Appeals Nos 666 and 667 of 1957
N C Chatterjee and G C Mathur for the appellant
A V Viswanatha Sastri K N Rajagopala Sastri and T M Sen for the respondents
March 8
The judgment of the Court was delivered by HIDAYATULLAH J
These two appeals raise a common question of law and it is convenient to deal with them together
They have been filed with certificate against a judgment of the High Court of Orissa by Jagannath Agarwala who sought to enforce a claim he had against the former State of Mayurbhanj and the ex Ruler of Mayurbhanj
They arise out of two petitions under article 226 of the Constitution for writs of mandamus etc which the High Court of Orissa dismissed by its order under appeal
It appears that in the year 1943 the Maharaja of 207 Mayurbhanj entered into an agreement or arrangement with Jagannath Agarwala for establishing a business for the manufacture of industrial alcohol and essential oils and for purchases of wheat and barley in the Punjab
Civil Appeal No 666 of 1957 relates to the establishment of the manufacturing business and Civil Appeal No 667 of 1957 to the purchases of wheat and barley
With reference to the establishment of the business the appellant urges that it was agreed that the capital required would be contributed by the parties in equal shares and that the profit and loss would also be shared equally
As regards the purchases the appellant was to advance such money as might be required and the State of Mayurbhanj was to provide necessary permits and facilities for transport
In furtherance of this agreement the appellant urges that he established a factory and started the business but the Maharaja instead of contributing his share of the capital asked the appellant to do so on his behalf promising to pay him the amount
The factory was constructed and it appears it went into production but later closed down suffering a total loss of Rs 280875 9 3
In the first case therefore the claim of the appellant against the Maharaja and the State was Rs 140400 odd
In the second case the appellant advanced a sum of Rs 50000 and also incurred a further expenditure of Rs 3741 7 9
The State of Mayurbhanj failed in its promise of procuring the necessary permits and facilities for transport and the appellant was therefore required to sell the foodgrains in the Punjab and thus incurred a loss of Rs 14844 0 3
The appellant alleges that the Maharaja promised to pay the amount
From January 1 1949 the Mayurbhanj State merged with the Province of Orissa and on the same day the Government of Orissa promulgated the Administration of Mayurbhanj State Order 1949 under section 4 of the Extra Provincial Jurisdiction Act 1947 47 of 1947
That Order allowed claims against the State of Mayurbhanj to be preferred to Government for its 208 consideration
Clause 9 of the Order in so far as it is material is as follows 9
Claims against Ruler of the State
a The Administrator shall as soon as possible publish a notification in the Gazette in English and in vernacular calling upon all persons having pecuniary claims whether immediately enforceable or not against the State or the Ruler of the State in his capacity as Ruler of that State to notify the same in writing to the officer authorised by the Administrator in this behalf hereinafter called the said officer within three months from the date of the notification
b The notice shall also be published at such places and in such other manner as the Administrator may by special or general order direct
c Every such claimant shall within the period specified in sub paragraph a notify to the said officer in writing his claim
with full particulars thereof and any claim presented after the expiration of such period shall be summarily rejected
d Every document including entries
in book of account in the possession of or under the control of the claimant on which he bases his claim shall be produced before the said officer along with the statement of the claim f Nothing in the preceding sub paragraphs shall apply to any pecuniary claim of Government or any local authority
g The said officer shall after making such enquiry as he may deem fit decide which claims notified under sub paragraph c are to be allowed in whole or in part and which are to be disallowed and on his decision being confirmed by the Administrator the said officer shall give written notice of the same to the claimants
The decision of the Administrator shall be final and shall not be liable
to be called into question in any Court whatsoever  h No court shall have jurisdiction to investigate 209 any pecuniary claim against the State or against the Ruler of the State in his capacity as Ruler of that State and such claim shall be determined only in accordance with the provisions of this paragraph
i The Administrator may delegate his powers under this paragraph to any officer subordinate to him not below the rank of an Additional District Magistrate
j The provisions of this paragraph shall not apply to any claim against the State based on a cause of action which arose on or after the 1st January 1949 and such claim shall be disposed of in accordance with the laws applied or continued in force under paragraph 5
 The appellant preferred his two claims for the consideration of the Claims Officer who was dealing with such claims on behalf of the Administrator
The Claims Officer made a report to the Administrator on June 20 1951 in respect of the first claim and after examining the merits gave his conclusions as follows Considering the evidence laid by the Claimant before me in support of his claim I find that he is entitled to a sum of Rs 137785 13 7 12
It has been urged by the Claimant that interest  Rs 4 per cent
per annum should be allowed to him till the date of repayment of his dues
He has been allowed interest from 1 4 43 to 28 2 49 and I think he should get interest thereafter  Rs 4 per cent
