAMES PERCY AINSCOUGH all of No. 4, Bankshall Street aforesaid Merchants (hereinafter called the "the Trustees" which expression shall mean and include the said Harry Douglas Townend Charles Roland Hatfield and James Percy Anscough or other the " Trustees of the fund herein mentioned for the time being appointed as hereinafter mentioned) of the Second Part and the PERSONS whose names appear in the Schedule hereto or who may by separate writings agree to become parties hereto and bound hereby of the third part WHEREAS the Company has decided to start as from the first day of January one thousand nine hundred and twenty nine a Provident Fund for the benefit of the employees of the Company (hereinafter called "the said fund") and has accepted contributions from the employees from the first January, one thousand nine hundred and twenty nine and for the management and regulations of such fund has framed rules and 'regulations NOW THIS INDENTURE WITNESSETH and it is hereby agreed between the parties hereto that the said Fund shall be governed by the following rules and regulations: Rules and Regulations 1.
The Fund shall be called "THE PROVIDENT FUND OF THE TIN PLATE COMPANY OF INDIA LIMITED".
The management of the Fund and the control of its funds shall be vested in the Trustees who will undertake such management without remuneration.
The object of the Fund is to accumulate for the benefit of the Company 's Employees who have joined 115 the Fund certain sums as a future provision for them and for their families.
All employees of the Company (excepting only such covenanted employees on the higher grades of pay as may be excluded by the Trustees at their discretion) upon completion of one year 's services with the Company shall be eligible for membership of the Fund.
Applications to join the Fund shall be in writing to the Company in a specified form and written notification shall be given by the Company to applicants of their inclusion as members.
Every application for membership shall be accompanied by a declaration in a specified form signed by the applicant in the presence of two witnesses who shall not be in any way related to the applicant.
Such declaration shall set forth the disposition in the event of his or her death while a member of the Fund of the money which shall be standing to the applicant 's credit in the Fund.
Should a member at any time desire to cancel his or her form of declaration be or she may do so by submitting to the Company a revised or substituted form in writing duly signed and witnessed in the same manner as in the case of the original form which should specifically cancel and annul all previous forms of declaration deposited by the member with the Fund.
5.In the event of the declaration as made under rule 4 having become obsolete full discretion shall rest with the Trustees as to the disposition of any sums standing to the credit of a member on his or her decease and no person or persons shall be recognised as having any claims thereto save and except such as shall be ascertained by the Trustees or their delegate duly appointed to make enquiry in that be half upon satisfactory evidence adduced as to which the Trustees or their delegate appointed to conduct the enquiry shall be sole judge to be the next of kin of the deceased member and payment by the Trustees the moneys representing his or her share in the fund 116 to the persons or person so ascertained shall operate as an absolute discharge to the Trustees from all liability there for to all persons whomsoever.
Each member shall be allowed to contribute a definite proportion not exceeding one twelfth of his or her earnings during any one year which shall be deducted from his or her earnings in monthly or weekly instalments.
Contributions as above shall be credited to an account to be opened in the name of each member to be denominated his or her 'A ' Account.
For the purpose of this fund, earnings shall be deemed to mean solely the monthly or weekly sum paid to the Employee for wages excluding from the purview of such term all accretions thereto and perquisites in the way of acting allowance commissions bonus payments overtime messing housing allowance lodging money travelling expenses and all such similar payments.
7.(a) On or as at the thirty first December in each year a sum equal to the amount contributed by each member to his or her 'A ' account during that year shall be credited by the company to another account to be opened in the name of each member and to be denominated his or her 'B ' Account.
The Company reserves to itself liberty to make such further contributions as may be requisite for the purposes of Rule 14 below.
(b) If the net dividend paid by the Company on its ordinary share capital in respect of any financial year shall be at a rate of not less than seven and a half per cent on such ordinary share capital a further sum calculated as hereinafter set out shall be paid by the Company.
Unless the Company shall decide that such further sum shall be paid into a separate Fund or otherwise than into this Fund such further sum shall be paid into this Fund to another account to be opened in the name of each person who shall have been a member on the thirty first day of December in the said financial year and to be denominated his or her 'C ' account.
The amount of such further sum 117 shall depend upon the rate of such net dividend and shall be ascertained according to the following scale: Rate of net dividend paid Amount of the further sum as aforesaid.
sum payable.
Not less than 7 1/2% and not One week 's wages.
exceeding 8 3/4% Exceeding 8 3/4 but not ex Two week 's wages.
ceeding 11 1/4% Exceeding 11 1/4 but not Three weeek 's wages.
exceeding 13 3/4% Exceeding 13 3/4% but not Four week 's wages.
exceeding 16 1/4% Exceeding 16 1/4% but not Five week 's wages.
exceeding 181% Exceeding 18 3/4% but not Six week 's wages.
exceeding 211% For each additional 2 1/2% An additional week 's wages.
For the purpose of this clause one week 's wages 'shall mean in the case of a worker in receipt of daily wages six times his daily rate of pay at the thirty first day of December in such financial year as aforesaid and in the case of a worker in receipt of monthly pay one fifty second part of twelve times his monthly rate of pay at the thirty first day of December in such financial year".
"Provided always that if at any time the Company 's Ordinary share capital shall be increased by capitalisation of any of its undistributed profits (not including profits arising from a revaluation of assets, from the sale of assets or from the sale of shares at a premium) or reduced, then the rate of net dividend paid by the Company in respect of any financial year after the coming into force of any such increase or reduction shall for the purposes of this clause be deemed to be the rate of net dividend actually so paid by the company altered in the ratio which the nominal value of the Company 's paid up capital at the end of such financial year (excluding therefrom all 118 portions of such capital which represent capitalised profits derived from revaluation of assets sale of assets or issue of shares at a premium) shall bear to the value which it would have had if such increase or increases or reduction or reductions of capital as shall come into effect after the first day of January one thousand nine hundred and thirty eight had never taken place".
"The payment into each member 's 'C ' Account in accordance with the above provisions shall be made as soon as conveniently may be after the holding of the annual Ordinary General Meeting of the Company at which such net dividend as aforesaid is finally declared and ascertained".
The moneys of the Fund shall be invested by the Trustees in accordance with the provisions from time to time in force under the Indian Income tax (Provident Funds Relief) Act, 1929.
(1) (a) On or as soon as may be after the thirty first day of December in each year the Trustees shall determine the amount standing to the credit of each member in his 'A ', B and C accounts on that date and for that purpose a general account shall be taken of the assets of the fund and of the receipts payments dealings and transactions in connection therewith during the calendar year terminating on such thirty first day of December (hereinafter referred to as the period of account).
(b) Each such general account shall comprise three revenue Accounts to be known as the 'A ' Revenue Account, the 'B ' Revenue Account and the "C" Revenue Account respectively.
The "A" Revenue Account shall be credited with all income accrued or profits realised during the period of account in respect of the investments representing moneys lying to the credit of the "A" accounts and the appreciation (if any) of such investments during the period of account.
The "A" Revenue Account shall be debited with all losses (if say) in respect of 119 depreciation of such investments and all sums paid during the period of account in respect of interest on contributions to retiring members or the representatives of deceased members as herein before provided.
The 'B ' Revenue Account shall be credited with all forfeits and all income accrued or profit realised during the period of account in respect of the investments representing moneys lying to the credit of the 'B ' Accounts and the appreciation (if any) of such investments during the period of account.
The 'B ' Revenue account shall be debited with all losses (if any) in respect of depreciation of such investments and all expenses of the Fund.
The "C" Revenue Account shall be credited with all income accrued or profit realised during the period of account in respect of the investments representing moneys lying to the credit of the 'C ' Accounts of the members, the appreciation (if any) of such investments during the said period and all interest received by the Trustees or., withdrawals made under Rule 18 hereof.
The "C" Revenue Account shall be debited with all losses (if any) in respect of depreciation of such investment as last aforesaid.
(c) The balance of the "A", "B" and "C ' Revenue Accounts respectively shall be appropriated to the "A", "B" and "C" accounts of the members in each case in proportion to the amounts standing to the credit of their respective "A", "B" and "C ' accounts at the close of the period of accounts provided always that for the purpose of such appropriation the Trustees may if they think fit disregard any sum standing to the credit of any member in his "A" "B" or the "C" Revenue Account not exceeding on( rupee and may carry forward to the next period of account any part of the balance of the "A" revenue account, the "B" revenue account or the "C" Revenue account which will not suffice to pay a complete one half percent on the total amount standing to the "B" or "C" accounts as the casecredit of the "A", may be of all the members.
Provided also that in ascertaining the amount at credit of a member 's "C ' 120 account for the purpose of calculating the proportions herein mentioned there shall be deducted from such "C" Account only those sums withdrawn under the provisions of Rule 18 hereof on which interest is not payable by him to the Fund.
(d)For the purpose of such Revenue Account the Trustees shall value the investments and securities of the Fund, and if the same shall in their opinion, which shall be final and conclusive, have appreciated or depreciated since the date of purchase, or if a general account shall have been taken subsequent to the date of purchase then since the date of the last preceding general account the amount of such appre ciation or depreciation shall be credited or debited to such revenue account as though the same were a realised profit or loss as the case may be.
(2)Notwithstanding the terms of Rule 9(1) the Trustees shall have the right should they in their uncontrolled discretion deem it necessary in the interests of the members as a whole to take out a general account of the assets of the fund as at any date in any year other than or in addition to the thirty first day of December and Members "A", "B" and "C" accounts shall be adjusted accordingly.
(3)In the case of the taking of a general account under rule 9(2) the words "the period of account" used throughout these rules shall mean and refer to (where the context shall admit) the period whereof such general account of the assets of the fund was taken under rule 9(2).
10.On retirement of any member with the consent of the General Manager of the Company before completion of more than fifteen years service with the company he or she shall be paid the entirety of the amount then standing to the credit of his or her "A" and "C" account together with one fifteenth of the moneys standing to the credit of his or her "B" account for such completed years service.
If any member before completion of fifteen 121 years service with the company shall be dismissed for misconduct or shall resign therefrom without the consent of the General Manager he or she shall be paid only the amount then standing to his or her credit in "A" account and 'C" Account.
The residue of any moneys standing to the credit of a member 's "B" account after payment of the moneys payable to him or her there out under Rule 10 and the entirety thereof if he or she shall be dismissed or resign in the circumstances as mentioned in rule 11 shall be forfeited to the Fund and carried to the "B" Revenue Account to be dealt with under Rule 9 (1) 13.
Upon termination by any means of a member 's service if more than fifteen years thereof shall then have been completed he or she shall be paid the entirety of the amount then standing to the credit of his or her "B" and "C" account.
For the computation of length of service under the foregoing rules continuous service only shall be reckoned as from the date or last date on which the employee entered or re entered service.
If in consequence of depreciation of securities the amount as received by a member or his or her representatives in respect of his or her "A" account under the last preceding rules shall fall short of the total of the contributions as made thereto the company may make an additional and contingent contribution to the fund to the amount of the deficiency for payment thereof to the member. 15.
If it shall be proved to the satisfaction of any of the trustees that any member has become insane or otherwise incapacitated from exercising proper control over his affairs they make payment out of the moneys standing to his or her credit in the Fund and at such time or times to such person or persons on his or her account as they may in their absolute discretion think expedient.
The above provisions for 16 122 payment shall not apply to moneys forfeited under Rule 17 which shall be dealt with by the Trustees at their absolute discretion thereunder.
On the death of any member while still in the service of the Company the sum standing to his or her credit in "A", "B" and 'C" accounts shall be paid to the person or persons named in the declaration form signed under Rule 4 or failing such declaration to the person or persons who shall be ascertained to be next of kin under the provisions of Rule 5.
No member of the Fund shall have any claim on the moneys standing to his or her credit therein otherwise than in accordance with the provisions of these rules and no person or persons other than a member save and except such as shall be nominated in the declaration under the provisions of Rule 4 or shall be ascertained to be the member 's next of kin under Rule 5 shall have any claim thereto in any right whatsoever.
Any assignment by a member of the moneys which would otherwise be payable to him or her under these rules whether absolute or by way of charge shall be wholly void and in the event of any member executing any such assignment or being adjudicated insolvent or if any order shall be served upon the Trustees of the Company for payment of the moneys standing to his or her credit to any person under any attachment or other process of any Court the said moneys shall at the time when they would have otherwise become payable to the member but for such assignment insolvency or attachment be liable to be forfeited to the FUND PROVIDED ALWAYS that the Trustees shall at their absolute discretion and without any legal obligation so to do pay and apply the same for the benefit of the member or his or her dependents and relatives.
Withdrawals by members of the money standing to their credit with the Fund shall not be allowed by the Trustees except that withdrawals from the amount standing to the credit of a member 's 'C ' 123 account may be allowed on the special grounds to the extent and subject to the conditions laid down by the Indian Income Tax Act and the Rules made thereunder in that behalf as in force from time to time.
There shall be not less than three Trustees of the said Fund. 20.
If and whenever any Trustees shall die resign or become incapable of acting or shall permanently leave India one or more persons in his place shall be appointed by the Company as such Trustees.
No copy shall be furnished to any member of his or her account but member may have inspection thereof in the Books of the Fund at all reasonable times.
These Rules may from time to time be altered and amended and other Rules and Regulations may be added or substituted for the management and working of the Fund in every case by the Company and the Trustees and with out reference to the parties hereto of the third part, provided always that should such addition or alteration curtail the rights or increase the obligations of the members of the Fund any member shall be entitled to withdraw from and at his or her own request in writing to the Fund, cease to be a member of the Fund in which case he or she shall be paid the money standing to his or her credit in the Fund (provided that the same shall not have become forfeited under Rule 17) or such portion thereof as he or she would have been entitled to if he or she had then retired from the service of the Company with the consent of the General Manager of the Company.
Any such alteration or amendment shall, be notified in writing to the parties responsible for according recognition to the Fund under the provisions of the Indian Income Tax (Provident Fund Relief) Act, 1929.
124 23.
The Company may at any time in its discretion dissolve or terminate the Fund and shall in such case carry out the winding up of the Fund and the members of the Fund shall receive all the moneys standing to their credit provided they shall not then have become forfeited under Rule 17 'A ', 'B ' and C '.
Any payment made in accordance with the Rules of the Fund to the member, his nominee or next of kin as ascertained or to any person or persons other than the foregoing shall operate as a full and efficient discharge of all liability of the Fund in respect thereof 25 These Rules and Regulations shall come into force with effect from the 1st day of January, 1929.
| The six employees in the Tin Plate Co. of India Ltd. were adjudged insolvents.
They were members in a Provident Fund of the said company, having certain amounts standing to their credit in the Fund.
The appellants creditor of the said employees filed applica tions under section 4 of the Insolvency Act against the company and Trustees of the Fund for orders that amounts standing to the credit of the insolvents in the Provident Fund account were their properties and had vested in the court and were available for distribution amongst the creditors and therefore should be brought into court.
The respondent pleaded in answer that the amount standing to the credit of each insolvent in the Provident Fund represented the contributions of the company and of the employees and that the corpus was a trust fund in the hands of the trustees of the fund; so they were not properties of the insolvents over which they had a disposing power and that they were not debts due to the insolvents.
It was said that according to the rules governing the Provident Fund the monies become payable to the employee or any other member of his family only on the happening of certain contingencies such as retirement, discharge, dismissal or death and that till then no right accrued to the insolvent.
It was further urged that the trustees could not be removed from the custody and control of the fund by the Official Receiver.
On a construction of the Rules of the Provident Fund, the Insolvency Court held in favour of the creditor.
On appeal, the High Court held that under the rules of the Fund, the insolvents had no present disposing power over the monies standing to their credit and that the Fund had vested in the Trustee.
On appeal to the Supreme Court: Held that it is reasonably clear from these rules that a subscriber has a present interest in the Fund though the moneys may become payable to him, or his nominee or heirs only in the future.
Even where there is a declaration about the nominee who is to receive payment after the subscriber 's death, the fund would still be the property of the subscriber in the hands of the nominee for the satisfaction of his debts, as there is no present gift to take effect immediately.
It could not be maintained that the subscribers had no right, title or interest in the fund or that such interest as they may possess was dependent upon a possible contingency which may or may not occur.
The amount standing to the credit of a subscriber even if payable in future would be a debt due by the company to him within the meaning of section 60 of the Code and hence liable to attachment and sale.
A person cannot enter into any arrangement or agreement by which his own title will cease in the event of bankruptcy for it would then be a fraud perpetrated on the Insolvency Law.
The liability of the estate to be attached by creditors on a bankruptcy or judgment is an incident of the estate, and no attempt to deprive it of that incident by direct prohibition would be valid.
Notwithstanding the rules of the Fund in the present case, the subscribers have an interest in the moneys which can vest in the Official Receiver on their adjudication.
The word "property" in the Insolvency Act is used in the widest possible sense which includes even property which may belong to or is vested in another but over which the insolvent has a disposing power which he may exercise for his own benefit; and this part of the definition has reference obviously to powers of appointment and the power of a Hindu father who is the managing ember of a joint family.
The fact that on the date of the adjudication the insolvent could not transfer the property does not militate against the view that he has a vested interest in the same.
Banchharam Mojumdar vs Adyanath Bhattacharjee, ([1909] I.L.R. , Dugdale vs Dugdale ([1888] 38 Ch. D. 176), Ex parte Dever.
In re Suse and Sibeth ([1887] , Hudson vs Gribble ([1903] 1 K.B. 517), D. Palaiya vs
T. P. Sen and another (A.I.R. 1935 Pat. 211), Secretary, Burma Oil Subsidiary Provident Fund (India) Ltd. vs Dadibhar Singh (A.I.R. 1941 Rang.
256), Gajraj Sheokarandas vs Sir Hukamchand Sarupchand and another (A.I.R. 1939 Bom.
Anandrao alias Adkoba s/o Risaram ji vs Vishwanath Watuji Kalar and others, (A.I.R. 1944 Nag. 144), Ismail Jokaria & Co. vs Burmah Shell Provident Trust Ltd. (A.I.R. 1942 Sind 47), Bishwa Nath Sao vs The Official Receiver ([1936] I.L.R. 16 Pat. 60), and Sat Narain vs Behari Lal and Others ([1924] 52 I.A. 22), referred to.
|
Appeals Nos. 21 and 22 of 1954.
Appeals under Article 133(1) (c) of the Constitution of India from the judgment and order dated the 18th September 1953 of the Travancore Cochin High Court at Ernakulam in O. P. No. 41 of 1952.
M.K. Nambiar, (N. Palpu, Sri Narain Andley and Rajinder Narain) for the appellant in C. A. No. 21 of 1954 and respondent in C. A. No. 22 of 1954.
M.C. Setalvad, Attorney General of India (G. N. Joshi), R. Ganapathy Iyer, Porus A. Mehta and R. H. Dhebar), for the respondents in C. A. No. 21 of 1954 and appellants in C. A. No. 22 of 1954.
December 20.
The Judgment of the Court was delivered by BHAGWATI J.
These two appeals with certificates under article 133 of the Constitution are directed against a judgment of the High Court of TravancoreCochin in a writ petition filed by one A. Thangal Kunju Musaliar, hereinafter called the petitioner.
The petitioner is a native of Quilon within the Travancore State which was originally under the sovereignty of the Maharaja of Travancore.
He is the Managing Director of Messrs A. Thangal Kunju.
Musaliar & Sons Ltd., Quilon, and bad been assessed to income tax for the years 1942 and 1943 and the final orders in his assessment for the said years were 1200 passed by the Chief Revenue Authority of Travancore on the 6th December 1946 and 30th November 1946 respectively.
On the 7th March 1949, the Travancore Legislature passed Act XIV of 1124 (M.E.) modelled on our Act XXX of 1947, styled the Travancore Taxation on Income (Investigation Commission) Act, 1124, to provide for an investigation into matters relating to taxation on income.
Section 1(3) of the Act provided that it was to come into force on such date as the Travancore Government may by notification in the Government Gazette appoint. 'Under section 3, a Commission to be called the Income tax Investigation Commission was to be constituted inter alia to investigate in accordance with the provisions of the Act cases referred to it under section 5 and report thereon to the Government.
The Commission was to be appointed to act in the first instance up to the last day of Karkadakom 1125 (16 8 1950) but the Government was empowered to extend its appointment to any period up to the last day of Karkadakom 1126 (16 8 1951).
Section 5(1) enacted that the Government might, at any time before the last day of Makaram 1125 (15 2 1950) refer to the Commission for investigation and report any case or points in a case in which the Government had prima facie reasons for belief that a person had to a substantial extent evaded payment of tax on income together with such material as might be available in support of such belief.
Section 6 prescribed the powers of the Commission and inter alia provided for the appointment by the Commission of an authorised official to examine accounts or documents, interrogate persons or obtain statements from persons.
On the 1st July; 1949, the Travancore State and the Cochin State integrated with each other and there was brought into existence the United State of Travancore and Cochin.
By virtue of Ordinance I of 1124 promulgated on the same day, called the United State of Travancore and Cochin Administra tion and Application of Laws Ordinance, 1124 (Ordinance I was enacted later as Act VT of 1125), 1201 all existing laws of Travancore were to continue in force till altered, amended or repealed by competent authority.
The existing law of Travancore was defined to mean any law in force in the State of Travancore immediately prior to the 1st July 1949.
On the 26th July 1949, a notification was published in the Travancore Cochin Government Gazette whereby, in exercise of the powers conferred by section 1(3) of the Travancore Taxation oN Income Investigation Commission) Act XIV of 1124 as continued in force By the United State of Travancore and Cochin Administration & Application of Laws (Ordinance, 1124 (I of 1124), the Government appointed the 7th Karkadakom 1124 (22 7 1949) to be the date on which the said Act was To have come into force.
On the 26th November 1949 the Government of the United State of Travancore and Cochin issued orders under section 5(1) of the Travancore Act XIV of 1124 referring the cases of the petitioner for the years 1942 and 1943 for investigation by the Travancore Income tax Investigation Commission.
These orders had specific reference to the years 1942 and 1943 and the investigation to be made by the Commission was with reference to the alleged evasion of tax by the petitioner for those respective years.
The cases were registered as Evasion Cases I and 2 of 1125.
On the 10th December 1949 the petitioner received from the Secretary of the Commission a notice in regard to the said cases.
The relevant portion of the said notice stated: "Whereas the Income tax Investigation Commission having been informed that a substantial portion of your income for 1942 and 1943 has escaped assessment, has ordered investigation into the matter, you are hereby required to produce the following on or before 21 12 1949 before the Commission.
The account books (day books and ledgers) for the years 1942 and 1943.
2. . . . 3. . . 4. . . . 1202 5. . . . 6.
Pursuant to this notice the petitioner produced the relevant books and the Commission duly completed its investigation under the terms of the Travancore Act XIV of 1124.
Before the Commission could, however, make its report, the Constitution of India came into force on the 26th January 1950 and the United State of Travancore and Cochin became a part of the territory of India,, forming, a Part 'B ' State.
Under article 372(1) of the Constitution, the Travancore Taxation on Income (Investigation Commission) Act, 1124 (Travancore Act XIV of 1124) was continued in force "until altered, amended or replaced by a competent authority" An Indian States Finance Enquiry Committee had been appointed in 1948 49 and it had made its recommendations regarding the agreements to be entered into between the President of the Union and the Rajpramukhs in regard to financial arrangements.
In accordance with the recommendations of the Committee, an agreement was entered into on the 25th February 1950 between the President of the Union and the Rajpramukh of Travancore Cochin in regard to these matters and on the 31st March 1950 the Finance Act, 1950 (Act XXV of 1950) came into force and the Indian Income tax Act, 1922 (XI of 1922) was extended to Travancore Cochin.
On the 18th April 1950, the , being Act XXXIII of 1950, was passed by Parliament extending to Travancore Cochin the Taxation on Income (Investigation commission) Act, 1947 (XXX of 1947) and section 3 of that Act provided that the law of Travancore corresponding to the Taxation on Income (Investigation Commission) Act, 1947 (XXX of 1947) shall continue to remain in force with the following modifications, viz., (a) that all cases referred to or pending before the State Commission (by whatever name called) in respect of matters relating to taxation on income 1203 other than agricultural income shall stand transferred to the Central Commission for disposal; and (b) that the State law shall, so far as may be, apply to determine the procedure that may be followed and powers that may be exercised by the Central Commission in the disposal of cases transferred under clause (a).
The Travancore Commission bad been appointed in the first instance to act up to the last day of Karkadakom 1125 116 8 1950).
Neither the Travancore Commission nor the Indian Commission to which the pending cases before the Travancore Commission were transferred as aforesaid made any report on these cases of the petitioner before the expiry of this period nor was any extension of the term of appointment of the Travancore Commission made up to the last day of Karkadakom 11 26 (16 8 1951) as originally contemplated.
On the 25th August 1951, therefore, the Opium and Revenue Laws (Extension of Application) Amendment Act, 1951, being Act XLIV of 1951, was passed amending Act XXXIII of 1950 whereby it was provided that in the place of clause (b) of section 3 of Act XXXIII of 1960, the following clause shall be substituted and shall be deemed always to have been substituted, viz., "in the disposal of cases transferred to the Central Commission, the Commission shall have and exercise the same powers as it has and exercises in the investigation of cases referred to it under the Taxation on Income (Investigation Commission) Act, 1947 (XXX of 1947) and shall be entitled to act for same term as under sub section (3) of section 4 of that Act" and it was further provided that any decision given by the Chief Revenue Authority of Travancore or of Travancore Cochin shall be deemed a decision of the Income tax Authority for the purposes of sub section (2) of section 8 of the Travancore Act XIV of 1124.
On the 18th October 1951, a notification was issued by the Indian Income tax Investigation Commission appointing M. Venkitachalam Potty, Income tax Officer on Special Duty, Trivandrum, as an 152 1204 authorised official under section 6 of the Travancore Taxation on Income (Investigation Commission) Act, 1124 read with Act XXXIII of 1950.
The authorised official, hereinafter referred to as respondent 1, forwarded to the petitioner on the 21st November 1951 for his information a copy of that notification, investing him with the powers of an authorised official and intimated that the investigation proposed to be conducted will not be confined to the years 1942 and 1943, the two years originally covered by Evasion Cases Nos. 1 and 2 of 1125 but that it would be necessary for him to investigate the petitioner 's income for the period from 1940 to the last completed assessment year notwithstanding the fact that the erstwhile State Commission had not specifically intimated to him that they proposed to cover the full period.
The petitioner, by his registered letter dated the 23rd February 1952 pointed out to respondent 1 the illegality of the steps proposed to be taken by him to which, however, the latter replied by his letter dated the 13th March 1952 stating that he proposed to consider income for the full investigation period, viz., from 1940 to the last completed assessment year.
The petitioner thereupon filed on the 6th May 1952 a writ petition in the High Court of Travancore Cochin, being 0.
P. 41 of 1952 against respondent 1 as also the Indian Income tax Investigation Commission, hereinafter called respondent 2, for a writ of prohibition or any other appropriate writ or direction prohibiting the respondents from holding any enquiry into the cases registered as Evasion Cases Nos.
I and 2 of 1125 on the file of Income tax Investigation Commission of Travancore or from holding any investigation into the income of the petitioner from 1940 to the last completed assessment year or for any other period.
Respondent 1 filed a counter affidavit in which it was inter alia submitted: "that the Commission by these proceedings is not trying to clutch at non existent jurisdiction.
They are fully prepared to shape their proceedings in accordance with the directions of this Hon 'ble Court".
1205 This affidavit was stated to have been filed as the answer of both the counter petitioners, viz., respondents I and 2 and respondent I stated that he had been fully authorised to do so.
The writ petition was heard by a Bench of three Judges of the High Court consisting of K. T. Koshi, C. J. and P. K. Subramonia Iyer and M. section Menon, JJ.
The learned Judges held that respondent 2 bad all the powers that the Travancore Commission had under the Travancore Act XIV of 1124 and no mote and accordingly issued a writ prohibiting respondent I from conducting an investigation into years other than 1942 and 1943 observing that any attempt to enlarge the scope of the enquiry was without legislative warrant.
The petitioner appealed in so far as the order of the High Court was against him permitting the enquiry for the years 1942 and 1943, his appeal being Civil Appeal No. 21 of 1954.
Respondents I and 2 appealed against the order of the High Court in so far as it prohibited respondent 1 from conducting investigation for the years which were not covered by the Evasion Cases Nos.
I and 2 of 1125, their appeal being Civil Appeal No. 22 of 1954.
Both these appeals came for hearing and final disposal before us on the 20th September 1955.
After the arguments had proceeded for some time Shri Nambiyar, for the petitioner, asked for leave to urge additional grounds, viz., (a) that section 5(1) of Travancore Act XIV of 1124 was ultra vires under articles 14 and 19, of the Constitution, and (b) that in particular,the said section 5(1) infringed article 14 of the Constitution inasmuch as it was not based on any rational classification whatsoever, and the word "substantial" therein could not possibly be deemed to be any form of classification.
On, our giving him such leave the learned Attorney General, appearing for respondents I and 2 asked for time to put in an affidavit showing the background against which Travaneore Act XIV of 1124 bad been passed by the, Travancore Legislature.
An affidavit was accordingly filed before us by Gauri Shanker, Secretary of 1206 respondent 2 setting out facts and events as and by way of answer to these new contentions of the petitioner.
A preliminary objection to the jurisdiction of the High Court to entertain the writ petition may be dealt with first.
This objection was not taken in the counter affidavit filed by the respondents, they having expressed their readiness to shape their proceeding,s in accordance with the directions of the Court.
The learned Advocate General of Travancore Cochin, however, urged before the High Court that the Court was not competent to entertain the petition in view of the fact that respondent 2 was not amenable to i s jurisdiction and the argument was that as respondent 2 functioned outside the State of Travancore Cochin and respondent I was a mere subordinate of respondent 2 it was beyond the competence of the High Court to grant the prayer embodied in the petition.
The High Court overruled the objection observing that respondent I was resident within the State of Travancore Cochin, his office was situated at Trivandrum, all his communications to the petitioner had emanated from within the State and the activities complained about were activities confined to the State.
It was of the opinion that the prayer in the petition was, in essence, a prayer to paralyse the hands of respondent I and thus prevent the mischief and that, by his residence and the location of his office within the State, respondent 1 was clearly amenable to the jurisdiction of the Court under article 226 of the Constitution.
It was further of opinion that the writ against respondent 1, if issued, was sufficient for stopping the mischief complained about and therefore it was unnecessary for it to decide whether or not a writ could be issued so far as respondent 2 was concerned.
It, therefore, issued the necessary writ of prohibition against respondent 1.
The learned Attorney General pressed this preliminary objection at the outset while arguing Civil Appeal No. 22 of 1954.
He pointed out that respondent 2 had its office in New Delhi and was permanently located there and the mere fact of its having appointed res 1207 pondent 1 to function and carry on the investigation within the State.
of Travancore under its direction did not make it amenable to the jurisdiction of the High ' Court.
He, therefore, contended that the High Court had no jurisdiction to entertain the writ petition against respondent 2.
He further contended that the High Court could not do indirectly what it was not able to do directly and that it could not issue any writ of prohibition against respondent 1 either even though he had his office at Trivandrum and had a permanent location within the jurisdiction of the High Court inasmuch as he was merely an arm of respondent 2 and any writ issued against him would have the indirect effect of prohibiting respondent 2 from exercising its legitimate functions within the ambit of its powers under the Travancore Act XIV of 11 24 read with Act XXX of 1950 and Act XLIV of 1951.
Reliance was placed by him on the decision of this Court in Election Commission, India vs Saka Venkata Rao(1).
The respondent in that case bad applied to the High Court of Madras under article 226 for a writ restraining the Election Commission, a statutory authority constituted by the President and having its office permanently located at New Delhi, from enquiring into his alleged disqualification for membership of the Assembly, and a single Judge of the High Court had issued a writ of prohibition restraining the Election Commission from doing so.
The Election Commission filed an appeal to this Court and agitated the question of the jurisdiction of the High Court under article 226 to issue the writ against it.
While discussing this question, Patanjali Sastri, C.J., who delivered the judgment of the Court, observed as under: "But wide as were the powers thus conferred, a two fold limitation was placed upon their exercise.
In the first place, the power is to be exercised "throughout the, territories in relation to which it exercises jurisdiction", that is to say, the writs issued by the Court cannot run beyond the territories subject to its jurisdiction.
Secondly, the person or authority to (1) ; 1208 whom the High Court is empowered to issue such writs must be "within those territories", Which clearly implies that they must be am enable to its jurisdiction either by residence or location within those territories".
The learned Chief Justice then traced the origin and development.
of the power to issue prerogative writs as a special remedy in England and observed at page 1151: "These writs were thus specifically directed to the persons or authorities against whom redress was sought and were made returnable in the Court issuing them and, in case of disobedience, were enforceable by attachment for contempt.
These characteristics of the special form of remedy rendered it necessary for its effective use that the persons or authorities to whom the Court was asked to issue these writs should be within the limits of its territorial jurisdiction".
The mere functioning, of the tribunal or authority permanently located and normally carrying on its activities elsewhere, within the territorial limits was not considered sufficient to invest the High Court with jurisdiction under article 226 nor was the accrual of the cause of action within the territories considered sufficient for the purpose.
The residence or location within the territories of the person or authority was considered a condition of the High Court being empowered to issue such writs with the result that the Election Commission having its office permanently located at New Delhi was held not amenable to the jurisdiction of the High Court for the issue of a writ under article 226.
This decision in Saka Venkata Rao 's case was followed by this Court in K. section Rashid & Son vs The Income tax Investigation Commission, etc.(1).
In that case, the assesses who were within the state of U.P. and whose original assessments were made by the income tax authorities of that State had filed writ petitions in the Punjab High Court for the issue of writs tinder article 226 to the Income tax Investigation Commission located in Delhi and investigating (1) ; 1209 their cases under section 5 of the Taxation on Income (Investigation Commission) Act, 1947.
The Punjab High Court had sustained the objection urged on behalf of the respondents to the effect that the assesses having belonged to the State of U.P. their assessment was to be made by the Income tax Commissioner of that State and the mere fact that the location of the Investigation Commission was in Delhi would not confer jurisdiction on the Punjab High Court to issue writs under article 226 and had dismissed the petitions.
This Court, on appeal, distinguished the decision in Parlakimidi 's case which was sought to be relied upon by the respondents before it and followed the position in law as it bad been enunciated in Saka Venkata Rao 's case, supra, and held that the Punjab High Court had jurisdiction to issue a writ under article 226 to the Investigation Commission which was located in Delhi in spite of the fact that the assesses were within the State of U.P. and their original assessments were made by the income tax authorities of that State.
The principle of these decisions would, it was urged by the learned Attorney General, eliminate respondent 2 and the High Court of Travancore Cochin would have no jurisdiction to entertain the writ petition against it.
It was, however, urged on behalf of the petitioner that, in the affidavit filed by the respondents, both the respondents had submitted that they were fully prepared to shape their proceedings in accordance with the directions of the Court.
This, it was submitted, was a voluntary submission to the jurisdiction of the High Court investing the High Court with jurisdiction to issue the appropriate, writ against respondent 2.
We need not, however, express any opinion on this point because no writ was in fact issued by the High Court against respondent 2 nor was any appeal filed by the petitioner against that part of the decision of the High Court.
The real question, however, is whether a writ could issue against respondent 1 who is, it was submitted, a mere arm of respondent 2 and a writ against whom 1210 would be equivalent to a writ issued by the High Court against respondent 2 which it had no jurisdiction to do.
An authorised official derives his appointment from the Commission under section 6 of the Travancore Act XIV of 1124.
Section 6(4) of the Act provides that if in the course of any investigation conducted by the Commission it appears to the Commission to be necessary to examine any accounts or documents or to interrogate any person or to obtain any statement from any person the Commission may authorise any income tax authority not below the rank of an income tax officer (called the "authorised official") in that behalf subject to such directions as may be issued by the Commission from time to time and the authorised official shall examine the accounts or documents, interrogate the persons and obtain the statements from the persons.
The authorised official is invested, under section 6, sub section (5), subject to the direction of the Commission, with the same powers as the Commission under sub sections (1), (2) and (3) which empower the Commission to require any person or banking or other company to prepare and furnish written statements of accounts and affairs giving information on such points or matters as in the opinion of the Commission may directly or indirectly be useful or relevant to any case referred to it; to administer oaths and exercise all powers of a Civil Court under the Code of Civil Procedure for the purpose of taking evidence on oath, enforcing attendance of witnesses and of persons whose cases are being investigated, compelling the production of docu ments and issuing commissions for the examination of witnesses and to impound and retain in its custody for such period as it thinks fit any documents produced before it.
The authorised official is, under section 6, sub section (10), to have full and free access to all documents, books and other papers which in his opinion are relevant to the proceedings in any case or cases under the Act and if specially authorised in this behalf by the Commission to any buildings and places where he may have reason to believe that such books, 1211 documents or papers may be found and also to have power to place identification marks on such books, documents or papers and to make extracts or copies therefrom or if he considers it necessary to take possession of or seize such books, documents or papers.
Under section 6, sub section (11), the authorised official is deemed to be a public servant within the meaning of section 16 of the Travancore Penal Code (I of 1074).
It is clear from the above provisions that the authorised official has considerable powers conferred upon him in the conduct of the investigation and even though he could be called a mere arm of the Commission or an authorised agent of the Commission, he has important functions to discharge and is not merely a mouth piece of the Commission or a con duit pipe transmitting the orders or the directions of the Commission.
He is no doubt under the general control and supervision of the Commission but he performs the various functions assigned to him on his own initiative and in the exercise of his discretion.
If, therefore, he does anything in the discharge of his functions as authorised official which is not authorised by law or is violative of the fundamental rights of the petitioner, he would be amenable to the jurisdiction of the High Court under article 226.
Even though this is the prima facie position, it was urged that he is acting under the directions of the Commission as its authorised agent and as such no writ can issue against him, because the principal who directs the activities and not the agent would be liable for the same.
This contention is unsound.
There can be no agency in the matter of the commission of a wrong.
The wrong doer would certainly be liable to be dealt with as the party directly responsible for his wrongful action.
The relationship between principal and agent would only be relevant for the purpose of determining whether the principal also is vicariously liable for the wrong perpetrated by his agent.
On the analogy of criminal liability, the 153 1212 offender could certainly not be heard to say that he was committing the offence under the behest or directions of his principal.
On the analogy of a civil wrong, the tortfeasor could certainly not protect himself against liability on the ground of having committed the tort under the directions of his principal.
The agent could in no event exculpate himself from liability for the wrongful act done by him and if he is thus amenable to the jurisdiction of the High Court the High Court could certainly issue an appropriate writ against him under article 226.
The jurisdiction under article 226 is exercised by the High Court in order to protect and safeguard the rights of the citizens and wherever the High Court finds that any person within its territories is guilty of doing an act which is not authorised by law or is violative of the fundamental rights of the citizen, it exercises that jurisdiction in order to vindicate his rights and redress his grievances and the only conditions of its exercise of that jurisdiction are those laid down in the passage from Patanjali Sastri, C.J. 's judgment cited above.
The argument that by issuing a writ against the agent under those circumstances the High Court would be putting him in a position whereby he would be compelled to disobey the directions of his principal is also of no avail for the simple reason that an agent is bound to obey all lawful directions of his principal and not directions which the High Court holds to be unlawful or not justified in law.
The agent could certainly be prohibited from obeying the un lawful directions of his principal and even if the principal cannot be reached by reason of his being outside the territories, the arm of the law could certainly reach the agent who is guilty of having committed the wrong and the High Court could certainly issue a writ against him under article 226.
It was further contended that by issuing such a writ against the authorised official the High Court would be indirectly prohibiting the Commission from conducting the investigation within the territories even though it could not directly prohibit the Com 1213 mission from doing so.
If the Commission was doing something within the territories through its authorised official which was not justified in law, it would not lie in the mouth of the Commission to urge that the High Court could not issue a writ of prohibition against its agent, the authorised official, who had his residence or permanent location within the territories merely because it would be indirectly prohibited from perpetrating a wrong within the territories.
The principal could, in no event, urge that his agent should be allowed to function for him within the territories in a manner which was not warranted by law or had no justification in law.
It is expected that once this Court has declared the law the Investigation Commission would comply with it and not place its agent in the wrong by directing him to act contrary to the law so declared.
Our attention was drawn by the learned Attorney General in this connection to three recent decisions of the High Courts of Allahabad, Nagpur and Pepsu which, according to him, supported his contention, viz., Azmat Ullah vs Custodian, Evacuee Property, U.P., Lucknow(1), Burhanpur National Textile Workers Union, Burhanpur vs Labour Appellate Tribunal of India at Bombay and others(2) and Joginder Singh Waryam Singh vs Director, Rural Rehabilitation, Pepsu, Patiala and others(2).
These decisions, however, are clearly not in point for, in each of them, the order passed by the authority within the territories and accordingly within the jurisdiction of the High Court concerned had merged in the order of the superior authority which was located outside the territories and was, therefore, beyond the jurisdiction of that High Court.
In that situation, a writ against the inferior authority within the territories could be of no avail to the petitioner concerned and could give him no relief for the order of the superior authority outside the territories would remain outstanding and operative against him.
As, therefore, no writ could be issued against that outside authority and as the (1) A.I.R. 1955 All. 435.
(2) A.I.R. 1955 Nag. 148.
(3) A.I.R. 1955 Pepsu 91.
1214 orders against the authority within the territories would, in view of the orders of the superior authority, have been infructuous, the High Court concerned had, of necessity, to dismiss the petition.
Such, however, was not the position in the present petition before the High Court of Travancore Cochin.
There was here no question of merger of any judicial order of respondent I into the judicial order of respondent 2.
In this case respondent 1 was actually claiming to exercise powers conferred upon him by certain sections of the Travancore Act XIV of 1124 which, it was submitted, were contrary to law or discriminatory and consequently ultra vires the Constitution.
