ivil Appeal No 32 17 of 1988
From the Judgment and Order dated 30588 of the Cus toms Excise and Gold Control Appellate Tribunal New Delhi in EMisc 19487 A  EA No 136585 A  Order No 30888 A Gauri Shankar Mrs H Wahi Manoj Arora and section Rajjappa for the Appellant
Soli J Sorabjee Attorney General VC Mahajan RP Srivastava and P Parmeshwaran for the Respondent
The Judgment of the Court was delivered by KANIA J
This is an appeal preferred by the appellant assessee from a judgment of the Central Excise and Gold Control Appellate Tribunal New Delhi hereinafter re ferred to as the said Tribunal
As the controversy before us is an extremely limited one we propose to set out only the facts necessary for appreciating that controversy
The appellant is a public limited company engaged inter alia in the manufacture of paper and paper boards which were assessable under Tariff Item No 17 of the First Schedule to the hereinafter referred to as the Central Excises Act
The period with which we are concerned in this appeal is the period September 9 1979 to July 26 1983
The appellant filed several price lists in Part I and Part II in respect of the clearances of paper and 322 paper boards made by the appellant
Section 4 of the Central Excises Act prescribes the mode of valuation of excisable goods for the purposes of charging of the duty of excise
Under clause a of subsection 1 of section 4 it is provided in brief that the duty of excise is chargeable on any excisable goods with reference to value which shall subject to the other provisions of the Act be deemed to be the normal price thereof and the normal price generally speaking is the price at which such goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place or removal where the buyer is not a related person and the price is the sole consideration for the sale
In the fixation of the normal price of paper and paper boards manufactured by the appel lant for the purposes of levy of excise duty the appellant claimed several deductions
One of these deductions was described as trade discount and another as service charge discount
The trade discount was the discount paid to the purchaser in accordance with the normal practice of the trade
The appellant had engaged several dealers with a view to promote its sales
A specimen of the usual agreements entered into by the appellant with its dealers has been taken on record
The opening part of the said agreement shows that the appellant is referred to in the agreement as the company and the contracting dealer is referred to as the Indentor
We propose to refer to the dealers engaged by the appellant to promote the sales of its products as Inden tors for the sake of convenience
Clause 3 of the agree ment shows that the Indentor agreed to purchase in his own name or procure acceptable indents from third parties for paper and paper boards manufactured by the company would be of such quantities and varieties as set out in the Schedule A to the agreement
The Indentors agreed to deposit with the company a certain amount of money as security
Clause 8 of the agreement shows that the Indentors held themselves responsible for the immediate clearance of the documents relating to the supply of paper on presentation by the bankers and that all bank charges other than discounting charges would be on the consignee s account
It is common ground that in the invoices in respect of the paper and paper boards supplied and sold pursuant to the aforesaid agreement with the Indentors in most cases the name of the dealer concerned was shown as the Indentor and the names of the parties to whom the goods were to be deliv ered were shown as the purchasers but in some cases the Indentors were themselves shown as purchasers
It was urged by Dr Gauri Shankar learned counsel for the appellant that although the discount allowed to the Indentors in respect of some of the aforesaid sales might have been described as service charge 323 discount that name could not govern the real nature of the transaction and the discount was really a trade discount
It was submitted by him that this discount should have been allowed as a deduction in the determination of the normal price of the aforesaid goods for the purpose of levy of excise duty
He relied upon the decision of this Court in Union of India  Ors
vs Bombay Tyres International Pvt Ltd 1984 17 ELT 329 SC and submitted that the nomenclature given to the discount could not be regarded as decisive of the real nature of the discount
There can be no quarrel with this proposition
But it is equally well set tled that in the determination of the normal price for the purposes of levy of excise duty it is only a normal trade discount which is paid to the purchaser which can be allowed as a deduction and commission paid to selling agents for services rendered by them as agents cannot be regarded as a trade discount qualifying for deduction Coromandel Ferti lizers Limited vs Union of India and Ors 1984 17 ELT 607 SC
The correctness of this proposition was not disputed by learned counsel for the appellant but it was submitted by him that in several cases where supplies had been effected pursuant to the aforesaid agreements the Indentors were really themselves the purchasers and hence the normal trade discount paid to them should have been allowed as a deduction in the determination of the normal price for the purposes of levy of excise duty
We find from the judgment of the Tribunal and the lower authorities that there is no dispute that wherever the Indentors are shown as the purchasers in the respective invoices the trade dis count given to them has been allowed as a deduction