per annum till the date of repayment of his dues
As regards the Claimant s demand for half share of further advances made by the Claimant after filing of this claim case it cannot be entertained in this case
Submitted to the Revenue Commissioner Orissa Cuttack through the District Magistrate Mayurbhanj as required under Clause 9g of the Administration of Mayurbhanj State Order 1949
 In the other case he made a report on November 5 1951 that the appellant had substantiated his claim for Rs 14844 0 3 and was also liable to be paid interest amounting to Rs 5303 14 0
This report was 27 210 submitted to the Member Third Board of Revenue Orissa Cuttack through the District Magistrate Mayurbhanj
On June 28 1952 the appellant received a Memo randum from the Deputy Secretary Board of Revenue Orissa Cuttack which read as  follows Dear Sri Agarwalla With reference to your petitions dated 1 10 51 and 7 9 50
I am directed to say that the claims have been rejected as Government have been advised that they are barred by limitation
Yours sincerely Sd
Govind Tripathy
It appears that the appellant applied for review and he was asked on November 8 1952 to produce before the Board any document or documents in his possession to show that these were continuing businesses and also to point out the law that no claim of a continuing business could be barred by limitation
The documents on which the appellant presumably relied before the Board of Revenue have not been printed in the record of this Court but on April 2 1953 the solicitors of the appellant were informed that the Board of Revenue had declined to review the matter
It appears also that in the first case even before the merger the Revenue Minister Mayurbhanj State had rejected the claim put forward by the appellant by his order dated October 26 1948 to the following effect The State need not recognise the claims put forward by Mr J Agarwalla as there was really no formation of any Joint Stock Company nor any written agreement entered into and finally settled
B Mohapatra Revenue Minister Mayurbhanj
It was in these circumstances that the two petitions under article 226 of the Constitution were filed
The High Court dismissed them
From the order of the High Court it appears that two points alone were urged before it
The first was that the decision of the 211 Claims Officer should have gone to the Board of Revenue as a whole and not to a single Member and the second was that the appellant should have been served with a notice by the Board before the recommendations of the Claims Officer were rejected and as has now been argued before this Court allowed a hearing
The first point was not argued before us and it seems that the appellant has accepted the decision of the High Court that the Third Member was competent to hear and dispose of these cases
The second point alone has been argued and
needs to be considered
The case was argued by Mr N C Chatterjee on behalf of the appellant as illustrating a patent breach of the principles of natural justice
He contended that his client was entitled to a proper hearing before the report in his favour was rejected and relied upon the following cases Shivji Nathubai vs The Union of India 1 New Prakash Transport Co Ltd vs New Suwarna Transport Co Ltd 2 Nagendra Nath Bora vs The Commissioner of Hills Division and Appeals Assam 3 and Gullapalli Nageswara Rao vs Andhra Pradesh State Road Transport Corporation 4
In reply Mr A V Viswanatha Sastri contended that the rejection of the claim was an act of State and that the new Sovereign State could not be compelled by a process of the municipal courts to accept a liability of the old Ruler and though the new Sovereign State might make such enquiry as it chose it was not compelled to give a hearing to the claimant
In his rejoinder MrChatterjee contended that the act of State was over when the new Sovereign State invited claims under a law passed for the purpose and proceeded to consider the evidence tendered in support of the claim He also contended that by the admission of the claim by the Claims Officer the act of State was over and that any further consideration of the report had to comply with the rules of natural justice laid down by this Court in the cases cited by him
What is an act of State and when it ceases to apply between a new Sovereign and the subjects of a State 1  3  2 4 1959 SUPP
1 SCR 319
212 conquered acquired or ceded to the new Sovereign has been the subject of several decisions of this Court
In Ms Dalmia Dadri Cement Co Ltd vs The Commissioner of Income tax 1 and The State of Saurashtra vs Memon Haji Ismail Haji 2 it has been held that unless the new Sovereign either expressly or impliedly admits the claim
 the municipal courts have no jurisdiction in the matter
The question to consider is whether such a stage had been reached in the enquiry which had been commenced
No doubt the plea that this was a part of an act of State was not specifically raised before the High Court but as pointed out by the Judicial Committee  in Vale Singh Ji Joravar Singh vs Secretary of State for India 3 no plea is really needed
It is clear from the Order which was made under the Extra Provincial Jurisdiction Act that claims were being asked to be entertained only for investigation and not for acceptance
It is the acceptance of the claim which would have bound the new Sovereign State and the act of State would then have come to an end
But short of an acceptance either express or implied the time for the exercise of the sovereign right to reject a claim was still open
In Vaje Singh Ji s case 3 enquiries were made by Captain Buckle and again in 1868 and the two enquiries lasted 16 years before the rejection of the claims and the rejection was still upheld as an act of State