The fact that respondent 1 was the agent of respondent 2, which being beyond its jurisdiction could not be reached by the High Court, could not make his acts any the less objectionable or discriminatory and ultra vires.
It is sufficient to say that if his action was contrary to law or if the provisions of law under which he was claiming to act became, after the commencement of the Constitution, void under article 13(1) as being repugnant to article 14 and the doer of the illegal act was within the reach of the High Court, the High Court had jurisdiction under article 226 to issue a writ against respondent I and thereby prevent further infringement of the petitioner 's fundamental rights.
The preliminary objection urged by the learned Attorney General against the jurisdic tion of the High Court, therefore, fails.
The next question canvassed in Civil Appeal No. 22 of 1954 was that respondent 2 was entitled to investigate the alleged evasion of tax by the petitioner not only for the years 1942 and 1943 but also the other years from 1940 to the last completed assessment year.
The decision of this question turns on a construction of the terms, of the references made by the Government of the United State of Travancore and Cochin under section 5(1) of the Travancore Act XIV of 1124.
A report dated the 17th November 1949 had been made by the Board of Revenue in regard to the income tax assessment of the petitioner for the years 11 19 and 1120(M.E.) and two orders were passed 1215 on the 26th November 1949 by the Government on the strength of that report.
The first of these orders related to taxation on the petitioner 's income for 1119 and the second related to the taxation on his income for 1120.
The return of income for the year ending the 31st December 1942 was the subject matter of the first order and after setting out the materials in the order the Government stated that they had prima facie reasons for believing that the petitioner had to a substantial extent evaded payment of tax on his income for 1119 and they considered that this was a fit case for reference to the Income tax Investigation 'Commission under section 5(1) of the Act.
The second order referred to the petitioner 's return of income for the year ending the 31st December 1943 and after ,setting out the materials, wound up similarly by stating that the Government had Prima facie reasons for believing that the petitioner bad to a substantial extent evaded payment of tax on his income for 1120 and they considered that this was a fit case for ref erence to the Income tax Investigation Commission under section 5(1) of the Act.
A cursory perusal of the Travancore Act XIV of 1124 will show that the Commission had no authority to investigate any case suo motu.
It could only investigate cases referred to it by the Government.
Thus under section 5(1), Government might refer to it for investigation and report any case or points in a case in which the Government had prima facie reasons for believing that a person had to a substantial extent evaded payment of taxation on income.
Such reference, however, could be made at anytime before the 16th February 1950 but not later.
Again, under sub section (4) of the same section, if in the course of investigation into any case or points in a case referred to it under sub section (1) the Commission bad reason to believe that some other person had evaded payment of taxation on income or some other points required investigation, it might make a report to the Government and the Government would forthwith refer to the Commission for investigation the case of such other person or such additional points as might 1216 be indicated in that report.
All that was done in the present case was that by two separate orders made under section 5(1) of the Act the Government referred two cases of the petitioner for the two years 1942 and 1943 to the Commission and they were registered as Evasion Cases Nos. 1 and 2 of 1125.
There was no other order under section 5(1) at any time before the 16th February 1950 and none could be made under that sub section after that date.
It was not suggested that there was any report by the Commission or any reference of any case or additional points in a case under section 5(4).
It was, therefore, contended for the petitioner that the Commission had no jurisdiction to enquire into any alleged evasion in any year prior or subsequent to the years 1942 and 1943.
The learned Attorney General, on the other hand, contended that the Government could, under section 5(1) of the Act, only refer the case of the petitioner who was reasonably suspected to have evaded the tax and, therefore, the whole case of the petitioner for all the years referred to in section 8(2) of the Act was the subject matter of the investigation which bad been entrusted to the Commission.
We are unable to accept this contention.
Under section 5(1) the Government could refer any case or points in a case.
There is nothing in that sub section which requires that a "case" referred thereunder must cover the entire period mentioned in section 8(2).
Indeed, the Government might have reason to believe that an assessee evaded the tax only in, say, two years and not in others and in such a case the Government could only refer the case for investigation of evasion during those two years only but could not refer any case for other years as to which they had no reasonable belief Therefore, in such a situation the reference must be limited to the particular years in which the evasion was believed to have taken place.
It makes no difference whether one calls the matter referred a "case" or "points in a case".
It follows, therefore, that, in order to ascertain whether, in a given case, the reference covers the entire period or only a shorter period, one has only to look at the order 1217 of reference.
The operative parts of the two orders of reference dated the 26th November 1949 in the present case clearly record the fact that the Government had prima facie reasons for believing that the petitioner had to a substantial extent evaded payment of taxation on his income for 1119 and 1120 (M.E.) and that they considered that "this was a fit case for reference to the Income tax Investigation Commission under section 5(1) of Act XIV of 1124".
What was a fit case for reference was described as "this" which clearly referred back to the evasion of payment on taxation on income for the two specific years in the two orders.
It is, therefore, clear that neither respondent 2 nor respondent I who was appointed an authorised official by respondent 2 had jurisdiction to cover any period beyond those specific years 1942 and 1943 and the notice which was issued by respondent I on the 21st November 1951 was, therefore, not warranted by law.
Respondent I had no warrant or authority whatever for issuing the said notice and we are of the opinion that the High Court was right in the conclusion to which it came that the action of respondent 1 was clearly illegal, without jurisdiction and unsupported by law.
The writ of prohibition issued against respondent I was, therefore, in order and Civil Appeal No. 22 of 1954 must stand dismissed with costs.
As regards Civil Appeal No. 21 of 1954, the petitioner contended that respondent 2 had no power or authority to conduct an investigation in regard to the alleged evasion of tax by the petitioner for the years 1942 and 1943 also.
Shri Nambiyar urged that: (1)The Travancore Act XIV of 1124 was not a law in force prior to the integration and was not an "existing law" continued in force by Ordinance I of 1124; (2)The notification dated the 26th July 1949 which purported to bring the Travancore Act XIV of 1124 into force as from the 22nd July 1949 was in effective and invalid; (3) Even if the Travancore Act XIV of 11 24 was 1218 in force, it could not apply to or override the assessment orders concluded by the Chief Revenue Authority, Travancore; (4) The Rajpramukh 's agreement read with article 245 of the Constitution precluded any investigation except in accordance with the Travancore Act XIV of 1124 and Act XXXIII of 1950 amended by Act XLIV of 1951 was invalid to the extent that it authorised investigation otherwise than in accordance with the Travancore Law; (5) Assuming all the foregoing points were held against the petitioner, section 5(1) of the Travancore Act XIV of 1124 was in any event unconstitutional and void as being inconsistent with article 14 of the Constitution.
(1): The Travancore Act XIV of 1124 was passed by the Travancore Legislature on the 7th March 1949.
It was, however, under section 1(3) to come into force on such date as the Travancore Government might by notification in the Government Gazette appoint.
No such notification was issued by the Travancore Government UP to the 1st July 1949 when the Travancore State and the Cochin State integrated into the United State of Travancore and Cochin.
On the 1st July 1949, the United State of Travancore and Cochin promulgated Ordinance I of 1124 whereby all existing laws of Travancore were continued in force till altered, amended or repealed by competent authority and the "existing law of Travancore" was therein defined to mean any law in force in the State of Travancore immediately prior to the 1st July 1949.
It was only on the 26th July 1949 that a notification was issued under section 1(3) by the United State of Travancore and Cochin bringing Act XIV of 1124 into force retrospectively from 22nd July, 1949.
The contention put forward on behalf of the petitioner was that as no notification under section 1(3) of Act XIV of 1124 had been issued up to the 1st July 1949, that Act had not been brought into force and was not in force on that date and, therefore, was not then an "existing law" which alone was given conti 1219 nuity by Ordinance I of 1124 which was promulgated on that very day.
The contention further was that, in the circumstances the Act was not continued by Ordinance I of 1124 but had lapsed and, therefore, the subsequent notification issued on the 26th July 1949 was wholly ineffective and consequently the reference of the cases of the petitioner to the Commission for investigation under section 5(1), the appointment of respondent I as the authorised official and the notices issued by him were unauthorised and wholly devoid of any authority of law.
The question for our consideration is whether Act XIV of 1124 or any part of it was, on the 1st July 1949, an existing law.
The general rule of English law, as to the date of the commencement of a statute, since 1797, has been and is that when no other date is fixed by it for its coming into operation it is in force from the date when it receives the royal assent (33 Geo.
3. c. 13).
The same rule has been adopted in section 5 of our .
We have not been referred to any Travancore Law which provides otherwise.
If, therefore, the same principle prevailed in that State, Travancore Act XIV of 1124 would have come into force on the 7th March 1949 when it was passed by the Travancore Legislature.
What prevented that result? The answer obviously points to section 1(3) which authorises the Government to bring the Act into force on a later date by issuing a notificated.
How could section 1(3) operate to postpone the commencement of the Act unless that section itself was in force? One must, therefore, concede that section 1(3) came into operation immediately the Act was passed, for otherwise it could not postpone the coming into operation of the Act.
To put the same argument in another way, if the entire Act including section 1(3) was not in operation at the date of its passing, how could the Government issue any notification under that very section? There must be some law authorising the Government to bring the Act into force.
Where is that law to be found unless it were in section 1(3)? In answer, Shri Nambiyar referred 154 1220 is to the principle embodied in section 37 of the English Interpretation Act which corresponds to section 22 of our .
That section does not help the petitioner at all.
All that it does is to authorise the making of rules or bye laws and the issuing of orders between the passing and the commencement of the enactment but the last sentence of the section clearly says that "rules, bye laws or orders so made or issued shall not take effect till the commencement of the Act or Regulation".
Suppose Shri Nambiyar is right in saying that the Government could issue a notification under section 1(3) by virtue of the principle embodied in section 22 of the , it will not take his argument an inch forward, for that notification, by reason of the last sentence of section 22 quoted above, will not take effect till the commencement of the Act.
It will bring about a stalemate.
It is, therefore, clear that a notification bringing an Act into force is not contemplated by section 22 of the .
Seeing, therefore, that it is section 1 (3) which operates to prevent the commencement of the Act until a notification is issued thereunder by the Government and that it is section 1(3) which operates to authorise the Government to issue a notification thereunder, it must be conceded that section 1(3) came into force immediately on the passing of the Act.
There is, therefore, no getting away from the fact that the Act was an "existing law" from the date of its passing right up to the 1st July 1949 and was, consequently, continued by Ordinance I of 1124.
This being the position, the validity of the notification issued on the 26th July 1949 under section 1(3), the reference of the case of the petitioner, the appointment of respondent 1 as the authorised official and all proceedings under the Travancore Act XIV of 1124 cannot be questioned on the ground that the Act lapsed and was not continued by Ordinance I of 1124.
(2): It is urged that the notification issued on the 26th July 1949 was bad in that it purported to bring the Act into operation as from the 22nd July 1949.
The reason relied upon is that the Govern 1221 meat could not, in the absence of express provision, authorising it in that behalf, fix the commencement of the Act retrospectively.
The reason for which the Court disfavours retroactive operation of laws is that it may prejudicially affect vested rights.
No such, reason is involved in this case.
Section 1(3) authorises the Government to bring the Act into force on such date as it may, by notification, appoint.
In exercise of the power conferred by this section the Government surely had the power to issue the notification bringing the Act into force on any date subsequent to the passing of the Act.
There can, therefore, be no objection to the notification fixing the commencement of the Act on the 22nd July 1949 which was a date subsequent to the passing of the Act.
So the Act has not been given retrospective operation, that is to say, it has not been made to commence from a date prior to the date of its passing.
It is true that the date of commencement as fixed by the notification is anterior to the date of the notification but that circumstance does not attract the principle disfavouring the retroactive operation of a statute.
Here there is no question of affecting vested rights.
The operation of the notification itself is not retrospective.
It only brings the Act into operation on and from an earlier date.
In any case it was in terms authorised to issue the notification bringing the Act into force on any date subsequent to the passing of the Act and that is all that the Government did.
In this view of the matter, the further argument advanced by the learned Attorney General and which found favour with the Court below, namely, that the notification was at any rate good to bring the Act into operation as on and from the date of its issue need not be considered.
There is no substance in this contention also.
(3): It was urged that, even if the Travancore Act XIV of 1124 was in force on the 1st July 1949 and was validly brought into operation from the 22nd July 1949, the terms of section 8(2) of the Act could not apply to or override the assessment orders of the petitioner for the years 1942 and 1943 which 1222 were concluded by the Chief Revenue Authority of Travancore.
Section 8(2) of the Act provided that, after considering the report of the Commission, the Government shall, by an order in writing, direct that such proceedings as they think fit under the various Income tax Acts of Travancore therein mentioned or any other law shall be taken against the person to whose case the report relates in respect of the income of any period commencing after the last day of Karkadakom 1115 (16 8 1939) and upon such a direction being given such proceedings may be taken and completed under the appropriate law notwithstanding any decision to a different effect given in the case by any income tax authority or Income tax Appellate Tribunal.
It was contended that the Chief Revenue Authority was not included in the description of "any income tax authority" and, therefore, even if the report of respondent 2 was adverse to the petitioner the assessment orders which were concluded by the Chief Revenue Authority could not be affected by the provisions of section 8(2) and could not be reopened.
This argument is based on a misconception of the true position of the Chief Revenue Authority.
The Chief Revenue Authority was an income tax authority mentioned in the hierarchy under the Travancore Act VIII of 1096.
When the Travancore Act XXIII of 1121 came to be passed, the income tax authorities enumerated therein included the Board of Revenue at the apex., substituting the Board of Revenue for the Chief Revenue Authority which occupied a similar position in the old Act.
By section 10 of the Travancore Act XIV of 1124, the Travancore Act VIII of 1096 was deemed to be in force for the purpose of the Act and to the extent necessary, with the result that in construing the provisions of section 8(2) of the Act, the words "any income tax auth ority" would include the Chief Revenue Authority which was an income tax authority under the Travancore Act VIII of 1096.
It may also be noted that section 4 of the Travancore Act XVII of 1122 continued all proceedings and petitions pending before the 1223 Chief Revenue Authority and provided that the same may be disposed of by the said authority or by such authority as may be appointed by the Government for the purpose as if the 'Said Travancore Act VIII of 1096 bad not been repealed.
It, therefore, follows that the Chief Revenue Authority was included within the expression "any income tax authority" in section 8(2) of the Act and the assessment orders of the petitioner for the years 1942 and 1943 which were concluded by the Chief Revenue Authority could be affected or overridden by any order which might be passed by the Government under section 8(2) of the Act.
This contention of the petitioner also, there fore, does not avail him.
(4): The Indian States Finance Enquiry Committee 1948 49 made two interim reports.
It recommended in the first interim report that subject to certain limitations indicated therein which were designed to secure legal "continuity" of pending proceedings and "finality and validity" of completed proceedings under the pre existing State legislation, the whole body of State legislation relating to "federal" subjects should be repealed and the corresponding body of Central legislation extended proprio vigore to the States with effect from the prescribed date or as and when the administration of particular "federal" subjects was assumed by the Centre.
All matters and proceedings pending under or arising out of preexisting States Acts should be disposed of under those Acts by, so far as may be, the "corresponding authorities" under the corresponding Indian Acts.
The income, profits and gains accruing and arising in States of all periods which were 'previous years ' of the States assessment years 1949 50 or earlier should be assessed wholly and in accordance with the States ' laws and at the States ' rates respectively, appropriate to the assessment years concerned.
Except in Travancore, there was no Income tax Investigation Commission in any State.
Should the Travancore Commission still be functioning at the time of the federal financial integration, all cases pending before it should be taken over by 1224 the Indian Commission.
The disposal of those cases should, however, (as in the case of pending assessments) be in accordance with the pre existing Travancore Law.
It recommended in the Second Interim Report that the Travancore Commission should be wound up and the cases referred to it should be transferred to the corresponding Commission in India.
These recommendations of the Committee in so far as they applied to Travancore Cochin were accepted by and incorporated into the agreement entered into between the President of India and the Rajpramukh of Travancore Cochin on the 25th February 1950 subject to certain modifications which are not relevant for the purpose of the present enquiry.
The result of the agreement was the enactment of Act XXXIII of 1950 which extended to Travancore Cochin the Act XXX of 1947 and section 3 of that Act provided that the law of Travancore corresponding to Act XXX of 1947 shall continue to remain in force with the modification that all cases referred to or pending before the Travancore Commission shall stand transferred to the Central Commission for disposal and that the State law shall determine the procedure to be followed and the powers to be exercised by the Central Commission in the disposal of those cases.
Evasion Cases Nos. 1 and 2 of 1125 which were pending before the Travancore Commission thus became transferred to res pondent 2 and were to be disposed of in accordance with the procedure laid down and the powers conferred on the Travancore Commission by the Travancore Act XIV of 1124.
Two questions, however, arose in the matter of this investigation by respondent 2, viz., (1) whether the life of the Travancore Commission, not having been extended beyond 16 8 1950, respondent 2 had the power and authority to continue the investigation of the cases of the petitioner after 16 8 1950, and, (2) whether any orders passed by the Government on the report made by respondent 2 would have the effect of overriding the assessment orders concluded by the Chief Revenue Authority, Travancore, in cases of the petitioner for the years 1942 and 1943.
1225 In regard to the first question, it was urged by Shri Nambiyar that the life of the Travancore Commission having come to an end on the 16th August 1950, respondent 2 also, which was its successor and to which the pending cases of the petitioner were transferred, could not function beyond 16 8 1950.
Parliament, however, passed, on the 26th August 1951, Act XLIV of 1951 amending Act XXXIII of 1950 whereby it provided with retrospective effect that, in the disposal of cases transferred to respondent 2, it shall have and exercise the same powers as it has and exercises in the investigation of cases transferred to it under Act XXX of 1947 and shall be entitled to act for the same term as under sub section (3) of section 4 of that Act thus extending the life of respondent 2 beyond 16 8 1950.
This) it was submitted, Parliament was not competent to do by reason of the terms of the agreement dated the 25th February, 1950, the effect of the enactment of Act XLIV of 1951 being to amend the law of the Travancore State which was to govern the investigation of pending cases by respondent 2.
The agreement was one which was contemplated under article 295 of the Constitution and, being provided by the Constitution itself, was a bar to the legislative competence of the Central Legislature under article 245.
The Central Legislature, it was submitted, was, therefore, not competent to pass Act XLIV of 1951 extending the life of respondent 2 beyond 16 8 1950 and respondent 2 was, therefore, not entitled to carry on any further investigation in the Evasion Cases Nos. 1 and 2 of 1125.
Considerable argument was addressed to us on the effect of the agreement on the legislative competence of the Central Legislature under article 245.
We do not, however, consider it necessary to decide this question as, in our opinion, the life of respondent 2 was not a part of the law of Travancore State which was to govern the procedure followed or the powers exercised by it in the investigation of the cases of the petitioner.
Respondent 2 to which the pending cases of the petitioner were transferred, was a body with a longer lease of life and the fact that the Travancore 1226 Commission had a shorter lease could not have the effect of curtailing the life of respondent 2.
The life of respondent 2 depended upon the law which established it and it was extended from time to time by subsequent legislation up to December, 1955, and that accident which gave to respondent 2 a longer lease of life did not contravene any provision of the Travancore law which determined the procedure to be followed and the powers to be exercised by the Travancore Commission.
The transfer to respondent 2 of the cases pending before the Travancore Commission, of necessity involved that those cases would be dealt with by respondent 2 which had a longer lease of life and respondent 2 could conduct the investigation of these cases and complete the same within the span of life which had been allotted to it by the relevant provisions of the Indian Law, the only limitations imposed upon the conduct of such investigation being that the procedure to be followed as also the powers to be exercised by it would be those obtaining in the Travancore Law.
Act XLIV of 1951 merely accepted this position and there was nothing in that Act which ran counter to the agreement.
As regards the second question also, the Chief Revenue Authority, as observed before, was an income tax authority within the meaning of the term as used in section 8(2) of the Travancore Act XIV of 1124 read with section 10 of that Act which continued in force the provisions of the Travancore Act VIII of 1096 so far as it was necessary for the purpose of the Act.
There also Act XLIV of 1951 did not make any changes in the existing Travancore Law which was to govern the investigation of the pending cases by respondent 2.
This contention of the petitioner, therefore, is equally untenable.
(5): This contention urged by Shri Nambiyar questions the vires of section 5(1) of the Travancore Act XIV of 1124.
This section provides: "Section5(1):Our Government may at any time before the last day of Makaram 1125 refer to the Commission for investigation and report any case or 1227 points in a case in which our Government have prima facie reasons for believing that a person has to a substantial extent evaded payment of taxation on income, together with such material as may be available in support of such belief, and may at any time before the last day of Meenam 1125 apply to the Commission for the withdrawal of any case or points in a case thus referred, and if the Commission approves of the withdrawal, no further proceedings shall thereafter be taken by or before the Commission in respect of the case or points so withdrawn".
It corresponds to section 5(1) of the Taxation on Income (Investigation Commission) Act, 1947 (XXX of 1947) which reads as under: "Section 5 (1): The Central Government may at any time before the last day of September 1948 refer to the Commission for investigation and report any case or points in a case in which the Central Government has prima facie reasons for believing that a person has to a substantial extent evaded payment of taxation on income, together with such material as may be available in support of such belief, and may at any time before the first day of September 1948 apply to the Commission for the withdrawal of any case or points in a case thus referred, and if the Commission approves of the withdrawal, no further proceedings shall thereafter be taken by or before the Commission in respect of the case or points so withdrawn".
We may also at this stage refer to the provisions of section 47 of the Travancore Act XXIII of 1121 which relates to income escaping assessment: "Section 47(1): If in consequence of definite information which has come into his possession the Income tax Officer discovers that income, profits or gains chargeable to income tax have escaped assessment in any year, or have been under assessed, or have been assessed at too low a rate, or have been the subject of excessive relief under this Act the Income tax Officer may, in any case in which he has reason to believe that the assessed has concealed the particulars of his income or deliberately furnished inaccu 155 1228 rate particulars thereof, at any time within eight years, and in any other case at any time within four years of the end of that year, serve on the person liable to pay tax on such income, profits or gains, or, in the case of a company, on the principal officer thereof, a notice containing all or any of the requirements which may be included in a notice under subsection (2) of section 29, and may proceed to assess or re assess such income, profits or gains and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub section: . . . . " The corresponding provision of the Indian Income tax Act was contained in section 34 which provided: "Section 34(1): If in consequence of definite information which has come into his possession the Income tax Officer discovers that income, profits or gains chargeable to income tax have escaped assessment in any year, or have been under assessed, or have been assesses at too low a rate, or have been the subject of excessive relief under this Act the Income tax Officer may, in any case in which be has reason to believe that the assessed has concealed the particulars of his income or deliberately furnished inaccurate particulars thereof, at any time within eight years, and in any other case at any time within four years of the end of that year, serve on the person liable to pay tax on such income, profits or gains, or, in the case of a company, on the principal officer thereof, a notice containing all or any of the requirements which may be included in a notice under subsection (2) of section 22, and may proceed to assess or re assess such income, profits or gains, and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub section: . . . ." Section 34 of the Indian Income tax Act was amended by Act XLVIII of 1948 which received the assent of the Governor General on the 8th September 1948.
It was further amended by the Indian Income tax Act, 1954 (XXXIII of 1954) which was assented to by the President on the 25th September 1229 1954 and introduced sub sections (1 A) to (1 D) therein.
It may, however, be noted that no amendment was made in section 47 of the Travancore Act XXIII of 1121 at any subsequent period and the question as to whether the provisions of section 5(1) of the Travancore Act XIV of 1124 became discriminatory and violative of the fundamental right guaranteed under article 14 of the Constitution will have to be determined with reference to the provisions of that sec tion set out above.
The true nature, scope and effect of article 14 of the Constitution have been explained by this Court in a series of cases beginning with Chiranjit Lal Chowdhuri vs The Union of India(1) and ending with Budhan Chowdhury and others vs The State of Bihar(2).
It is, therefore, not necessary to refer to the earlier cases and it will suffice to quote the principle as summarised in the decision of the Full Court in the last mentioned case at page 1049 in the following terms: "It is now well established that while article 14 forbids class legislation, it does not forbid reasonable classification for the purposes of legislation.
In order, however, to pass the test of permissible classification two conditions must be fulfilled, namely, (i) that the classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from others left out of the group, and (ii) that differentia must have a rational relation to the object sought to be achieved by the statute in question.
The classification may be founded on different bases, namely, geographical, or according to objects or occupations or the like.
What is necessary is that there must be a nexus bet ween the basis of classification and the object of the Act under consideration.
It is also well establisbed by the decisions of this Court that article 14 condemns discrimination not only by a substantive law but also by a law of procedure".
The principles underlying article 14 of the Constitution are well settled.
The only difficulty which (1) ; (2) ; 1230 arises is in regard to the application of those principles to the facts of a particular case and the Court has to consider the terms of the impugned legislation having regard to the background and the surrounding circumstances so far as it may be necessary to do so in order to arrive at a conclusion whether it infringes the fundamental right in question.
Section 5(1) of Act XXX of 1947 (which is in pari materia with section 5(1) of the Travancore Act XIV of 1124) was impugned in the case of Suraj Mall Mohta & Co. vs A. V. Visvanatha Sastri and another(1).
The references for investigation in that case had been made in pursuance of a report made by the Commission to the Central Government under the provisions of section 5(4) of the Act requesting that the 'Case of the petitioner along with other cases may be referred to the Commission for investigation.
The contention urged on behalf of the petitioner was that the provisions of sections 5(1), 5(4), 6, 7 and 8 of Act XXX of 1947 had become void being discriminatory in character after the coming into force of the Constitution.
The attack made against the provisions of section 5(1) of the Act was two fold: "(1) That the section was not based on any valid classification; the word "substantial" being vague and uncertain and having no fixed meaning, could furnish no basis for any classification at all; (2) That the Central Government was entitled by the provisions of the section to discriminate between one person and another in the same class and it was authorised to pick and choose the cases of persons who fell within the group of those who bad substantially evaded taxation.
It could, if it chose, send the case of one person to the Commission and show favouritism to another person by not sending his case to the Commission though both of these persons be within the group of those who had evaded the payment of tax to a substantial extent".
As regards section 5(4), it was urged that it bad no independent existence and was bound to fall with section 5(1) if his contention regarding its invalidity (1) ; 1231 prevailed.
In the alternative, it was urged that assuming that section 5(1) was valid, even then section 5(4) had to be declared void because it gave arbitrary power to the Commission to pick and choose and secondly because the clause was highly discriminatory in character inasmuch as an evasion, whether substantial or insubstantial, came within its ambit as well as within the ambit of section 34(1) of the Indian Income tax Act.
This Court considered it sufficient for the decision of that case to examine the contentions urged against the validity of section 5(4) of the Act because the case of the petitioner was referred to the Commission under those provisions of the Act and not under section 5(1) and decided that case on the assumption that section 5(1) of the Act was based on a valid classification and dealt with a group of persons who came within the class of war profiteers which required special treatment, that the classification was rational and that reasonable grounds existed for making a distinction between those who fell within that class and others who did not come within it, but without in any way deciding or even expressing any opinion on that question.
This Court compared the provisions of section 5(4) of the Act with those of section 34(1) of the Indian Income tax Act and came to the conclusion that section 5(4) dealt with the same class of persons who fell within the ambit of section 34(1) of the Indian Income tax Act and were dealt with in sub section (1) of that section and whose income could be caught by a proceeding under that section.
It held that there was nothing uncommon either in properties or in characteristics between persons who had been discovered as evaders of income tax during an investigation conducted under section 5(1) of the Act and those who had been discovered by the Income tax Officer to have evaded payment of income tax.
Both those kinds of persons had common properties and had common characteristics and therefore required equal treatment.
The Court thus held that both section 34(1) of the Indian Income tax Act and sub sec 1232 tion (4) of section 5 of the impugned Act dealt with persons who had similar characteristics and similar properties, the common characteristics being that they were persons who had not truly disclosed their income and had evaded payment of taxation on income.
The court then considered whether the procedure prescribed by Act XXX of 1947 for discovering the concealed profits of those who bad evaded payment of taxation on their income was substantially different and prejudicial to the assesses than the procedure prescribed in the Indian Income tax Act.
After comparing the provisions of section 8 of Act XXX of 1947 and those of sections 31, 32 and 33 of the Indian Income tax Act, this court came to the conclusion that there was material and substantial difference between the two procedures and there was no doubt that the procedure prescribed by the impugned Act deprived a person who was dealt with under that Act of those rights of appeal, second appeal and revision to challenge questions of fact decided by the judge of first instance.
The procedure prescribed by the impugned Act in sections 6 and 7 was also compared with the procedure prescribed in sections 37 and 38 in the Indian Income tax Act and this Court held that the procedure prescribed by the impugned Act was substantially more prejudicial to the assessee than the procedure prescribed under the Indian Income tax Act.
It was thus clear that persons dealt with under Act XXX of 1947 were submitted to a procedure which was more drastic and prejudicial than the procedure which was available to those who were dealt with under section 34 of the Indian Income tax Act.
This Court, therefore, was of the opinion that section 5(4) and the procedure prescribed by the impugned Act in so far as it affected the persons proceeded against thereunder being a piece of discriminatory legislation offended against the provisions of article 14 of the Constitution and were thus void and unenforceable.
It was after this decision of this Court in Suraj 1233 Mall Mohta 's case supra that Parliament enacted the Indian Income tax Amendment Act, 1954 (XXXIII of 1954) introducing sub sections (1 A) to (1 D) in section 34 of the Indian Income tax Act.
Though Act XXXIII of 1954 received the assent of the President on the 5th September 1954 it was to come into effect from the 17th July 1954.
Section 34(1 A) purported to meet two criticisms which had been, in the main, offered against the constitutionality of section 5(1) of the Act in Suraj Mall Mohtas case.
One criticism was that the classification made in section 5(1) of the Act was bad because the word 'substantial ' used therein was a word which had no fixed meaning and was an unsatisfactory medium for carrying the idea of some ascertainable proportion of the whole, and thus the classification being vague and uncertain, did not save the enactment from the mischief of article 14 of the Constitu tion.
That alleged defect was cured in section 34 (1 A) inasmuch as the Legislature clearly indicated there what it meant when it said that the said object of Act XXX of 1947 was to catch persons who, to a substantial extent, had evaded payment of tax, in other words, what was seemingly indefinite within the meaning of the word 'substantial ' bad been made definite and clear by enacting that no evasion below a sum of one lakh was within the meaning of that expression.
The other criticism was that section 5(1) did not necessarily deal with the persons, who, during the war, had made huge profits and evaded payment of tax on them.
Section 34(1 A) remedied this defect also.
It clearly stated that it would operate on income made between the 1st September 1939 and 31st March 1946 tax on which had been evaded.
Section 5(1) was again attacked in the case of Shree Meenakshi Mills Ltd. vs Sri A. V. Visvanatha Sastri and Another(1).
This was a petition under article 32 of the Constitution filed on the 16th July 1954 after the decision in Suraj Mall Mohta 's case, supra, had been pronounced.
Section 5(1) of the Act was attacked on the very same grounds which were mentioned in (1) 1234 the judgment in Suraj Mall Mohta 's case, supra, but had not been dealt with by this Court it being considered sufficient to strike down section 5(4) of the Act without expressing any opinion on the vires of section 5(1).
Even in this case, section 5(1) was not struck down as void on a comparison of its provisions with those of section 34(1) of the Indian Incometax Act as was done in the case of section 5(4) in Suraj Mall Mohta 's case, supra.
By the time this petition came to be heard by this Court, the Parliament had enacted Act XXXIII of 1954 which, as stated above, introduced section 34(1 A) in section 34 of the Indian Income tax Act and this Court came to the conclusion on a comparison of the provisions of section 5(1) of the Act with section 34(1 A) of the Indian Income tax Act that the new sub section inserted in section 34 by Act XXXIII of 1954 was intended to deal with the class of persons who were said to have been classified for special treatment by section 5(1) of Act XXX of 1947.
This Court reiterated the conclusions to which it had come in Suraj Mall Mohta 's case, supra, that the procedure prescribed by the Act for making the investigation under its provisions was of a summary and drastic nature and it constituted a departure from the ordinary law of procedure and in certain important aspects was detrimental to the persons subjected to it and as such was discriminatory.
It did not again express an opinion on the validity of section 5(1) as being based on a valid classification and being thus saved from the mischief of article 14 of the Constitution, but, on a comparison of the provisions of section 5(1) of the Act with those of section 34(1 A) of the Indian Income tax Act which came into effect from the 17th July 1954, came to the conclusion that this defence of the provisions of section 5(1) being saved from the mischief of article 14 of the Constitution on the basis of a valid classification was no longer available in support of it after the introduction of the new subsection in section 34 of the Indian Income tax Act which sub section dealt with the same class of persons dealt with by section 5(1) of the impugned 1235 Act.
The result was that proceedings could no longer be continued under the procedure prescribed by the impugned Act and section 5 (1) was thus struck down as unconstitutional and void after the coming into operation of section 34(1 A) of the Indian Income tax Act.
These two cases, viz., Suraj Mall Mohta 's case supra and Shree Meenakshi Mills ' case, supra, did not directly pronounce upon the vires of section 5(1) of the Act in comparison with section 34(1) of the Indian Income tax Act though the vires were the subject matter of a direct challenge therein.
The ratio of these decisions is, however, helpful in the determination of the question that arises directly before us, viz., whether section 5(1) of the Act is discriminatory in its character and thus violative of the fundamental right guaranteed under article 14 of the Constitution.
In both these cases, this Court was of the opinion that the procedure for investigation prescribed by Act XXX of 1947 (corresponding with the Travancore Act XIV of 1124) was of a summary and drastic nature and constituted a departure from the ordinary law of procedure and in certain aspects was detrimental to persons subjected to it as compared with the procedure prescribed by the corresponding provisions of the Indian Income tax Act (corresponding to the Travancore Act XXIII of 1121) and was as such discriminatory.
The provisions of sections 5 (4) and 5 (1) of the Act were compared respectively with the provisions of section 34(1) and section 34(1 A) of the Indian Income tax Act and, on a comparison of these provi sions, this Court came to the conclusion that the classes of persons who were said to have been classified for special treatment by those respective sections of the Act were intended to be and could be dealt with under section 34(1) and section 34(1 A) of the Indian Income tax Act and there could, therefore, be no basis of a valid classification for special treatment under the provisions of Act XXX of 1947 (corresponding with the Travancore Act XIV of 1124).
The procedure prescribed by the Travancore Act XIV of 1124 being thus discriminatory as compared 156 1236 with the procedure prescribed in the Travancore Act XXIII of 1121, the questions that arise for our consideration are, (1) whether there is a rational basis of classification to be found in the enactment of section 5(1) of the Act, and (2) whether the same class of persons were intended to be and could be dealt with under the provisions of section 47 of the Travancore Act XXIII of 1121.
In order to ascertain the scope and purpose of the impugned section reference must first be made to the Act itself.
The preamble of a statute has been said to be a good means of finding out its meaning and as it were a key to the understanding of it.
The preamble to the Travancore Act XIV of 1124, like that of Act XXX of 1947, runs thus: "Whereas it is expedient for the purpose of ascertaining whether the actual incidence of taxation on income is and has been in recent years in accordance with the provisions of law and the extent to which the existing law and pro cedure for the assessment and recovery of such taxation is adequate to prevent the evasion thereof, to make provision for an investigation to be made into such matters.
It is hereby enacted as follows".
It does not unfortunately give any assistance in the solution of the problem before us.
Section 5(1) itself, however, gives some indication as to the real object of it.
The condition on which the action of the Government under that section is made dependent is that the Government must have prima facie reasons for believing that a person has to a substantial extent evaded payment of taxation on his income.
The powers conferred on the Commis sion by section 6 and the procedure prescribed for the Commission by section 7 are clearly very drastic and harsh.
This unmistakably shows that the legislative authority took the view that these stringent measures were necessary for unearthing the tax evasions which had gone unnoticed before when the usual procedure under the Income tax law was applied.
Then comes section 8(2) which authorises the Government after perusal of the report of the Commission to direct proceedings to, be taken against the person to whose 1237 case the report relates in respect of the income of any period commencing after the 16th August 1939.
This provision clearly evinces that the intention of the legislative authority is to catch the income evaded from after the 16th August 1939.
Section 5(1) also provides that the reference thereunder of a case must be made at any time before the 16th February 1950.
From these sections it will appear that the object of this law was to uncover the evasion of tax on income made after the 16th August 1939 and before the 16th February 1950 about the existence of which evasion the Government had prima facie reason to believe.
The question at once arises as to why it was that the legislative authority took the view that there were possible cases of tax evasion.
It has been said that although the statement of 'the objects and reasons appended to a bill is not admissible as an aid to the construction of the Act as passed (see Aswini Kumar Ghose case(1)), yet it may be referred to only for the limited purpose of ascertaining the conditions prevailing at the time which necessitated the making of the law (see Subodh Gopal Bose 's case(2)).
Similar observations were made by Fazl Ali, J. with ref erence to legislative proceedings being relevant for the proper understanding of the circumstances under which an Act was passed and the reasons which necessitated it in Chiranjit Lal Chowdhuri vs The Union of India(3).
Indeed, in the case of Kathi Raning Rawat vs The State of Saurashtra(4), this Court permitted the State to file an affidavit stating in detail the circumstances which prevailed at the time when the law there under consideration bad been passed and which necessitated the passing of that law.
In the present case also, an affidavit has been filed by Gauri Shanker, Secretary of respondent 2, stating the reasons why it was thought necessary to enact the impugned Act including section 5(1).
This affidavit clearly brings out the serious problem that faced the revenue authorities.
A war of unprecedented magnitude had raged from September 1939 to 1946.
The (1) ; (2) ; , 628.
(3) ; , 879.
(4) ; 1238 war conditions brought in their train a sudden rise in the demand of all kinds of goods, both consumer and industrial, which, naturally pushed up the prices to abnormal heights affording a great opportunity to the producers, manufacturers and merchants to reap huge profits.
There was good reason to believe that these abnormal profits were not being brought into regular accounts but were being concealed.
Faced with this situation, means bad to be devised to enquire into the tax evasions and to realise the legitimate dues of the State.
If regard be had to this background it is obvious that section 5(1) had reference to a class of substantial evaders of income tax who required to be specially treated under the drastic procedure provided by Act XXX of 1947.
It was, however, urged that the words "substantial extent" were of such vague import that they did not afford any reasonable basis of classification.
Reference was made to Stroud 's Judicial Dictionary, 3rd ed., Vol. 4, page 2901, where the word "substantial" has been described to be: "A word of no fixed meaning, it is an unsatisfactory medium for carrying the idea of some ascertainable proportion of the whole (Terry 's Motors, Ltd. vs
Binder; , The word "substantial" has been used in various legislative enactments and even though it is said to be a word of no fixed meaning, Viscount Simon in Palser vs Grinling(1) observed: "One of the primary meanings of the word is equivalent to considerable, solid, or big.
It is in this sense that we speak of a substantial fortune, a substantial meal., a substantial man, a substantial argument or ground of defence.
Applying the word in this sense, it must be left to the discretion of the judge of fact to decide as best he can according to the circumstances in each case. ." and it has been described at page 2902 of Stroud 's Judicial Dictionary to be "equivalent to considerable,solid or big".
Even though the word "substantial" by itself might (1) , 817.
1239 not afford a definite measure or yard stick for including particular individuals within the classification, the background and the circumstances mentioned in the aforesaid affidavit of Gauri Shanker indicate with reasonable certainty the class of persons who are intended to be subjected to this drastic procedure.
It does not require much effort to pick out persons who would fall within this group or category of substantial evaders of income tax and even though a definite amount be not specified in section 5(1) of the Act as constituting a substantial evasion of income tax the Government, to whom the process of selection for the purposes of reference of the cases for investigation to the Commission is entrusted, would not have any difficulty in finding out the persons coming within this group or category.
To use the language of Viscount Simon, the income tax which has been evaded would have to be considerable, solid or big, and once that conclusion was reached by the Government, the cases of such persons would indeed be referred by them for investigation by the Commission under section 5(1) of the Act.
It was, however, urged that it would be open to the Government within the terms of section 5(1) of the Act itself to discriminate between persons and persons who fell within the very group or category; the Government might refer the case of A to the Commission leaving the case of B to be dealt with by the ordinary procedure laid down in the Travancore Act XXIII of 1121.
The possibility of such discriminatory treatment of persons falling within the same group or category, however, cannot necessarily invalidate this piece of legislation.
It is to be presumed, unless the contrary were shown, that the administration of a particular law would be done "not with an evil eye and unequal band" and the selection made by the Government of the cases of persons to be referred for investigation by the Commission would not be discriminatory.
This question was considered by this Court in two cases, viz. , Kathi Raning Rawat vs The State of Sau 1240 rashtra(1) and Kedar Nath Bajoria vs The State of West Bengal(2).
Mr. Justice Mukherjea, as he then was, dealt with the argument in Kathi Raning Rawat vs The State of Saurashtra(1) as under: "It is a doctrine of the American courts which seems to be well founded on principle that the equal protection clause can be invoked not merely where discrimination appears on the express terms of the statute itself, but also when it is the result of improper or prejudiced execution of the law.
(Vide Weaver on Constitutional Law, p. 404).
But a statute will not necessarily be condemned as discriminatory, because it does not make the classification itself but, as an effective way of carrying out its policy, vests the authority to do it in certain officers or administrative bodies. . . .
In my opinion, if the legislative policy is clear and definite and as an effective method of carrying out that policy a discretion is vested by the statute upon a body of administrators or officers to make selective application of the law to certain classes or groups of persons, the statute itself cannot be condemned as a piece of discriminatory legislation.
After all "the law does all that is needed when it does all that it can, indicates a policy . and seeks to bring within the lines all similarly situated so far as its means allow" (Vide Buck vs Bell, ; , 208).
In such cases, the power given to the executive body would import a duty on it to classify the subject matter of legislation in accordance with the objective indicated in the statute.
The discretion that is conferred on official agencies in such circumstances is not an unguided discretion; it has to be exercised in conformity with the policy to effectuate which the direction is given and it is in relation to that objective that the propriety of the classification would have to be tested.
If the ad ministrative body proceeds to classify persons or things on a basis which has no rational relation to the objective of the legislature, its action can certainly be annulled as offending against the equal protection clause.
On the other hand, if the statute (1) ; , 459.
(2) ; , 41, 1241 itself does not disclose a definite policy or objective and it confers authority on another to make selection at its pleasure, the statute would be held on the face of it to be discriminatory irrespective of the way in which it is applied. . . " The same line of demarcation was also emphasized by Patanjali Sastri, C. J., delivering the judgment of the Court in Kedar Nath Bajoria vs The State of West Bengal(2).
It, therefore.
, follows that the mere fact that the Government is entrusted with the power to select cases of persons falling within the group or category of substantial evaders of income tax for reference to the Commission would not render section 5(1) discriminatory and void.
The object sought to be achieved by the impugned piece of legislation is quite definite and that is to catch substantial evaders of income tax out of those who have made huge profits during the war period.
They form a class by themselves and have to be specially treated under the procedure laid down in the Act.
Being a class by themselves, the procedure to which they are subjected during the course of investigation of their cases by the Commission is not at all discriminatory because such drastic procedure has reasonable nexus with the object sought to be achieved by the Act and therefore such a classification is within the constitutional limitations.
The selection of the cases of persons falling within that category by the Government cannot be challenged as discriminatory for the simple reason that it is not left to the unguided or the uncontrolled discretion of the Government.
The selection is guided by the very objective which is set out in the terms of section 5 (1) itself and the attainment of that object controls the discretion which is vested in the Government and guides the Government in making the necessary selection of cases of persons to be referred for investigation by the Commission.
It cannot, therefore, be disputed that there is a valid basis of classification to be found in section 5(1) of the Act.
(1) ; , 41.
1242 The validity of the classification was further attacked on the ground that the limitation of the period within which the cases of the substantial evaders of income tax falling within this group or category may be referred for investigation by the Government to the Commission, viz., 16th February 1950 imports a discrimination in so far as those persons whose cases are referred before that date would be treated under the procedure laid down in the Travancore Act XIV of 1124 whereas those whose cases have not been referred by that date would not be subjected to the same treatment even though they fell within the same category.
This would bring about a discrimination between the same class of persons some of whom would be subjected to that special treatment and others who would escape the same.
Section 5(4) of the Act also would not cure this defect because the cases contemplated therein are either the cases which have been already referred for investigation to the Commission under section 5(1) of the Act or cases of other persons about whose alleged 'evasion of income tax the Commission has gathered information during the course of their investigations.
Even if these other persons be thus subjected to the special procedure prescribed in the Act there would remain, outside the jurisdiction of the Commission, numbers .of persons whose cases are not covered by sections 5(1) or 5(4) but who nonetheless are comprised within the class of substantial evaders of income tax.
They would have to be dealt with under the ordinary law and presumably under section 47 of the Travancore Act XXIII of 1121 if they could be dealt with thereunder.
If they could not be so dealt with, the only result would be that they would escape the surveillance of the Government and the escapement of income tax in their cases would be without any remedy.
This, it was urged, was discriminatory and was enough to strike down section 5(1) of the Act.
It would be impossible in the normal course to reach all substantial evaders of income tax.
Those persons falling within that category in respect of whom the 1243 Government had received the requisite information and in whose cases the Government had prima facie reasons for believing that they had to a substantial extent evaded payment of taxation on income would have their cases referred by the Government for investigation by the Commission.
Those persons in respect of whom no such information was available to the Government would certainly escape detection but that is the position with regard to each and every law which may be passed in order to detect evasion of payment of income tax.
Even under the provisions of section 47 of the Travancore Act XXIII of 1121 (corresponding to section 34 of the Indian Income tax Act as it stood before the amendment in 1948), those persons in respect of whom the Incometax Officer had gathered definite information and consequently discovered that income, profits or gains chargeable to income tax had escaped assessment in any year could be dealt with under the relevant provisions of that Act.
Those persons in respect of whom no such information had been received by the Income tax Officer could not be reached at all.
The fact that some persons falling within a particular category may escape detection altogether is not necessarily destructive of the efficacy of the particular legislation.
The only thing required is that, as between persons who fall within the same category and who can be dealt with under the same procedure, there should be no discrimination, some being treated in one way and others being treated in another.
It was also urged that discrimination was inherent in the terms of section 5(1) itself by reason of its operation being limited only to those persons whose cases were referred to the Commission on or before the 16th February 1950.
It thus arbitrarily left out persons who evaded payment of taxation on income made during the war period but whose cases were not discovered or referred to the Commission on or before that date although they were otherwise similarly situated.
Reliance was placed in support of this position on the following passage from the judgment of Mahajan, C. J. in Shree Meenakshi Mills ' case, 157 1244 supra, at pages 795 796: "Assuming that evasion of tax to a substantial amount could form a basis of classification at all for imposing a drastic procedure on that class, the inclusion of only such of them whose cases had been referred before 1st September, 1948, into a class for being dealt with by the drastic procedure, leaving other tax evaders to be dealt with under the ordinary law will be a clear discrimination for the reference of the case within a particular time has no special or rational nexus with the necessity for drastic procedure. . " These observations were made to repel the first argument of the learned Attorney General that the class of substantial evaders who fall within section 5(1) were only those whose cases had been referred within the date fixed.
It was pointed out that if the class was so circumscribed then that by itself would make the classification discriminatory by leaving out those substantial evaders whose cases had not been referred by that date.
By that passage, however, this Court did not hold that in fact section 5(1) was confined to such a limited class.
We are of the opinion that the fixation of the date for references for investigation by the Government to the Commission, viz., the 16th February 1950 was not an attribute of the class of substantial evaders of income tax which were intended to be specifically treated under the drastic procedure prescribed in the Travancore Act XIV of 1124 but was a mere accident and a measure of administrative convenience.
The date of such references could, without touching the nature and purpose of the classification, be extended by the Travancore Legislature by a necessary amendment of the Travancore Act, XIV of 1124, and if such an amendment had been grafted on the Act as originally passed, no one belonging to the particular class or category of substantial evaders of income tax could have complained against the same.
The next question to consider is whether the same class of persons dealt with under section 5(1) of the Travancore Act XIV of 1124 were intended to and 1245 could be dealt with under the provisions of section 47 of the Travancore Act XXIII of 1121.
Because, if that was the position at any particular period of time, section 5(1) of the Travancore Act XIV of 1124 would certainly be discriminatory in so far as there will be two distinct provisions simultaneously existing in the statute book, one of which could be applied to some persons within the same class or category and the other could be applied to others also falling within the same class or category, thus discriminating between the two groups.
Section 47 of the Travancore Act XXIII of 1121, as already observed, was in the same terms as section 34(1) of the Indian Income tax Act as it stood before its amendment in 1948.
Each of the following conditions had to be fulfilled before the Income tax Officer could take action under this section, viz.: (i)that definite information bad come into the possession of the Income tax Officer that income, etc.
had escaped; (ii)that inconsequence of such definite information the Income tax Officer discovered that income, etc.
(a) had escaped assessment, or (b) had been under assessed, or (c) had been assessed at too low a rate, or (d) had been the subject of excessive relief; (iii) that the Income tax Officer had reason to belive that (a) the assessee had concealed the particulars of his income, or (b) deliberately furnished inaccurate particulars thereof It is, therefore, abundantly clear that section 47(1) of the Travancore Act XXIII of 1121 was directed only against those persons concerning whom definite information came into the possession of the Incometax Officer and in consequence of which the Incometax Officer discovered that the income of those persons bad escaped or been under assessed or assessed at too low a rate or had been the subject of excessive relief.
The class of persons envisaged by 1246 section 47(1) was a definite class about which there was definite information leading to discovery within 8 years or 4 years as the case may be of definite item or items of income which had escaped assessment.
The Travancore Act XIII of 11 21 was passed on the 9th July 1946.
The action to be taken under it was not confined to escapement from assessment of income made during the war period (September 1939 to 1946).
Action could be taken in respect of income which escaped assessment even before the war and also more than 8 years after the end of the war.
Turning now to section 5(1) it will be noticed that the class of persons sought to be reached comprises only persons about whom there was no definite information and no discovery of any definite item or items of income which escaped taxation but about whom the Government had only prima facie reason to believe that they evaded payment of tax to a substantial amount.
The class of persons who might fall within section 5(1) of the Travancore Act XIV of 1124 was, therefore, not the same class of persons who may come under section 47(1) of the Travancore Act XXIII of 1121.
Further, action under section 5(1) read with section 8(2) of the 'Travancore Act XIV of 1124 is definitely limited to the evasion of payment of taxation on income made during the war period.
It cannot, therefore, be urged that section 5(1) of the Travancore Act XIV of 1124 was discriminatory in comparison with section 47(1) of the Travancore Act XXIII of 1121, for the persons who came under section 5(1) were not similarly situated as persons who came under section 47(1), Section 5(1) of Act XXX of 1947 was struck down in Shree Meenakshi Mills ' case, supra, as it comprised the same class of persons who were brought in the amended section 34(1 A) of the Indian Income tax Act, 1922 but the same cannot be said about section 5(1) as compared to section 47(1).
These two sections do not overlap and do not cover the same class of persons.
The result, therefore, is that section 5(1) of the Travancore Act XIV of 1124 which has to be read for 1247 this purpose in juxtaposition with section 47 of the Travancore Act XXIII of 1121 cannot be held to be discriminatory and violative of the fundamental right guaranteed under article 14 of the Constitution.
The proceedings which took place in the course of investigation by the Commission up to the 26th January 1950 were valid and so also were the proceedings during the course of investigation which took place after the inauguration of the Constitution on the 26th January 1950 under which the petitioner, as a citizen of our Sovereign Democratic Republic acquired inter alia guarantee of the fundamental right under article 14 of the Constitution.
The result, therefore, is that all the contentions urged on behalf of the petitioner fail and Civil Appeal No. 21 of 1954 must be dismissed with costs.
Civil Appeals Nos. 21 and 22 of 1954 will accordingly be dismissed with costs.
There will be a set off for costs.
| The petitioners native of Quilon within the Travancore State had been assessed to income tax for the years 1942 and 1943, the final orders in his assessment having been passed by the Chief Revenue authority of Travancore in December 1946 and November 1946 respectively.
Travancore Taxation on Income (Investigation Commission) Act, 1124 (Act XIV of 1124) modelled on the Indian Act XXX of 1947 was passed by the Travancore Legislature, to provide for an investigation into matters relating to taxation on income.
In July 1949 , the United State of Travancore and Cochin was brought into existence as a result of integration between the two States.
All existing laws of Travancore were to continue in force by virtue of Ordinance I of 1124 which was later enacted as Act VI of 1125.
In November 1949 the Government of the 'United State of Travancore 1197 Cochin issued orders under section 5(1) of the Travancore Act XIV of 1 124 referring the cases of the petitioner for the years 1942 and 1943 (called Evasion Cases Nos. 1 & 2 of 1125) for investigation by the Travancore Income Tax Investigation Commission.
Before the Commission could make its report the Constitution of India came into force and the United State of Travancore Cochin became a part of India (Part B State) and the Travancore Act XIV of 1124 was continued in force until altered, amended or repealed by a competent authority.
In April 1950 Parliament passed Act XXXIII of 1950 whereby Taxation on Income (Investigation Commission) Act, (Act XXX of 1947) was extended to Travancore Cochin and the law of Travancore corresponding to Act XXX of 1947 was to continue in force with certain modifications.
In October 1951, a notification issued by the Indian Investigation Commission appointed Respondent No. 1 as an authorised official under section 6 of Travancore Act XIV of 1124 read with Act XXXIII of 1950.
Respondent No. I sent a copy of that notification to the petitioner on 21st November, 1951 for his information and further intimated to him that the investigation proposed to be conducted will not be confined to the years 1942 and 1943 but that it would be necessary for him to investigate the petitioner 's income for the period from 1940 to the last completed assessment year.
The petitioner filed a writ petition in the Travancore High Court against Respondent No. I and Respondent No. 2 (Indian Income Tax Investigation Commission) for a writ of prohibition or any other writ prohibiting the Respondents from holding an enquiry into the cases registered as Evasion Cases Nos. 1 & 2 of 1126 or from holding an investigation into the income of the petitioner from the year 1940 to the last completed assessment year.
The Travancore High Court held that the Respondent No. 2 had all the powers that the Travancore Commission had under Travancore Act XIV of 1124 and no more and granted the writ prohibiting respondents from conducting an enquiry into years other than 1942 and 1943.
Both the parties appealed to the Supreme Court against the order of the High Court.
A preliminary objection to the jurisdiction of the High Court to entertain the writ petition was repeated in the Supreme Court by the Attorney General.
Held, that the High Court bad jurisdiction under article 226 of the Constitution to issue a writ against Respondent No. 1 because under the provisions of section 6 of the Travancore Act XIV of 1124 the authorised official (Respondent No. 1) had considerable powers conferred upon him in the conduct of the investigation, and if he did anything as authorised official which was not authorised by law or was violative of the fundamental rights of the petitioner as in the present case be would be amenable to the jurisdiction of the High Court under article 226 of the Constitution.
Held, further that under the provisions of the Travancore Act XIV of 1124 the Commission had no authority 'to investigate any case suo motu.
It could only investigate cases referred to it by 1198 Government.
All that was done in the present case was that by two separate orders made under section 5(1) of the Act the Government referred two cases of the petitioner for the two years 1942 and 1943 to the Commission.
There was no other order under section 5(1) at any time before 16th February 1950 and none could be made under that sub section after that date.
Therefore neither Respondent No. 2 nor Respondent No. 1 who had been appointed as authorised Official by Respondent No. 2 had jurisdiction to cover any period beyond the two specific years 1942 and 1943 and the notice dated 21st November 1951 issued by Respondent No. 1 to investigate the petitioner 's income for the period from 1940 to the last completed assessment year was clearly illegal and without jurisdiction.
Held, also that section 5(1) of the Travancore Act XIV of 1124 which is to be read in juxta position with section 47 of the Travancore Inc6me Tax Act, 1121 (XXIII of 1121) is not discriminatory and violative of the fundamental right guaranteed under article 14 of the Constitution.
Section 47(1) of the Travancore Act XXIII of 1121 was directed only against those persons concerning whom definite information came into the possession of the, Income tax Officer and in consequence of which the Income tax Officer discovered that the income of those persons had escaped or been under assessed or assessed at too low a rate or had been the subject of excessive relief.
The class of persons envisaged by section 47(1) was a definite class about which there was definite information leading to discovery within 8 years or 4 years as the case may be of definite item or items of income which had escaped assessment.
The action to be taken under Travancore Act XXIII of 1121 was not confined to escapement from assessment of income made during the war period (September 1939 to 1946).
Action could be taken in respect of income which escaped assessment even before the war and also more than 8 years after the end of the war.
On the other hand under section 5(1) of the Travancore Act XIV of 1124 the class of persons sought to be reached comprised only these persons about whom there was no definite information and no discovery of any definite item or items of income which escaped taxation but about whom the Government had only prima facie reason to believe that they had evaded payment of tax to a substantial amount.
Further, action under section 5(1) read with section 8(2) of the Travancore Act XIV of 1124 was definitely limited to the evasion of payment of taxation on income made during the war period and therefore section 5(1) of the Travancore Act XIV of 1124 was not discriminatory in comparison with section 47(1) of the Travancore Act XXIII of 1121.
Election Commission, India vs Saka Venkata Rao ([1953] S.C.R. 1144), K. section Rashid & Son vs The Income tax Investigation Commission, etc.
([1954] S.C.R. 738), Azmat Ullah vs Custodian, Evacuee Property, U.P., Lucknow (A.I.R. 1955 All, 435), Burhanpur 1199 National Textile Workers Union, Burhanpur vs Labour Appellate Tribunal of India at Bombay and others (A.I.R. 1955 Rag. 148), Joginder Singh Waryam Singh vs Director, Rural Rehabilitation, Pepsu, Patiala and others (A.I.R. 1955 Pepsu 91), Chiranjit Lal Chowdhuri vs The Union of India ([1950] S.C.R. 869), Budhan Chowdhury and others vs The State of Bihar ([1955] 1 S.C.R. 1045), Suraj Mall Mohta & Co. vs A. V. Visvanatha Sastri and another ([1955] 1 S.C.R. 448), Shree Meenakshi Mills Ltd. vs Sri A. V. Visvanatha Sastri and Another ([1955] 1 S.C.R. 787), Aswini Kumar Ghose 's case ([1953] S.C.R. 1), Subodh Gopal Bose 's case ([1954] S.C.R. 587, 628), Kathi Baning Bawat vs The State of Saurashtra ([1952] S.C.R. 435), Palser vs Grinling ([1948] A.C. 291) and Kedar Nath Bajoria vs The State of West Bengal ([1954] S.C.R. 30), referred to.
|
Appeal No. 17 of 1954.
Appeal by Special Leave from the Judgment and Order dated the 11th day of June 1951 of the Punjab High Court in Civil Reference No. 2 of 1951.
Hardyal Hardy and Sardar Singh, for the appellant.
C. K. Daphtary, Solicitor General of India (G. N. Joshi and R. H. Dhebar, with him) for the 'respondent.
February 21.
The Judgment of the Court was delivered by VENKATARIAMA AYYAR J.
The appellant is a firm carrying on business at Ludhiana in the Punjab.
The Income tax Officer assessed its income for 1945 1946 at Rs. 71,186, and on 17 9 1947 a notice of demand was served on it for Rs. 29,857 6 0 on account of income tax and super tax.
The appellant preferred an 168 appeal against the assessment, and it was actually received in the office of the Appellate Assistant Commissioner on 5 11 1947.
It was then out of time by 19 days; but the appeal was registered as No. 86, and notice for hearing under section 31 was issued for 13 12 1947, and after undergoing several adjournments, it was actually heard on 1 10 1948.
For the year 1946 1947, the Income tax Officer assessed the income of the firm at Rs. 1,09,883, and on 29 9 1947 a notice of demand was served on it for Rs. 51,313 14 0 on account of income tax and super tax.
The appellant preferred an appeal against this assessment, and it was actually received in the office of the Appellate Assistant Commissioner on 5 11 1947, and it was then 7 days out of time.
It was registered as No. 89, and notice for hearing under section 31 was issued for 24 6 1948.
Eventually, it was heard along with Appeal No. 86 on 1 10 1948.
At the hearing, the Department took the objection that the appeals were presented out of time, and were therefore liable to be dismissed.
The appellant prayed for condonation of the delay on the ground that following on the partition of the country the conditions were very unsettled, that curfew order had been promulgated and was in force, and that the post office did not accept registered letters, and that the traffic on the Grand Trunk Road was closed., and that in view of these exceptional circumstances, it bad sufficient cause for not presenting the appeals in time.
On 31 12 1948 the Appellate Assistant Commissioner passed orders in both the appeals, holding that there was not sufficient ground for condoning the delay, and rejecting them in limine.
These orders were purported to be passed under section 31 read along with section 30(2).
Against these orders, the appellant preferred appeals under section 33 of the Act to the Appellate Tribunal which by its order dated 4 4 1950 dismissed them on the ground that the orders of the Assistant Commissioner were in substance passed under section 30 (2) and not under section 31 and that no appeal lay against them under section 33, On the applica 169 tions of the appellant, the Tribunal referred under section 66(1) of the Income Tax Act the following question for the decision of the High Court of Punjab: "Whether in the circumstances of the case appeals lay to the Tribunal against orders of the Appellate Assistant Commissioner dismissing the appeals against the assessments for the years 19451946 and 1946 1947 in limine".
The reference was beard by Khosla and Harnam Singh JJ., who held following an earlier decision of that court in Dewan Chand vs Commissioner of Incometax(1) that the orders of the Appellate Assistant Commissioner were under section 30(2) and not appealable under section 33.
Certificate to appeal to this Court against this order having been refused by the High Court, the appellant applied for and obtained leave to appeal to this Court under article 136 of the Con stitution, and that is how the appeal comes before US.
The provisions of the Act bearing on the question may now be referred to.
Section 30(1) confers on the assessee a right of appeal against orders passed under the sections specified therein.
Section 30(2) provides that the appeal shall ordinarily be presented within thirty days of the order of assessment, but the Appellate Assistant Commissioner may admit an appeal after the expiration of the period if he is satisfied that the appellant bad sufficient cause for not presenting it within that period.
Section 30(3) provides that "the appeal shall be in the prescribed form and shall be verified in the prescribed manner".
Section 31(1) enacts that "the Appellate Assistant Commis sioner shall fix a day and place for the hearing of the appeal, and may from time to time adjourn the hearing".
Section 31(3) specifies the orders that may be passed in appeals according as they are directed against orders passed under the one or the other of the sections of the Act which are specified in section 30(1).
When the appeal is against an order of assessment under section 23 and this is what we are con (1) (1951] 20 , 170 cerned with in this appeal it is provided in section 31(3), clauses (a) and (b) that in disposing of the appeal the Appellate Assistant Commissioner may (a) confirm, reduce, enhance or annul the assessment, or (b) set aside the assessment and direct the.
Incometax Officer to make a fresh assessment after making such further enquiry as the Income tax Officer thinks fit.
Section 33(1) enacts that, "Any assessee objecting to an order passed by an Appellate Assistant Commissioner under section 28 or section 31 may appeal to the Appellate Tribunal within sixty days of the date on which such order is communicated to him".
Stated succinctly, section 30 confers a right of appeal on the assessee, section 31 provides for the hearing and disposal of the appeal, and section 33 confers a right of further appeal against orders passed under section 31, Now, on these provisions the question is whether an order dismissing an appeal presented under section 30 as out of time is one under section 30(2) or under section 31 of the Act.
If it is the former, there is no appeal provided against it; if it is the latter, it is open to appeal under section 33.
On this question, there has been a sharp conflict of opinion among different High Courts and even among different Benches of the same High Court.
The Bombay High Court has held that when an appeal is presented out of time, and there is no order of condonation of delay under section 30(2), there is, in law, no appeal before the Appellate Assistant Commissioner, and that an order by him rejecting the appeal does not fall within section 31 and is not appealable: Commissioner of Income tax vs Mysore Iron and Steel Works(1) and K. K. Porbunderwalla vs Commissioner of Income tax(2); but that if the appeal is admitted after an order of condonation is made under section 30(2), an order subsequently passed dismissing it on the ground of limitation would be one under section 31 and would be appealable under section 33 and the result will be the same even when the appeal is admitted without (1) .[1949] , (2) 171 any order of condonation under section 30(2): Champalal A sharam vs Commissioner of Income tax(1).
The High Court of Allahabad has also taken the same view, and held that an order refusing to condone delay and rejecting an appeal before it was admitted was not one under section 31 and was not appealable: Vide Shivnath Prasad vs Commissioner of Income tax, Central and U. P.(3) and Municipal Board, Agra vs Commissioner of Income tax, U. P.( 3 ); but that ail order dismissing the appeal as time barred after it had been admitted was one under section 31 and was appeable: Mohd. Nain Mohd. Alam vs Commissioner of Income tax(1).
The High Court of Punjab has held following Shivnath Prasad vs Commissioner of Incometax, Central and U. P.(2) and Commissioner of Incometax vs Mysore Iron and Steel Works(5) that when the Appellate Assistant Commissioner declines to condone delay and rejects the appeal, it is one under section 30(2) and not appealable.
It has further held that even if the appeal bad been admitted without an order of condonation and dismissed at the hearing on the ground of limitation, it would not be under section 31, because the scheme of the Act contemplated that an order to be passed under that section must relate to the merits of the assessment.
It is on this decision that the judgment under appeal is based It may be mentioned that the decision in Dewan Chand vs Commissioner of Income tax(6) was dissented from in a recent decision of the Punjab High Court in General Agencies vs Income tax Commissioner(7) .
In Commissioner of Income tax vs Shahzadi Begum the Madras High Court has held that an order declining to excuse delay and rejecting the appeal is one under section 31, whether it is made before the appeal is admitted or after, and that an appeal which is filed out of time is, nonetheless, an appeal for purposes of section 31, and that an order dismissing it would be appealable under section 33.
In Gour Mohan (1) , (3) (5) (7) A.I R. 1956 Punjab 26.
(2) (4) (6) (8) 172 Mullick vs Commissioner of Agricultural Income tax(1), the Calcutta High Court has, after a full discussion, come to the conclusion that an order of dismissal on the ground of limitation at whatever stage was one which fell under section 31.
It is unnecessary to refer to the views expressed in decisions of other High Courts, as the point now under discussion did not directly arise for decision therein.
The question is which of these views is the correct one to adopt.
We start with this that under section 33 it is only orders under section 31 that are appealable.
The question therefore narrows itself to this whether an order declining to condone delay and dismissing the appeal as barred by time is an order under section 31.
It will be, if it is passed in appeal against an order of assessment, and is one which affirms it.
Now, the conflicting views expressed by the several High Courts centre round two points: (1) when an appeal is presented out of time and there has been a refusal to condone delay under section 30(2), is an order rejecting it as time barred one passed in appeal; and (2) if it is, is such an order one confirming the assessment within section 31(3)(a)? On the first point, as already stated, it has been held by the Bombay High Court that while an order dismissing an appeal as time barred after it is admitted is one under section 31, a similar order passed before it is admitted is one under section 30(2).
The ratio of this distinction is stated to be that in law there is no appeal unless it is presented in time, and if presented beyond time, unless the delay is excused.
In Commissioner of Income tax vs Mysore Iron and Steel Works(2), Chagla, C.J. stated the position thus: "An asseesee has a statutory right to present an appeal within thirty days without any order being required from the Appellate Assistant Commissioner for admission of that appeal.
But if the time prescribed expires, then that statutory right to present an appeal goes; and an appeal can only be entertained provided it is admitted by the Appellate Assistant Commissioner after condoning the delay.
(1) (2) 173 Therefore before an appeal could be admitted in this case, an order from the Appellate Assistant Commissioner was requisite that the delay had been condoned and it was only on such an order being made that the appeal could be entertained by the Appellate Assistant Commissioner.
Now section 31 deals only with such appeals which are presented within the prescribed period or admitted after the delay has been condoned, and the procedure laid down in section 31 with regard to the hearing of appeals only applies to such appeals.
Therefore, in my opinion, when the Appellate Assistant Commissioner refused to condone the delay, there was no appeal before him which he could hear and dispose of as provided under section 31 of the Act.
Section 33 then gives the right of appeal to the assessee from an order made by the Appellate Assistant Commissioner either under section 28 or under section 31.
Therefore the Legislature did not give the right of appeal to the assessee against an order made by the Appellate Assistant Commissioner under section 30 of the Act".
Learned counsel for the appellant disputes the correctness of the last observation that an order of the Appellate Assistant comissioner refusing to condone the delay is one under section 30(2), and contends that the only order that could be passed under that section was one excusing delay, and an order refusing to condone it will fall outside it, and that such an order could only be made under section 31.
We find it difficult to accede to this contention.
When power is granted to an authority to be exercised at his discretion, it is necessarily implicit in the grant that he may exercise it in such manner as the circumstances might warrant.
And if the Appellate Assistant Commissioner has a discretion to excuse the delay, he has also a discretion in appropriate cases to decline to do so.
We are therefore of opinion that the refusal to excuse delay is an order under section 30(2.).
But the question still remains whether the view taken in Commissioner of Income tax vs Mysore Iron 23 174 and Steel Works(1) and K. K. Porbunderwalla v Commissioner of Income tax (2) that an appeal which is filed beyond the period of limitation is, in the eye of law, no appeal, unless and until there is a condonation of delay, and that, in consequence, an order passed thereon cannot be held to be passed in appeal so as to fall within section 31 is right.
Now, a right of appeal is a substantive right, and is a creature of the statute.
Section 30(1) confers on the assessee a right of appeal against certain orders, and an order of assessment under section 23 is one of them.
The appellant therefore had a substantive right under section 30(1) to prefer appeals against orders of assessment made by the Income tax Officer.
Then, we come to section 30(2), which enacts a period of limitation within which this right is to be exercised.
If an appeal, is not presented within that time, does that cease to be an appeal as provided under section 30(1)? It is well established that rules of limitation, pertain to the domain of adjectival law, and that they operate only to bar the remedy but not to extinguish the right.
An appeal preferred in accordance with section 30(1) must, therefore, be an appeal in the eye of law, though having been presented beyond the period mentioned in section 30(2) it is liable to be dismissed in limine.
There might be a provision in the statute that at the end of the period of limitation prescribed, the right would be extinguished, as for example, section 28 of the Limitation Act; but there is none such here.
On the other hand, in conferring a right of appeal under section 30(1) and prescribing a period of limitation for the exercise thereof separately under section 30 (2), the legislature has evinced an intention to maintain the distinction well recognised under the general law between what is a substantive right and what is a matter of procedural law.
In Nagendranath Dey vs Suresh Chandra Dey(3) Sir Dinshaw Mulla construing the word ' appeal ' in the third column of article 182 of the Limitation Act observed: "There is no definition of appeal in the Civil Pro (1) (2) (3) 59 I.A. 283, 287.
175 cedure Code, but their Lordships have no doubt that any application by a party to an appellate, Court, asking it to set aside or revise a decision of a subordinate Court, is an appeal within the ordinary acceptation of the term, and that it is no less an appeal because it is irregular or incompetent".
These observations were referred to with approval and adopted by this Court in Raja Kulkarni and others vs The State of Bombay(1).
In Promotho Nath Roy vs W. A. Lee(2), an order dismissing an application as barred by limitation after rejecting an application under section 5 of the Limitation Act to excuse the delay in presentation was held to be one "passed on appeal" within the meaning of section 109 of the Civil Procedure Code.
On the principles laid down in these decisions, it must be held that an appeal pre sented out of time is an appeal, and an order dismissing it as time barred is one passed in appeal.
Then, the next question is whether it is an order passed under section 31 of the Act.
That section is the only provision relating to the hearing and disposal of appeals, and if an order dismissing an appeal as barred by limitation is one passed in appeal, it must fall within section 31.
And as section 33 confers a right of appeal against all orders passed under section 31, it must also be appealable.
But then, it is contended that in an appeal against assessment the only order that could be passed under section 31 (3)(a) is one which confirms, reduces, enhances or annuls the assessment, that such an order could be made only on a consideration of the merits of the appeal, and that an order dismissing it on the ground of limitation is not within the section.
That was the view taken in Dewan Chand vs Commissioner of Income tax(3).
But there is practically a unanimity of opinion among all the other High Courts that to fall within the section it is not necessary that the order should expressly address itself to and decide on the merits of the assessment, and that it is sufficient that the effect of the order is to confirm the assessment (1) [1954] S.C.R. 384, 388.
(2) A.I.R. 1921 Cal.
(3) 176 as when the appeal is dismissed on a preliminary point.
In Commissioner of Income tax vs Shahzadi Begum(1), Satyanarayana Rao, J. said: "If the appeal is dismissed as incompetent or is rejected as it was filed out of time and no sufficient cause was established, it results in an affirmation of the order appealed against".
In Gour Mohan Mullick vs Commissioner of Agricultural Income tax(2), construing sections 34, 35 and 36 of the Bengal Agricultural Income Tax Act which are in terms identical with those of sections 30, 31 and 33 of the Indian Income Tax Act, Chakravarti, J. observed: "I would base that view on the ground that the order, in effect, confirmed the assessment or, at any rate, disposed of the appeal and was thus an order under section 35, because what that section really contemplates is a disposal or conclusion of the appeal and the forms of orders specified in it are not exhaustive.
An appellate order may not, directly and by itself, confirm, or reduce or enhance or annul an assessment and may yet dispose of the appeal.
If it does so, it is immaterial whether the ground is a finding that the appeal is barred by limitation or a finding that the case is not a fit one for extension of time or both".
This reasoning is also the basis of the decisions of the Bombay and Allahabad High Courts which bold that an order rejecting an appeal on the ground of limitation after it had been admitted is one under section 31, though there is no consideration of the merits of the assessment.
Thus, in K. K. Porbunderwalla vs Commissioner of Income tax(3), Chagla, C. J. observed: ``. although the Appellate Assistant Commis sioner did not hear the appeal on merits and held that the appeal was barred by limitation his order was under section 31 and the effect of that order was to confirm the assessment which bad been made by the Income tax Officer".
In Special Manager of Court of Wards vs Commissioner (1) (2) (3) 177 of Income tax(1), the Allahabad High Court stated that the view was "possible that even though the period of limitation is prescribed under section 30 and the power to grant extension is also given in that section the power is really exercised under section 31 as the Appellate Assistant Commissioner when he decides not to extend the period of limitation may be said in a sense to have confirmed the assessment".
The respondent relied on a later decision of the) 'Allahabad High Court in Mahabir Prasad Niranjanlal vs Commissioner of Income tax(2), wherein it was held by the learned Judges, departing from the previous course of authorities of that court, that an order of the Appellate Assistant Commissioner dismissing an appeal as time barred was one under section 30(2) and not under section 31, and was therefore not appealable.
This conclusion they felt themselves bound to adopt by reason of certain observations of this Court in Commissioner of Income tax, Madras vs Mtt.
section Ar.
Arunachalam Chettiar(3).
But when read in the context of the point that actually arose for decision in that case, those observations lend no support to the conclusion reached by the learned Judges.
There, the facts were that an appeal was preferred by the assessee under section 30(1) against an order of the Income tax Officer, and that was dismissed by the Appellate Assistant Commissioner on 19 11 1945 as incompetent.
No appeal was filed against this order, and it became final.
But acting on a suggestion made in the order dated 19 11 1945, the assessee filed an original miscellaneous application before the Appellate Tribunal for relief, and by its order dated 20 2 1946 the Tribunal set aside the findings of the Income tax Officer, and directed him to make a fresh computation.
Then, on the application of the Commissioner of Income tax, the Tribunal referred to the High Court under section 66(1) of the Income tax Act the following question: "Whether in the facts and circumstances of the case, the order of the Bench dated 20th February, (1) , 212.
(2 ) (3) ; 474 475, 178 1946 in the miscellaneous application is an approoriate order and is legally valid and passed within the jurisdiction and binding on the Income tax Officer".
The High Court declined to answer this reference on the ground that the order of the Tribunal was not one passed in an appeal under section 33(1), and that In consequence, the reference under section 66(1) was itself incompetent.
The correctness of this decision was challenged on appeal to this Court, and in affirm ing it, this Court observed: . . when on 19th November 1945, the Appellate Assistant Commissioner declined to admit the appeal, the assessee did not prefer any appeal but only made a miscellaneous application before the Appellate Tribunal.
There is no provision in the Act permitting such an application.
Indeed, in the statement of the case the Appellate Tribunal states that in entertaining that application and correcting the error of the Income tax Officer it acted in exercise of what it regarded as its inherent powers.
There being no appeal under section 33(1) and the order having been made in exercise of its supposed inherent jurisdiction, the order cannot possibly be regarded as one under section 33(4) and there being no order under section 33(4) there could be no reference under section 66(1) or (2), and the appellate Court properly refused to entertain it".
There is, of course, nothing in the decision itself which bears on the point now under discussion.
But certain observations occurring at pages 474 and 475 were referred to by the learned Judges as leading to the conclusion that an order dismissing an appeal as barred by time would fall undersection 3O(2).
Now, those observations came to be made by way of answer to a new contention put forward by the learned, Attorney General in support of the appeal.
That contention was that the miscellaneous application presented to the Tribunal might be treated as an appeal against the order dated 19 11 1945, in which case the order passed thereon on 20 2 1946 would fall under section 33(4) and the reference would be com 179 petent. 'In disagreeing with this contention, this Court observed that the appeal to the Appellate Assistant Commissioner was incompetent under section 30(1), that even if it was competent, the order dated 19 11 1945 was not one contemplated by section 31, and there could be no appeal against such an order under section 33(1).
Now, it should be noticed that the question actually referred under section 66(1) was the correctness and legality of the order passed in a miscellaneous application and not of any order made in an appeal preferred under section 33(1).
In this context, the point sought to be raised by the learned, Attorney General did not arise at all for decision, and the observations in answer thereto cannot be read as a pronouncement on the question of the maintainability of the appeal, much less as a decision that an order dismissing an appeal as barred by limitation is one under section 30(2).
Accordingly, the question whether an order dismissing an appeal as barred by limitation falls under section 30(2) or section 31 remains unaffected by the observations in Commis sioner of Income tax, Madras vs Mtt.
section Ar.
Aruna chalam Chettiar(1).
Then again, under the provisions of the Act, limitation is not the only preliminary ground on which an appeal could be disposed of without a consideration of the merits.
Section 30(3) provides that an "appeal shall be in the prescribed form and shall be verified in the prescribed manner".
If the Appellate Assistant Commissioner holds that the appeal does not comply with the requirements of this enactment and rejects it on that ground, the order must be one made under section 31, since section 30(3) makes no provision for such an order, as does section 30(2) in the case of limitation.
All the orders under section 31 being appealable under section 33, the order of dismissal for noncompliance with section 30(3) must also be appealable, and it was so decided in Maharani Gyan Manjari Kuari vs Commissioner of Income tax(2) .
How is this view to be reconciled with the contention that section 31 contemplates only orders on the (1) ; (2) 180 merits of the assessment and not on preliminary issues? Vide also the decision in Kunwarji Ananda vs Commissioner of Income tax(1), which was followed in Maharani Gyan Manjari Kuari vs Commissioner of Income tax(2), and in Ramnarayana Das Mandal vs Commissioner of Income tax(3).
There is thus abundant authority for the position that section 31 should be liberally construed so as to include not only orders passed on a consideration of the merits of the assessment but also orders which dispose of the appeal on preliminary issues, such as limitation and the like.
The learned Solicitor General sought to get over these decisions by taking up the position that section 31(3) (a) construed in its literal and ordinary sense, conferred jurisdiction on the Appellate Assistant Commissioner only to pass orders on the merits of the assessment, that it was not therefore open to him to entertain any question which did not directly relate to such merits, and that accordingly he could not hear or decide any issue of a preliminary nature such as limitation, and dispose of the appeal on the ,basis of the finding on that issue.
He conceded that this contention would run counter to numerous authorities, but argued that they were all wrong.
Having given due consideration to this contention, we are of opinion that it is not well founded.
Taking the plea of limitation which is what we are concerned with in this appeal when there is a judgment or order against which the statute provides a right of appeal but none is preferred within the time prescribed therefor, the respondent acquires a valuable right, of which he cannot be deprived by an order condoning delay and admitting the appeal behind his back.
And when such an order is passed ex partehe has a right to challenge its correctness at the bearing of the appeal.
That is the position under the general law (vide Krishnasami .
Panikondar vs Ramasami Chettiar(4), and there is nothing in the provisions of the Income Tax Act, which enacts a different principle.
(1) I L.R. 11 Patna 187; A.I.R. 1931 Patna 306; 5 I.T.C. 417.
(2) [1944]12 I.T.R. 59.
(3) (4) Mad. 412; 45 I.A. 25.
181 Therefore, if an appeal is admitted without the fact of delay in presentation having been noticed, clearly it must be open to the Department to raise the objection at the time of the hearing of the appeal.
That would also appear to be the practice obtaining before.
the Income tax Tribunal, as appears from the decisions cited before us, and that, in our opinion, is right.
Similar considerations would apply to other objections of a preliminary character, such as one based on section 30, sub section (3).
We should be slow to adopt a construction which deprives parties of valuable rights.
We are therefore of opinion that contentions relating to preliminary issues are open to consideration at the time of the hearing of the appeal, and that the jurisdiction of the Appellate Assistant Commissioner is not limited to the bearing of the appeal on the merits of the assessment only.
In this view, the orders of the Appellate Assistant Commissioner holding that there were no sufficient reasons for excusing the delay and rejecting the appeals as time barred would be orders passed under section 31 and would be open to appeal, and it would make no difference in the position whether the order of dismissal is made before or after the appeal is admitted.
The question referred must accordingly be answered in the affirmative.
This appeal will therefore be allowed, and the order of the court below set aside.
The appellant will have his costs here and in the court below.
| The appellant firm filed appeals against orders assessing it to income tax and super tax for the years 1945 1946 and 1946 1947 beyond the time prescribed by section 30(2) of the Income tax Act.
The appeals were numbered, and notices were issued for their hearing under section 31.
At the hearing of the appeals before the Appellate Assistant Commissioner, the Department took the objection that the appeals were barred by time.
The appellant prayed for condonation of delay, but that was refused, and the appeals were dismissed as time barred.
The appellant then preferred appeals against the orders of dismissal to the Tribunal under section 33 of the Act, and the Tribunal dismissed them on the ground that the orders of the Assistant Commissioner were in substance passed under section 30(2) and not under section 31 of the Act and that no appeal lay against them under section 33 of the Act.
On a reference under section 66(1) of the Act the High Court held that the orders of the Appellate Assistant Commissioner were made under section 30(2) and were not appealable under section 33 of the Act.
On appeal by special leave to the Supreme Court the question for determination was whether an order dismissing an appeal presented under section 30 as out of time was one under section 30(2) or under section 31 of the Act because if it was the former there was no appeal provided against it; if it was the latter it was open to appeal under section 33.
Held that the orders of the Appellate Assistant Commissioner fell within section 31.
A right of appeal is a substantive right and is a creature of the statute.
section 30(1) confers on the assessee a right of appeal against certain orders and an order of assessment under section 23 is one of them.
The appellant had therefore a substantive right under section 30(1) to prefer appeals against orders of assessment made by the Income Tax Officer.
167 An appeal presented out of time is an appeal and an order dismissing it as time barred is one passed in appeal.
Section 31 is the only provision relating to the hearing and disposal of appeals and if an order dismissing an appeal as barred by limitation as in the present case is one passed in appeal it must fall within section 31 and as section 33 confers a right of appeal against all orders passed under section 31, it must also be appealable.