Vaje Singh Ji s case 3 has been relied upon by this Court in the two cases referred to in the argument of Mr A V Viswanatha Sastri
It would therefore appear that the act of State could not be said to have come to an end when the Government allowed claims to be preferred or when their own Officer made his report
The Claims Officer was not a part of the municipal courts and Government cannot be said to have submitted itself to the jurisdiction of the municipal courts when it entrusted the enquiry to him
Nor can the investigation of claims be said to have conferred a civil right upon the claimants to enforce their claims against the State
In our opinion enquiry was for the benefit of the State and not 1 1959 SCR 729
2  3 1924 LR 51 IA 357
213 for conferring rights upon likely claimants
It was always open to the Government to admit any claim even though reported adversely by the Claims Officer though such a contingency might have been very remote
Equally therefore the Government had the paramount right to reject a claim which its Claims Officer considered good but on which the Government held a different opinion
In short till there was an acceptance by the Government or some officer of the Government who could be said to bind the Government the act of State was still open and in our opinion it was so exercised in this case
Mr Chatterjee contended that at least within the four corners of the Order the appellant had a right to be heard and that he did not have a proper bearing
If the Member Board of Revenue entertained some doubt about the claim being within time he might have heard the party
That this was an enquiry mainly to ascertain whether a claim should or should not be recognised is obvious enough
It was in no sense a trial of any issue between the appellant and the Government
To judge such an action with the same rigour with which a judicial enquiry or trial is judged is to convert the enquiry into a civil suit
The appellant was fully heard by the Claims Officer and the only question was whether the claim was within time
Even there the Member Board of Revenue asked the appellant to submit all documents and arguments in support of his contention that the claim was within limitation and to that extent the appellant had his say
Whether the Member Board of Revenue should have gone further and given a viva voce hearing was a matter entirely for that Officer to choose and there was nothing under the law to compel him
Though we think that such an opportunity might have been afforded to the appellant we cannot say that this was a matter which entitled him to a writ
In this view of the matter the appeals fail and are dismissed
But in the circumstances of the case there shall be no order as to costs
Appeals dismissed


Summary:
The High Court quashed the charges framed against the respondents
The charge sheet stated that accused 1 to 9 had committed offenses under section 12oB of the Indian Penal Code and section 52 of the Prevention of Corruption Act 1947 and that accused No had committed offenses under SS
51c and 5 id of the Prevention of Corruption Act and SS 463 464 Of the Indian Penal Code and accused 2 to 8 abetted all the offenses and each of the accused in addition had committed offenses under section 420 Of the Indian Penal Code
The High Court directed the Special judge to frame fresh charges inter alia on the ground that charge No 1 was an omnibus charge containing as many as 203 offenses and that it was direct violation of SS 234 235 and 239 Of the Code of Criminal Procedure
Further that the Special judge had no jurisdiction to try the offenses under section 120B read with SS
466 467 and 420 Of the Indian Penal Code because he was appointed a Special judge under the Criminal Law Amendment Act only for trying offenses under Prevention of Corruption Act
The question was whether all the accused persons could be jointly tried in respect of all these offenses
Held that when several persons had committed offenses in the course of the same transaction they could jointly be tried in respect of all those offenses under section 239 Of the Code of Criminal Procedure and the limitation placed by section 234 Of the Code could not come into operation but the charges should be suitably split up so that the accused persons would not be prejudiced in answering the charges and defending themselves
Held further there is no analogy between section 120B and section Log of the Indian Penal Code
There may be an element of abetment in a conspiracy which is an offence by itself but conspiracy is something more than abetment for which a person could separately be charged
Offenses created under SS
109 and 120B of the Indian Penal Code are quite distinct and there is no warrant for limiting the prosecution to only one element of conspiracy that is abetment when the allegation is that what a person did was something over and above that
If the alleged offenses flow out of the conspiracy the appropriate form of charge would be a specific charge in respect of each of those offenses along with the charge of conspiracy
Held further that the introduction of a large number of charges spread over a long period was a question of propriety and it should be left to the judge or the Magistrate trying the case to adopt the course which he thought to be appropriate in the facts and circumstances of the case
Held also that while a special judge appointed under section 6 of the Criminal Law Amendment Act has jurisdiction to try cases under section 5 of the Prevention of Corruption Act he can under section 73 Of the Criminal Law Amendment Act try other offenses under the Criminal Procedure Code for which the accused can be charged at the same trial
196 In re Venkataramaiah AIR 1938 Mad 130 disapproved
section Swaminatham vs State of Madras AIR 1957 SC 340 R vs Dawson 1960 1 All ER 558 and Durgadas Tulsiram Sood vs State ILR  referred to