To fall within section 31 it is not necessary that the order should expressly address itself to and decide on the merits of the assessment and it is sufficient that the effect of the order is to confirm the assessment as when the appeal is dismissed on a preliminary point.
An order rejecting an appeal on the, ground of limitation after it had been admitted is one under section 31, though there is no consideration of the merits of the assessment.
Held therefore that the orders of the Appellate Assistant Commissioner holding that there were no sufficient reasons for excusing the delay and rejecting the appeals as time barred would be orders passed under section 31 and would be open to appeal, and it would make no difference in the position whether the orders of dismissal were made before or after the appeals were admitted.
Commissioner of Income tax, Madras vs Mtt.
`r. section Ar.
Arunachalam Chettiar, ([1953] S.C.R. 463), explained.
Case law discussed.
|
minal Appeal No. 65 of 1954.
Appeal by special leave from the judgment and order dated the 2nd January 1953 of the Judicial Commissioner 's Court at Ajmer in Criminal Appeal No. 3 of 1952 arising out of the judgment and order dated the 4th January, 1952 of the Court of Sessions Judge at Ajmer in Criminal Appeal No. 300 of 1951.
B.P. Berry and B. P. Maheshwari, for the appellant.
C. K. Daphtar Solicitor General of India (Porus A. Mehta and P. G. Gokhale, with him) for the respondent.
March 12.
The Judgment of the Court was delivered by BOSE J.
The appellant, S.N. Mehra, a Camp Clerk 201 Ajmer, has been convicted of offences under section 420 of the Indian Penal Code and section 5(2) of the Prevention of Corruption Act, 1947 (Act II of 1947).
He was sentenced to two years ' rigorous imprisonment and a fine of Rs. 100 on each count.
The substantive sentences are concurrent.
The substance of the offences for which he was convicted lay in obtaining sums to talling Rs. 23 12 0 from Government as T.A. for two journeys, one from Ajmer to Abu Road and the other from Ajmer to Reengus.
The money represents the second class railway fare for these journeys.
The allegation against him is that either he did not travel at all between those places on the relevant dates, or, if he did, that he did not pay the fare.
He appealed to the Sessions Judge at Ajmer and was acquitted.
The State filed an appeal against the acquittal to the Judicial Commissioner of Ajmer ' The learned Judicial Commissioner accepted the appeal and remanded the case for retrial before a Special Judge because, by reason of certain amendments in the law, only a Special Judge could try an offence under section 5(2) of the Prevention of Corruption Act at the date of the remand.
The appeal here raises certain questions about sanction which we do not intend to discuss because, in our opinion, the evidence adduced does not justify a retrial as no conviction for those two offences could be based on it.
It was first alleged that the appellant did not travel at all on the relevant dates and that the burden of proving that he did was on him.
We do not think this issue arises because the charge assumes that he did travel and there is no evidence before us to justify even a prima facie inference that he did not.
The charge runs "That you, on or about etc . cheated the Government by dishonestly inducing the Government to pay you Rs. 62 9 0 on account of T.A. for the journeys performed on the above mentioned days. . " 202 There is no suggestion that the journeys were not performed and only purported to be; and it would be unfair to permit the State to go back on what it said in the charge at this stage, especially after the appellant has entered on his defence and virtually admitted that he did travel on those dates; in any case, he has not denied the fact and that would naturally operate to his disadvantage if the prosecution were to be allowed to change its position in this way.
We must therefore accept the fact that he did travel as alleged on the relevant dates, and the only question that remains is whether he paid the second class fares which he later claimed, and obtained, from Government as T.A. for those journeys.
The only proof that is adduced in support of the allegation that he did not is that no second class tickets were issued at Ajmer on the relevant dates either for Abu Road or for Reengus.
This is proved by the Booking Clerk Ram Dayal, P.W. 4.
But the same witness proves that tickets are not always issued and that passengers can pay the fare on the train; also, if the second class is fully booked no further tickets are issued till the arrival of the train.
In that case, passengers sometimes buy a third class or an inter class ticket and then pay the difference to the conductor or guard of the train if they are able to find second class accommodation when the train arrives.
There is no proof that one or other of these courses was not followed on the dates with which we are concerned.
The railway registers and books would show whether or not any such payments were made on those dates and the State could have proved the absence of such payments as easily as it was able to prove, from the same sort of material, that no second class tickets were issued.
Instead of doing that, the State contented itself with saying that no second class tickets were issued and, then relying on Illustration (b) to section 106 of the Evidence Act, it contended that the burden of proving that the accused did pay the second class fares was on him.
Illustration (b) runs thus: "A is charged with travelling on a railway with 203 out a ticket.
The burden of proving that he had a ticket is on him".
But this is only an illustration and must be read subject to the section itself and cannot travel beyond it.
The section runs "When any fact is especially within the knowledge of any person, the burden of proving that fact is on him".
The stress, in our opinion, is on the word "especially".
Section 106 is an exception to section 101.
Section 101 lays down the general rule about the burden of proof.
"Whoever desires any Court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts, must prove that those facts exist".
Illustration (a) says "A desires a Court to give judgment that B shall be punished for a crime which A says B has committed.
A must prove that B has committed the crime".
This lays down the general rule that in a criminal case the burden of proof is on the prosecution and section 106 is certainly not intended to relieve it of that duty.
On the contrary, it is designed to meet certain exceptional cases in which it would be impossible, or at any rate disproportionately difficult, for the prosecution to establish facts which are "especially" within the knowledge of the accused and which he could prove without difficulty or inconvenience.
The word "especially" stresses that.
It means facts that are preeminently or exceptionally within his knowledge.
If the section were to be interpreted otherwise, it would lead to the very startling conclusion that in a murder case the burden lies on the accused to prove that he did not commit the murder because who could know better than he whether he did or did not.
It is evident that cannot be the intention and the Privy Council has twice refused to construe this section, as reproduced in certain other Acts outside India, to mean that the 204 burden lies on an accused person to show that be did not commit the crime for which he is tried.
These cases are Attygalle vs Emperor(1) and Seneviratne vs R. (2).
Illustration (b) to section 106 has obvious reference to a very special type of case, namely to offences under sections 112 and 113 of the Indian Railways Act for travelling or attempting to travel without a pass or ticket or with an insufficient pass, etc.
Now if a passenger is seen in a railway carriage, or at the ticket barrier, and is unable to produce a ticket or explain his presence, it would obviously be impossible in most cases for the railway to prove, or even with due diligence to find out, where he came from and where he is going and whether or not be purchased a ticket.
On the other band, it would be comparatively simple for the passenger either to produce his pass or ticket or, in the case of loss or of some other valid explanation, to set it out; and so far as proof is concerned, it would be easier for him to prove the substance of his explanation than for the State to establish its falsity.
We recognise that an illustration does not exhaust the full content of the section which it illustrates but equally it can neither curtail nor expand its ambit; and if knowledge of certain facts is as much available to the prosecution, should it choose to exercise due diligence, as to the accused, the facts cannot be said to be "especially" within the knowledge of the accused.
This is a section which must be considered in a commonsense way; and the balance of convenience and the disproportion of the labour that would be involved in finding out and proving certain facts balanced against the triviality of the issue at stake and the ease with which the accused could prove them, are all matters that must be taken into consideration.
The section cannot be used to undermine the well established rule of law that, save in a very exceptional class of case, the burden is on the prosecution and never shifts.
Now what is the position here? These journeys (1) A.I.R. 1936 P.C. 169.
(2) , 49. 205 were performed on 8 9 1948 and 15 9 1948.
The prosecution was launched on 19 4 1950 and the appellant was called upon to answer the charge on 9 3 1951; and now that the case has been remanded we are in the year 1956.
The appellant, very naturally, said on 27 4 1951, two and a half years after the alleged offences: "It is humanly impossible to give accurate explanations for the journeys in question after such a lapse of time".
And what of the prosecution? They have their registers and books, both of the railway and of the department in which the appellant works.
They are in a position to know and prove his official movements on the relevant dates.
They are in a position to show that no vouchers or receipts were issued for a second class journey by the guard or conductor of the trains on those days.
This information was as much within their "especial" knowledge as in that of the appellant; indeed it is difficult to see how with all the relevant books and other material in the possession of the authorities, these facts can be said to be within the "especial" knowledge of the appellant after such a lapse of time however much it may once have been there.
It would, we feel, be wrong to allow these proceedings to continue any longer.
The appellant has been put upon his trial, the prosecution has had full and ample opportunity to prove its case and it can certainly not complain of want of time to search for and prepare its material.
No conviction could validly rest on the material so far produced and it would savour of harassment to allow the continuance of such a trial without the slightest indication that there is additional evidence available which could not have been discovered and produced with the exercise of diligence at the earlier stages.
We set aside the order of the Judicial Commissioner and restore the order of the Sessions Judge acquitting the appellant on both counts of the charge framed against him.
| The appellant was put up for trial under section 420 of the Indian Penal Code and section 5(2) of the Prevention of Corruption Act of 1947 for obtaining a total sum of Rs. 23 12 0 from the Government as T.A., being second class railway fares for two journeys, one from Ajmer to Abu Road and the other from Ajmer to Reengus, without having actually paid the said fares.
The prosecution proved from the railway books and registers that no such second class tickets were issued at Ajmer on the relevant dates and the same witness who proved this also proved that tickets were not always issued and the passengers could pay the fare in the train and if the second class was fully booked, no further tickets were issued till the train arrived,in which case passengers sometimes bought third class or inter class tickets and thereafter paid the difference to the guard of the train, if they could find second class accommodation on the arrival of the train.
There was no proof that one or other of those courses were not followed by the appellant and the prosecution instead of proving the absence of any such payments, in the same way as it had proved the non issue of second class tickets, relied on Illustration (b) to section 106 of the Evidence Act and contended that it was for the appellant to prove that he had actually paid the second class fares.
200 Held, that Illustration (b) to section 106 of the Evidence Act had no application, the evidence adduced by the prosecution did not warrant a conviction and the accused should, having regard to the long lapse of time, be acquitted.
That section 106 of the Evidence Act does not abrogate the well established rule of criminal law that except in very exceptional classes of cases the burden that lies on the prosecution to prove its case never shifts and s, 106 is not intended to relieve the prosecution of that burden. ' On the contrary, it seeks to meet certain exceptional cases where it is impossible, or disproportionately difficult, for the prosecution to establish facts which are especially within the knowledge of the accused and which can be proved by him without difficulty or inconvenience.
But when knowledge of such facts is equally available to the prosecution if it chooses to exercise due diligence, they cannot be said to be especially within the knowledge of the accused and the section cannot apply.
Attygalle vs Emperor, (A.I.R. and Seneviratne vs
B., ([1936] 3 All E.R. 36), referred to.
That illustrations to a section do not exhaust its full content even as they cannot curtail or expand its ambit, and in applying section 106 the balance of convenience, the comparative labour involved in finding out and proving the facts and the ease with which the accused can prove them must be taken into consideration.
That cases coming under sections 112 and 113 of the Indian Railways Act to which Illustration (b) to section
106 has obvious application stand on a different footing.
|
minal Appeal No. 24 of 1956.
On appeal by special leave from the judgment and order dated the, 26th September 1955 of the Allahabad High Court (Lucknow Bench) in Criminal Appeal No. 195 of 1955 and Capital Sentence No. 17 of 1955 arising out of the judgment and order dated the 11th April 1955 of the Court of the Sessions Judge at Bahraich in Criminal S.T. No. 9 of 1955.
D. R. Prem, for the appellant.
K. B. Asthana and C. P. Lal, for the respondent.
March 12.
The Judgment of the Court was delivered by IMAM J.
The appellant 'was sentenced to death for the murder of one Ram Dularey.
He was also sentenced to seven years ' rigorous imprisonment for having robbed the murdered man of his goods.
He was tried along with two other persons, who were ' acquitted, by the Sessions Judge of Bahraich.
All the four assessors,, who attended the trial, were of the opinion that the appellant was guilty.
The High Court of Allahabad affirmed the conviction and the sentence and this appeal is by special leave, 193 Certain facts have been proved beyond all doubt.
Indeed, the most important of them are admitted by the appellant in his statement under section 342 of the Code of Criminal Procedure when examined in the Court of Sessions.
It has been established by the evidence in the case that the deceased Ram Dularey, a shop keeper of Jarwal, had gone to Lucknow to purchase goods for his shop.
On his return journey, he got down from the train at Jarwal Road Station on the 2nd of July, 1954, at about 9 30 p.m.
He had with him articles consisting of a box, a balti, a gunny bag, jholas and other things.
Shortly thereafter, he engaged the appellant 's cart to take him and his goods to his village.
Two other persons also got on to the cart.
The appellant was driving the cart.
Neither the deceased nor the articles, which were with him, nor the cart ever reached Jarwal.
In the morning, Ram Dularey 's body was found near a bridge in close vicinity of Jarwal. 'Information was sent to the police who commenced investigation and their enquiriesed them to the appellant, who was arrested on the 6th of July, 1954.
The appellant gave the key of his kothri to the police with which it was opened.
From the kothri numerous articles were recovered, including a big knife exhibit 20 with blood stains, a dhoti exhibit 3, a box exhibit 9, a balti exhibit I,, a chadar exhibit 2, a gunny bag exhibit 13 and a jhola exhibit 24.
It is not necessary to give the details of the other articles recovered.
The knife was sent to the Chemical Examiner along with the dhoti.
Although minute blood stains were detected on the knife, they were not sufficient to enable a comparison in a blood group test.
No blood was discovered on the dhoti.
The dhoti exhibit 3, the box exhibit 9, the balti exhibit 1, the chadar exhibit 2, the gunny bag exhibit 13 and the jhola exhibit 24 have been identified as belonging to the deceased Ram Dularey.
When examined under section 342 of the Code of Criminal Procedure by the Sessions Judge, the appellant stated that the deceased Ram Dularey bad asked him to take his goods in his cart and it was agreed that Rs. 2 would be paid as the fare.
The appellant 194 took the deceased on his cart with his goods including the box exhibit 9.
Two other men were also in the cart who got down at the Sugar Mill gate at the Railway Station.
At the Raduayan Bridge three men enquired if Ram Dularey was in the cart.
Ram Dularey responded and got down from the cart asking the appellant to halt his cart at Jarwal Bazar Bridge, where he waited for the deceased until 4 a.m., but the deceased did not turn up.
As the appellant did not know the house of the deceased in Jarwal Bazar, he took the dead man 's goods in his cart to his own house as his buffaloes were very hungry.
To the question as to whether any article of the deceased was recovered from his house by the police, the appellant stated that he handed over to the police all the property of the deceased which be had looked in the kothri.
He asserted that he had told the people in his village as well as the Mukhia that he would hand over the property to its owner when he came to take it.
Concerning the knife, he disowned its ownership and could not say how it came to be found in his house.
So far as the dhoti exhibit 3 is concerned, the appellant claimed it as his.
On behalf of the appellant, it was urged that the evidence in the case was insufficient to establish any of the charges framed against him.
In the alternative, it was suggested, that as the co accused of the appellant had been acquitted the latter could not be convicted of the offence of murder by the application of the provisions of section 34 of the Indian Penal Code in the absence of proof that any act of his caused the death of Ram Dularey.
It was also submitted that no question was put by the Sessions Judge to the appellant when he was examined under section 342 of the Code of Criminal Procedure concerning the act of murder or robbery.
We have examined the statement of the appellant recorded under section 342 of the Code of Criminal Procedure by the Sessions Judge.
At the very commencemeilt of the record of that statement, the Sessions Judge readout the appellant 's statement under section 342 of the Code of Criminal Procedure before 195 the Committing Magistrate and enquired 'Whether it was correct.
, to which the 'appellant replied in the affirmative.
The statement of the appellant before the Magistrate is admissible under section 287 of the Code of Criminal Procedure.
The Magistrate pointedly asked the appellant as to whether he along with the other accused murdered Ram Dularey and had taken his property to which the appellant replied in the negative.
It was not necessary for the Sessions Judge to specifically repeat the same when the appellant admitted his statement before the Committing Magistrate as correct when read out to him.
Apart from this, when the statement of the appellant to the Sessions Judge is read as a whole, it clearly shows that the appellant knew what the accusation against him was and he offered an explanation for the disappearance of Ram Dularey from his cart and for his possession of the deceased 's goods.
There is no justification for supposing that there had been any prejudice caused to the appellant on account of improper or insufficient recording of his statement by the Sessions Judge under section 342 of the Code of Criminal Procedure.
On the facts proved beyond question it is clear that the last time the deceased was seen alive was in the company of the appellant and two other persons when the cart started for Jarwal and his goods were ' on that cart.
There is, however, no evidence as to what happened in the course of the journey.
Concerning that we have only the statement of the accused.
The evidence next establishes that after the cart started, next morning, the 3rd of July, the dead body of Ram Dularey was found not far from Jarwal.
His goods had disappeared and some of them at any rate were found in the possession of the appellant on the 6th of July.
The real question is whether the evidence in the case establishes that the appellant murdered and robbed Ram Dularey.
The evidence is circumstantial.
Before we deal with that evidence, it is necessary to consider how far recent possession of property of a deceased, in circumstances clearly indicating that he 196 had been murdered and robbed, would suggest that not only the possessor of the property was a thief or a receiver of stolen property, but that it also indicated that he was guilty of a more aggravated crime which had connection with the theft.
In the case of The Emperor vs Sheikh Neamatulla(1) Sir Lawrence Jenkins had the occasion to examine this question.
After referring to section 114 of the Evidence Act, be quoted the following passage from Wills on Circumstantial Evidence: "the possession of stolen goods recently after the loss of them, may be indicative not merely of the offence of larceny, or of receiving with guilty knowledge, but of any other more aggravated crime which has been connected with theft.
This particular fact of presumption commonly forms also a material element of evidence in cases of murder; which special application of it has often been emphatically recognized".
In the case of Queen Empress vs Sami and Another(2) at page 432, the learned Judges of the High Court observed, "Under these circumstances, and in the absence of any explanation, the presumption arises that any one who took part in the robbery also took part in the murder.
In cases in which murder and robbery have been shown to form parts of one transaction, it has been held that recent and unexplained possession of the stolen property while it would be presumptive evidence against a prisoner on the charge of robbery would similarly be evidence against him on the charge of murder.
All the facts which tell against the appellant, especially his conduct indicating a consciousness of guilt, point equally to the conclusion that he was guilty as well of the murder as of the robbery. . . . .
In the case of Emperor vs Chintamoni Shahu(3), the opinion was expressed that "the possession of stolen goods recently after the loss of them may be indicative not merely of the offence of larceny or of receiving with guilty knowledge but of any other more aggravated Crime which has been (1) [1913]17 C.W.N. 1077.
(2) Mad.
(a) A.I.R. 1930 Cal.
379. 197 connected with the theft; this particular fact of pre sumption forms also a material element of evidence in the case of murder".
A similar view seems to have been taken in the case of In re Guli Venkataswamy(1) as well as in the case of Ramprashad Makundram Rajput vs The Crown(2).
In the present case it is established beyond doubt that the deceased travelled with his goods with the appellant on his bullock cart.
He should have reached his destination Jarwal in the course of the night.
He never got there.
Obviously, he was murdered on his way home.
On the appellant 's own statement, he and the deceased were alone in the cart after the other two persons had got off the cart at the Sugar Mill gate.
Thereafter the deceased was never seen alive by any one.
He was found murdered.
The appellant was found in possession of the deceased 's goods three days afterwards.
The appellant made no effort to trace the whereabouts of the deceased or lodge information of his disappearance from the bullock cart.
The appellant has told the court that some people called the deceased while the cart was on its journey and the deceased told him to wait for him at a certain place.
He waited until 4 a.m. but the deceased never turned up.
This should have aroused his suspicions and he should have informed the police or someone in authority about it.
He says he informed the Mukhia and all the people about it.
Neither the Mukhia nor anyone has been examined by the appellant to support his story.
Reliance was placed on the statement of Iftikhar Ahmad P.W. 7) who spoke of a rumour in the village that the appellant had brought the property of a man on his cart who had gone away and that this rumour had been spread by the appellant.
It is clear, however, that the witness was not speaking of this from his personal knowledge and his statement is not legal evidence.
On the other hand, if really the appellant had spread such a rumour there is no adequate explanation for his failure to inform the authorities.
He (1) A.I.R. 1950 Mad. 309.
(2) A.I.R. 1949 Nag.
26 198 knew he was in possession of a large number of articles belonging to the man who had hired his cart but had disappeared in very strange circumstances.
In addition, there is no explanation for his possession of a big blood stained knife, a weapon which if used against the deceased, could have caused the injuries found on him.
It is true that the blood stains were minute and have not been established to be of human blood.
The appellant, however, denied that the knife belonged to him, and has not explained as to how it came to be in his possession.
It is impossible to believe his story that he waited until 4 a.m. for the deceased to return.
The cart had started from Jarwal Road Station at about 10 p.m.
It could not have been more than a couple of hours later that the deceased left the cart.
To wait from that time until 4 a.m. at a place not far from Jarwal itself appears to be a fantastic story.
It is true that none of the clothes of the appellant were found to be bloodstained, as they should have been, if he bad parti cipated in the murder, having regard to the nature of the injuries on the deceased.
These clothes were not seized until the 6th July, some three days later, and the appellant could have removed all traces of blood stains from his clothing in that time.
The appellant was convicted of the offences of murder and robbery by the Sessions Judge by the application of section 34 of the Indian Penal Code.
The charge framed, however, was one of murder and robbery and there was no mention of these offences having been committed in the furtherance of a common intention.
The High Court, however, found that the appellant along with two others committed these offences and they shared in the goods robbed.
On this finding, even if the co accused of the appellant were acquitted, the appellant could be convicted by the application of the provisions of section 34 of the Indian Penal Code.
The charge framed against the appellant was for murder and robbery and the only question to be decided was whether the evidence was sufficient to support such a charge or did it merely establish offences less grave in nature.
We think it 199 was and are satisfied that it establishes the offences of murder and robbery against the appellant and not merely the minor offence of robbery or theft.
It is impossible to accept the submission that the evidence does not establish any offence having been committed by the appellant.
Having regard to what is established in the case and the principles deducible from the cases cited, we are satisfied that the appellant has been rightly convicted of the offences of murder and robbery.
The appeal is accordingly dismissed.
| The appellant was sentenced to death for the murder of one and also sentenced to seven years rigorous imprisonment for having robbed the murdered man of his goods, It was established by the evidence on the record that the deceased, a shop keeper of village Jarwal had gone to Lucknow to purchase goods for his shop.
On his return journey he got down from the train at about 10 p.m.
He had with him a box, a balti, a gunni bag and a jhola and other things.
He engaged the appellant 's cart to take him and his goods to his village.
Two other persons also got on to the cart.
Neither the deceased, nor the articles which were with him nor the cart reached Jarwal.
In the morning the body of the deceased was found near a bridge in the vicinity of Jarwal.
During investigation on the fourth day after the occurrence the appellant gave the key of his kothri to the police and from the kothri, a dhoti, a box, a balti, a chadar, a gunny bag and a jhola were recovered which were identified as belonging to the deceased.
A big knife was also recovered from the kothri which the appellant disowned but could not explain how it was found in his home.
The appellant on examination before the Sessions Judge under section 342 of the Code of Criminal Procedure stated that the deceased asked him to take his goods 'in the cart at about 10 p.m. when he got down at the Railway Station.
Two other men were also in the cart who got down at the Sugar Mill gate near the Railway Station.
At Raduayan Bridge three men enquired if the deceased was in the cart.
The deceased responded and got down from the cart asking the appellant to halt his cart near Jarwal Bazar Bridge where he waited for the deceased up to 192 4 a.m. but he did not turn up.
Not knowing the house of the deceased he took the dead man 's goods to his own house as his buffaloes were very hungry.
He stated further that he had handed over all the articles of the deceased person to the police which he had locked in the kothri.
Held, that recent and unexplained possession of the stolen property while it would be presumptive evidence against a prisoner on the charge of robbery would similarly be evidence against him on the charge of murder.
All the facts which tell against the appellants especially his conduct indicating consciousness of guilt, point equally to the conclusion that he was guilty as well of the murder as of the robbery.
The Emperor vs Sheikh Neamatulla ([1913] , Queen Empress vs Sami and Another ([1890] I.L.R. 13 Mad. 426), Emperor vs Chintamoni Shahu (A.I.R. , In re Guli Venkataswami (A.I.R. 1950 Mad. 309), and Bamprashad Mukundram Rajput vs The Crown (A.I.R. , referred to.
|
Appeal No. 199 of 1955.
Appeal by special leave from the judgment and order dated the 17th day of April 1953 of the Nagpur High Court in Miscellaneous Civil Case No. 53 of 1950.
Nur ud din Ahmad and Naunit Lal, for the appellant.
C. K. Daphtary, Solicitor General of India, G. N. Joshi and B. H. Dhebar, for the respondent.
February section The Judgment of the Court was delivered by BHAGWATI J.
This is an appeal with special leave from the Judgment and Order of the High Court of Judicature at Nagpur on a reference made by the Income tax Appellate Tribunal, Bombay Branch 'A ' under section 66(1) of the Indian Income tax Act XI of 1922 whereby the High Court answered the ref erred question against the appellant.
The appellant, a firm of Messrs Pratapmal Laxmichand of Betul consisted of 7 partners, viz., Misrilal Goti, Meghraj Goti, Panraj Goti, Phulchand, Basantibai, Ratanbai and Gokulchand Goti.
A deed of partnership was executed on the 12th February 1944 by all the partners except Gokulchand Goti who happened to be in the Seoni Jail being a security prisoner under the Defence of India Rules.
He was unable to sign the same in spite of all efforts to obtain his signature in prison.
An application for registration of the firm under section 26 A of the Act for the assessment year 1943 44 was made on the 24th March 1944 personally signed by the other 6 partners of the firm and was accompanied by the deed of partnership which also had been signed by those 6 partners.
The Special Income tax Officer, Nagpur, rejected the application on the ground that the deed itself was not valid inasmuch as it had not been signed 93 by all the partners mentioned in the body and there was no signature of Gokulchand on the deed and the application.
An appeal was taken to the Appellate Assistant Commissioner against this decision of the Special Income tax Officer on the 24th April 1944.
Gokulchand appended his signature to the deed of partnership in Seoni Jail on the 9th January 1945.
The appeal was heard before the Appellate Assistant Commissioner on the 20th March 1947 and he passed an order on the 17th February 1948 cancelling the order of the Special Income tax Officer and directing him to register the firm after obtaining the signature of Gokulchand both on the application for registration and the deed of partnership.
At the instance of the Commissioner of Income tax, C. P. and Berar, an appeal was filed against this order of the Appel late Assistant Commissioner by the Income tax Officer, Spl.
I.T. cum E.P.T. Circle, Nagpur, before the Income tax Appellate Tribunal.
The Tribunal allowed the appeal by its order dated 11/16 October 1948 observing that the Special Income tax Officer was justified in refusing to register the firm as the application for registration was not signed by Gokulchand, that Rule 2(c) of the Indian Income tax Rules, 922, on which the Appellate Assistant Commissioner teems to have relied did not apply and the Appellate Assistant Commissioner was not justified in directing the Income tax Officer "to register the firm after obtaining the signature of Seth Gokulchand both in the application for registration and the deed of partnership".
The appellant applied for a reference to the High Court under section 66(1) of the Act and the Tribunal referred the following question arising out of its order for the opinion of the High Court: "Whether on the facts and in the circumstances of the case the Appellate Assistant Commissioner was legally competent to direct the Income tax Officer to register the firm after obtaining the signature of Seth Gokulchand both in the application for registration and in the deed of partnership".
When the statement of the case was being drawn up by the Tribunal, counsel for the appellant suggested that the words 94 appearing in para 6 of the statement, viz., "No application was submitted to the Appellate Assistant Commissioner seeking his permission under Rule 2(c) of the Indian Income tax Rules" be deleted.
He also suggested that the concluding words in the question referred to the High Court, viz., "after obtaining the signature of Seth Gokulchand both in the application for registration and in the deed of partnership" be deleted.
With regard to the latter suggestion the Tribunal observed that they were unable to delete the same inasmuch as the words sought to be deleted were the concluding words appearing in the Appellate Assistant, Commissioner 's order dated the 17th February, 1948 giving directions to the Income tax Officer and were words which were material to the question before the High Court.
With regard to the first suggestion counsel for the appellant had stated that the appellant had submitted three applications to the Appellate Assistant Commissioner all dated 20th March, 1947 and that it would be wrong to state that no application was submitted to the Appellate Assistant Commissioner.
The allegation made by the appellant was properly investigated subsequently and the Tribunal was satisfied that the appellant did not appear to have put in the application dated 20th March, 1947 as alleged.
This being the position the Tribunal stated that no change in the statement of case was called for as suggested by the appellant.
It was on this statement of case by the Tribunal that the referred question came to be determined by the High Court.
Before the High Court the appellant had applied on the 27th November, 1950 that the three certified copies of the three applications dated 20th March, 1947 made by the appellant to the Appellate Assistant Commissioner with their originals should be sent for by the High Court from the Incomeax Tribunal and an order had been made accordingly.
he High Court was of the opinion that the Appelate Assistant Commissioner should have ordered egistration of the firm provided there was an application before him duly signed by all the partners.
As, 95 however, there was no such application, he could not have directed the Income tax Officer to register the firm after obtaining the signature of Gokulchand on the application and also in the partnership deed .
The High Court accordingly answered the referred question in the negative.
An application under section 66 A(2) of the Act for a certificate for leave to appeal to this Court against that order was dismissed by the High Court but the appellant obtained special leave to appeal against the same from this Court on the 6th December, 1954.
The main question that arises for our determination in this appeal is: What are the powers of the Appellate Assistant Commissioner on the hearing of an appeal against the refusal by the Income tax Officer to register a firm under section 26 A of the Act and Rule 2 of the Indian Incometax Rules, 1922? Section 26 A of the Act provides: " (1) Application maybe made to the Income tax Officer on behalf of any firm, constituted under an instrument of partnership specifying the individual shares of the partners, for registration for the purposes of this Act and of any other enactment for the time being in force relating to income tax or supertax.
(2) The application shall be made by such person or persons, and at such times and shall contain such particulars and shall be in such form, and be verified in such manner, as may be prescribed; and it shall be dealt with by the Income tax Officer in such manner as may be prescribed".
Rule 2 of the Indian Income tax Rules, 1922, which was in force at the relevant period, in so far as is material for the purpose of this appeal, provided: "Any firm constituted under an Instrument of Partnership specifying the individual shares of the partners may, under the provisions of section 26 A of the Indian Income tax Act, 1922 register with the Income tax Officer the particulars contained in the said Instrument on application made in this behalf.
Such application shall be signed by all the partners 96 (not being minis) personally and shall be made (a) before he income of the firm is assessed for any year under section 23 of the Act, or (b). . or (c) with the permission of the Appellate Assistant Commissioner hearing an appeal under section 30 of the Act, before the assessment is confirmed, reduced, enhanced or annulled, or (d) (e) The decision of the Income tax Officer in regard to the invalidity of the deed of partnership inasmuch as it did not bear the signature of Gokulchand was not challenged by the appellant at any stage of the proceedings nor in the statement of case before us.
Counsel for the appellant, however, relying on a passage in the "Law and Practice of Income tax by Kanga and Palkhivala", 3rd Ed., at page 754, urged that it was not necessary that the partnership agree ment should be signed by all the partners and if the agreement had not been signed by one of the partners but that partner had assented to the agreement and put it forward along with the other partners for registration, the agreement would be admissible for registration.
In the first instance, it was not open to the appellant to urge any point which was not taken in the statement of case and even if it was open to him to urge that contention we do not think it necessary to express any opinion on the correctness or otherwise of the statement above referred to in view of the construction which we put on Rule 2 of the Indian Income tax Rules, 1922.
The Rules were framed under section 26 A(2) of the Act and bad statutory force.
Under Rule 2, the application for registration of the firm was to be made to, the Income tax Officer and the particulars contained in the Instrument of Partnership specifying the individual shares of the partners were to be registered with him on an application made in that behalf signed by all the partners (not being minors) personally.
No such application was submitted to the Special Income tax Officer in this case before he 97 made his order on the 18th March 1944, and on the materials as they stood on record then, the order of the Special Income tax Officer was perfectly justified.
No such application signed by all the partners of the firm including Gokulchand was also available before the Appellate Assistant Commissioner when he heard the appeal on the 20th March 1947.
The appellant contended that he had in fact filed in the office of the Appellate Assistant Commissioner on the said 20th March 1947 three applications one of which was such an application signed by all the partners personally including Gokulchand and it was strenuously urged on his behalf that the Appellate Assistant Commissioner passed his order dated the 17th February 1948 ignoring the said application which had been filed in his office.
It was urged that, if the Appellate Assistant Commissioner had before him the said application dated the 20th March 1947 signed by all the partners personally including Gokulchand, it was his duty to direct a registration of the firm himself without anything more inasmuch as the deed of partnership had been signed by Gokulchand on the 9th January 1945 and the application for registration of the firm dated the 20th March 1947 bore his signature.
The direction given by the Appellate Assistant Commissioner to the Income tax Officer to register the firm was, it was contended, therefore proper and we were asked to treat the words "after obtaining the signature of Seth Gokulchand in the application for regis tration and in the deed of partnership" as superfluous.
We are not impressed with this argument.
As appears abundantly clear from the terms of the order made by the Appellate Assistant Commissioner himself and also from the statement of case prepared by the Tribunal, the application signed by all the partners personally including Gokulchand was not before the Appellate Assistant Commissioner.
An application had been made by the appellant before the Tri bunal to amend the statement of case by deleting from para 6 thereof the words "no application was submitted to the Appellate Assistant Commissioner 13 98 seeking his permission under Rule 2(c) of the Indian Income tax Rules" but the same had been rejected by the Tribunal as a result of proper investigation conducted by it subsequently, the Tribunal stating that they were satisfied that the assessee did not appear to have put in an application dated the 20th March 1947 as alleged.
The reference was beard by the High Court on this statement of case prepared by the Tribunal and no steps were taken by the appellant before the High Court for having the statement of case amended by the Tribunal or for having a further statement of case submitted by the Tribunal recording therein the facts alleged by the appellant.
We must, therefore, decide this appeal on the facts stated in the statement of case by the Tribunal and on the basis that the application for registration dated the 20th March 1947 signed by all the partners personally including Gokulchand was not before the, Appellate Assistant Commissioner.
If that was the position, the only power which the Appellate Assistant Commissioner bad under Rule 2(c) was to accord permission to the appellant to make the application in proper form to the Incometax Officer signed by all the partners personally including Gokulchand before the assessment was confirmed, reduced, enhanced or annulled.
The Appellate Assistant Commissioner had, under the Rule, no power to direct the Income tax Officer to register the firm after obtaining the signature of Gokulcband both in the application for registration and in the deed of partnership as he did.
As a matter of fact the appellant did not ask for such permission from the Appellate Assistant Commissioner nor was any revision taken by the appellant before the Commissioner under section 33 A of the Act against the said order of the Appellate Assistant Commissioner.
The appellant contented himself with arguing that the order made by the Appellate Assistant Commissioner was justified and the sole controversy which arose between the parties and was the subject matter of the referred question was whether the Appellate Assistant Commissioner was legally competent to direct the Income 99 tax Officer to register the firm after obtaining the signature of Gokulchand both in the application for registration and in the deed of partnership.
The appellant attempted no doubt to have the words "after obtaining the signature of Seth Gokulchand both in the application for registration and in the deed of partnership" deleted from the referred question.
That attempt, however, failed and no steps were taken by the appellant before the High Court at the hearing of the reference to either have the referred question amended or reframed in order to bring into prominence his contention in regard to the powers of the Appellate Assistant Commissioner.
On the question as framed, the only answer which the High Court could give was that the Appellate Assistant Commissioner was not legally competent to direct the Income tax Officer to register the firm after obtaining the signature of Gokulchand both in the application for registration and in the deed of partnership.
Rule 2(c) above quoted did not empower the Appellate Assistant Commissioner to do anything of the sort and we are of the opinion that the answer given by the High Court in the negative was, therefore, correct.
Counsel for the appellant tried to support his argument by referring to the provisions of the earlier partnership deeds between the several partners of this firm in the years 1929 and 1941 which specifically provided that in the event of retirement, or death of, or relinquishment, of his share by a partner, the partnership will not be dissolved but will be continued, in case of death of any of the partners, by such of the partners as remained and the legal representatives or nominees of the deceased partner and in the case of retirement of any of the partners by such of the partners as remained.
We fail to understand what bearing these clauses have on the determination of the referred question.
In the result, the appeal of the appellant fails and must stand dismissed with costs.
| The appellant (a firm) consisted of seven partners and a deed of partnership was executed by all the partners except one who happened to be in Jail being a security prisoner under the Defence of India Rules.
An application for registration of the firm under section 26 A of the Indian Income tax Act was made before the Incometax Officer, who, however, rejected it on the ground that the deed of partnership and the application for registration were not signed by all the partners.
On appeal, the Appellate Assistant Commissioner cancelled the order of the Income tax Officer and directed him to register the firm after obtaining the signature of the partner who had not signed before, both on the application for registration and the deed of partnership.
Held, that under Rule 2(c) of the Indian Income tax Rules, 1922, framed under section 26 A(2) of the Indian Income tax Act, the Appellate Assistant Commissioner had only the power to direct registration of the firm if an application duly signed by all the partners had been presented to him before the assessment was confirmed, reduced, enhanced or annulled and that he was not legally 92 competent to direct the Income tax Officer to register the firm after obtaining the signature of the partner who had not signed before.
|
Appeal No. 235 of 1954.
On Appeal by Special Leave from the Judgment and Order dated the 26th day of February 1953 of the Bombay High Court in Appeal No. 120 of 1952 arising out of the Order dated the II the day of September, 1952 of the said High Court in its Ordinary Original Jurisdiction in Misc.
Application No. 216 of 1952.
M.C. Setalvad, Attorney General of India (B. Sen and R. H. Dhebar, with him) for the appellant.
Sri Narain Andley, J. B. Dadachanji and Rajinder Narain, for the respondent.
20 1956.
January 17.
The Judgment of the Court was delivered by IMAMJ.
By an order dated 12th May 1952, hereinafter referred to as the impugned order the Government of the State of Bombay requisitioned under section 5 of the Bombay Land Requisition Act, 1948 (Bombay Act XXXIII of 1948), hereinafter referred to as the Requisition Act, the premises specified therein.
The impugned order, so far as it is relevant to the present appeal, stated, "Now, therefore, in exercise of the powers conferred by sub section (1) of section 5 of the Bombay Land Requisition Act, 1948 (Bombay Act XXXIII of 1948) the Government of Bombay is pleased to requisition the said part of the building for a public purpose, namely, for housing an Officer of the State Road Transport Corporation which is a public utility service".
The respondent filed a writ application under Article 226 of the Constitution in the Bombay High Court and the application was beard by Tendolkar, J. who set aside the impugned order.
Against his decision the appellant appealed and a Division Bench of the said Court affirmed the decision of Tendolkar, J.
The present appeal is by special leave against the decision of the High Court.
The principal ground upon which the impugned order was set aside was that the requisition was not for a public purpose and therefore could not have been validly made under section 5 of the Requisition Act.
On behalf of the appellant, the Attorney General has urged that in the circumstances of the present case, the requisition was for a public purpose and the impugned order had been wrongly set aside by the High Court.
In support of his submission he relied upon certain provisions of the (LXIV of 1950), hereinafter referred to as the Act, the decision of the Privy Council in the case of Hamabai Framjee Petit vs Secretary of State for India in Council(1) and the decisions of this Court in (1) [1914] L.R. 42 I.A. 44.
21 The State of Bombay vs Bhanji Munji and Another(1) and The State of Bombay vs Ali Gulshan (Civil Appeal No. 229 of 1953) decided on the 4th of October 1955(2).
On the other hand, Mr. Andley, on behalf of the respondent, contended that to requisition the premises to house an employee of the State Road Transport Corporation, hereinafter referred to as the Corporation, could not be regarded as a public purpose because that was a matter in which the general interest of the community was not directly and vitally concerned.
He urged that although their Lordships of the Privy Council rightly approved the observations of Batchelor, J. concerning the expression 'public purpose ', they erred in their decision in Hamabai 's case.
In any event, Hamabai 's case could be distinguished as in that case there was a scheme for constructing houses for Government servants generally and not procuring residential accommodation for one particular individual.
The validity of the impugned order was also questioned by him on the ground that nothing had been established to prove that by housing an officer of the Corporation in the requisitioned premises the needs or the purposes of the Corporation would be served or that it would contribute to the efficiency of the officer concerned.
Before Tendolkar, J. two points bad been raised (1) that no enquiry, as required by section 5 of the Requisition Act, was held and (2) that the impugned order was invalid as the requisition was not for a public purpose.
The former question was decided against the respondent while the latter was decided in his favour.
In appeal, the first point does not appear to have been put forward as there is no reference to it in the judgments of the learned Judges of the Division Bench.
In this Court the only point argued was as to whether the requisition was for a public purpose or not.
Before proceeding to consider that question it is necessary to make some reference to the purpose for which the Corporation is established, its compo.
sition, the extent of control exercised by the State Government over it and its activities.
(1) (2) ; 22 It was not disputed before us that the Corporation is a public utility concern and is governed by the provisions of the Act.
The purpose for which the Corporation was created may be gathered from the provisions of section 3 of the Act which enables a State Government to establish a Road Transport Corporation having regard to the advantages offered to the public, trade and industry by the development of road transport, the desirability of coordinating any form of road transport with any other form of transport and the desirability of extending and improving the facilities for road transport in any area and of providing an efficient and economical system of road transport service.
The Corporation consists of a Chairman and members appointed by the State Government who are removable by that authority.
Where capital is subscribed by the issue of shares under section 23 of the Act provision is made for the representation of the share holders in the Corporation and the manner in which they are to be elected in accordance with rules to be framed under the Act.
Its Chief Executive Officer or General Manager and its Chief Accounts Officer are to be appointed by the State Government.
The other officers and servants are to be appointed by the Corporation but the conditions of appointment and service and the scales of pay shall be determined by regulations made under the Act subject to the provisions of section 34, which authorises the State Government to issue directions and general instructions to the Corporation and these instructions may include directions relating to the recruitment and conditions of service.
The Corporation is under the effective control of the State Government.
In addition to what has already been mentioned when referring to the composition of the Corporation, the capital of the Corporation may be provided by the Central and State Governments in such proportion as is agreed between them.
When no such capital is provided, the Corporation may raise capital, as is authorised by the State Government, by issue of shares.
These shares are guaran 23 teed by that Government.
The budget of the Corporation has to be submitted to the State Government for approval and its accounts are to be audited by an auditor appointed by that Government.
The balance of the net profits, after providing for various matters mentioned in section 30 of the Act, is to be made over to the State Government for the purpose of road development.
The Corporation can be superseded by the State Government or that Government may, after an enquiry under section 36, authorize a person by notification in the official Gazette to take over the Corporation and administer its affairs during the period the notification is in force.
The activities of the Corporation are manifold in pursuit of which there is a statutory duty to so exercise its powers as to provide, secure or promote the provision of an efficient, adequate, economical and properly coordinated system of road transport in the State or part of it and in any extended area (vide section 18 of the Act).
The powers of the Corporation are stated in section 19 of the Act.
These powers, although not exhaustive, cover a wide field.
Particular reference need be made only to some of them.
Section 19(1) provides: "Subject to the provisions of this Act, a Corporation shall have power: (a). . . . (b). . . . (c)to provide for its employees suitable conditions of service including fair wages, establishment of provident fund, living accommodation, places for rest and recreation and other amenities".
Section 19(2) excluding the explanation to clause (a) and some clauses with which we are not immediately concerned, states, "Subject to the provisions of this Act, the powers conferred by subsection (1) shall include power: (a) to manufacture, purchase, maintain and repair rolling stock, vehicles, appliances, plant, equipment or any other thing required for the purpose of any of the activities of the Corporation referred to in sub section (1).
24 (b) to acquire and hold such property, both movable and immovable, as the Corporation may deem necessary for the purpose of any of the said activities and to lease, sell or otherwise transfer any property held by it.
(d) to purchase by agreement or to take on lease or under any form of tenancy any land and to erect thereon such buildings as may be necessary for the purpose of carrying on its undertaking.
" The provisions of the Act read as a whole lead us to the conclusion that if the premises specified in the impugned order had been requisitioned for the Corporation, the requisition would have been for a public purpose.
Indeed the learned Judges of the High Court were of this opinion and Mr. Andley did not contend to the contrary.
According to him, in this case., the requisition was not for the Corporation but for an employee of the Corporation and for his convenience which could not be a public purpose.
The expression 'public purpose ' has been considered in many cases and it is unnecessary to refer to them except the three cases cited by the Attorney General.
In Hamabai 's case(1) the observation of Batchelor, J. to the effect "General definitions are, I think, rather to be avoided where the avoidance is possible, and I make no attempt to define precisely the extent of the phrase 'public purposes ' in the lease; it is enough to say that, in my opinion, the phrase, whatever else it may mean, must include a purpose, that is, an object or aim, in which the general interest of the community, as opposed to the particular interest of individuals, is directly and vitally concerned" received the approval of the Privy Council.
Their Lordships, however, rejected the contention that there cannot be a 'public purpose ' in taking land if that land when taken is no it in some way or other made available to the public at large.
This contention had been raised because the Government had resumed lands, which had been the subject of a lease and a sana , the terms of which permitted the Government to resume the lands for any public purpose, with a view to erect (1) [1914] L.R. 42 I.A. 44.
25 thereon dwelling houses for the use of Government officials as their private residence on adequate rent.
The concluding portion of the judgment of the Privy Council is important and needs to be quoted.
It stated, "But here, so far from holding them to be wrong, the whole of the learned judges, who are thorough conversant with the conditions of Indian life, say that they are satisfied that the scheme is one which will redound to public benefit by helping the Government to maintain the efficiency of its servants.
From such a conclusion their Lordships would be slow to differ, and upon its own statement it commends itself to their judgment".
In Bhanji Munji 's case(1) the requisition was for housing a person having no housing accommodation.
After considering the affidavits, the facts and the circumstances of the case, Bose, J .
observed "The Constitution authorizes requisition for a public purpose.
The purpose here is finding accommodation for the homeless.
If, therefore, a vacancy is allotted to a person who is in fact homeless, the purpose is fulfilled".
In Ali Gulshan 's case(2) the requisition was for the purpose of housing a member of the staff of a foreign Consulate.
This Court held that the requisition was for a State purpose, which it is needless to say must be regarded as a public purpose.
An examination of these and other cases leads us to the conclusion that it is impossible to precisely define the expression 'public purpose '.
In each case all the facts and circumstances will require to be closely examined in order to determine whether a 'public purpose ' has been established Prima facie the Government is the best judge as to whether 'public purpose ' is served by issuing a requisition order, but it is not the sole judge.
The courts have the jurisdiction and it is their duty to determine the matter whenever a question is raised whether a requisition order is or is not for a 'Public purpose '.
The cases of Hamabai, Bbanji Munji and Ali Gulshan are merely illustrative.
In each of them primarily the person directly and vitally concerned would be the person to whom the residential accommodation would be (1) [1955] 1 S.C.R. 777.
(2) ; , 4 26 allotted with which prima facie the general interest of the community would not be directly concerned at all.
We must regard Hamabai 's case as a decision to the ,effect that the general interest of the community was directly and vitallyconcerned with the efficiency of the Government servants because it would be to its benefit to have such servants and, therefore, providing living accommodation for them was a public purpose.
The decision in Bhan Munji 's case must be read as one in which the general interest of the community was directly and vitally concerned with pre vention of lawlessness and disease and to house the homeless in order to avoid such a contingency was a public purpose.
In Ali Gulshan 's case a State purpose was served because the State Government was interested in its own trade or commerce and in the efficient discharge of his duties by a foreign Consul who would be concerned with such trade or commerce.
In the present case it is possible to construe the impugned order as a requisition on behalf of the Corporation as it does not name any individual for whom the requisition is being made.
In other words the requisitioned premises were at the disposal of the Corporation to house one of its officers to be named later on.
Apart from that, there is a statutory power in the Corporation under section 19 (1) (c) of the Act to provide living accommodation for its employees and under section 14 the Corporation appoints such number of its officers and servants as it considers necessary for the efficient performance of its functions.
It may be assumed, therefore, that the Corporation appoints only such officers as are needed for the efficient discharge of its functions and that the State Government was requested to requisition some premises as living accommodation for one of them whose posting at Bombay was necessary.
Indeed the affidavit of Mr. Nadkarni, Accommodation Officer of the Government of Bombay, states that the official of the Corporation has to perform his duties in Bombay.
Having regard to the provisions of section 19 (2) (a) and (b) of the Act, the power in the Corporation 27 to provide living accommodation for its employees must be regarded, as one of its statutory activities undersection 19(1).
Theword 'acquire ' may include the power to purchase by agreement but is wide enough to enable the Corporation to request the State Government to acquire property under the Land Acquisition Act (I of ] 894) in order to provide living accommodation for its employees.
The activities of the Corporation under section 19 (1) are so interlinked with its successful functioning as a Road Transport Corporation that requisitioning or acquisition of property to advance and ensure those activities must be regarded as for a public purpose.
It would not be sufficient to merely establish the Corporation.
It has to have an adequate and efficient staff, living accommodation forwhom would be an absolute need of the Corporation.
Its officers have to be efficient in the discharge oftheir duties, for upon them depends the successful working of the road transport system upon which the public must rely and thus it would be directly and vitally concerned with the efficiency of 'the employees of the Corporation.
It was suggested that a line must be drawn somewhere, otherwise there was no guarantee to what lengths the powers of requisition might be exercised by the Government.
It is sufficient to say that each case would have to be decided upon the facts and the circumstances ap pearing therein.
Here the Corporation is a public utility concern and the general interest of the community is directly and vitally concerned with its activities and its undertaking.
A breakdown in the Organisation of the Corporation, leading to dislocation of the road transport system would create a chaotic condition to the detriment of the interest of the community.
Providing living accommodation for its employees is a statutory activity of the Corporation and it is essential for it to provide such accommodation in order to ensure an efficient working of the road transport system and it must, therefore, be held that the impugned order was validly passed under the Requisition Act.
In the result the appeal is allowed and the decision 28 of the High Court is set aside.
Costs in the appeal in this Court shall be paid by the appellant to the respondent as directed by the order granting Special Leave.
Each party, however, will bear his own costs in the High Court.
| In exercise of the powers conferred by sub section (1) of section 5 of the Bombay Land Requisition Act, 1948 the Government of Bombay requisitioned by an order dated 12th May 1952, the premises specified therein, for a public purpose, namely, for bousiing an officer of the State Road Transport Corporation which is a public utility service.
On a writ application under article 226 of the Constitution filed by the respondent the requisition order was set aside by the Bombay High Court on the ground that the requisition was not for a public purpose and therefore could not have been made under section 5 of the Requisition Act.
On appeal by special leave to the Supreme Court.
19 Held (1) that in the circumstances of the present case the requisition was for a public purpose and the impugned order had been wrongly set aside by the High Court; (2) the phrase 'Public purpose ' includes a purpose, that is, an object or aim, in which the general interest of the community, as opposed to the particular interest of individuals is directly and vitally concerned.
It is impossible to define precisely the expression 'public purpose '.
In each case all the facts and circumstances will require to be closely examined to determine whether a public purpose has been established; (3) the Corporation has power to provide for its employees suitable conditions of service including. . . living accommodation, places for rest and recreation and other amenities vide section 19(1) (c) of the Road Transport Corporation Act, 1950; (4) the provisions of the Road Transport Corporation Act read as a whole lead to the conclusion that if the premises specified in the impugned order had been requisitioned for the Corporation, the requisition would have been for a public purpose; (5)in the present case the Corporation is a public utility concern and the general interest of the public is directly and vitally concerned with its activities and undertaking.
Providing living accommodation for its employees is a statutory activity of the Corporation and it is essential for it to provide such accommodation in order to ensure efficient working of the road transport system and therefore the impugned order was validly passed under the Requisition Act.
Hamabai Framjee.
Petit vs Secretary of State for India in Council ([1914] L.R. 42 I.A. 44), The State of Bombay vs Bhonji Munji and Another ([1955] 1 S.C.R. 777) and The State of Bombay vs Ali Gulshan ([1955] 2 S.C.R. 867), referred to.
|
minal Appeal No. 34 of 1955.
Appeal by special leave from the judgment and order dated the 7th June 1954 of the Punjab High Court at Simla in Criminal Revision No. 985 of 1953 arising out of the judgment and order dated the 9th May 1953 of the Court of the Additional District Judge, Ambala.
Ramalal Anand and I. section Sawhney, for the appellant.
Gopal Singh and P. G. Gokhale, for respondent No. I. Jindra Lal and Gopal Singh, for respondent No. 2. 1956.
February 15.
The Judgment of the Court was delivered by BOSE J.
This appeal was argued at great length because of the wide divergence of judicial opinion that centres round sections 195 and 476 of the Criminal Procedure Code.
The question is about the validity of a complaint made against the appellant for perjury and for using a forged document as genuine in the following circumstances.
The second respondent Amar Singh filed a civil 127 suit against the appellant for recovery of a large sum of money on the basis of a mortgage in the Court of Mr. E. F. Barlow, a Subordinate Judge of the First class.
The appellant filed a receipt which purported to show that Rs. 35 000 had been paid towards satisfaction of the mortgage (whether in full satisfaction or part is not clear), and in the witness box he swore that he had paid the money and was given the receipt.
Mr. Barlow held that the receipt did not appear to be a genuine document and that the appellant 's evidence was not true.
Accordingly he passed a preliminary decree against the appellant for the full amount of the claim on 15 3 1950 and a final decree followed on 15 7 1950.
There was an appeal to the High Court but that was dismissed on 9 5 1951.
The High Court also held that the receipt was a very auspicious document and that the appellant 's evidence was not reliable.
The plaintiff then made an application in the Court of Mr. W. Augustine, who is said to have succeeded Mr. Barlow as a Subordinate Judge of the first class, asking that a complaint be filed against the, appellant under sections 193 and 471 of the Indian Penal Code.
But before it could be beard Mr. Augustine was transferred and it seems that no Subordinate Judge of the first class was appointed in his place; instead, Mr. K. K. Gujral, a Subordinate Judge of the fourth class, was sent to this area and be seems to have been asked to decide the matter.
But as he was only a Subordinate Judge of the fourth class be made a report to the District Judge that he had no jurisdiction because the offences had been committed in the Court of a Subordinate Judge of the first class.
The District Judge thereupon transferred the matter to the Senior Subordinate Judge, Mr. Pitam Singh, and that officer made the complaint that is now under consideration.
The appellant filed an appeal against Mr. Pitam Singh 's order to the Additional District Judge, Mr. J. N. Kapur.
This learned Judge held that the Senior Subordinate Judge (Mr. Pitam Singh) had no jurisdiction to make the complaint because he was 128 not Mr. Barlow 's successor.
He also held, on the merits, that there was no prima facie case.
The matter went to the High Court in revision and the learned High Court Judge who beard the matter held that the Senior Subordinate Judge had jurisdiction and that the material disclosed a prima facie case.
Accordingly, he set aside the Additional District Judge 's order and restored the order of the Senior Subordinate Judge making the complaint.
This raises three questions.
The first concerns the jurisdiction of the Senior Subordinate Judge Mr. Pitam Singh to entertain the application and make the complaint.
The second is whether the Additional District Judge had jurisdiction to entertain an appeal against Mr. Pitam Singh 's order; and the third is whether the High Court had power to reverse the Additional District Judge 's order in revision.
We will first deal with Mr. Pitam Singh 's jurisdiction to make the complaint.
This question is governed by the Criminal Procedure Code and by the Punjab Courts Act, 1918.
We will examine the Criminal Procedure Code first.
The offences said to have been committed are ones under sections 471 and 193 of the Indian Penal Code, namely, using as genuine a forged document knowing it to be forged and perjury.
Section 195(1) (b) and (c) of the Criminal Procedure Code prohibit any Court from taking cognizance of either of these two offences except on the complaint in writing of the Court concerned "or of some other Court to which such Court is subordinate".
The offences were committed in the Court of Mr. E.F. Barlow, a Subordinate Judge of the first class.
It seems to have been accepted that Mr. Gujral was not Mr. Barlow 's successor because be was only a Subordinate Judge of the fourth class, but whether he was the successor or not, he neither made the complaint nor rejected the application.
He declined to do either because he said be had no jurisdiction; so also neither Mr. Barlow nor Mr. Augustine made a complaint or rejected the application.
That carries 129 us on to section 476 A of the Criminal Procedure Code.
Section 476 A states that when the Court in which the offence is said to have been committed neither makes a complaint nor rejects an application for the making of a complaint, "the Court to which such former Court is subordinate within the meaning of section 195, sub section (3)" may take action under section 476.
Section 476 authorises the appropriate Court, after recording a finding that it is expedient in the interests of justice, etc., to, among other things, make a complaint in writing and forward it to a Magistrate of the first class having jurisdiction.
That was done by Mr. Pitam Singh.
So the only question we have to decide on this part of the case is whether the Court of the Senior Subordinate Judge over which Mr. Pitam Singh presided was the Court to which the Court of Mr. Barlow was subordinate within the meaning of section 195(3 ).
Now it is to be noticed that subordination has been given a special meaning in this section.
It is not any superior Court that has jurisdiction, nor yet the Court to which the "former Court" is subordinate for, what might be termed, most general purposes, but only the Court to which it is subordinate within the meaning of section 195(3).
Section 195(3) states that "For the purposes of this section, a Court shall be deemed to be subordinate to the Court to which appeals ordinarily lie from the appealable decrees or sentences of such former Court, or in the case of a Civil Court from whose decrees no appeal ordinarily lies to the principal court having ordinary original civil jurisdiction within the local limits of whose jurisdiction such Civil Court is situate" and then follows this proviso "Provided that (a)where appeals lie to more than one Court, the Appellate Court of inferior jurisdiction shall be the Court to which such Court shall be deemed to be subordinate; and 130 (b) where appeals lie to a Civil and also to a Revenue Court, such Court shall be deemed to be subordinate to the Civil or Revenue Court according to the nature of the case or proceeding in connection with which the offence is alleged to have been committed".
These provisions have given rise to much conflict in the High Courts.
The controversy has centred round the word "ordinarily".
One class of case, of which Wadero Abdul Rahman vs Sadhuram(1) is a sample, holds that "ordinarily" means "in the majority of cases" and that it has no reference to the particular case in hand.
We do not think that is right because that gives no meaning to the proviso to sub clause (3).
If appeals lie to a particular Court, e.g., the District Court, in the majority of cases and to another Court,say the High Court, only in a few cases, then the inferior tribunal is a fixed quantity and so the need to choose between the inferior and the superior Court cannot arise.
That makes sub clause (a) to the proviso otiose; also, it does not necessarily follow that the appeal in the majority of cases will always lie to the inferior Court.
Cases may occur in which the majority of appeals would go to the higher of two given tribunals; and in any case this interpretation has the disadvantage that a Court may be compelled to call for and go into a mass of statistics to ascertain which of two Courts entertains the majority of appeals over a given period of time, as well as to determine what is the appropriate period of time.
Another view considers that the word means that the higher Court is the one to which there is an unrestricted right of appeal and so cannot apply when any restriction intervenes such as when the right of appeal is limited to a particular class of cases or is hedged in by conditions.
This was the view taken in M. section Sheriff vs Govindan(2).
Other views are also possible but we do not intend to explore them.
In our opinion, the matter is to be viewed thus.
The first question to be asked is whether any decrees, orders or sentences of the original Court (1) [1930) (2) A.I.R. I , 1061, 131 are appealable at all.
If they are not, and the Court is a Civil Court, then,, under section 195(3), the appeal against the order making or refusing.to make a complaint will be to the principal Court of ordinary original civil jurisdiction.
If, however, appeals from its various decrees and orders lie to different Courts, then we have to see to which of them they "ordinarily" lie and select the one of lowest grade from among them.
In determining the Court or Courts to which an appeal will ordinarily lie, we have to see which Court or Courts entertain appeals from that class of tribunal in the ordinary way apart from special notifications or laws that lift the matter out of the general class.
Our meaning will be clearer when we turn to the case in hand and examine the Punjab Courts Act of 1918.
Apart from the Courts of Small Causes and Courts established under other enactments, the Punjab Courts Act, 1918 makes provision for three classes of Civil Courts, namely (1) the Court of the District Judge, (2) the Court of the Additional Judge, and (3) the Court of the Subordinate Judge.
At the moment we are concerned with the Subordinate Judge.
Section 22 enables the State Government to fix the number of Subordinate Judges after consultation with the High Court.
The local limit of jurisdiction of each of these Judges is the district in which he is appointed unless the High Court defines a different limit (section 27).
The pecuniary limits are set out in section 26: "The jurisdiction to be exercised in civil suits as regards the value by any person appointed to be a Subordinate Judge shall be determined by the High Court either by including him in a class or otherwise as it thinks fit".
These are what might be termed the ordinary powers and jurisdiction of these Courts.
But sections 29 and 30 authorise the High Court to confer certain additional powers and jurisdiction on them.
We will deal with that later.
132 Next, we turn to the provisions for appeal.
They are governed by section 39.
In the absence of any other enactment for the time being in force, when the value of the suit does not exceed five thousand rupees the appeal lies to the District Judge, and in every other suit, to the High Court.
But by sub section (3) the High Court is empowered to direct by notification "that appeals lying to the District Court from all or any of the decrees or orders passed in an original suit by any Subordinate Judge shall be preferred to such other 'Subordinate Judge as may be mentioned in the notification" and when that is done "such other Subordinate Judge shall be deemed to be a District Court for the purposes of all appeals so preferred".
The High Court availed itself of this provision and provided that appeals lying to the District Courts from decrees or orders passed by any Subordinate Judge in two classes of case which are specified "shall be preferred to the Senior Subordinate Judge of the first class exercising jurisdiction within such Civil District".
There are thus three forums of appeal from the Court of the Subordinate Judge depending on the nature of the suit and its value.
The question is whether in each of these three classes of case the appeal can be said to lie "ordinarily" to one or other of these appellate tribunals.
Applying the rule we have set out above, the appeal to the Senior Subordinate Judge cannot be termed "ordinary" because the special appellate jurisdiction conferred by the Notification is not the ordinary jurisdiction of the Senior Subordinate Judge but an additional power which can only be exercised in a certain limited class of case.
It is not a power common to all Subordinate Judges nor even to all Senior Subordinate Judges.
Therefore, it cannot be said that appeals from the Courts of the various Subordinate Judges "ordinarily" lie to the Senior Subordinate Judge.
Consequently, that Court is not one of the appellate tribunals contemplated 133 by section 195(3) of the Criminal Procedure Code and its proviso.
But appeals do "ordinarily" lie either to the District Court or the High Court; and as the District Court is the lower of these two tribunals that must be regarded as the appellate authority for the purposes of section 476 B of the Criminal Procedure Code.
Now it is to be observed that this is a purely objective analysis is and is not subjective to any particular suit.
In the present suit, the value of the suit was over Rs. 5,000, so the appeal would have lain to the High Court, but we are not concerned with that be cause section 195(3) does not say that the appellate authority within the meaning of that section shall be the Court to which the appeal in the particular case under consideration would ordinarily lie but generally "the Court to which appeals ordinarily lie from the appealable decrees or sentences of such former Court".
It would, however, be wrong to say that the nature of the proceedings in the case must be wholly ignored because sub clause (b) to the proviso to sub section (3) states that "where appeals lie to a Civil and also to a Revenue Court, such.
Court shall be deemed to be subordinate to the Civil or Revenue Court according to the nature of the case or proceeding".
Therefore, to that limited extent the nature of the proceedings must be taken into account, but once the genus of the proceedings is determined, namely whether civil, criminal or revenue, the heirarchy of the superior Courts for these purposes will be determined, first by the rules that apply in their special cases and next by the rule in section 195(3) which we have just expounded and explained.
M. section Sheriff vs The State of Madras and Others,(1) was quoted but the present point was neither considered nor decided there.
The next question is whether the Court of the Senior Subordinate Judge is the same Court as Mr. Barlow 's Court, namely the Court of the Subordinate (1) [1954] section C. R. 1144,1147.
18 134 Judge of the first class.
That depends on whether there is only one Court of the Subordinate Judge in each district, presided over by a number of Judges, or whether each Court is a separate Court in itself.
That turns on the provisions of the Punjab Courts Act.
We make it clear that our decision on this point is confined to the Punjab Act.
We understand that similar Acts in other States are differently worded so that what we decide for the Punjab may not bold good elsewhere.
We say this because rulings were cited before us from other parts of India which take differing views.
We do not intend to refer to them because it would not be right to examine the language of Acts that are not directly before us.
Accordingly, we confine ourselves to the Punjab Act (Act VI of 1918).
Section 18 of the Punjab Courts Act states that there shall be the following classes of Courts, namely ". . . . . . . . (3) the Court of the Subordinate Judge".
Section 22 provides that "the State Government may. . fix the number of Subordinate Judges to be appointed".
Section 26, which has already been quoted, fixes the pecuniary limits of their jurisdiction.
Then comes section 27 defining the local limits of their jurisdiction: "(1) The local limits of the jurisdiction of a Subordinate Judge shall be such as the High Court may define.
(2) When the High Court posts a Subordinate Judge to a district, the local limits of the district shall, in the absence of any direction to the contrary, be deemed to be the local limits of his jurisdiction".
From there we go to the Notification.
It is High Court Notification No. 4 dated 3 1 1923.
It makes four classes of Subordinate Judges with effect from 5 1 1923 "in respect of the jurisdiction to be exercised by them in original suits, namely: Class I Subordinate Judges exercising juris 135 diction without limit as to the value of the cases; Class II Subordinate Judges exercising jurisdiction in cases of which the value does not exceed Rs. 5.000; Class III Subordinate Judges exercising jurisdiction in cases of which the value does not exceed Rs. 2,000; Class IV Subordinate Judges exercising jurisdiction in cases of which the value does not exceed Rs. 1,000.
When a Subordinate Judge is appointed to any of the classes constituted by this Notification, he shall exercise the jurisdiction here in before defined for the class to which he is appointed within the local limits of the civil district to which he may be posted from time to time".
This gives rise to three points of view.
According to one, there is only one Court of the Subordinate Judge for each district and every other Subordinate Judge is an additional Judge to that Court.
This is based on the language of section 18, and the High Court Notification is, under that view, interpreted as dividing the Judges of that one Court into four categories but not as creating independent Courts.
Section 26 is there read as empowering the High Court to include each Subordinate Judge individually on appointment into a given class within the one Court and not to turn him into a separate Court.
According to the second view, there are four classes of Subordinate Judge 's Courts in the Punjab because of the High Court Notification.
The argument here runs that section 18 must be read with section 26, and as the High Court is empowered to divide Subordinate Judges in a district into classes it must mean that each class forms an independent Court, for according to this point of view, it would be anomalous to have Judges of the one Court invested with differing pecuniary jurisdictions because that is always regarded as inherent to the Court.
The position created by the Act, it is said, is not the same as the one that arises when work is administratively distributed among Additional Judges of the same 136 Court because the jurisdiction and powers of the Judges are unaffected by such distribution and there remains the one Court with one inherent and territorial jurisdiction despite the distribution.
The third view is that each Subordinate Judge is a separate and independent Court in himself and it is pointed out that section 27 invests each Judge personally with a territorial jurisdiction and not the Court, and so also section 26.
Under section 33 the power of control (apart from the High Court) over all civil Courts within the local limits of a District Judge 's jurisdiction is with him, and section 34 empowers the District Judge to distribute any civil business "cognizable by . the Courts under his control. among such Courts in such manner as he thinks fit".
The Senior Subordinate Judge does not therefore appear to be vested with either administrative or judicial control over any other Subordinate Judge except in so far as he is a Court of appeal in certain specified classes of case.
In our opinion, the Senior Subordinate Judge who made the complaint had no jurisdiction to make it, either as the original Court which tried the suit, or as the appellate authority under section 476 B of the Criminal Procedure Code.
It is not enough that he also had first class powers because be was not the same Court.
That is not to say that a successor could not have been appointed to Mr. Barlow so as to establish continuity in the Court over which he presided.
It is possible that one could have been appointed and indeed it seems to have been assumed that Mr. Augustine was his successor.
But as Mr. Augustine did not take up this matter we need not decide that point.
What we think is clear is that Mr. Pitam Singh was not a successor, especially as appeals lay to him from certain decisions of the Subordinate Judges in his district.
It would be unusual to provide an appeal from one Judge of a Court to another single Judge of the same Court.
It would be even more anomalous to have an appeal from the decision of a judge lie to his successor in office.
Even 137 in the High Courts, where there are Letters Patent appeals, the appeal is always heard by a Division Bench of at least two Judges; nor can this be treated as a case where a Court with inherent jurisdiction decides the matter as an original tribunal though, owing to territorial or other similar classification not affecting inherent jurisdiction, the case should have gone to some other tribunal of co ordinate or lesser authority.
Section 193(1) of the Criminal Procedure Code imposes a definite bar which cannot be ignored or waived any more than the prohibitions under sections 132 and 197 and, just as the sanctions provided for in those sections cannot be given by any authority save the ones specified, so here, only the Courts mentioned in section 195 (1) (b) and (c) can remove the bar and make the complaint.
This also appears to accord with the Punjab practice.
The Rules and Orders of the Punjab High Court reproduce a Notification of the High Court dated 16 5 1935 as amended on 23 2 1940, at page 3 of Chapter 20 B of Volume I, where it is said in paragraph 2 "It is further directed the Court of such Senior Subordinate Judge of the first class shall be deemed to be a District Court, etc.
" This appears to regard each Senior Subordinate Judge as a Court in himself and not merely as the presiding officer of the Court of the Subordinate Judge.
Section 39(3) of the Punjab Courts Act is also relevant.
It states that "the High Court may by notification direct that appeals lying to the District Court from all or any of the decrees or orders passed in an original suit by any Subordinate Judge shall be preferred to such other Subordinate Judge as may be mentioned in the notification, and the appeals shall thereupon be preferred accordingly, and the Court of such other Subordinate Judge shall 'De deemed to be a District Court, etc.
" Now this permits an appeal from one Subordinate Judge to another and the words the "Court of such other Subordinate Judge" indicate that the Subordi 138 nate Judge to whom the appeal is preferred is a separate and distinct Court.
The position thus reduces itself to this.
The original Court made no complaint; section 476 A of the Criminal Procedure Code was therefore attracted and the jurisdiction to make the complaint was transferred to the Court to which Mr. Barlow 's Court was subordinate within the meaning of section 195.
That Court, as we have seen, was the Court of the District Judge.
Now, when the matter was reported to the District Judge by Mr. K. K. Gujral, the District Judge dealt with it.
He had authority under section 476 A either to make the complaint himself or to reject the application.
He did neither.
Instead, he sent it to Mr. Pitam Singh who had no jurisdiction.
Of course, the District Judge could have sent it to the original Court or to the successor Judge of that Court if there was one, but he sent it to a Court without jurisdiction, so his order was ineffective and the subsequent order of Mr. Pitam Singh was without jurisdiction.
That still left the District Court free to act under section 476 A when the matter came back to it again.
This time it came by way of appeal from Mr. Pitam Singh 's order but that made no difference because the substance of the matter was this: the original Court had not taken any action, therefore it was incumbent on the District Judge to make an appropriate order either under section 476 A or by sending it for disposal to the only other Court that had jurisdiction, namely the original Court.
But the District Judge did not deal with it.
The application went instead to the Additional District Judge and what we now have to see is whether the Additional District Judge had the requisite power and authority.
That depends on whether the Additional District Judge was a Judge of the District Court or whether he formed a separate Court of his own like the various Subordinate Judges; and that in turn depends on the language of the Punjab Courts Act.
As we have already pointed out, section 18 of that Act states that, in addition to Courts of Small Causes 139 and Courts established under other enactments, "there shall be the following classes of Civil Courts, namely: (1) The Court of the District Judge; (2) The Court of the Additional Judge; and (3) The Court of the Subordinate Judge".
The Court of the Additional Judge is therefore constituted a distinct class of Court, and it is to be observed that the Act speaks of the Court of the Additional Judge and not of the Additional District Judge as is the case with certain other Acts in other parts of India.
This language is also to be compared with articles 214 and 216 of the Constitution which constitute and define the constitution of the High Courts in India. ``214(1).
There shall be a High Court for each State ' '.
"216 .
Every High Court shall consist of a Chief Justice and such other Judges as the President may from time to time deem it necessary to appoint".
The Punjab Courts Act nowhere speaks of an Additional District Judge or of an Additional Judge to the District Court; also, the Additional Judge is not a Judge of co ordinate judicial authority with the District Judge.
Section 21 (I) states that "When the business pending before any District Judge requires the aid of an Additional Judge or Judges for its speedy disposal, the State Government may appoint such Additional Judges as may be necessary".
But these Judges cannot discharge all the judicial functions of the District Judge.
Their jurisdiction is a limited one and is limited to the discharge of such functions as may be entrusted to them by the District Judge.
Section 21(2) states that "An Additional Judge so appointed shall discharge any of the functions of a District Judge ' which the District Judge may assign to him".
It is true that sub section (2) goes on to say that "in the discharge of those functions he shall exercise the same powers as the District Judge" but these powers are limited to the cases with which 140 he is entitled to deal.
Thus, if his functions are confined to the hearing of appeals he cannot exercise original jurisdiction and vice versa.
But if he is invested with the functions of an appellate tribunal at the District Court level, then he can exercise all the powers of the District Judge in dealing with appeals which the District Judge is competent to entertain.
This is a very different thing from the administrative distribution of work among the Judges of a sin ale Court entitled to divide itself into sections and sit as division Courts.
When the Chief Justice of a High Court or the District Judge of a District Court makes an administrative allotment of work among the Judges of his Court, their jurisdiction and powers are not affected, and if work allotted to one Judge goes to another by mistake his jurisdiction to entertain the matter and deal with it is not affected.
But that is not the scheme of the Punjab Courts Act and the mere fact that Mr. J. N. Kapur called himself the Additional District Judge and purported to act as such cannot affect the matter of his jurisdiction.
As the Punjab Courts Act does not contemplate the appointment of Additional Judges to the District Court, none can be appointed.
The Court contemplated is the Court of the Additional Judge which is in the nature of a special tribunal set up for a special purpose and invested with the powers of a District Judge when dealing with the matters specially entrusted to its jurisdiction.
We hold therefore that the Court of the Additional Judge is not a division Court of the Court of the District Judge but a separate and distinct Court of its own.
Now, as we have seen, when the original Court does not make a complaint under section 476 of the Criminal Procedure Code or reject the application, then the only other Court competent to exercise these powers is the Court to which appeals from the original Court "ordinarily lie".
That Court, in the present case, was the Court of the District Judge and not the Court of the Additional Judge Mr. J. N. Kapur.
Therefore, Mr. J. N. Kapur 's order was also without jurisdiction.
141 Mr. Kapur 's order went up to the High Court in revision, and the next question we have to determine is whether the High Court had jurisdiction to entertain the revision and the extent of its powers.
Keshardeo Chamria vs Radha Kissen Chamria and Other8(1) and many cases from the High Courts were cited which show that there is much difference of opinion about this but we are fortunately not called upon to decide that question because this is not a case where a Court with jurisdiction has acted under section 476 of the Criminal Procedure Code of its own motion or has acted as a Court of appeal under section 476 B.
As we have shown, the Court of the Senior Subordinate Judge Mr. Pitam Singh had no jurisdiction to entertain this matter either as a Court of appeal under section 476 B or of its own authority under section 476 A.
The Additional Judge Mr. J. N. Kapur, who has called himself an Additional District Judge, also had no jurisdiction under either section.
But he seised himself of the case and has rejected the application for the making of a complaint.
He therefore assumed a jurisdiction which he did not possess and that at once attracted the revisional jurisdiction of the High Court.
Now it does not matter in this case whether that jurisdiction lies under section 439 of the Criminal Procedure Code or under section 115 of the Civil Procedure Code because under either of these two sections the High Court is entitled to set aside an order of a Court subordinate to it which has assumed a jurisdiction that it does not possess.
Therefore, in so far as the High Court set aside the order of Mr. J. N. Kapur it was right.
But where it went wrong was in upholding the complaint made by the Senior Subordinate Judge.
As we have shown, that Court had no jurisdiction to make the complaint .
The next question is whether the High Court could itself have made the complaint in this particular case because if it could have done so then we would not have used our extraordinary powers of appeal under article 136 to set right what would in those circum (1) ; , 150 to 152.
19 142 stances have been a mere procedural irregularity.
But as our opinion is that the High Court had no jurisdiction to act under section 476 in this case, we are bound to interfere.
As we have shown, section 195 contains an express prohibition against taking cognizance of the kind of complaint we have here unless the bar is lifted either by the original Court or the Court to which it is subordinate within the meaning of section 195(3).
Those are the only Courts invested with jurisdiction to lift the ban and make the complaint.
Had this been a case in which the High ' Court was the superior Court within the meaning of section 195(3) the matter would have been different, but as the original Court was neither the original Court nor the Court to which the original Court was subordinate, according to the special definition in section 195(3), it had no jurisdiction to make the complaint of its own authority.
Therefore, all that the High Court could, and should, have done was to send the case to the District Judge for disposal according to law.
We will, therefore,, now do what the High Court should have done.
We were asked not to allow the proceedings to pend any longer but we are not prepared to do that in this case.
If the view taken by Mr. Pitam Singh and the High Court is right, then a serious offence of a kind that is unfortunately becoming increasingly common, and which is difficult to bring home to,an offender, has been committed against the administration of justice, and if the District Court is satisfied, as were Mr. Pitam Singh and the High Court, that a prima facie case has been made out and that it is expedient in the interests of justice that a complaint should be filed, then it is but right that the matter should be tried in the criminal Courts.
We will not say anything more lest it prejudice the appellant.
The District Judge will of course be free to exercise his own discretion.
The application for the making of a complaint will accordingly be remitted to the District Judge who will now deal with it.
| The question as to which Court is competent to make a com plaint under section 476 A read with section 195(3) of the Code of Criminal Procedure where none wag made by the Court in which the offence was committed or its successor Court, will depend on the nature of the proceeding in which the offence was committed, whether civil, criminal or revenue, and on the hierarchy of superior Courts to which an appeal from such proceeding will ordinarily lie as contemplated by section 195(3) of the Code, apart from such exceptions as may be made in respect of any particular matters by any special notifications or laws.
Where, however, appeals ordinarily lie to different courts, the one of the lowest grade will be the Court competent to make the complaint.
Wadero Abdul Bahman vs Sadhuram, ([1930] and M. section Sheriff vs Govindan (A.I.R. , 1061), not approved.
Under the Punjab Courts Act of 1918 and the hierarchy of civil Courts established thereby, appeals from the Courts of the various subordinate Judges who constitute distinct Courts do not ordinarily lie to the Senior Subordinate Judge but to the District Judge and the Court of the Additional Judge is not a Court of coordinate jurisdiction with that of the District Judge.
The Act neither mentions nor recognises an Additional District Judge as a Court of that hierarchy.
Consequently, in a case where offences under sections 193 and 471 of the Indian Penal Code were alleged to have been committed in a civil proceeding in the Court of a Subordinate Judge of the first class, exercising jurisdiction under the Punjab Courts Act of 1918, and neither he nor his successor made a complaint or rejected the application for the making of it, the Senior Subordinate Judge had no jurisdiction to entertain the matter and make the complaint either as a Court of appeal under section 476 B or of Its own authority under section 476 A of the Code of Criminal Procedure and the Additional 17 126 Judge, by wrongly describing himself as an Additional District Judge, could not assume a jurisdiction which he did not possess under those sections.
The High Court has power to revise orders of subordinate Courts made without jurisdiction both under section 439 of the Code of Criminal Procedure and under section 115 of the Code of Civil Procedure, therefore, it was not necessary to decide under article 136 of the Constitution which of these two sections applied in the present case, but the High Court erred in upholding the complaint made by the Senior Subordinate Judge because that court had no jurisdiction to make the complaint.
The High Court is not a Court to which the Subordinate Judge of the first class is subordinate within the meaning of section 196(3) of the Code of Criminal Procedure and could not, therefore, make the complaint of its own authority and should have remitted the application to the District Judge for disposal according to law.
|
os. 651 of 1954 and 39, 46, 51 and 176 of 1955.
45 Under Article 32 of the Constitution of India for the enforcement of fundamental rights.
section P. Sinha (section D. Sekhari, with him), for the petitioner in Petition No. 651 of 1954.
section P., Sinha (B. K. Saran and M. M. Sinha, with him), for the petitioner in Petition No. 39 of 1955.
B. K. Saran and M. M. Sinha, for the petitioner in Petition No. 46 of 1955.
section D. Sekhari, for the petitioner in Petition No. 51 of 1955.
R. Patnaik, for the petitioner in Petition No. 176 of 1955.
M. C. Setalvad, Attorney General of India (R. Ganapathy Iyer and P. G. Gokhale, with him) for respondents in all the Petitions.
January 20.
The Judgment of the Court was delivered by JAGANNADHADAS J.
These are five petitions under article 32 of the Constitution by the heads of five Maths in the State of Orissa of which four known as Mahiparakash Math, Uttaraparswa Math, Dakshinaparswa Math and Radhakant Math are situated in Puri and the fifth known as Manapur Math is near Tirtol in Cuttack district.
In all these petitions certain provisions of the Orissa Hindu Religious Endowments Act, 1951 (Orissa Act II of 1952) as amended by Orissa Act XVIII of 1954 are challenged as being unconstitutional and ultra vires.
Since the questions raised are mostly common, all the petitions are dealt with by this single judgment.
These petitions have a background of previous history of legislation and litigation which it is necessary to set out in order that the questions raised, may be properly appreciated.
The first statutory interference by the Provincial Legislature with the management of Hindu religious endowments in Orissa was by the Orissa Hindu Religious Endowments Act, 1939 (Orissa Act IV of 1939) which came into operation 46 on the 31st August, 1939.
This was modelled on a similar Act operating in the Province of Madras at thetime.
ThevalidityoftheActasawholeasalso, of certain provisions thereof we 're challenged by the Mahants of the various Maths in Orissa, about 30 in number, by instituting a suit in the year 1940.
The suit was on behalf of the individual Maths who figured as plaintiffs (including three of the present petitioners, viz. Mahants of Mahiparakash Math, Dakshinaparswa Math and Radhakanta Math) and also in a representative capacity under Order I, rule 8 of the Civil Procedure Code.
(Vide printed record of this Court in Case No. I of 1950).
That suit was dismissed by the District Judge of Cuttack and came up in appeal to the High Court of Orissa.
The High Court upheld the validity of the Act and of the various sections thereof by its judgment dated the 13th September, 1949, which is reported in Mahant Sri Gadadhar Ramanuj Das vs The Province of Orissa(1).
An appeal was filed therefrom to the Supreme Court in Jaiiuary, '1950, which was numbered as Case No. I of 1950.
This appeal remained pending for over four years and came up for final hearing in February, 1954.
During the period of pendency of the appeal the Orissa Legislature passed two further Acts relating to Hindu religious endowments.
The first of them was Orissa Act II of 1952 which was an Act to "amend and consolidate the law relating to the ad ministration and governance of Hindu religious institutions and endowments in the State of Orissa" and which on its coming into force was intended to repeal the pre existing Orissa Act IV of 1939.
This Act became law on the 16th February, 1952, by the assent of the President.
It did not however come into force at once on account of sub section (3) of section I therein which provided that the Act is to "come into force on such date as the State Government may, by notification, direct".
No such notification was issued during the pendency of the appeal in the Supreme Court.
This Act was, in fact, brought into force much later, i.e., only as from the 1st Janu (1) I.L.R. [19491 Cuttack 656.
47 ary, 1955, by a notification of the Government of Orissa dated the 22nd December, 1954, published in the Orissa Gazette dated the 31st December, 1954.
While thus the 1952 Act remained on the statute book without its coming into force.
, other independent statutory provisions amending the Act of 1939 were passed and brought into operation.
The first of them was Orissa Ordinance No. 11 of 1953 which was promulgated by the Governor of Orissa on the 16th May, 1953.
This was later superseded and substituted by Orissa Act XVIII of 1953 which came into operation on the 28th October, 1953.
By these two successive legislative measures, the Act of 1939 was amended in certain respects and it is the Act so amended that was in operation during the period from May, 1953 to March, 1954, falling within the later portion of the pendency of Case No. I of 1950 in the Supreme Court.
Some time in 1953, subsequent to the month of May, the Commissioner of Hindu Religious Endowments, Orissa, appears to have initiated proceedings for the framing of schemes in respect of a number of Matbs, and schemes were actually framed during this period as regards the four Maths, Mahiparakash, Uttaraparswa, Daksbinaparswa and Radhakanta comprised in Petitions Nos.
651 of 1954, 49, 46 and 51 of 1955, respectively.
These schemes were brought into operation and the administration of some of these Matbs was taken over by the Trustees under the schemes.
Thereafter Mahants of three of the affected Maths, Mahiparakash, Uttaraparswa and Radhakanta, who are also petitioners before us, filed applications under article 226 before the High Court of Orissa challenging the alidity of the schemes.
Those applications were dismissed by the High Court on the 17th February, 1954.
Meanwhile the Mahant of Dakshinaparswa Math who was a petitioner in the High Court and also before filed along with another Mahant, a petition under icle 32 of the Constitution to this Court on the d December, 1953, challenging the Act then in force as being in violation of their fundamental rights.
This was Petition No. 405 of 1953.
This petition as 48 well as Case No. 1 of 1950, referred to above, came up for hearing, together, in this Court on the 9th, 10th and 11th February, 1954.
Judgment of this Court therein was delivered on the 16th March, 1954, and is reported in Mahant Sri Jagannath Ramanuj Das vs The State of Orissa(2).
As a result thereof, sections 38 and 39 of Orissa Act IV of 1939 as amended in 1953, under which the schemes were framed were declared unconstitutional.
Accordingly, the schemes became invalid and therefore the possession of such of the Matbs which had been, taken over under the schemes was restored to the Mahants.
(It may be mentioned in passing, in this context, that the judgment of this Court refers to Orissa Act II of 1952 as being the one in force at the time and whose provisions were under consideration by the Court.
This is a slip.
The Act then in force was, as already stated, the Act of 1939 as amended in 1953.
That this is a slip in the judgment is admitted before us.
That does not however in any way detract from the reasoning and the bind ing character of the judgment, since as a fact what were really referred to were the sections of the 1939 Act as amended in 1953).
Now, after the judgment of this Court was delivered in March, 1954.
, the Orissa Legislature again intervened and passed another Act, Orissa Act XVIII of 1954.
This Act purported to amend not the 1939 Act which was by then in operation but the 1952 Act which had not by then come into force.
Orissa Act XVIII of 1954 received the assent of the President on the 2nd December, 1954; and came into force at once and therefore Orissa Act II of 1952 became pro tanto amended and modified.
By that date the 1952 Act so amended was awaiting the issue of notification under section 1(3) thereof for being brought into force.
This notification, as alreay stated, was ultimately issued on the 22nd December.
1954, bringing Orissa Act II of 1952 as amended Act XVIII of 1954 into force from the 1st January, 1955, and thereby repealing Orissa Act IV of 1939 amended in 1953.
The first of the petitions before us, relating to Mahiparakash Math was filed in this (1) ; 49 Court, anticipating this notification, while the other four were filed after the notification was issued.
As already stated, all these petitions challenge the validity of various sections of Act 11 of 1952 as amended in 1954 (hereinafter referred to as the present Act).
The challenge is entirely based upon the principles laid down by this Court in Mahant Sri Jagannath Ramanuj Das vs The State of Ori8sa(1).
The ' above is the history of the relevant legislation and the connected parallel litigation.
The main attack is in respect of sections 42 and 79 A of the present Act relating to the schemes for religious institutions of the kind with which we are concerned in these petitions.
There can be no doubt that the two sections apply to these Maths.
The phrase "religious institution" occurring in section 42 has been defined as meaning (also) "a math and endowments attached thereto".
A Math is "an institution succession to the headship of which devolves in accordance with the directions of the founder or is regulated by custom" and a hereditary trustee is "a trustee of an institution succession to whose office devolves by custom or is specifically provided for by the founder".
A Math is therefore a religious institution presided over or managed by a hereditary trustee so as to render section 42 (1) (b) applicable.
To appreciate the ground of attack it is necessary to trace the changes in the provisions relating to the framing of schemes for such institutions in the successive legislative measures.
In the Act as it, stood in 1939 the provisions in this behalf are sections 38, 39 and 40.
Since the attack is mainly as regards the procedure for the framing of the scheme, it is sufficient to notice what the gist of these three provisions is in so far as it relates to the procedure for an enquiry to frame a scheme.
Under these three sections the enquiry is to be held by the Commissioner for Endowments appointed under the Act.
For this purpose he is to function jointly with one or more persons in the service of the Crown appointed by the Provincial Government in (1) ; 7 50 this behalf.
The enquiry has to be conducted "in such manner as may be prescribed".
In making the enquiry the Commissioner and the person or persons associated with him therein are to consult the trustee and the persons having interest.
After the scheme is settled and the order determining the scheme is published in the prescribed manner the trustee or any person having interest may, within six months of the date of such publication, institute a suit in the court to modify or set aside such order.
The order settling a scheme is final and binding on the trustee and all persons having interest, subject to the result of the suit, if any, as above mentioned.
Of course, the result of the suit itself would, under the general law, be subject to further appeal under the Civil Procedure Code in the ordinary way.
Changes were made in these provisions in 1953 first by Orissa Ordinance II of 1953 and then by Orissa Act XVIII of 1953 as already stated.
The modification is that sub section (4) of section 39 which provided for a right of suit, by the trustee or the person interested, in the regular civil court (with the concomitant further appeals to higher courts) was deleted and the following was substituted as sub section (4) of section 39: "Every order under this section shall be published in the prescribed manner and the order so passed shall be final and binding on the trustee and all persons having interest".
As a consequence thereof section 40 of the 1939 Act, which stated that "subject to the result of the suit the order settling a scheme is final", was omitted.
The result of these two changes was that once the Commissioner with the assistance of one or more Government officers who were to be specially nominated, settled a scheme after making the prescribed enquiry, that order was not open to any further question or correction in the ordinary courts.
It was at this stage that the validity of the provisions relating to the framing of a scheme came up for consideration before this Court in March, 1954.
This Court held that the legislation in so far as it authorised the 51 framing of a scheme by the Commissioner along with his associates and declared such determination as final without any scope for correction thereof by judicial intervention, was an unreasonable restriction on the right of the head of the Math with reference to his interest in the Math.
Accordingly sections 38 and 39 of the Act then in force were struck down as unconstitutional and invalid.
The present provisions which are the result of a later amendment are contained in sections 42 and 44 of the present Act and are substantially different.
The relevant portions thereof are as follows: "42.
(1) Whenever there is reason to believe that in the interest of the proper administration of religious institution a scheme may be settled for it, or when not less than five persons having interest make an application in writing stating that in the interests of the proper administration of a religious institution a scheme should be settled for it, the Assistant Commissioner or the Commissioner, as the case may be, shall proceed to frame a scheme in the manners hereinafter provided (a) (b) in the case of a religious institution presided over or managed by a hereditary trustee, the Assistant Commissioner shall make such enquiry as he thinks fit and submit his report to the Commissioner who shall hold an enquiry in the manner prescribed and so far as may be, in accordance with the provisions of the Code of Civil Procedure, 1908, relating to the trial of suits and if he is satisfied that in the interests of the proper administration of such institution a scheme of administration should be settled, he shall consult in the prescribed manner the trustee and the persons having interest and by order settle a scheme of administration for the institution.
(7)Every order of the Commissioner settling a scheme under this section shall, subject to the provisions of Section 44, be binding on the trustee, the Executive Officer and all persons having interest.
(1) 52 (2) Any party aggrieved by the order of the Commissioner under sub section (1) of section 42 may appeal to the High Court within thirty days from the date of the order or publication thereof as the case may be".
The effect of these provisions of the present Act is (1) that a scheme can be framed by the Commissioner alone on a report of the Assistant Commissioner on such enquiry as he thinks fit and not by the Commissioner in association with one or more Government officers to be appointed for the purpose by the Government, (2) that there is no right of suit for cballenging the validity or the correctness of the scheme framed by the Commissioner but there is only an appeal to the High Court direct.
It is urged that these provisions still continue to be unreasonable restrictions on the rights of the Mathadipathi and are accordingly ultra vires and unconstitutional.
In the case reported in the Commissioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutth (1) the interest of Mathadipathi in the Math has been recognised as property falling within the scope of article 19(1)(f) of the Constitution.
It was recognised that the ingredients, of office and property, of duties and personal interest, are blended together in the rights of a Mahant and that the Mahant has the right to enjoy the property or the beneficial interest so long as he is entitled to hold his office.
It was recognised that the beneficial interest which the Mahant enjoys is appurtenant to his duties and that as he is in charge of a public institution, reasonable restrictions can always be placed upon his rights in the interests of the public.
It was however held therein that provisions for the framing of a scheme which by its terms operate by way of unreasonable restriction would be unconstitutional and invalid.
It is this principle that was applied in the next decision of this Court relating to Orissa Maths in Mahant Sri Jagannath Ramanuj Das vs The State of Orissa(2).
There, the validity of the then provisions of the Act, i.e., of sections 38 and 39 of (1) (1954] S.C.R. 1005.
(2) ; 53 Orissa Act IV of 1939 as amended in 1953 was adjudged in the following terms: "Sections 38 and 39 relate to the framing of a scheme.
The scheme can certainly be settled to ensure due administration of the endowed property but the objection seems to be that the Act provides for the framing of a scheme not by a civil court or under its supervision but by the Commissioner, who is a ' mere administrative or executive officer.
There is also no provision for appeal against his order to the court. .
We think that the settling of a scheme in regard to a religious institution by an executive officer without the intervention of any judicial tribunal amounts to an unreasonable restriction upon the right of property of the superior of the religious institution which is blended with his office.
Sections 38 and 39 of the Act must, therefore, be held to be invalid".
It is urged that though the obvious purpose of the amending Act of 1954 passed after this decision by the Supreme Court, was to remedy the defect above pointed out by providing for a right of appeal direct to the High Court from the determination of the Commissioner settling the scheme, the present provisions still continue to be unreasonable restrictions on the right of property of the Mahant.
It is further urged that the initial decision in a scheme proceeding is still on the basis of an executive enquiry by an executive officer and that in any case a direct appeal to the High Court as against the Commissioner 's order cannot be as adequate a safeguard regarding the rights of the Mahants, as a suit and a right of appeal therefrom in the ordinary course to the higher courts would be.
It is undoubtedly true that from a litigant 's point of view an appeal to the High Court from the Commissioner 's order is not the same as, an independent right of suit and an appeal to the higher courts from the result of that suit.
But in order to judge whether the provisions in the present Act operate by way of unreasonable restriction for constitutional purposes what is to be seen is whether the person affected gets a reasonable chance of presenting his entire case before the original tribunal which has to 54 determine judicially the questions raised and whether he has a regular appeal to the ordinarily constituted court or courts to correct the errors, if any, of the tribunal of first instance.
For that purpose it is relevant to notice that in the present Act, the Commissioner of Endowments has, by virtue of section 4 thereof, to be a member of the Judicial Service (of the State) not being below the rank of a Subordinate Judge, while under section 7 of Act IV of 1939 a Commissioner of Endowments could be a person of either the judicial or the executive service and that even where a member of the judicial service is appointed he may be a person below the rank of a Subordinate Judge.
Another important difference has also to be noticed, viz., that while under section 38 of the previous Act the enquiry has to be conducted "in such manner as may be prescribed" which means as prescribed by the Provincial Government by rules made under the Act and hence changeable by the Government, under the present Act, section 42(1) (b) specifically enjoins that "the Commissioner shall hold an enquiry in the manner prescribed and so far as may be in accordance with the provisions of the Code of Civil Procedure relating to the trial of suits".
It may also be noticed that before the Commissioner starts his enquiry it is expected that the Assistant Commissioner, who, by virtue of section 5(2), is to be a person holding a judicial office not lower in rank than that of a Munsif, is to make such enquiry as he thinks fit and submit his report.
Thus in the initial stage of the framing of the scheme under the provisions of the present Act there is first of all something in the nature of a preliminary enquiry by a judicial officer of the rank of a Munsif and this is followed by a regular and full enquiry before the Commissioner who is of the rank of a Subordinate Judge.
The enquiry before the Commissioner is assimilated to and is governed by the provisions relating to the trial of suits by enjoining that, as far as may be, it is to be in accordance with the provisions of the Code of Civil Procedure relating to trial of suits.
While, therefore, under the prior Act the enquiry before the Commissioner might well 55 have been of the nature of an executive enquiry by an executive officer, the enquiry under the present Act is by itself in the nature of a judicial enquiry by judicial officers followed up by a right of regular appeal to the High Court.
A scheme framed with reference to such a procedure cannot ipsofacto be pronounced to be in the nature of unreasonable restriction on the rights of the Mahant.
The legislature ' might well have thought that, instead of making the enquiry before the Commissioner more or less in the nature of a preliminary executive enquiry to be followed up by the affected Mahant by way of a regular suit in the Civil Court '.
it is much more satisfactory and in the public interests, to impress the enquiry before the Commissioner himself with the stamp of greater seriousness and effectiveness and to assimilate the same to a regular enquiry by the judicial officer according to judicial procedure and then to provide a right of direct appeal to the High Court.
It has been strongly urged that a mere right to appeal to the High Court would virtually be in the nature of a limited appeal confined to challenge only on certain basic matters and probably limited to questions of law.
We can find no warrant for any such apprehension.
The right of appeal is given in very wide and general terms.
Obviously the appeal can be both on facts and on law and would relate not merely to the merits of the scheme but also to all basic matters whose determination is implicit in the very framing of a scheme.
In our opinion the present provisions cannot be struck down as being in the nature of unreasonable restriction on the rights of the Mahant.
Two other minor provisions in this connection have been brought to our notice and relied upon as indicating unreasonable restriction on the rights.
One is that while under the 1939 Act the period of limitation for a right of suit was six months, the period allowed for an appeal under the present Act is only 30 days.
Another is that under section 74(3) the operation of the order of the Commissioner is not to be stayed pending the disposal of the appeal.
It 56 has been urged that these provisions operate very harshly against the Mahant affected by a scheme when framed.
It is pointed out that as the result of a scheme being put into operation immediately, the Mahant may be deprived of the effective possession of the Math and hence of the wherewithal to file an appeal within the very short time that is allowed, as also of the resources to conduct the appeal in the High Court or to maintain himself during its pendency which may take years.
There is not much force in this contention.
In so far as the question of filing of an appeal is concerned, there should be no difficulty since the provisions relating to appeals in forma pauperis would be applicable and can be availed of if the circumstances call for it.
In so far as any situation may arise which may call for financial facilities for the conducting of the appeal or for interim maintenance, the learned Attorney General suggests that the appellate Court would have inherent power and discretion to give appropriate directions for supply of funds out of the trust estate and that in any view, such power and discretion have to be implied in the provision for an appeal so that the said right of appeal may not become illusory.
Having regard to the suggestion thus put forward, which we accept, we cannot hold that the provision in section 74(3) that the operation of the order of the Commissioner framing a scheme is not to be stayed pending the disposal of the appeal, brings about an unreasonable restriction.
In this view we think that the incidental provisions above referred to do not in any way detract from the reasonableness of the main provisions.
In our opinion, therefore, the provisions in the present Act of 1952 as amended in 1954, relating to the framing of schemes are not open to any of the constitutional objections raised, and are valid.
The next point that has been urged, depends on the fact that in four of the petitions before us relating to the Maths of Mahiparakash, Uttaraparswa, Dakshinaparswa and Radhakanta, schemes were in fact framed in the year 1953 under the provisions of 57 Orissa Act IV of 1939 as amended in 1953.
It may be recalled that these provisions were held invalid by the decision of this Court in March, 1954, above referred to.
It must therefore be taken that these schemes were void as the law then stood.
It is with reference to that situation that the Orissa Legislature by an amendment in 1954 of the 1952 Act introduced section 79 A into this Act which runs as follows: "Notwithstanding anything contained in any of the other provisions of this Act or in any judgment, decree or order of any court all schemes purporting to have been settled in pursuance of sections 38 and 39 of the Orissa Hindu Religious Endowments Act, 1939, after the commencement of the Orissa Hindu Religious Endowments (Amendment) Ordinance, 1953, and before the commencement of this Act shall be deemed to have been settled under the provisions of this Act and any person aggrieved by any such scheme may within sixty days from the date of commencement of this Act prefer an appeal to the High Court and such appeal shall be dealt with and disposed of in the same manner as appeals provided for under sub section (2) of section 44".
This purports to revive the schemes which were pronounced to be invalid by the judgment of this Court and attempts to remove the defect noticed in the judgment of this Court by providing for a regular appeal to the High Court against that very scheme within 60 days from the date of the commencement of the Act.
It may be noticed that the schemes so revived are only those which were settled after the commencement of Orissa Hindu Religious Endowments (Amendment) Ordinance, 1953, and before the commencement of the 1952 Act, i.e., between 16th May, 1953 to 31st December, 1954, (hereinafter referred to as the specified period).
This was exactly the period within which the amendment of 1939 Act made in 1953 was in force, abolishing the right of suit and making the scheme as determined by the Commissioner final and conclusive.
Section 79 A in terms purports to revive the invalid scheme notwith 8 58 standing any judgment, decree or order of any court, which means that though a court may have pronounced the scheme as void still that is deemed to be alive.
It has been suggested that this is directly flouting the decision of this Court and that the legislature has no power to declare as valid and constitutional what was decided by this Court as invalid and unconstitutional.
But it is to be observed that the legislature does not purport to do anything of the kind.
What it does is not to deem the schemes previously settled as having been validly settled on those very dates, under the then existing law.
This of course is beyond legislative competence since the legislature has not the power to override unconstitutionality as such.
But what the legislature has purported to do is to take up those very schemes and deem them to have been settled under the _provisions of the present Act and thereby to lay them open to any attack available under the present law.
Such a pro vision is not uncommon in legislative practice, and is enacted in order to avoid the public inconvenience of having to re do what has previously been done.
The result of section 79 A is to treat the schemes framed within the specified period as schemes framed immediately after the commencement of the present Act and to impute thereto, by a fiction, compliance with the various procedural and other steps which are requisite under section 42.
We can see no reason for thinking that such a provision is not within the competence of the Legislature.
It has been suggested that this is really interfering with the jurisdiction of this Court under article 32.
But there is no substance in that suggestion.
The right of any person to seek remedy under article 32 in respect of any violation of his fundamental rights is in no way curtailed or affected by the fact that an actual decision of this Court on an application under article 32 is, in effect, nullified by appropriate and competent legislative measures.
Indeed, the right has been, in fact, successfully invoked on the prior occasion and has again been invoked on the present occasion.
If it fails this time it is not because the right and the remedy under 59 article 32 have been taken away or affected but because the unconstitutionality has been removed.
Section 79 A, therefore, is not open to any objection on the ground of legislative incompetence.
It has further been urged that to treat the scheme prepared with reference to the Act of 1939 as amended in 1953 as a scheme prepared under the present Act by means of a fiction is really in the nature of deprivation of certain advantages which an aggrieved person would have had if in fact the scheme was settled under the present Act, and that therefore such a scheme would still operate by way of unreasonable restriction.
This contention is also without substance.
It is true that in the present Act the procedure relating to the scheme has four steps which are as follows: (1) The scheme is to be framed by a Commissioner, who is, by appointment, a judicial officer.
(2) The procedure is, as far as may be, the same as that in the trial of suits.
(3) There is a preliminary enquiry by the Assistant Commissioner.
(4) There is an appeal to the High Court.
Out of these four, the substantial item is the last one and that has been specifically provided for under section 79 A and a period of sixty days from the date of the commencement of the Act has been provided for the right of appeal.
There can be no complaint on this score.
It is true that the schemes under the Act then in operation, i.e., during the specified period, might possibly have been framed by (a) an executive officer, as also (b) in pursuance of procedure under the rules framed by the Executive Government which may not approximate to that of a trial of a suit.
But this was merely a theoretical possibility.
In fact, as appears from the record and, as has beenstated to us by the learned Attorney General on behalf of the State and not disputed on the other side, the Endo wment Commissioner during the specified period was a Subordinate Judge of the Orissa Judicial Service.
The actual procedure which was in force at the time under the rules as then prescribed was also in fact in 60 consonance with the trial of suits under the Civil Procedure Code.
This appears clearly from rules 51 to 109 of the Rules framed by the Government of Orissa, an official copy of which has been supplied to us in court by the learned Attorney General on behalf of the State.
As regards the provision that the enquiry by the Commissioner under the present Act has to be preceded by a preliminary enquiry by an Assistant Commissioner who is of the rank if a Munsif, the argument that the deprivation of this feature by the deeming provision in section 79 A operates to the disadvantage of the Mahants is not by any means a serious point.
It is to be noticed that this is setoff by the fact that schemes under the 1939 Act are framed not by the Commissioner alone but along with one or more Government officers appointed by the Government.
We are, therefore, unable to, uphold the contention that the deeming provision under section 79 A which treats the previous schemes as schemes framed under the present Act results in bringing about any substantial disadvantages to the detriment of the Mahants.
We accordingly hold that section 79 A of the present Act is not open to any constitutional objection.
We are, therefore, clearly of the opinion that sections 42(1)(b), 42(7) and 44(2) as well as section 79 A of the present Act are not open to the constitutional objections raised before us.
It may be mentioned that in the petitions before us some other provisions of the present Act have also been challenged as being unconstitutional.
But no arguments have been advanced before us in respect thereof.
It may also be mentioned that the petitions before us have not raised any questions relating to the merits of the scheme in so far as any specific provisions thereof may have operated by way of unreasonable restrictions, in the light of the considera tions pointed out by this Court in its judgment in the Commi8sioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutth(1).
Nor does it appear that any appeal as (1) ; 61 provided in section 79 A has been filed to the High Court in respect of these cases challenging the validity or the propriety of the various provisions in the scheme or correctness of the decision, express or implied, on the basic facts which are the foundation of the scheme proceedings.
We express no opinion on any of these matters.
In the last of the petitions relating to Manapur Math, the facts appear to be slightly dissimilar but this makes no substantial or material difference.
In that case the original scheme was one framed under sections 38 and 39 of the 1939 Act as they stood before their amendment in 1953 which provided for a right of suit.
The scheme itself was dated the 22nd May, 1948.
Previous to the framing of the scheme there appears to have been a claim by the Mahant that the institution was a private one and not a public one and that it did not fulfil the definition of the word "Math" under the Act.
There appears to have been a compromise between the then Mahant and the public of the village in which the Math is situated, who were interested in the Math.
The compromise was to the effect that the institution was to be declared a Math but that the then Mahant was to be recognised as the hereditary trustee thereof.
This compromise was recognised by the Commissioner by his order dated the 12th May, 1947, formally making the above declarations.
It was on the basis of this that, later on, a scheme was framed on the 22nd May, 1948.
It does not appear that the Mahant filed any suit which was then available to him.
But it is stated to us by the learned Advocate appearing for the petitioner that an application was filed in the High Court for a writ to qudsh the scheme, and that it was dismissed by the High Court on the 16th November, 1954.
The scheme became final under the original Act of 1939 as it stood before the 1953 amendment.
Obviously, with reference to the facts of such a case, no argument of the kind that has been addressed to us in the other four petitions was available.
In the result, therefore, all the five petitions must be dismissed with costs.
| Sections 38 and 39 of the Orissa Hindu Religious Endowments Act, 1939 (Orissa Act IV of 1939) as amended by Orissa Act XVIII of 1953 were declared unconstitutional and void by the Supreme Court in Mahant Sri Jagannath Bamanuj Das vs The State of Orissa ([1954] S.C.R. 1046) on the ground that legislation in so far as it authorised the framing of a scheme by the Commissioner along with his associates and declared such determination as final without any scope for correction thereof by judicial intervention was an unrea sonable restriction on the right of the head of the Math as respects his interest in the Math which is a, right to bold property within the meaning of article 19(1)(f) of the Constitution.
After the judgment dated 16th March 1954 delivered by the Supreme Court in the Case Of Mahant Sri Jagannath Bamanuj Das vs The State of Orissa, ([1954] S.C.R. 1046) the Orissa Legislature passed the Orissa Act XVIII of 1954 purporting to amend not the 1939 Act which was then in operation but the Orissa Act II of 1952 which had not then come into force.
The Orissa Act XVIII of 1954 received the assent of the President on the 2nd December 1954 and came into force at once and thus the Orissa Act II of 1952 became pro tnnto amended and modified.
The 1952 Act so amended came into force from the 1st January 1955 by virtue of a notification dated 22nd December 1954 issued under the provisions of section 1(3) thereof which provided that the Act wag to come into force on such date as the State Government may.
by notification provide.
The five petitions under article 32 of the Constitution in the present case challenged the validity of various sections of the Orissa Act II of 1952 as amended by Act XVIII of 1954 on the principles laid down in the case of Mahant Sri Jagannath Bamanuj Das vs The State of Orissa, ([1954] S.C.R. 1046).
Held, that sections 42(1)(b), 42(7), 44(2) as well as section 79(A) of Orissa Hindu Religious Endowments Act, 1951 (Orissa Act II of 1952) as amended by Orissa Act XVIII of 1954 are not unconstitutional and 44 ultra vires and the contention that the provisions of sections 42 and 44 of the present Act to the effect (1) that a scheme can be framed by the Commissioner alone on a report of the Assistant Commissioner on such inquiry as he thinks fit and not by the Commissioner in association with one or more Government Officers to be appointed for the purpose by the Government (2) that there is no right of suit for challenging the validity or the correctness of the scheme framed by the Commissioner but there is only an appeal to the High Court, still continue to be unreasonable restrictions on the right of Mathadipathi as in the case of Mahant Sri Jagannath Bamanuj Das vs The State of Orissa [(1954) S.C.R. 1046] is without substance.
In the initial stage of the framing of the scheme under the provisions of the present Act there is first of all something in the nature of a preliminary enquiry by a judicial officer of the rank of a Munsif and this is followed by a regular and full enquiry before the Commissioner who is of the rank of a Subordinate Judge.
The enquiry before the Commissioner is assimilated to and is governed by the provisions relating to the trial of suits by enjoining that, as far as may be, it is to be in accordance with the provisions of the Code of Civil Procedure relating to trial of suits. 'While, therefore, under the prior Act the enquiry before the Commissioner might well have been of the nature of an executive enquiry by an executive officer, the enquiry under the present Act is by itself in the nature of a judicial enquiry by judicial officers followed up by a right of regular appeal to the High Court.
A scheme framed with reference to such a procedure cannot ipso facto be pronounced to be in the nature of an unreasonable restriction on the rights of the Mahant.
The legislature might well have thought that instead of making the enquiry before the Commissioner more or less in the nature of a preliminary executive enquiry to be followed up by the affected Mahant by a regular , suit in the Civil Court, it is much more satisfactory and in the public interests, to vest the enquiry before the Commissioner himself with the stamp of greater seriousness and effectiveness and to assimilate the same to a regular enquiry by the judicial officer according to judicial procedure and then to provide a right of direct appeal to the High Court.
The right of appeal to the High Court is given in very wide and general terms because the appeal can be both on facts and on law.
Mahant Sri Gadadhar Bamanuj Dos vs The Province of Orissa, (I.L.R [1949] Cuttack 656), Mahant Sri Jagannath Bamanuj Das vs The State of Orissa ([1954] S.C.R. 1046) and Commissioner, Hindu Beligious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Matth, ([1964) S.C.R. 1006], referred to.
|
s Nos.
604,605, 647 649) 663, 671 and 692 of 1954.
Petitions under Article 32 of the Constitution of India for the enforcement of fundamental rights.
30 section P. Sinha, (B. Patnaik, with him) for the petitioners in P. Nos. 604, 605, 649 and 663 of 1954.
M. C. Setalvad, Attorney General of India, (Porus A Mehta and P.G. Gokhale., with him) for the respondents in all the Petitions.
January 20.
The Judgment of the Court was delivered by BHAGWATI J.
These petitions under article 32 of the Constitution are filed by the owners of Stage Carriage Services plying their buses on several routes in the districts of the State of Orissa impugning the provisions of Orissa Act XXXVI of 1947 and Orissa Act I of 1949 as violative of their fundamental rights.
They raise a common question of law and can be disposed of by one judgment.
The State of Orissa embarked upon a scheme of Nationalised State Transport and, as a first step towards it, enacted an Act styled the Orissa Motor Vehicles (Regulation of Stage Carriage and Public Carrier 's Services) Act, 1947 (Orissa Act XXXVI of 1947), which modified the provisions of the , for the better regulation of Stage Carriage and Public Carrier 's Services in the Province of Orissa.
This Act envisaged the formation of a Joint Stock Company in which the Central and the Provincial Governments shall together have controlling interests for providing in stages or in one stage a more efficient administration of the entire stage carriage and public carrier 's services in the Province of Orissa.
Such a Company was to be authorised to run stage carriage and public carrier 's services in the Province of Orissa to the exclusion of all other persons in the routes and areas over which it extended its activities, and with that end in view, the provisions of the , were modified as therein specified.
Section 4 of the Act provided that the Provincial Government may, if they think fit by notification direct that the powers conferred by the , on a Provincial Transport Authority or Regional Transport Authority shall 31 be held in abeyance with respect to the issue, renewal, suspension or transfer of permits for stage carriage services and public carrier 's services.
Such a notification was to be effective according to the directions either in the whole of the Province or in any specifled area or in respect of any specified route or routes.
On the issue of such a notification, the abovementioned powers conferred on the Provincial Transport Authority or the Regional Transport Authority were to be held in abeyance and all permits issued, renewed or transferred by them were to become inoperative and the Provincial Government alone was to have the power to issue or renew permits or to grant temporary permits or to suspend or to transfer permits for stage carriage services and public carrier 's services.
Whilst the State of Orissa was examining the question of the formation of such a Company, the merger of feudatory States of Orissa with the Province of Orissa took place on the 1st January, 1948.
Some of these Durbars had their own transport services and these were taken over by the State Government of Orissa.
Orissa was then divided into 5 zones for the purpose of proper development of road transport, viz., Sambalpur, Keonjhar, Koraput, Ganjam and Cuttack zones.
It was decided by the Government to nationalise passenger service transport in the first three zones to be run departmentally based on the nucleus services taken over from the feudatory States which had merged.
In order to give, effect to this decision, the Orissa Motor Vehicles (Amendment) Act 1948 (Orissa Act I of 1949) was enacted which further amended the , in the manner therein specified.
Section 1(3) of that Act provided that the remaining provisions of the Act shall come into force in such specified areas of the district or districts as the Provincial Government may by notification from time to time appoint.
The Provincial Government may also by notification withdraw the remaining provisions of the Act from any specified areas.
It Was further provided that on and from the date when the remaining provisions of the Act came into force in any specified areas, the 32 provisions of Orissa Act XXXVI of 1947 shall be repealed in respect of the said specified areas and when the remaining provisions of the Act were withdrawn from any specified areas, the provisions of Orissa Act XXXVI of 1947 shall be deemed to be revived in the said specified areas from the date of publication of the notification of withdrawal.
The effect of these provisions was that in those areas or districts where a notification under section 4(1) of the Orissa Act XXXVI of 1947 was not issued, the provisions of the , continued to apply; where such a notification was issued, the provisions of Orissa Act XXXVI of 1947 came to be applied except where, by virtue of the power reserved under section 1 of Orissa Act I of 1949, the remaining provisions of that Act were brought into force by a notification issued in that behalf, in which case the provisions of Orissa Act XXXVI of 1947 were repealed in respect of the said specified areas and the provisions of Orissa Act I of 1949 becameapplicable.
These were the three distinct sets of circumstances which would prevail at a given time after the enactment of Orissa Act I of 1949 according as the relevant notifications under section 4(1) of Orissa Act XXXVI of 1947 or under section 1(4) of Orissa Act I of 1949 were issued bringing particular area or areas within the operation of the said respective Acts.
Whereas a Joint Stock Company in which the Central and the Provincial Governments were together to have controlling interests was envisaged in Orissa Act XXXVI of 1947, State Transport Service was envisaged in Orissa Act I of 1949 which defined State Transport Service to mean a service in which the Orissa State has entire or partial financial interest and which the Provincial Government may by notifi cation declare to be a State Transport Service for the purposes of the Act.
A Joint Stock Company was accordingly formed in 1950 which was called the Orissa Road Transport Co., Ltd. The Transport Services which were run through the Joint stock Company were termed the "Rationalised Services".
The 33 Services which were run through the State Transport Service were termed the "Nationalised Services".
In pursuance of the above scheme of Nationalised State Transport, the State Government of Orissa issued notifications and press notes which gave intimation to the owners of Stage Carrier Services operating on the several routes within the districts of Orissa that with effect from the 1st January 1955 either the Orissa Road Transport Co., Ltd., or the State Transport Service will be operating the said respective routes.
That was the occasion for the above petitions being filed by the owners of the Stage Carriage Services plying their buses on the said respective routes impugning Orissa Act XXXVI of 1947 and Orissa Act I of 1949 as unconstitutional and void as aforesaid.
The petitions before us are not Confined to the areas and routes where only Rationalised Services or Nationalised Services are contemplated to be introduced by the State Government.
Petitions Nos.
604 of 1954, 648 of 1954,664 of 1954, 666 of 1954 and 671 of 1954 are concerned with the nationalisation of the services and the routes operated upon by the petitioners in those petitions are intended to be served by the State Transport Service.
Petitions Nos.
605 of 1954, 647 of 1954, 649 of 1954, 663 of 1954 and 665 of 1954 are concerned with the rationalisation of the services and the routes operated upon by the petitioners in those petitions are intended to be served by the Orissa Road Transport Co., Ltd. Petition No. 692 of 1954 is not clear whether the scheme to be put into operation by the State Government in the route operated upon by the petitioner therein is intended to be nationalised or rationalised.
One thing, however, is common between all these petitioners that their permits under which they have been operating their buses upon those routes for the last several years are liable to be either terminated or cancelled or are not to be renewed under the scheme of Nationalised Road Transport Services and either the State Government or the Transport Authorities will grant the permits on those routes only to the Orissa Road 5 34 Transport Co. Ltd or the State Transport Service as the case may be.
The provisions of the impugned Acts were attacked on the ground that there was discrimination in favour of the State Transport Service and the Orissa Road Transport Co. Ltd. It was urged that the State could not discriminate against persons in its own favour as well as in favour of the Joint Stock Company formed for carrying on motor transport business as that would be a negation of equality guaranteed under article 14 of the Constitution.
It was also urged that zonal and territorial discrimination in the application of the impugned Acts arbitrarily offended against article 14 of the Constitution.
A further ground of, attack was that the said provisions of the impugned Acts and the rules framed thereunder infringed article 19(1)(f) and (g) of the Constitution as they put restrictions on the citizens regarding their rights to hold property and to practice trade or business.
Article 31(2) was also alleged to have been infringed because the Gazette Notification of the State of Orissa purporting to take away the petitioners motor transport business amounted to confiscation and the inte rests of the petitioners in a commercial undertaking were purported to be acquired without making any provisions for compensation.
The impugned Acts, it was alleged, also violated the guarantee of freedom of inter State and intra state trade embodied in article 301 of the Constitution.
Our attention was drawn to the relevant provisions of the , Orissa Act XXXVI of 1947 and Orissa Act I of 1949 regarding the issue and renewal of permits.
Under the , the Provincial Transport Authority and the Regional Transport Authority were invested with the requisite powers in this behalf.
Sections 47 and 55 prescribed the matters to be considered by the Regional Transport Authority in considering applica tions for stage carriage permits and public carrier 's permits and section 58 provided for the duration and renewal of permits.
So far as renewals of permits were concerned, it was provided that, other conditions 35 being equal, applications for renewal shall be given preference over new applications for permits.
When a notification was issued under section 4(1) of Orissa Act XXXVI of 1947, the powers conferred on the Provincial Transport Authority or the Regional Transport Authority by the , were held in abeyance and the Provincial Government alone was invested with the power to issue or renew permits.
In the granting or refusing to grant such permits, the Provincial Government was not bound to take into consideration the matters specified in sections 47 or 55 of the .
The Provincial Government was also authorised by notification to cancel any permit granted under the , without following the provisions of section 60 of that Act.
The only provision which was made in section 6 of Orissa Act XXXVI of 1947 in this behalf was that when a permit became inoperative under section 4(2) or was cancelled under section 5 of that Act, compensation as therein prescribed was payable to such permit holder.
Sections 3 and 4 of Orissa Act I of 1949 added two further clauses to sections 47 and 55 of the , viz.) " (g) other conditions being equal, in the interest of proper co ordination of transport facilities, the expediency of giving due consideration to a State Transport Service; (h)the necessity for preventing unhealthy competition in any route or routes or area on which the State Transport Service may ply;" It was pointed out that the whole scheme of Orissa Act XXXVI of 1947 and Orissa Act I of 1949 was to oust the owners of stage carriage service from business and create a virtual monopoly in favour of the Orissa Road Transport Co. Ltd. or the State Transport Service and thus discriminate against persons in favour of the Joint Stock Company or the State.
Even though the Provincial Government was invested with power to issue or renew the permits which would become inoperative, under section 4(2) (b) of Orissa 36 Act XXXVI of 1947, that power would be exercised only having regard to the object which the State Government had in view in enacting that Act and the only result would be the issue of permits in favour of the Orissa Road Transport Co. Ltd. The position under Orissa Act I of 1949 would be no better in spite of clauses (g) and (h) having been added to sections 47 and 55 of the , because the expediency of giving due consideration to a State Transport Service and the necessity for preventing unhealthy competition therein mentioned would also have the effect of eliminating the private owned stage carriage service altogether and replacing in its stead the State Transport Service.
It was also pointed out that the State Government had arbitrarily and without any rational basis selected certain districts like Ganjam and Puri and parts of Cuttack District for starting the Orissa Road Transport Co. Ltd., and had introduced State Transport Service in certain other districts such as Sambalpur, Keonjhar, Bolangir and some parts of Cuttack District.
Orissa Act XXXVI of 1947 was applied to the former Districts while Orissa Act I of 1949 was applied to the latter Districts.
The provisions of both the Acts being materially different as set out above the application of one Act to particular districts of the State and of the other Act to the other districts of the State was violative of the guarantee of equal protection of laws enshrined in Article 14 of the Constitution.
The owners of stage carriage services to whom Orissa Act XXXVI of 1947 applied had the additional advantage of having compensation granted to them in accordance with the terms of section 6 thereof which advantage was not available to those owners of stage carriage services to whom Orissa Act I of 1949 was applied.
There was also a further advantage which was available to the persons to whom Orissa Act XXXVI of 1947 applied and it was section 8 of the Act which provided that, when permits had been cancelled by the Provincial Government under the provisions of the Act, the Provincial Government may, by notification, require such 37 permit holders or owners to sell any specified vehicle or vehicles and any other movable or immoveable property used in connection with the operation and maintenance of such vehicle or vehicles, to the Company, when so constituted, at the rates assessed in the prescribed manner.
This advantage was not available to the persons to whom Orissa Act I of 1949 applied.
It has, however, to be remembered that the Scheme of Nationalised State Transport had its origin in the White Paper published by the Government of India towards the end of the year 1944 with a view to removing the difficulties coming in the way of proper development of road transport and the need for cheap, efficient and rapid road transport services and the elimination of wasteful competition had been emphasized therein.
The matter was discussed at the meeting of the Transport Advisory Council held in 1945 and the Transport Advisory Council had then drafted a code of principles and practice for regulating the co ordination of rail road transport services which were later ratified by the State Government and accepted by the Government of India.
It was this scheme which was embarked upon by the State of Orissa and several steps were taken by the State Government in order to implement that scheme.
The first step towards such implementation was the enactment of Orissa Act XXXVI of 1947 which envisaged the formation of a Joint Stock Company in which the Central and the Provincial Governments shall together have controlling interests.
Before such a Company could be formed the feudatory States in Orissa had merged in the Province on the 1st January 1948 and the State Government had on its band transport services which were owned by such States and had been taken over by the State Government of Orissa.
These transport services formed the nucleus on the basis of which the State Government thought of adopting another mode of implementing the scheme of Nationalised State Transport and Orissa Act I of 1949 was passed envisaging the State Transport Service which would also serve the same purpose.
When these two modes of implementation, viz., the formation of a 38 Joint Stock Company and the starting of the State Transport Service, were adopted by the State Government, the question naturally arose as to bow these two different ideas could be worked out the fulfil ment of the end in view.
The nucleus for transport services which had been owned by the State Government had to be utilised so far as it was available and having regard to the situation as it obtained, the State Government naturally thought of applying Orissa Act I of 1949 to certain districts of the State leaving the other districts to be served by the mode envisaged in Orissa Act XXXVI of 1947.
Such a zonal or territorial or geographical division of the several districts of the State for implementation of the scheme of Nationalised State Transport by either the formation of a Joint Stock Company or the running of the State Transport Service was based on the availability of the transport services acquired by the State Government from the various merging States and if such a division was made having regard to the situation as it thus obtained, no challenge could be made against it on the ground of discrimination or the denial of equal protection of laws.
What was essential was that, as between the owners of stage carriage services operating on a particular route or in a particular area, no discrimination should be made and all should be treated alike.
If each one of such owners had the same Act applied to them they could not be heard to complain about any discrimination.
They formed a separate group or class by themselves to be treated in a particular manner having regard to the exigencies of the situation and the Government was the best judge of the circumstances which obtained within the particular locality which necessitated the application of one Act or the other for the implementation of the scheme.
If the State Transport Services were not sufficient in number and could not fully serve the purpose sought to be achieved, the State Government would well be within its rights to form a Joint Stock Company as envisaged in Orissa Act XXXVI of 1947 and if such a JointStock Company could not be formed within a 39 measurable distance of time, the State Government could very well allow the old order of things to continue under which the owners of stage carriage services would be governed only by the provisions of the .
It all depended upon the administrative convenience as to whether the State Government could adopt one mode of implementation of the scheme or the other and no blame could be laid at its door if, in the circumstances of this case, it adopted one mode of implementation in one district or part of a district and adopted another mode of implementation in another district or another part of a district provided, however, as we have stated above, all persons who were operating on a particular route or routes or were located in a particular area or disict were treated equally and without any d nation interse.
Such zonal or territorial or geogra phical division, therefore, would not be violative the equal protection of laws.
A further argument which was addressed before us on behalf of the petitioners may be noted here and it was that Orissa Act I of 1949 bad been applied to some of them and that Act provided for no compensation to be given to them as in the case of those owners of stage carriage services to whom Orissa Act XXXVI of 1947 had been applied.
That, it was contended, was discriminatory as between the several owners of stage carriage services and thus violated Article 14 of the Constitution.
This argument, however, ignores the fact that under Orissa Act XXXVI of 1947, the permits issued or renewed in favour of the owners of stage carriage services by the Provincial Transport Authority or the Regional Transport Authority cease to be operative or are cancelled by the Provincial Government as the case may be and compensation is given to such permit holders for such premature termination or cancellation of their permits.
The owners of stage carriage services to whom Orissa Act I of 1949 is applied stand, however, on a different footing.
Their permits continue for the normal period and the considerations which are laid down in clauses (f) and (g) which have been thereby added to sections 47 and 55 of the , would come into 40 play when these permits which have expired by lapse of time come to be considered for renewal on applications made by permit holders in that behalf.
These permits may or may not be renewed in favour of these permit holders but the non renewal of such permits would not be on a par with the premature termination or cancellation of the permits held by the owners of stage carriage services to whom the provisions of Orissa Act XXXVI of 1947 were applied.
The two positions, therefore, are not similar and the permit holders under Orissa Act I of 1949 do not fall in the same class or group as the permit holders under Orissa Act XXXVI of 1947.
There is no question, therefore, of any discrimination between these two classes or groups of permit holders and it cannot be validly urged that the provisions of the impugned Acts in so far as they applied to different classes or groups of permit holders are in any manner violative of the fundamental right embodied in article 14 of the Con stitution.
The argument that the provisions of the impugned Acts were designed with a view to oust the private stage carriage services from business altogether and were intended to create a virtual monopoly in favour of the Joint Stock Company or the State as the case maybe is also now of no avail.
Saghir Ahmad 's case(1) was particularly relied upon by the petitioners in support of their contentions but article 19(6) of the Constitution as amended by the Constitution (First Amendment) Act, 1951, enacts that "Nothing in sub clause (g) shall affect the operation of any existing law in so far as it imposes, or prevent the State from making any law imposing, in the interests of the general public, reasonable restrictions on the exercise of the right conferred by the said sub clause, and, in particular, nothing in the said sub clause, shall affect the operation of any existing law in so far as it relates to, or prevent the State from making any law relating to, (i). . . . . (ii)the carrying on by the State, or by a corporation owned or controlled by the State, of any trade, (1) ; business, industry or service, whether to the exclusion, complete or partial, of citizens or otherwise".
This amendment excludes all argument in regard to the alleged ousting of the private owned stage carriage services and the creation of a virtual monopoly in favour of the Joint Stock Company or the State.
The Orissa Road Transport Co. Ltd. which is a Joint Stock Company formed under the provisions of Orissa Act XXXVI of 1947 and the State Transport Services which are envisaged in Orissa Act I of 1949 would, therefore, be able to carry on their business even if it resulted in the complete elimination of the privateowned stage carriage services without any violation of the fundamental right guaranteed under article 19(1)(g) of the Constitution.
It was attempted to be argued on behalf of the petitioners that the amendment of article 19(6) of the Constitution would not affect the position as it obtained under the impugned Acts because these Acts had been long in operation before the amendment came into force and the petitioners were entitled to relief based on our decision in Saghir Ahmad 's case, supra.
A similar argument was sought to be advanced before us in Petitions Nos.
189 to 193 of 1955 Bhikaji Narain Dhakras vs The State of Madhya Pradesh & Another") and that argument was repelled by us in the manner following: "The contention of the respondents before us is that although the amending Act, on the authority of our decision in Saghir Ahmad s case (supra), became on and from the 26th January 1950 void as against the citizens to the extent of its inconsistency with the provisions of article 19(1)(g), nevertheless, after the 18th June 1951 when clause (6) was amended by the Constitution (First Amendment) Act, 1951 the amending Act ceased to be inconsistent with the fundamental right guaranteed by article 19(1) (g) read with the amended clause (6) of that article, because that clause, as it now stands, permits the creation by law of State monopoly in respect, inter alia, of motor transport business and it became operative again (1) ; 6 42 even as against the citizens. . .
In our judgment the contentions put forward by the respondents as to the effect of the Constitution (First Amendment) Act, 1951 are well founded and the objections urged against them by the petitioners are untenable and must be negatived".
It is hardly necessary for us to consider the further contention urged by the petitioners, viz., that the fundamental right guaranteed under article 19(1)(f) and under article 31(2) had been violated.
If the permits held by them under the , were prematurely terminated or cancelled under the provisions of Orissa Act XXXVI of 1947 compensation was provided by the Act itself.
If there was no renewal of their permits on the expiration thereof after they had run for their normal period by virtue of the provisions of Orissa Act I of 1949, no claim could be made by them on the score of such non renewal because renewal was not a matter of right.
The Provincial Transport Authority or the Regional Transport Authority would be well within their rights to refuse such renewal having regard to the provisions of the amended sections 47 and 55 of the , and, if at all there was any deprivation of their proprietary rights, it would be by authority of law.
Nor need we pause to consider the last contention urged on behalf of the petitioners that the impugned Acts violated the guarantee of freedom of inter State and intrastate trade or business embodied in article 301 of the Constitution.
In the first instance, it is not a fundamental right conferred by Part III of the Constitution which can be enforced by a petition under article 32.
Moreover, article 305 as it stood before the amendment and the amended article 305 which came into effect after the Constitution (Fourth Amendment) Act, 1955, afford a complete answer to this contention of the petitioners.
The result, therefore, is that there is no substance in any of the contentions urged on behalf of the petitioners and the petitions must, therefore, stand dismissed as ordered by us already.
| The petitioners were owners of Stage Carriage Services holding permits under the Motor Vehicles Act of 1939.
The State Government of Orissa, in pursuance of its scheme of a Nationalised State 'Transport as contemplated by the Orissa Motor Vehicles (Regulation of Stage Carriage and Public Carrier 's Services) Act of 1947 (Orissa Act XXXVI of 1947) and Orissa Act I of 1949, which amended the provisions of the Motor Vehicles Act of 1939, issued notifications under those Acts intimating the owners of different Stage Carriage Services operating different routes within the districts of Orissa that with effect from the 1st of January, 1955, either the Orissa Road Transport Co. Ltd., or the State Transport Service, formed under the two Acts, would exclusively operate the said routes.
The owners impugned the Acts as unconstitutional and violative of their funda mental rights.
It was contended that the two Acts, whose provisions were materially different, discriminated against them and in favour of the aforesaid transport services as also in their arbitrary application to different zones and territories of the State and contravened article 14 of the Constitution.
It was further contended that the provisions of the Acts and rules framed thereunder infringed articles 19(1)(f) and (g) by putting restrictions on the rights to hold property and to practise trade and business, that the Notifications 29 purporting to take away their transport business amounted to confiscation without compensation and infringed article 31(2) and lastly, that the impugned Acts violated freedom of inter state and intrastate trade guaranteed by article 301 of the Constitution.
Held, that the owners of Stage Carriage Services operating a particular route or in a particular area formed a separate group or class by themselves and so long as each one of such a group or class was governed by the same Act and treated the best judge as to which of the two impugned Acts, or the Act of 1939 which they sought to amend, should, in its administrative convenience, be applied to a particular locality or what mode it should follow for the implemen tation of its scheme and such zonal or territorial divisions it thought fib to make for that purpose according to different circumstances prevailing in different localities could not be held to be either discriminatory or violative of the equal protection of law.
That the position of the permit holders under the two Acts was not on a par, and was materially different and they fell into two distinct classes and, consequently payment of compensation under one and non payment under the other did not make for discrimination.
That the contention that the impugned Acts created a monopoly in favour of either the Joint Stock Company or the State by ousting the private Stage Carriage Services from the business and thereby infringed article 19(1)(f) was no longer tenable in view of article 19(6) of the Constitution as amended by the Constitution (First Amendment) Act of 1951.
Saghir Ahmad vs The State of U. P. ([1965] 1 S.C.R. 707), held inapplicable.
Bhikaji Narain Dhakras vs The State of Madhya Pradesh ([1955] 2 S.C.R. 589), applied.
That the provisions of the impugned Acts could not be held to contravene articles 19(1)(f) and 31(2) of the Constitution as the Act of 1947 did provide for compensation for premature termination and under the Act of 1949, renewal could not be claimed as a matter of right and any deprivation of proprietary right would be by authority of law.
That freedom of inter state or intrastate trade guaranteed by article 301 of the Constitution is not one of the fundamental rights that can be enforced under article 32 of the Constitution and article 305 as amended by the Constitution (Fourth Amendment) Act of 1955 was a complete answer to that contention of the petitioners.
|
Appeal No. 195 of 1955.
Appeal from the judgment and order dated the 30th day of December 1953 of the Nagpur High Court in Miscellaneous Civil Case No. 35 of 1952.
Kirpa Ram Bajaj, Hardyal Hardy, with him) for the appellant.
C. K. Daphtary, Solicitor General of India (G. N. Jo8hi and R. H. Dhebar, with him) for the respondent.
February 17.
The Judgment of the Court was delivered by DAS C.J.
This is an appeal from the judgment and order passed by a Bench of the Nagpur High Court on the 30th December, 1953 in Miscellaneous Civil Case No. 35 of 1952, whereby the Bench answered in the negative the question that had been referred to them by the Income Tax Appellate Tribunal, Bombay under section 66(1) of the Indian Income Tax Act, 1922 (hereinafter referred to as the Act).
In connection with the assessment for the assessment year 1949/1950 of Dulichand Laxminarayan, an unregistered firm, an application was made under section 26 A of the Act before the Income Tax Officer, Raigarh for its registration as a firm constituted under a Deed of Partnership dated the 17th February 1947.
In the opening paragraph of that deed the names and descriptions of the parties thereto were set out in the following words: "We, Dulichand Laxminarayan Firm, through Malik (partner) Laxmi Narayan son of Laljimal, Laxmi Narayan Chandulal Firm through Malik (partner) Chandulal son of Nanakchand, Mulkhram Bholaram Firm through Malik (partner) Tekchand son of Bholaram, Jeramdas Hiralal Firm through 157 Malik (partner) Beharilal son of Asharam and Mangatrai Ganpatram through Malik (partner) Ganpatram son of Mangatrai, Agarwar Bani, aged 50, 40, 28, 25, 45 residing at Raigarh are partners in equal shares with effect from 5 1 1946 in the firm Dulichand Laxminarayan in whose name Importers ' Licence of cloth is issued for Raigarh State group Raigarh, Jaipur Saraigarh, Udeypur and Sakti State, on the following terms and conditions. . . .
Then follow 15 clauses containing the terms on which the partnership business was agreed to be done.
At the foot of the deed signatures were appended in the following order one below the other: Laxminarayan for Dulichand Laxmi Narayan.
Beharilal for Jairam Das Hiralal.
Ganpatram for Mangatrai Ganpatram.
Tekchand for Mukhram Bholaram.
Chandulal for Laxminarayan Chandulal.
It is common ground that out of the five constituent parties Dulichand Laxminarayan, Jairamdas Hiralal and Laxminarayan Chandulal are separate firms constituted under three separate deeds of partnership and that Laxminarayan, Beharilal and Chandulal, who signed the deed on behalf of those firms are partners in their respective firms.
There is also no dispute that Mukbram Bholaram is the name of a business carried on by a Hindu undivided family of which Tekchand, who has signed for it, is the Karta.
It is also conceded that Mangatrai Ganpatrai is an individual.
The application for registration was signed by the same five individuals who bad signed the deed of partnership.
Finding that Dulichand Laxminarayan constituted under the aforesaid Deed of Partnership dated the 17th February 1947 consisted of three firms, one Hindu undivided family business and one individual and taking the view that a firm or a Hindu undivided family could not as such enter into a partnership with other firms or individuals, the Income Tax Officer held that the said Dulichand Laxminarayan could not be registered as a firm under section 26 A and 21 158 accordingly on the 26th February 1950 he rejected the application.
On appeal the Appellate Assistant Commissioner held that when a firm entered into a partnership with another firm the result in law was that all the partners of each of the smaller firms became partners of the bigger firm and, therefore, there was no legal flaw in the constitution of the bigger firm of Dulichand Laxminarayan.
He, however, took the view that, as the application for registration had not also been signed personally by all the partners of those three smaller firms as required by section 26 A of the Act and rule 2 of the Rules framed under section 59 of the Act, there was no valid application for registration and consequently the firm could not be registered.
The result was that on the 5th August 1950 the Appellate Assistant Commissioner dismissed the appeal.
The assessee appealed to the Income Tax Appellate Tribunal.
The Tribunal agreed with the Appellate Assistant Commissioner that a valid partnership had been brought into existence but reversed the decision of the Appellate Assistant Commissioner on the ground that as all the five executants of the deed had signed the application for registration, the requirements of law had been satisfied.
Accordingly on the 12th June 1951 the Tribunal directed registration of the firm.
On the application of the Commissioner of Income Tax, Madhya Pradesh the Tribunal under section 66(1) of the Act drew up a Statement of Case and submitted to the High Court of Nagpur the following question of law, namely: Whether on the facts of the Case the assessee is entitled to registration under section 26 A of the Income Tax Act? The reference came up for hearing before a Bench of the Nagpur High Court on the 30th December 1953.
Following their own judgment delivered earlier in the day in Miscellaneous Civil Case No. 189 of 1951, Jabalpur Ice Manufacturing Association vs Commissioner of Income Tax, Madhya Pradesh and Bhopal(1), (1) 159 the High Court answered the referred question in the negative.
In view, however, of the importance of the question involved in the reference the High Court, under section 66 A(2) of the Act, gave a certificate of fitness for appeal to this Court.
Hence the present appeal.
Section 26 A of the Act under which the application for registration was made provides as follows: (1) Application may be made to the Income tax Officer on behalf of any firm, constituted under an instrument of partnership specifying the individual shares of the partners, for registration for the purposes of this Act and of any other enactment for the time being in force relating to income tax or supertax.
(2) The application shall be made by such person or persons, and at such times and shall contain such particulars and shall be in such form, and be varied in such manner, as may be prescribed; and it shall be dealt with by the Income tax Officer in such manner as may be prescribed.
The relevant portion of rule 2 of the Rules made under section 59 of 'the Act runs thus: "Any firm constituted under an Instrument of Partnership specifying the individual shares of the partners may, under the provisions of section 26 A of the Indian Income tax Act, 1922 (hereinafter in these rules referred to as the Act), register with the Income tax Officer, the particulars contained in the said Instrument on application made in this behalf.
Such application shall be signed by all the partners (not being minors) personally, or. . .
At the hearing before us it was at one time suggested that the partners of the firm consisted of the five individuals who had signed the deed and each of them had an ' equal share as specified therein and that as all the said five partners had signed the application for registration the requirements of section 26 A of the Act and rule 2 had been fully complied with and the assessee should have been registered as a firm for the purposes of the Act.
A perusal of the deed and par 160 ticularly the portions hereinbefore set out indicate beyond any doubt that the intention of the parties quite clearly was that each of the three constituent firms and not the particular member of each of the said three firms who had signed the deed for his respective firm was to be the partner in the bigger firm constituted under this deed.
The contention that only the five individual executants of the deed were the partners of the newly created firm runs counter to the apparent tenor of the deed and cannot be entertained.
Indeed learned counsel appearing in support of this appeal did not press this point.
The main argument before us has centred round the larger question as to whether a firm as such can be a partner in another firm.
Section 26 A of the Act quoted above postulates the existence of a firm, for otherwise no question of its registration can possibly arise.
The Act, however, does not indicate what a firm signifies or how it is to be constituted.
Indeed section 2(6B) of the Act clearly provides,inter alia, that "firm" and "partnership" have the same meanings respectively as they have in the .
We have, therefore,, to go to the last mentioned Act to ascertain what a firm is and how it can be created.
Turning, then, to the we come to section 4 which defines 'partnership", "partner", "firm" and "firm name" in the words following: 4.
Definition of "Partnership", "Partner", "firm" and "firm name: "Partnersbip" is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all.
Persons who have entered into partnership with one another are called individually "partners" and collectively "a firm", and the name under which their business is carried on is called the "firm name".
This section clearly requires the presence of three elements, namely (1) that there must be an agreement entered into by two or more persons; (2) that the agreement must be to share the profits of a business; 161 and (3) that the business must be carried on by all or any of those persons acting for all.
According to this definition "persons" who have entered into partnership with one another are collectively called a "firm" and the name under which their business is carried on is called the "firm name".
The first question that arises is as to whether a firm as such can enter into an agreement with another firm or individual.
The answer to the question would depend on whether a firm can be called a "person".
There is no definition of the word "person" in the Partnership Act.
The , however, by section 3 (42) provides that "person shall include any company or association or body of individuals whether incorporated or not".
The firm is not a company but is certainly an association or body of individuals.
The argument is that applying that definition to the word "persons" occurring in section 4, one can at once say that an unincorporated association or body of persons, like a firm, can enter into a partnership just as by the application of that definition to section 4 of the a company can become a partner in a firm.
The definitions given in section 3 of the , however, apply when there is nothing repugnant in the subject or context.
It is difficult to say that there is anything repugnant in the context of section 4 itself which will exclude the application of that definition to the word "Persons" occurring in section 4.
Is there, however, anything repugnant in the subject of partnership law, which will exclude the application of that definition to section 4? As pointed out in Lindley on Partnership, llth Edition, at page 153, merchants and lawyers have different notions respecting the nature of a firm.
Commercial men and accountants are apt to look upon a firm in the light in which lawyers look upon a corporation, i.e., as a body distinct from the members composing it.
In other words merchants are used to regard a firm, for purposes of business, as having a separate and independent existence apart from its partners.
In some systems of law this separate per 162 sonality of a firm apart from its members has received full and formal recognition, as, for instance, in Scotland.
That is, however, not the English Common Law conception of a firm.
English Lawyers do not recognize a firm as an entity, distinct from the members composing it.
Our partnership law is based on English Law and we have also adopted the notions of English lawyers as regards a partnership firm.
Some of the mercantile usages relating to a firm have, however, found their way into the law of partnership.
Thus in keeping accounts, merchants habitually show a firm as a debtor to each partner for what he brings into the common stock and each partner is shown as a debtor to the firm for all that he takes out of that stock.
But under the English Common Law, a firm, not being a legal entity, could not sue or be sued in the firm name or sue or be sued by its own partner, for one cannot sue oneself.
Later on this rigid law of procedure, however, gave way to considerations of commercial convenience and permitted a firm to sue or be sued in the firm name, as if it were a corporate body (see Code of Civil Procedure, Order XXX corresponding to rules of the English Supreme Court Order XLVIII A).
The law of procedure has gone to the length of allowing a firm to sue or be sued by another firm having some common partners or even to sue or be sued by one or more of its own partners (see Order XXX, rule 9 of the Code of Civil Procedure), as if the firm is an entity distinct from its partners.
Again in taking partnership accounts and in administering partnership assets, the law has, to some extent, adopted the mercantile view and the liabilities of the firm are regarded as the liabilities of the partners only in case they cannot be met and discharged by the firm out of its assets.
The creditors of the firm are, in the first place, paid out of the partnership assets and if there is any surplus then the share of each partner in such surplus is applied in payment of his separate debts, if any, or paid to him.
Conversely, separate property of a partner is applied first in the payment of his separate debts and the surplus, if any is utilised in meeting the 163 debts of the firm (see section 49 of the ).
In the Indian Income Tax Act itself a firm is, by section 3, which is the charging section, made a unit of assessment.
It is clear from the foregoing discussion that the law, English as well as Indian, has, for some specific purposes, some of which are referred to above, relaxed its rigid notions and extended a limited per,personality of a firm.
Nvertheless, the general concept of partnership, firmly established in both systems of Law, still is that a firm is not an entity or "person" in law but is merely an association of individuals and a firm name is only a collective name of those individuals who constitute the firm.
In other words, a firm name is merely an expression, only a compendious mode of designating the persons who have agreed to carry on business in partnership.
According to the principles of English jurisprudence, which we have adopted for the purposes of determining legal rights "there is no such thing as a firm known to the law" as was said by James, L. J. in Ex parte Corbett, In re Shand(1) In these circumstances to import the definition of the word "person" occurring in section 3(42) of the into section 4 of the will, according to lawyers, English or Indian,, be totally repugnant to the subject of partnership law as they know and understand it to be.
It is in this view of the matter that it has been consistently held in this country that a firm as such is not entitled to enter into partnership with another firm or individuals.
It is not necessary to refer in detail to those decisions many of which will be found cited in Jabalpur Ice Manufacturing Association vs Commissioner of Income tax, Madhya Pradesh(2) to which a reference has already been made.
We need only refer to the case of Bhagwanji Morarji Goculdas vs Alembic Chemical Works Co. Ltd and others(3), where it has been laid down by the Privy Council that Indian Law has not given legal personality to a firm apart from the partners.
This (1) , 126.
(2) (3) 164 view finds support from and is implicit in the observations made by this Court in the Commissioner of Income Tax, West Bengal vs A. W. Figgies & Co. and others(1).
In Jai Dayal Madan Gopal(2), Sulaiman C. J. followed the Calcutta decisions and was not prepared to dissent from the view that the word "person" in section 239 of the should not be interpreted so as to include a firm.
The learned Chief Justice, however, expressed the view that it was difficult to say that there was anything in section 239 itself which made the application to that section of the definition of "person" as given in in any way repugnant.
The learned Chief Justice, however, does not appear to have con sidered whether there was anything repugnant in the subject of partnership law, as it prevails in this country, which operates to exclude the application of that deanition to the word "person" occurring in section 239 of the .
In our opinion, the word "Persons" in section 4 of the , which has replaced section 239 of the , contemplates only natural or artificial, i.e., legal persons and for the reasons stated above, a firm is not a "person" and as such is not entitled to enter into a partnership with another firm or Hindu undivided family or individual.
In this view of the matter there can arise no question of registration of a partnership purporting to be one between three firms, a Hindu undivided family business and an individual as a firm under section 26 A of the Act.
The learned Advocate for the appellant then urges that at any rate the partnership was not illegal, for there was no legal impediment in the way of all the members of all the three constituent firms and the karta of the Hindu undivided family and the individual entering into an agreement and that, therefore, a valid partnership was constituted by the deed of partnership under consideration.
Assuming that this contention is possible in view of the language which (1) ; ; (2) 165 has been used in this deed for describing the parties, the position of the appellant will not improve, for in order to be entitled to the benefit of registration under the Act, it will have to be shown that the shares of all individual partners are specified in the deed and that all the partners have personally signed the application for registration as required by section 26 A of the Act read with Rule 2.
The deed specifies that each of the five constituent parties is entitled to an equal, i.e., 1/5 share but it does not specify the individual shares of each of the partners of each of the three smaller constituent firms.
Further all the members of those three firms have not signed the application for registration personally.
It is said that each of the three persons who executed the deed for the three smaller firms must be regarded as having the authority of their co partners in their respective firms to sign the application for registration just as they had their authority to execute the deed itself for them.
Even if they had such authority as to which there is no evidence at all on the record the section and rule 2 require that each partner (not being minors) must sign personally.
That admittedly has not been done, and., therefore, the application was not in proper form.
In our judgment the answer given by the High Court to the question is correct.
This appeal must, therefore, be dismissed with costs.
| In connection with the assessment for the assessment year 1949 1950 of Dulichand Lakshminarayan an unregistered firm, an application was made under section 26 A of the Indian Income Tax Act, 1922 before Income Tax Officer, Raigarh, for its registration as a firm constituted under a Deed of Partnership dated 17th February, 1947.
In the opening paragraph of the deed the names and descriptions of the five parties thereto were set out.
The signatures of five per sons were appended on behalf of five parties respectively at the foot of the deed.
It was common ground that out of the five constituent parties, D.L., J.H., and L.C., were separate firms constituted under three separate deeds of partnership.
The three different persons who signed the deed on behalf of those three firms respectively were partners in their respective firms.
The fourth party M.B. was the name of a business carried on by a Hindu undivided family of which the person who signed it was the karta.
The fifth party M.G. was an individual.
The Income Tax Officer rejected the application on the ground that Dulichand Lakshminarayan, constituted under the deed dated 17th February 1947, consisted of three firms, one Hindu undivided family business and one individual and that a firm or a Hindu undivided family could not as such enter into a partnership with other firms or individual, 155 The assessee 's appeal to the Appellate Assistant Commissioner was dismissed but it succeeded before the Income Tax Appellate Tribunal who directed registration of the firm.
On the application of the Commissioner of Income Tax under section 66(1) of the Income Tax Act the High Court held that on the facts of the case the assessee was not entitled to registration under section 26 A of the Income Tax Act.
On appeal to the Supreme Court: Held that a perusal of the deed would indicate beyond any doubt that the intention of the parties quite clearly was that each of the three constituent firms and not the particular member of each of the said three firms who had signed the deed for his respective firm was to be the partner in the bigger firm constituted under this deed.
The contention that only the five individual executant of the deed were the partners of the newly created firm was against the tenor of the deed and was therefore without force.
Section 26 A of the Indian Income Tax Act postulates the existence of a firm.
The Act, however, does not indicate what a firm signifies or how it is to be constituted.
Section 2(6 B) of the Act clearly provides, inter alia, that "firm" and "partnership" have the same meaning respectively as they have in the .
Section 4 of the (which gives the definitions of "partnership", "partner", "firm" and "firm name") clearly requires the presence of three elements namely (1) that there must be an agreement entered into by two or more persons: (2) that the agreement must be to share the profits of a business; and (3) that the business must be carried on by all or any of those persons acting for all.
The general concept of partnership according to both systems of law, English as well as Indian, is that a firm is not an entity or "person" in law but is merely an association of individuals and a firm name is only a collective name of those individuals who constitute the firm.
In other words a firm name is merely an expression, only a compendious mode of designating the persons who have agreed to carry on business in partnership.
The word "persons" in section 4 of the , which has replaced section 239 of the Indian Contract Act, contemplates only natural or artificial, i.e., legal persons and therefore a firm is not a person and as such is not entitled to enter into a partnership with another firm or Hindu undivided family or individual and there is no question of registration of a partnership purporting to be one between three firms, a Hindu undivided family business and an individual as a firm unders.
26 A of the Act, as in the present case.
Jabalpur Ice Manufacturing Association vs Commissioner of Income Tax, Madhya Pradesh and Bhopal ([1965] , Exparte Oorbett, In re Shad, ([1880] ; , 126), Bhag 156 wanji Morarji Goculdas vs Alembic Chemical Works Co. Ltd. and others , Commissioner of Income Tax, West Bengal vs A. W. Figgies & Co. and others ([1954] S.C.R. 171), and In re Jai Dayal Madan Gopal, ([1933] I.T.R. 186), referred to.
|
ON: Criminal Appeals No. 28 to 31 of 1955.
Appeals by special leave from the judgment and order dated the 11th February, 1953 of the Hyderabad High Court in Criminal Appeals Nos. 1260 to 1263 of 1951/1952 arising out of the judgment and order dated the 6th November, 1951 of the Court of the Sessions Judge at Warangal in Original Criminal Case No. 127 of 1950.
H. J. Umrigar, for appellant No. 1.
K. R. Choudhry, for appellants Nos. 2 to 4.
Porus A. Mehta and P. G. Gokhale, for the respondent.
March 14.
The Judgment of the Court was delivered by CHANDRASEKHEARA AIYAR J.
The four appellants and two others named Sheshaya and Pitchi Reddy, who are all communists, were charged with the murder of one Venkatakrishna Shastry who was a Congress worker or leader.
The appellants were convicted of the offence but the other two were acquitted by the Sessions Judge, Warangal, Hyderabad State, on the astounding ground that no overt acts were proved against them.
The appellants preferred appeals to the High Court at Hyderabad and there was the usual reference for confirmation of the death sentences imposed on them.
The appeals were heard by a Bench consisting of Deshpande J. and Dr. Mir Siadat Ali Khan J. and 249 they disagreed with each other.
Deshpande J. held that the evidence did not establish the guilt of the appellants and be acquitted them.
On the other band, Dr. Mir Siadat Ali Khan came to the conclusion that the prosecution had established its case beyond reasonable doubt.
He confirmed the convictions but reduced the sentences to imprisonment for life.
Owing to this difference of opinion, the matter was referred to a third Judge, Manohar Pershad J. and be agreed with the finding of guilty given by his learned bro ther Dr. Mir Siadat Ali Khan.
We granted special leave to the appellants to come before this court.
The facts of the occurrence, as alleged by the prosecution, are these.
On the evening of 19 1 1949, the deceased Venkatakrishna Shastry of the village of Maturpeta and five other persons, who were Congress workers like him, were returning to the village from a tank.
One of the communist leaders called Nagabhushan Rao had been arrested a month or two previously and the communist party believed that Venkatakrishna Shastry was responsible for the arrest.
So a large group of communists, about 25 or 30 in number including the accused, armed with guns and swords, paid a visit to Maturpeta to wreak vengeance against the Congress group led by Venkatakrishna Shastry.
They ran into the Congress group as they were getting back to the village after the evening stroll.
P.W. 14, a dhobi boy named Gopai was one of the camp followers of this communist group.
Venkatakrishna Shastry and his co workers were tied up with their own clothes and were led to the village chavadi over which a Congress flag was flying.
A rope was brought from the house of P. W. 17 and the members of the Congress group were tied with this rope and led some distance away from the village to a red gram field, and all of them were beaten by their enemies; except Shastry, the rest were driven away from the place.
Shastry was tied with the rope and taken in the eastern direction by Mangapaty (the dalam or troup leader) and the accused.
P. W. 14 was following the group carrying a bundle of their clothes on his head.
After a short halt at the village of 250 Suknevedu, where some food was taken, the party went towards a mango tope near a brook, four or five miles away leading Venkatakrishna Shastry as the captive.
The deceased, Gopai (P.W. 14) and some of the accused remained on the bank of the brooklet.
The others went a little beyond and one of them came back with orders that Venkatakrishna Shastry should be fetched.
Venkatakrishna Shastry was taken along and when the moon was at the meridian, the rope with which he was led was tied round the neck of the deceased into a noose.
Two of the accused pulled one end of the rope and two others at the other end in opposite directions.
Venkatakrishna Shastry was thus strangled to death.
A pit was dug and the body of Venkatakrishna Shastry was buried in the river bed.
P.W. 14 saw all this from a distance of twenty yards in clear moonlight.
Two or three days later, after some wanderings in the jungle and mountain dens P.W. 14 left the company of his masters who were implored by the boy 's father P.W. 7 to permit him to take the boy away.
Next morning a report was sent by P.W. 2 the police patel about the abduction of Venkatakrishna Shastry and investigation was begun.
On 8 2 1949, that is about twenty days after the occurrence, some bones of a human body were discovered in the riverbed as the result of crows and vultures hovering round the place.
The police Patwari (P.W. 10) sent a report about this discovery.
The police arrived on the scene and exhumed the body which was identified as that of Venkatakrishna Shastry.
This was on 9 2 1949.
It was sent for postmortem examination.
The condition in which the body was at the time of exhumation is stated in a panchnama that was then prepared.
The results of the postmortem examination are spoken to by the doctor P.W. 7.
Being the only witness for the commission of the crime, the dhobi boy (P.W. 14) was subjected to severe criticism by Mr. Umrigar who held the dock brief for the appellants.
He described him as an accomplice and as an unmitigated liar and he asked us not even to look at his evidence.
P.W. 14 does not satisfy the 251 definition of an accomplice; he falls somewhat short of the requirements which would confer on him this status.
According to the evidence, he left his parents ' roof after a quarrel with his father and while wandering in the jungles he was picked up by the communists only 3 days before and taken as their servant on promise to give him food.
His main duty appears to have been to go with the group carrying their bundles of clothes on his head.
It was in this capacity that he was not only able to see the abduction of the deceased but also to witness the actual murder.
He took no part whatever in the commission of the offence or in any active or passive preparations for the same.
He was not a particeps crimines.
After securing his release from his temporary masters, he went back with his father to the village.
It is true he did not divulge the secret of the murder to any one else except to his own father.
But who would, in view of the atrocities and terrorism that prevailed in that region during the relevant time? It required a very courageous man to have proclaimed the truth, needless of consequences to himself, And we cannot credit the dhobi boy with so much of fearlessness.
The learned counsel urged that if a man sees the perpetration of a crime and does not give information of it to anyone else, he might well be regarded in law as an accomplice and that he could be put in the dock with the actual criminals.
There is, however, no warrant for such an extreme proposition.
On the other hand, the following short passage from Russell on Crime, 10th Edition, page 1846, will show its untenability: "But a person may be present, and, if not aiding and abetting, be neither principal nor accessory; as, if A, happens to be present at a murder and takes no part in it, nor endeavours to prevent it, or to apprehend the murderer, this course of conduct will not of itself render him either principal or accessory".
Indeed, there can be no doubt that the evidence of a man like P.W. 14 should be scanned with much caution and we must be fully satisfied that he is a witness of truth, especially when no other person 252 was present at the time to see the murder.
Though he was not an accomplice, we would still want corroboration on material particulars in this particular case, as he is the only witness to the crime and as it would be unsafe to hang four people on his sole testimony unless we feel convinced that he is speaking the truth.
Such corroboration need not, however, be on the question of the actual commission of the offence;, if this was the requirement, then we would have independent testimony on which to act and there would be no need to rely on the evidence of one whose position may, in this particular case, be said to be somewhat analogous to that of an accomplice, though not exactly the same.
What the law requires is that there should be such corroboration of the material part of the story connecting the accused with the crime as will satisfy reasonable minds that the man can be regarded as a truthful witness.
In the leading case of Rex vs Baskerville(1) it was pointed by Lord Reading C.J. that "the corroboration need not be direct evidence that the accused committed the crime; it is sufficient if it is merely circumstantial evidence of his connection with the crime.
The nature of the corroboration will depend on and vary according to the particular circumstances of each case.
What is required is some additional evidence rendering it probable that the story of the accomplice is true and that it is reasonably safe to act upon it.
Judged by this test, we can say that the evidence given by P.W. 14 has been amply corroborated.
It was not disputed for the appellants that there is abundant evidence consisting of the testimony of several witnesses in support of the truth of the narrative given by P.W. 14 regarding the abduction of the deceased.
This evidence was given not by mere onlookers but by men like P.Ws. 3, 4, 5, 6 and 9, who were with the deceased when the communist group came upon them and who were themselves badly beaten up by the gang before being released from, impending death at the merciful intervention of (1) [1916] 2 K.B.D. 658 253 some one of them.
They say that at the time of the release the accused retained the deceased with them and took him away in the direction of Mulgupad.
From this stage, P. W. 14 takes us to the river bank where the deceased and he were allowed to sit.
The accused went into the river bed and later on orders were issued by the appellant No. 1, the deceased was led by a rope from the bank by Muthyalu (4th appellant).
The rope was tied round the neck of the deceased into a noose and pulled in opposite directions by two of the accused on each side and Shastry was thus strangled to death.
His body was buried in a pit dug in the river bed.
The rope which was found round the neck of the dead body when it was exhumed is said to be the rope with which P.Ws. 3 to 6 and 9 were tied up and as the one that the members of the gang brought from the house of Silam Brahmareddi (P.W. 17) earlier that evening when the village was raided and the Congress workers were marched to the Congress flag.
There is also evidence that the party of the accused when they first encountered the party of the deceased asked who and where was Venkatakrishna Shastry.
The assailants, who were armed to the teeth, indulged in threats to kill all of them.
The deceased was a Congress leader and it is not surprising that he was singled out for terrific punishment, while the others were let off with a good thrashing and admonitions that they should give up their Congress affi liations.
It is but natural in the circumstances that they should take away the deceased to a distant place to do away with him.
That he was so led by the group of the accused is also corroborated by the evidence of Yesob (P.W. 12) who was watching his jawar crop on the night in question in a neighbouring field.
Let us now turn to the exhumation of the dead body, the inquest report, the postmortem certificate, and the evidence of the doctor (P. W. 7).
The patwari of Sakrivedu (P.W. 10) sent a report on the 8th February, 1949, that he had information that a dead body lay buried in the river bed.
The report has not 254 been filed but its purport about the condition of the body is given in the inquest report as unidentifiable.
Two police sub inspectors and some constables reached the river bed the same day and exhumed the body.
Its then condition is described in these words in the inquest report: "It was noticed that a rope of Chinna and Ambara was wrapped from neck to the waist.
Both hands were missing and out of the two legs one was attached to the body with little flesh.
The bones of the other separated leg (the down part of the knee) and the bones of one hand were found in the pit.
There were some hairs in the head.
The flesh of the face was rotten and decayed.
Teeth are safe and sound.
There is rotten flesh from the neck to the buttocks.
It appears that this dead body is of a Hindu Brahmin".
The panchnama is signed by two persons, one of whom HAS BEEN EXAMINED AS P.W. 16.
He, along with the witnesses who gave evidence as co sufferers with the deceased in the communist raid of that evening, have identified the body as that of Venkatakrishna Shastry.
The doctor 's postmortem certificate is exhibit 2 and according to it the body was petrified and even the marks of strangulation could not be detected; both the palms had been cut out, the left hand was severed completely; there was only the left eye in a rotten condition; the right eye was not found, the right ear was not there.
Examined as P.W. 7, the doctor has said that the face of the corpse could not be identified, as the scalp was eaten away by mud, and the bony structure of the face was present.
In the face of this evidence, the learned counsel for the appellants contended with much force that identification must have been impossible and that the witnesses who speak to the same should be disbelieved.
Two factors are,, however, overlooked in this argument.
Though the body was in an advanced state of decomposition and many parts of the limbs were missing and even the flesh in the face was gone, it would not have been difficult for close associates of 255 Venkatakrishna Shastry to say that it was his corpse, from the general features form, outline, contour build of the body, and the appearance of such of the limbs as were available to see.
His friend Madhusudhana Rao, P.W. 15, was working with the deceased for some years in the Congress office and knew him well indeed.
There is his evidence about identification.
More important still is the identification of the rope round the neck of the body, the dhoti with the violet border that was on its waist, and the janjam or the holy thread.
The rope was brought from the house of Brahma Reddy (P.W. 17).
It was the one which was tied in loops round each member of the Congress group as they were led from the village to the redgram field; it was the rope that was used to lead Venkatakrishna Shastry to the brooklet; and it was the rope that was found round the neck of the dead body when it was unearthed.
The bordered dhoti which was on the corpse belonged to Venkatakrishna Shastry.
From these external marks, and the general features, friends of the deceased like P.Ws. 3 to 6 and 9 and P.W. 17 in whose house Shastry was living could say, we think, that the body buried in the waist deep pit in the bed of the river was that of Venkatakrishna Shastry.
Whether he is regarded as an accomplice or as the sole witness of the offence P.W. 14 has been corroborated in such a manner that his evidence about the steps taken by the accused immediately prior to the perpetration of the murder carries conviction to our minds.
The connection of the accused with the crime must be held to have been made out.
We have also to accept that the dead body recovered was that of Venkatakrishna Shastry and no question of the absence of the body arises.
For this gruesome and revolting murder the appellants have got only imprisonment for life for which they must be thankful to the difference of opinion that arose among the learned Judges of the High Court.
The appeal fails and is dismissed.
| There is no warrant for the extreme proposition that if a man sees the perpetration of a crime and does not give information of it to anyone else, he might well be regarded in law as an accomplice and that he could be put in the dock with the actual criminals.
A person may be present, and, if not aiding and abetting, be neither principal nor accessory; as, if A, happens to be present at a murder and takes no part in it, nor endeavours to prevent it, or to apprehend the murderer, this course of conduct will not of itself render him either principal or accessory.
Russell on Crime, 10th Edition, p. 1846, referred to.
33 248 In the matter of corroboration of the evidence of a single witness against the accused what the law requires is that there should be such corroboration of the material part of the story connecting the accused with the crime as will satisfy reasonable minds that the man can be regarded as a truthful witness.
The corroboration need not be direct evidence that the accused committed the crime; it is sufficient if it is merely circumstantial evidence of his connection with the crime.
The nature of the corroboration will depend on and vary according to the particular circumstances of each case.
Rex vs Baskerville (1916) 2 K.B.D. 658, referred to.
|
ION: Criminal Appeal No. 49 of 1954.
Appeal by special leave from the judgment and order dated the 7th October, 1953 of the Orissa High Court at Cuttack in Criminal Appeal No. 108 of 1952 arising out of the judgment and order dated the 14th November 1952 of the Court of Assistant Sessions Judge at Sambalpur Sundergarh in Sessions Trial No. 7/4 (5) of 1922.
section C. Isaacs, R. Patnaik and R. C. Prasad, for the appellant.
Porus A. Mehta and P. G. Gokhale, for the respondent.
March 13.
The Judgment of the Court was delivered by SINHA J.
The main question canvassed in this appeal by special leave is whether the ruling of this Court in the case of Topan Das vs The State of Bombay(1) governs this case also, in view of the fact that the appellant is the only person out of the accused persons placed on trial, who has been convicted for the offence of conspiracy under section 120 B, Indian Penal Code.
The point arises in the following way: The appellant and four others were placed on their trial before the Assistant Sessions Judge of Sambalpur for offences under sections 120 B, 409,477 A and 109, Indian Penal Code with having committed the offences of criminal conspiracy, criminal breach of trust in respect of Government property, and falsification of accounts with a view to defraud the Government.
The appellant was the District Food Production Officer in Sambalpur and the other four accused persons were agricultural sub overseers in charge of their respective areas under the appellant.
Another such agricultural sub overseer was Pitabas Sahu at Bargarh centre.
He was examined at the trial as P.W. 25 and (1) 209 shall hereinafter be referred to as the approver.
The prosecution case is that in furtherance of the Grow More Food Scheme initiated by Government it was decided to subsidize the supply of oil cake to agriculturists with a view to augmenting the production of food crops.
Cultivators were to be supplied this variety of manure at Rs. 4 4 0 per maund, though the Government had to spend Rs. 7 12 0 per maund.
The appellant entered into a conspiracy with his subordinate staff including the agricultural sub overseers aforesaid to misappropriate the funds thus placed at their disposal for the procurement and supply of oil cake to cultivators.
To bolster up the quantity of oil cakes to be procured, they showed false transactions of purchase and distribution thereof and falsified accounts, vouchers, etc.
Thus they were alleged to have misappropriated the sum of Rs. 4,943 4 0 of Government money.
A large volume of oral and documentary evidence was adduced on behalf of the prosecution.
The three assessors who assisted at the trial were of the opinion that none of the accused was guilty.
The learned Assistant Sessions Judge in agreement with the assessors acquitted the four agricultural sub overseers aforesaid of all charges, giving them the benefit of the doubt.
But in disagreement with the assessors he convicted the appellant under all the charges and sentenced him to rigorous imprisonment for four and a half years and a fine of Rs. 2,000 under section 409, Indian Penal Code, and to rigorous imprisonment for two years each under sections 120 B and 477 A of the Code, the sentences of imprisonment to run concurrently.
The learned trial Judge observed in the course of his judgment as follows: "Hence on a consideration of all the evidence as discussed above, I find that the prosecution have fully proved their case that the accused Bimbadhar Pradhan, the D.F.P.O. has conspired to embezzle the Government money.
They have also proved that he has got an active hand and in assistance of Pitabas 210 Sahu has embezzled Government money amounting to Rs. 4,943 4 0 and in that act he has also actively helped Pitabas Sahu in falsifying the Government records by making false entries.
Hence all these three charges have been conclusively proved against him.
So far as regards the other accused persons, I have already stated that they are considerably inexperienced and the doubtful nature of evidence against these accused persons and considering the position between the first accused and the other accused persons, I give these four accused persons the benefit of doubt though I do not approve their conduct in this affair.
As per my findings given above, I may state here that this is a case in which we find a person in charge of the entire administration of agricultural and G.M.F. development of a district has not only soiled his own hands by embezzling Government money by corrupt means but has also introduced corruption into the entire administration of that department by spoiling the career of young men who are entrusted with this work and employed under him".
The appellant went up in appeal to the High Court of Orissa.
A Division Bench of that Court allowed his appeal and set aside his convictions and sentences under sections 409 and 477 A, Indian Penal Code, but upheld his conviction and sentence in respect of the charge of conspiracy under section 120 B of the Code.
We need not enter into the correctness of the findings of the trial court in respect of the acquittal of the other four accused, or of the High Court with regard to the acquittal of the appellant in respect of the charges under sections 409 and 477 A, Indian Penal Code.
The High Court held that though the appellant had withdrawn the sum of Rs. 27,000 from the Government treasury with a view to subsidizing the procurement of oil cake, it had not been proved that there was an entrustment to the appellant.
Hence the charge against him under section 409 failed.
As regards the charge under section 477 A, the High 211 Court acquitted him on the ground that the documents said to have been falsified, which were large in number, had not been mentioned in the charge and a vague statement that "accounts, cash books, stock books, petty cash sale register, cash memos, applications from cultivators, receipts, bills, vouchers, papers, documents, letters, correspondence, etc.
had been falsified" was made.
As regards the charge of conspiracy under section 120 B, the High Court observed that the most important witness to prove the charge was the approver aforesaid (P.W. 25) who had given a full description of the conspiracy on the 23rd or 25th September 1947 between the appellant and other sub overseers including himself for the purpose of showing bogus purchases and bogus distribution of large quantities of oil cake.
It also observed that "Most of the witnesses examined by the prosecution to corroborate the evidence of Pitabas are themselves accomplices in the conspiracy".
The High Court found that in respect of that conspiracy the evidence given by the approver got adequate corroboration from other independent witnesses.
After setting out the evidence the High Court recorded the following finding: "This would be strongest corroboration of the evidence of the approver about the appellant being the prime mover and the brain behind the entire fraud.
It was he who wanted to misuse his official position and persuade his subordinates to join with him in showing false procurement and distribution figures of oilcakes".
And finally the High Court came to the following conclusion: "I am therefore of the opinion that the approver 's version about the leading part in the conspiracy played by the appellant in persuading all his subordinates to join with him for the purpose of committing criminal breach of trust of the sums withdrawn from the treasury by showing false procurement and distribution of oilcake is true.
There is independent corro 212 boration of his evidence which is inconsistent with the appellant being a mere negligent superior officer who was deceived and defrauded by his dishonest subordinates.
It was then urged that in the charge under section 120 B of the Indian Penal Code, the date of the commission of the offence was stated to be the month of October 1947, whereas according to the evidence of P.W. 5, the conspiracy took place at Bargarh between the 23rd and 25th September 1947.
This discrepancy in the date is immaterial and has not prejudiced the appellant in any way".
From the concurrent orders of conviction and sentence of the appellant under section 120 B, Indian Penal Code, he was granted special leave to appeal to this Court.
The learned counsel for the appellant has raised the following points in support of the appeal: 1.
That all the persons charged with the offence of conspiracy except the appellant having been acquitted, his conviction and sentence in respect of that charge could not in law be maintained; 2.
That the appellant himself having been acquitted of the substantive charges under sections 409 and 477 A of the Code, he could not be convicted for conspiracy to commit those very offences; 3.
That the evidence of the prosecution witnesses having been disbelieved as against the other accused, the same evidence should not have been relied upon for convicting the appellant of the charge of conspiracy; 4.
That the provisions of section 342, Code of Criminal Procedure, had not been fully complied with in so far as important circumstances in the prosecution evidence had not been put to the appellant in his examination by the court under that section.
In our opinion, there is no substance in any one of these contentions and we proceed to give our reasons for our conclusions.
In support of the first contention raised on behalf of the appellant strong reliance was placed on the 213 recent decision of this Court in Topan Das vs State of Bombay(1) and the rulings relied upon in that case.
The cases, The Queen vs Manning(2), The Queen vs Thompson(3) and The King vs Plummer(4) were cited in support of the contention that where all the accused persons except one are acquitted on a charge of conspiracy, the conviction of one only on that charge cannot be sustained.
In this connection the recent decision of the Judicial Committee of the Privy Council in the case of Kannangara Aratchige Dharmasena vs The King(5) may also be referred to, though it was not cited at the Bar.
In that case the Judicial Committee held that where only two persons are involved in a charge of conspiracy, if a new trial has to be directed in respect of one it should be ordered in respect of both, because the only possible conclusion in such a case was either that both were guilty or that neither was guilty of the offence.
The recent decision of this Court so strongly relied upon by the appellant lays down a similar rule, but is clearly distinguishable from the case in hand inasmuch as in that case the only persons alleged to have been guilty of the offence of conspiracy were the persons placed on trial.
There was no allegation nor any evidence forthcoming that any other persons were, though not placed on trial, concerned with the crime.
In those circumstances this Court laid it down that it was essential to bring the charge of conspiracy home to the accused person or persons to prove that there was an agreement to commit an offence between two or more persons.
On the findings in that case only one person, after the acquittal of the rest of the accused was concerned with the crime and stood convicted of the charge of conspiracy.
As a person cannot be convicted of conspiring with himself to commit an offence, this Court gave effect to the contention that on the findings and on the evidence, (1)[1955] 2 S.C.R. 881.
(2) (3) ; (4) (5) 28 214 as also on the charge in that case the conviction could not be sustained.
But in the instant case, as already indicated, on the findings of the courts below, apart from the persons placed on trial, there was the approver who implicated himself equally with the other accused persons and a number of other prosecution witnesses as having been privy to the conspiracy.
The evidence of the approver has been found by the courts below to have been materially corroborated both as to the unlawful agreement and as to the persons concerned with the conspiracy.
In the first information report lodged on the 28th June 1948 the approver Pitabas Sabu, one of the agricultural sub overseers, was named along with the other five accused as the persons concerned with the conspiracy.
Subsequently Pitabas Sahu aforesaid was granted pardon on condition of his making a full and true statement of the facts of the case and was examined as an approver, on whose evidence mainly rested the case against the accused.
His evidence, as indicated above, was supported by the dealers in oilcake who supplied the commodity which was the subject matter of the conspiracy.
It cannot therefore be said that this case is on all fours with the recent decision of this Court referred to above.
But it was argued on behalf of the appellant that be was charged only with a conspiracy with the other accused persons and not with any conspiracy with the approver along with those others.
The charge under section 120 B is in these terms: "First, that you, on or about the month of October, 1947 in the district of Sambalpur agreed with Hemchandra Acharya and other accused persons to do or caused to be done an illegal act by illegal means and that you did some acts in pursuance of the said agreement to wit, the offence of criminal breach of trust under section 409, I.P.C. and falsification of accounts under section 477 A punishable with R. I. for more than two years and thereby committed an offence punish 215 able under section 120 B, I.P.C. , and within the cognizance of court of Sessions".
It will thus appear from the words of the charge that the approver was not specifically named as having been one of the conspirators, unless he could be brought within the category of "other accused persons".
Something will have to be said as to what those words denote, whether the approver was also included within that description.
Counsel for the appellant contended that they did not.
Counsel for the State Government contended to the contrary.
In England an indictment consists of three parts: (1) the commencement, (2) the statement of the offence, and (3) the particulars of the offence.
The English law of indictment from very early times has been based on very technical rules.
Those rules have now been codified by the Indictments Act, 1915 (5 & 6 George 5, Chapter 90).
In Rule 2 (Schedule 1) of the Act as amended by the Administration of Justice (Miscellaneous Provisions) Act of 1933, the form of "the commencement of the indictment" has been prescribed.
The form of "Statement of the offence" has been prescribed by Rule 4 of the Act and below that has to follow "Particulars of offence" as re quired by Rule 5.
Those rules more or less correspond to the rules laid down in Chapter XIX of the Code of Criminal Procedure.
Section 221, Code of Criminal Procedure, requires that the charge shall state the offence with which the accused is charged, giving the specific name of the offence, if such a name has been given by the law which creates the offence, which in this case means the offence of criminal conspiracy, defined by section 120 A, Indian Penal Code.
The naming of the section is, under sub section (5) of section 221 , Code of Criminal Procedure, equivalent to a statement that every legal condition required by law to constitute the offence of criminal conspiracy charged against the appellant was fulfilled.
Section 222 of the Code requires that the particulars as to the time and place of the alleged offence, and 216 the person (if any) against whom, or the thing (if any) in respect of which, the offence was committed, shall be stated.
It is noteworthy that section which requires the particulars of the offence to be stated does not in terms further require that in an offence,like conspiracy the names of the co conspirators should also be mentioned.
Hence in England it is enough if the indictment states that the accused along with other persons unknown had committed the offence of criminal conspiracy.
Though the statute law in India does not make it obligatory that the persons concerned in the crime of criminal conspiracy should be specifically named along with the person or persons charged in a particular trial, it is always advisable to give those particulars also in order to give a reasonable notice to the accused that he has been charged with having conspired with so and so (persons named), as also persons unnamed, to commit a certain offence.
In this case the charge against the five accused persons with reference to section 120 B, Indian Penal Code, named only those five persons as the conspirators and omitted to name the approver also as having been privy to the conspiracy.
This is clearly brought out with reference to the charge framed against the other four accused (who have been acquitted by the trial court as aforesaid).
It states: "That you, on or about the month of October 1947 in the district of Sambalpur, agreed with Bimbadhar Pradhan to do or caused to be done an illegal act by illegal means. . . . .
We find with reference to the records of the trial court that the trial has not been characterised by thoroughness or circumspection.
The date of the offence as given in the charge is different from the date as disclosed in the evidence, as pointed out by the High Court, which found that mistake bad not caused any prejudice to the accused.
Similarly, the charge under section 477 A had not, as held by the High Court, been framed with sufficient parti 217 cularity as a result of which the appellant had to be acquitted of that charge on appeal.
If the charge under section 120 B had added the words "and other persons, known or unknown", there would have been no ground for a grievance on the part of the appellant.
But even so, in our opinion, the provisions of section 225, Code of Criminal Procedure, are clearly applicable to the facts and circumstances of the present case.
It has not been shown to us how the omission to mention the name of the approver in the charge under section 120 B, Indian Penal Code, has misled the appellant or has occasioned a failure of justice.
The prosecution case throughout has been, as is clear with reference to the petition of complaint, that the appellant with his subordinates in the Food Department had conspired to misappropriate the funds allocated to the procurement of oil cake with a view to helping agriculturists with manure to raise more food crops.
The approver has been very much in the picture all the time and, as a matter of fact, as found by the courts below, his evidence is the main plank in the prosecution case.
Of course, there is the other corroborative evidence, as pointed out in the judgments of the courts below.
The provisions of section 537 are equally attracted to this case.
With reference to the provisions of that section it is pertinent to note that though the other accused had been acquitted by the trial court and though he was the only appellant in the High Court, he did not raise the points with reference to the alleged illegality or irregularity in the charge, before that court.
Hence applying the Explanation to that section to this case, it cannot be urged that the omission in the charge has occasioned a failure of justice.
But the learned counsel for the appellant has invited our pointed attention to the observations of Mr. Justice Mathew at p. 243 of Queen vs Manning(1) that it is "an imperative rule of law" that "in a (1) 218 charge for conspiracy in a case like this where there are two defendants, the issue raised is whether or not both the men are guilty, and if the jury are not satisfied as to the guilt of either, then both must be acquitted".
But Lord Coleridge, C. J., whose direction to the jury in that case was the subject matter of the judgment does not put it as high as Mr. Justice Mathew, but understood it "to be the established rule of practice".
Reliance was placed by the learned counsel for the appellant on the case of The King vs Plummer(1), in which it has been observed that with the acquittal of the only alleged conspirators no verdict of guilty against the appellant could be passed because the verdict would be regarded as repugnant, in so far as it would amount to saying that there was a criminal agreement between the appellant and the others and none between them and him.
Hence it was contended that in a situation such as the present case presents, the conviction of the appellant would amount to a similar repugnancy.
This aspect of the matter has been well discussed in a judgment of the Calcutta High Court delivered by Mr. Justice Mukerji in the case of I. G. Singleton vs The King Emperor(2).
The learned Judge has there pointed out the difference between the position as it obtains in India and that in England.
The rule of English law as to the acquittal of an alleged conspirator following from the acquittal of the other when the conspiracy was said to be only between the two and in a joint trial of both is based upon a rule of practice and procedure, namely, that repugnancy or contradiction on the face of the record is a ground for annulling a conviction.
But such a repugnancy is not by itself a sufficient ground for quashing a conviction in India where the matter is governed by statutory law both as to the offence and the procedure for bringing the offender to justice.
In India there is no provision in the statutory law justifying an interference with a conviction on the (1) (2) 219 ground of repugnancy in the record.
That is not to say that the court is to shut its eyes to the inconsistency in convicting one person of the offence of conspiracy on the same evidence on which the other alleged conspirator had been acquitted.
If the matter is as simple as that, ordinarily the courts will have no difficulty in setting aside the conviction, when there was absolutely nothing on the record to distinguish the case against the one from that against the other.
Such was the case which was decided by this Court in Topan Das vs State of Bombay(1).
Learned counsel for the appellant pressed upon us the consideration that notwithstanding the state of affairs as disclosed in the evidence, the appellant was entitled to an acquittal because in the charge as framed against him there was no reference to the approver.
He contended that the rule upon which the accused was entitled to an acquittal was not a matter of practice but of principle.
In the instant case we are not sure that the acquittal of the co accused by the trial court was well founded in law or justified by the evidence in the case.
The trial court has not disbelieved the evidence led on behalf of the prosecution.
It has only given the benefit of the doubt to the accused whom it acquitted on grounds which may not bear scrutiny.
But as the case against those acquitted persons is not before us, we need not go any further into the matter.
It has further been contended by the learned counsel for the appellant that the High Court having acquitted him in respect of the two substantive charges of criminal breach of trust and of falsification of documents he should not have been convicted of the offence of criminal conspiracy because the conspiracy was alleged to have been for those very pur poses.
It is a sufficient answer to this contention to say that the offence of criminal conspiracy consists in the very agreement between two or more persons to commit a criminal offence irrespective of the (1) 220 further consideration whether or not those offences have actually been committed.
The very fact of the conspiracy constitutes the offence and it is immaterial whether anything has been done in pursuance of the unlawful agreement.
But in this case the finding is not that Government money had not been misappropriated or that the accounts had not been falsified.
The charge under section 477 A relating to the falsification of the documents has failed because the High Court found that particular charge was wanting in sufficient particulars, thus causing prejudice to the accused.
The charge under section 409, Indian Penal Code, was set aside by the High Court on the ground that there was "practically no evidence of entrustment with the appellant of the price of 1500 maunds of oil cakes, a substantial portion of which he was said to have misappropriated".
How far this observation of the High Court is well founded in law with reference to the official position of the appellant who had the spending of the Government money in his hands is not a matter on which we need pronounce.
It is enough to point out that it has not been found by the courts below that the object of the criminal conspiracy had not been achieved.
On the other hand, there is enough indication in those judgments that the object of the conspiracy had been to a large extent fulfilled.
Hence it must be held that there is no substance in this contention also.
Another contention raised on behalf of the appellant was that the other accused having been acquitted by the trial court the appellant should not have been convicted because the evidence against all of them was the same.
There would have been a great deal of force in this argument, not as a question of principle but as a matter of prudence, if we were satisfied that the acquittal of the other four accused persons was entirely correct.
In this connection the observations of this Court in the case of Dalip Singh vs State of Punjab(1), and of the Federal Court in (1) ; , 156.
221 Kapildeo Singh vs The King(1) are relevant.
It is not essential that more than one person should be convicted of the offence of criminal conspiracy.
It is enough if the court is in a position to find that two or more persons were actually concerned in the criminal conspiracy.
If the courts below had come to the distinct finding that the evidence led on behalf of the prosecution was unreliable, then certainly no conviction could have been based on such evidence and all the accused would have been equally entitled to acquittal.
But that is not the position in this case as we read the judgments of the courts below.
Lastly, it was contended that the examination of the appellant by the learned trial Judge was not in full compliance with the requirements of section 342, Code of Criminal Procedure.
Two points have been sought to be made in this connection.
Firstly, it has been contended that though the other accused who have been acquitted by the trial court were questioned with reference to the conspiracy with the approver Pitabas Sahu, no such question was put to the appellant.
It is true that the court questioned him about his "conspiracy with the other accused persons".
Counsel for the parties before us did not agree as to the significance of the words "in conspiracy with the other accused persons".
The contention on behalf of the appellant was that they referred only to the persons actually standing trial before the court, whereas counsel for the State con tended that they had reference to all the accused persons named in the petition of complaint including the approver.
A number of rulings of the different High Courts as to what is the position of an approver, whether he continues to be an accused person even after the grant of pardon or whether he is only in the position of a witness on behalf of the prosecution, were cited before us.
But we do not think it necessary in this case to pronounce upon that because we have, as already indicated, come to our conclusions (1) , 837, 838.
29 222 on the assumption that there is an omission in the charge in so far as the approver has not been specifically named in the charge under section 120 B, Indian Penal Code.
Secondly, it was contended that the evidence of P.W. 27 who had been chiefly relied upon in the courts below as corroborating the approver had not been specifically put to the appellant though the evidence of the approver Pitabas Sahu was pointedly put to him.
In our opinion, it is not ordinarily necessary to put the evidence of each individual witness to the accused in his examination under section 342, Code of Criminal Procedure.
The appellant was put the question "Have you got anything to say on the evidence of the witnesses?" That, in our opinion, is sufficient in the circumstances of this case to show that the attention of the accused was called to the prosecution evidence.
As to what is or is not a full compliance with the provisions of that section of the Code must depend upon the facts and circum stances of each case.
In our opinion, it cannot be said that the accused has been in any way prejudiced by the way he has been questioned under that section.
As all the contentions raised on behalf of the appellant fail, the appeal must stand dismissed.
| The appellant and four others were placed on their trial before the Assistant Sessions Judge of Sambalpur for offences under sections 120 B, 409, 477 A and 109, I.P.C. with having committed the offences of criminal conspiracy, criminal breach of trust in respect of Government property and falsification of accounts with a view to defraud the Government.
The appellant was the District Food Production Officer and the other four accused persons were agricultural sub overseers under the appellant and another agricultural sub overseer namely P. was examined at the trial as an approver.
The Assistant Sessions Judge convicted the appellant under all the three charges but acquitted the four sub overseers giving them the benefit of doubt.
The High Court in appeal allowed the appeal of the appellant in respect of charges under sections 409 and 477 A, I.P.C. but upheld his conviction and sentence in respect of the charge of conspiracy under section 120 B, I.P.C. observing that in respect of that charge the evidence given by the approver got corroboration from other independent evidence.
On appeal by special leave to the Supreme Court the main question for consideration was whether the ruling of the Supreme Court in the case of Topan Das vs The State of Bombay ([1955] 2 S.C.R. 881), governed the present case in view of the fact that the appellant was the only person out of the accused persons on trial who had been convicted of the offence of conspiracy under section 120 B, I.P.C. Held (i) that the case of Topan Das vs State of Bombay was, clearly distinguishable from the present case as in that case the only persons alleged to have been guilty of the offence of conspiracy 'Were the persons placed on trial.
There was no allegation nor any 207 evidence forthcoming that any other persons though not placed on trial, were concerned with the crime.
On the findings in that case, only one person, after the acquittal of the rest of the accused, was concerned with the crime and stood convicted of the charge of conspiracy.
As a person cannot be convicted of conspiring with himself to commit an offence, the Supreme Court gave effect to the.
contention that on the findings and on the evidence, as also on the charge in that case, the conviction could not be sustained.
But in the instant case on the findings of the courts below, apart from the persons placed on the trial, there was the approver who implicated himself equally with the other accused persons and a number of other prosecution witnesses as having been privy to the conspiracy.
And therefore the present case was not on all fours with the case of Topan Das vs State of Bombay.
(ii) The provisions of section 225, Cr.
P.C. were clearly applicable to the facts and circumstances of the present case.
It had not been shown how the omission to mention the name of the approver in the charge under section 120 B, I.P.C. had misled the appellant or had occasioned a failure of justice.
(iii) The provisions of section 537 of the Code of Criminal Procedure were equally applicable to the facts of the case.
As the appellant did not raise the point with reference to the alleged illegality or irregularity in the charge before the High Court it must be held, applying the Explanation to that section, that the omission in the charge bad not occasioned a failure of justice.
The contention that with the acquittal of the alleged conspirators no verdict of guilty against the appellant could be given, because the verdict would be regarded as repugnant in so far as it would amount to saying that there was a criminal agreement between the appellant and the others and none between them and him, the conviction of the appellant would amount to a similar repugnancy was without substance because the rule of English law as to the acquittal of an alleged conspirator when the conspiracy was said to be only between the two is based upon a rule of practice and procedure, namely that repugnancy or contradiction on the face of the record is a ground for annulling a conviction.
But such a repugnancy is not by itself a sufficient ground for quashing a conviction in India where the matter is governed by statutory law both as to the offence and the procedure for bringing the offender to justice.
In India there is no provision in the statutory law justifying an interference with a conviction on the ground of repugnancy in the record.
Topan Das vs State of Bombay ([1955] 2 S.C.R. 881), The Queen vs Manning ([1883] , The Queen vs Thompson ([1851] 16 Q.B. 832), The King vs Plummer ([1902] 2 K.B. 339), Kannangara Aratchige Dharmasena vs The King ([1951] A.C. 1), I. G. Singleton vs The King Emperor ([1924] , Dalip Singh vs State of Punjab ([1954] S.C.R. 145) and Kapildeo Singh v, The King ([1949 50] F.C.R. 834), referred to. 208
|
Civil Appeal No. 1 of 1956.
On appeal from the judgment and order dated the 2nd/21st day of September 1955 of the Madras High Court in Writ Appeal No. 65 of 1955 arising out of the order dated the 5th day of May 1955 of the said High Court in Writ Petition No. 158 of 1955.
G.S. Pathak, B. Ganapathy Iyer and G. Gopalakrishan, for the appellant.
M. O. Setalvad, Attorney General for India, B.K.B. Naidu and Naunit Lal, for respondent No. 2. 1956.
March 15.
The Judgment of the Court was delivered by IMAM J.
This appeal comes before us on a certificate granted by the Madras High Court that the case was a fit one for appeal to this Court as it involved two important questions, namely, the powers of the Government under section 64 A of the , as amended by the Motor Vehicles (Madras Amendment) Act, 1948 for the State of Madras (hereinafter referred to as the Act), to interfere with the orders of subordinate Transport Authorities on the ground of propriety and the limits of judicial review which the courts have under article 226 of the Constitution of India.
The appellant and respondent No. 2, had applied for stage carriage permits in the Mayuram Town Service for routes Nos. 1 and 2.
These applications, along with others, were considered by the Regional Transport Authority, Tanjore.
By its order dated the 31st of May, 1954, it granted a permit for route No. 1 to the appellant and for route No. 2 to respondent No. 2.
Both the appellant and respondent No. 2 being dissatisfied appealed under section 64 of the Act to the appropriate authority, the Central Road Traffic Board (hereinafter referred to as the Board), but the appeals were dismissed by its order dated the 18th of August, 1954.
As section 64 A conferred upon the State Government certain powers, which have 258 been described in this case as revisional powers, the appellant and respondent No. 2 filed representations thereunder before the State Government against the orders of the Regional Transport Authority and the Board.
The State Government set aside the orders passed by the aforesaid authorities and directed that permits for both the routes Nos. 1 and 2 be issued to respondent No. 2.
Against this order, the appellant filed an application under article 226 of the Constitution in the High Court for the issue of a writ of certiorari.
The application was heard by a single Judge who issued the requisite writ.
Against his decision there was a Letters Patent appeal by respondent No. 2, which was allowed and the decision of the single Judge was set aside.
The ground upon which the Regional Transport Authority granted the appellant and respondent No. 2 permits for routes Nos. 1 and 2 respectively was that they were experienced and were operating town buses at Kumbakonam.
This opinion was approved by the Board which also thought that a certain amount of healthy competition was required in the Mayuram Town routes.
It also considered that the Regional Transport Authority was within its rights in not considering the aspect of sector coverage by muffassil buses of the appellant and respondent No. 2.
It appears that respondent No. 2 was covering the entire route No. 1 and the appellant was covering a portion of route No. 2.
The State Government in setting aside the orders of the Regional Transport Authority and the Board passed the following order: "As between the claims of Sri Raman & Raman Ltd. and Sri Sathi Vilas Bus Service, the Government consider that it will be in the interest of the public to grant both the permits to Sri Sathi Vilas Bus Service, Poryar, since he has better facilities for operation and will be able to serve the public better.
The Government of Madras therefore sets aside as improper the order of the Central Road Traffic Board No. R 27792/A2/54 dated the 18th of August, 1954 in so far as it confirms the order of the Regional Transport Authority, Tanjore granting one permit of route 259 No. 1 to Sri Raman & Raman Ltd. and directs that the two permits in question be granted to Sri Sathi Vilas Bus Service, Poryar".
Before dealing with the submissions made on behalf of the appellant, it would be desirable to make reference to certain provisions of the Act concerning the grant of permits.
Section 42 of the Act prohibits an owner of a transport vehicle from using or permitting it to be used in any public place save in accordance with the conditions of a permit granted by a Regional Transport Authority.
Section 43 gives certain powers to the State Government to control road transport.
Section 44 authorises the State Government to constitute a State Transport Authority as well as a Regional Transport Authority to perform certain functions mentioned therein.
Section 47 sets forth certain matters which a Regional Transport Authority shall bear in mind in deciding to grant or to refuse a stage carriage permit.
Section 64 enables a person aggrieved by the order of the Regional Transport Authority, with respect to matters men tioned therein, to appeal to the prescribed authority.
Section 64 A states: "The State Government may, of its own motion or on application made to it, call for the records of any order passed or proceeding taken under this Chapter by any authority or officer subordinate to it, for the purpose of satisfying itself as to the legality, regularity or propriety of such order or proceeding and after examining such records, may pay pass such order in reference thereto as it thinks fit".
Mr. Pathak, for the appellant, contended that having regard to the terms of section 64 A, there were two stages for the exercise of power thereunder by the State Government.
The first stage was the condition precedent for assumption of jurisdiction for the exercise of that power.
A collateral fact had to be decided, namely whether the order passed by any authority or officer subordinate to the State Government was in fact illegal, irregular or improper.
If the decision was in the affirmative, then and then only would the State Government have jurisdiction to revise the 260 order complained against.
The decision of the State Government both with respect to questions of fact and law could be examined by a court in a proceeding for the issue of a writ of certiorari and such court in doing so could decide whether the order which was revised by the State Government was or was not illegal, irregular or improper.
In the present case, there was no question of illegality or irregularity in the orders of the Regional Transport Authority and the Board.
The only question was as to whether these orders were improper.
The propriety of an order does not necessarily mean that it must be correct order.
There must be something extraneous to the order it self which made it improper.
Merely because the State Government took a different view of the facts to that of the authority or officer subordinate to it would not make the order of such authority or officer improper.
The second stage, namely, the passing of an order as the State Government thought fit, 'could only be reached after a decision had been arrived at on the condition precedent conferring jurisdiction on the State Government to revise an order.
The substantial ground upon which the State Government revised the order of the authority subordinate to it was that respondent No. 2 had better facilities for operation and would, therefore, be able to serve the public better.
The authorities subordinate to the State Government, however, had the representations of the appellant and respondent No. 2, as well as other applicants, which fully stated all material particulars in this respect and it could not be said that these matters were not considered by them.
The orders of the subordinate authorities accordingly must be read to mean that as between the appellant and respondent No. 2 both bad equal facilities for operation and that things being equal between them in every way, one permit should be granted for one route to the appellant and another for another route to respondent No. 2.
There could be nothing improper in this.
The condition precedent to the exercise of jurisdiction to revise the order was therefore absent and the State Government acted in excess of its 261 jurisdiction in revising the orders of its subordinate authorities.
Mr. Pathak further contended that there was an error on the face of the record in the order passed by the State Government as it had refused to consider seniority or experience in motor transport as a factor for the granting of a permit and it thought that it could come to any conclusion it liked and reference was made to paragraph 8 of the affidavit filed on behalf of the State Government in the High Court.
On the basis of that affidavit and that paragraph, it was also urged that the error on the face of the record was that the Government acted on an erroneous idea of its own jurisdiction.
He further contended that section 64 A was an invalid provision.
In the alternative, he urged that a court or authority, in the exercise of its revisional powers, cannot take a contrary view of the facts to that taken by the subordinate court or authority.
Exercise of such revisional power could only be made in cases where the subordinate court or authority had taken a perverse view of the facts and had arrived at a conclusion which no reasonable person could have arrived at.
In support of his first contention, Mr. Pathak relied upon Paragraph 116 at page 59 of Halsbury 's Laws of England, third edition, Vol. 11.
It appears from an examination of that paragraph and paragraph 117 at page 60 of the same Volume that there may be cases where the jurisdiction of an inferior tribunal may depend upon the fulfilment of some condition precedent or upon the existence of some particular fact.
Such a fact is collateral to the actual matter which the inferior tribunal has to try, and the determination of whether it exists or not is logically and in sequence prior to the determination of the actual question which the inferior tribunal has to try.
In such a case, in certiorari proceedings, a court can enquire into the correctness of the decision of the inferior tribunal as to the collateral fact and may reverse that decision if it appears to it, on the 262 materials before it, to be erroneous.
There may be tribunals, however, which, by virtue of legislation constituting them, have the powers to determine finally the preliminary facts on which the further exercise of their jurisdiction depends.
With respect to them, in such cases, their decision even if wrong on facts or law cannot be corrected by a writ of certiorari.
In cases where the fact in question is a part of the very issue which the inferior tribunal has to enquire into, a court will not issue a writ of certiorari, although the inferior tribunal may have arrived at an erroneous conclusion with regard to it.
In the present case, if there was at all any collateral fact to be decided, it was whether the appropriate authority had in fact passed any order in respect of which powers under section 64 A could be exercised.
It is not disputed that in fact orders were passed by the Regional Transport Authority and the Board, authorities subordinate to the State Government, and that these orders existed when the appellant and respondent No. 2 moved that Government to exercise its powers under section 64 A.
The condition precedent and the existence of a collateral fact in that way for the exercise of powers under that section were therefore present when the State Government exercised its powers.
In order to satisfy itself whether the order of an authority subordinate to it was legal, regular or proper, the State Government was not deciding the existence of a collateral fact but the issue itself as to the legality, regularity or the propriety of the order.
The satisfaction of the State Government in this respect would be an expression of its opinion and not the determination of a fact upon which depended its jurisdiction to exercise its powers under section 64 A.
What is the nature of the functions performed under the Act by the Regional Transport Authority, the Board and the State Government in the matter of granting or refusing to grant a permit may now, be considered.
That they are not judicial is accepted, but, it is said, they are not administrative but quasi judicial and therefore amenable to the jurisdiction of 263 a court possessing the power to issue a writ of certiorari.
In proceedings under sections 47, 64 and 64 A of the Act there is no determination of any individual 's rights and from that point of view the functions of these authorities may be regarded as executive or administrative.
On the other hand, it may be said that a person has the fundamental right to carry on his business of plying buses and therefore has the right to have the statutory functions of these authorities properly exercised in which case they would be quasi judicial functions.
Assuming this to be so, it has yet to be seen whether the State Government acted in excess of its legal authority.
Chapter IV of the Act contains provisions concerning the control of transport vehicles.
The Act authorises the State Government to constitute a State Transport Authority and Regional Transport Authorities, and under section 43, subject to its provisions, it can control road transport.
In the first instance, the authority to grant or refuse to grant a permit is vested in the Regional Transport Authority, but its order is not final as a dissatisfied party can appeal against the order under section 64 to the appropriate authority.
Before section 64 A was inserted into the Act by an Act of the legislature of the State of Madras, it might have been possible to contend that the order of a Regional Transport Authority which bad not been appealed against and the order of the appropriate authority under section 64, where an appeal bad been made, were incapable of interference by the State Government for lack of statutory authority.
By enacting section 64 A, the legislature clearly intended that should not be so and that the State Government should have the powers to intervene, if it was satisfied that the order in question was either illegal, irregular or improper.
In clothing the State Government with such power the legislature clearly intended the State Government to decide the issue as to whether any order in question was illegal, irregular or improper.
It would not be open to a court exercising the power of certiorari to intervene merely be cause it might be of the opinion that the view taken 264 ] by the State Government was erroneous.
The word "propriety" has nowhere been defined in the Act and is capable of a variety of meanings.
In the Oxford English Dictionary (Vol. VIII), it has been stated to mean.
"fitness; appropriateness; aptitude suitability; appropriateness to the circumstances or conditions; conformity with requirement, rule or principle; rightness, correctness, justness, accuracy".
If the State Government was of the opinion that respondent No. 2 had better facilities for operation than the appellant and their service to the public ' would be more beneficial, it could not be said that the State Government was in error in think ing that the order of the Board confirming the order of the Regional Transport Authority was improper.
It is to be remembered that under section 47 of the Act a Regional Transport Authority in deciding whether to grant or to refuse a permit shall have regard, amongst other things, to the interest of the public generally and the advantages to the public of the service to be provided.
Assuming that in the matter of experience there was nothing much to choose between the appellant and respondent No. 2, better facilities for operation of the bus service possessed by respondent No. 2, would be to the interest of the public generally and an advantage to the public Of the service to be provided and therefore was an overriding factor when other things were equal.
As between the appellant and respondent No. 2 neither the Regional Transport Authority nor the Board recorded a finding as to which of them had the better facilities for transport operation or that such faci lities as existed between them were of equal merit.
The State Government did not have, therefore, the advantage of knowing, on the face of the orders of these authorities, what view they took of this matter.
,Even if it is assumed that their orders meant that the facilities for operation as between the appellant and respondent No. 2 were of equal merit, still the State Government was not in a position to know on what material this opinion was based or that it was a reasonable view.
In order to satisfy itself the State 265 Government examined the materials available to it and came to the conclusion that respondent No. 2 bad the better facilities, in other words, it would be unreasonable to hold that respondent No. 2 had not the better facilities.
The learned single Judge.
of the High Court more than once held that he could not find that there was no material before the State Government to justify its finding that respondent No. 2 had the better facilities, and he further held that was a factor which restricted the jurisdiction of the High Court under article 226 of the Constitution.
That should have concluded the matter so far as the High Court was concerned.
He, however, thought that it could not be said that the conclusion reached by the State Government was the only conclusion possible and a mere disagreement on the conclusions to be drawn from the available materials, where either view was a reasonable one, was not enough to establish that the orders passed by the Board and the Regional Transport Authority were improper within the meaning of section 64 A. The State Government had therefore acted in excess of its jurisdiction,.
It seems to us, that the order of the State Government as it stands cannot be said to be in excess of its jurisdiction nor can it be said that in recording a finding that respondent No. 2 had the better facilities for operation and would serve the public better, it went beyond its powers, in the absence of a finding to the contrary by the authorities subordinate to it.
The interests of the public and the advantages to it of the service to be provided were very, it not the most, important factors to be taken into consideration in the matter of granting or refusing to grant a permit.
In the conflicting claims of the appellant and respondent No. 2 concerning the facilities available to them for operation of the bus service, the State Government was bound to decide, in the interests of the public generally, which of these had the better facilities.
It was within the scope of it 's authority to decide this and a court in certiorari proceedings ought not to interfere with that decision.
To hold that the opinion of the Regional Transport Authority and the 266 Board that the facilities for operation were equal as between these persons was a reasonable view would be to constitute the court as the final authority in a matter, in which, by the provisions of the Act, that function was accorded to the State Government.
We are not prepared therefore to say that the State Government acted in excess of its statutory authority.
There is no error on the face of the record so far as the order of the State Government is concerned and reference to paragraph 8 of the State Government 's affidavit in the High Court does not establish any such thing.
That paragraph was in answer to paragraphs 13 and 14 of the appellant 's affidavit and it set out the contentions of the State Government as to its powers.
There is nothing in that paragraph to establish that in fact the State Government had declined to consider seniority or experience in the matter of selection.
No substantial ground was put forward for supposing that section 64 A was an illegal provision.
It was within the competence of the State Legislature to insert section 64 A into the Act.
It was a reasonable provision in keeping with the entire scheme of the Act concerning transport vehicles and control of road transport.
As to the extent of powers of revision in a court or authority we do not intend to express any opinion in this case having regard to the view we take that the order of the State Government cannot be interfered with by the issue of a writ of certiorari.
As regards the limits of judicial review which the courts have under article 226 which is one of the grounds on which the certificate was issued by the High Court, that question has since been considered in the various decisions of this Court, which do not require recapitulation.
In our opinion, this is not a case in which it would be reasonable to hold that the State Government acted in excess of its jurisdiction.
The appeal is accordingly dismissed with costs to be paid to respondent No. 2.
| The appellant and respondent No. 2 along with others applied for stage carriage permits for two routes and the Regional Transport Authority granted a permit for one route to the appellant and for the other route to the respondent No. 2.
Both appealed to the Central Road Traffic Board but the appeals were dismissed.
Neither the Regional Authority nor the Board recorded any finding as to which of them had the better facilities for transport operation or that they were of equal merit.
They applied to the State Government under section 64 A of the Motor Vehicles Act of 1939 as amended by the Motor Vehicles (Madras Amendment) Act of 1948 and the State Government set aside the orders passed by the said subordi nate authorities and issued permits for both the routes to the respondent No. 2 on the ground that he had better facilities for operation and would serve the public better.
Against this order of the State Government the appellant moved the High Court for a writ of certiorari and a single Judge issued the writ.
On a Letters Patent appeal that decision was set aside.
The appellant contended that the State Government had acted in excess of its powers under section 64 A of the Act in setting aside the orders of the subordinate authorities and that the section itself was invalid.
Held, that the State Government was within its powers in passing the order it did and the appeal must be dismissed.
That it was within the competence of the State Legislature to insert section 64 A into the Act and its legality could not be questioned and the clear intention of the legislation was to empower the State Government to decide the legality, regularity or propriety of any orders passed by the subordinate authorities in the interest of the general public.
That the State Government was the final authority to decide which of the rival applicants had the better facilities for operation of the bus service and where it bad come to a decision in favour of an applicant, its decision could not be interfered with under article 226 of the Constitution merely because its view might be erroneous.
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Subsets and Splits