More over to obviate any controversy in this regard learned Attorney General who appears for the respondent fairly states that when the matter goes back to the Tribunal the respondent is agreeable that the normal trade discount may be allowed in those cases where the Indentor is also shown as the purchaser in the concerned invoice
It is however submitted by learned counsel for the appellant that although in some of the cases the Indentor might not be shown as the purchaser and the purchaser shown is the different party yet the real nature of the transaction was that the Indentor purchased the goods referred to in the said invoice and in turn sold it to a customer whose name was shown as the purchaser in the invoice for the sake of convenience so that the delivery could be directly effected to him
We are of the view that it is not open to the appellant to raise this contention at this stage
No case has ever been made out right upto the Tribunal and even before the Tribunal that in respect of any particular invoice although the name of the purchaser was other than that of the Indentor it was really the Indentor who was the purchaser and he in turn has sold the goods to the third party whose name was shown as 324 purchaser or even that the Indentor had entered into the transaction as the agent of the purchaser
If such a conten tion had been raised the factual position could have been examined and different considerations might have been ap plied
But it is certainly not open to the appellant to raise this contention at this stage in this appeal partic ularly keeping in mind that the Tribunal is the final fact finding authority
No other contention has been raised before us
In our opinion there is no merit in the appeal
There will however be one clarification that as agreed to learned Attorney General if in any case the purchaser named in the invoice is the same as the Indentor normal trade discount given to the Indentor will be allowed as a deduc tion in the determination of the normal price for the levy of excise duty subject to other relevant considerations
In the result the appeal fails and is dismissed save to the extent of the aforesaid clarification
The appellant to pay the costs of the appeal to the respondent
RSS Appeal dis missed


Summary:
The appellant along with his father and mother were the joint owners of the suit property
After the death of the appellant s mother he and his father executed an agreement dated 23rd August 1951 by which they severed their status as joint owners and agreed to hold the property as tenants in common
On 16th April 1952 the appellant s father trans ferred his undivided half share in the suit property in favour of his another son Sohrab
Thus the appellant and his brother Sohrab came to hold an equal undivided one half share each as tenants in common in respect of the said property
After Sohrab s death his widow the first respondent and his minor sons the second and third respondents sold on 16th April 1987 their undivided one half share in the property to the fourth respondent and his wife
On 18th April 1987 the appellant filed a suit under section 44 of the Transfer of Property Act against the respondents inter alia on the ground that the suit property was a dwelling house belonging to an undivided family and therefore the
fourth respondent who was a stranger to the family had no right to have joint possession or common enjoyment of the property on the basis of purchase of undivided share
The appellant also took out a notice of motion in the suit in which it was claimed that he was entitled to inter imperpetual injunction restraining respondents 1 2 and 3 from parting with possession of the suit property
He fur ther claimed that if the said relief was not granted irrepa rable loss and great prejudice will be caused to him which could not be compensated in terms of money and that the equity and balance of convenience was in his favour
The Trial Court granted interim injunction the same day but when the order was sought to be executed it was report ed that the 4th respondent had already taken possession
333 The suit and the notice of motion were resisted on the grounds that the appellant and respondents 1 2 and 3 were owners of the property in equal moity but the property was not joint family property or property belonging to an undi vided family that there had already been a partition as to the user of the property with the result that Sohrab s family were in exclusive possession of ground floor and a garage in the building and that the fourth respondent had already taken possession of that portion of the property
It was further contended that the respondents would suffer irreparable loss and great prejudice if the injunction was granted and that the balance of convenience was not in favour of the appellant
The Trial Court found that the suit property was a dwelling house belonging to an undivided family that there was no partition of the same by metes and bounds that so far as the suit property was concerned the appellant and his family and the family of respondents 1 2 and 3 were joint and undivided that the case would fail within the scope of the second paragraph of section 44 of the Transfer of Property Act and that respondent No 4 and his wife as strangers were not entitled to joint possession of the said dwelling house
Since the 4th defendant had claimed that he had already entered into possession the Court granted interim mandatory injunction to the effect that the fourth respondent his servants and agents were restrained from remaining in possession or enjoyment of the suit property
On appeal the High Court was of the view that prima facie the facts indicate that throughout the parties have lived separately that there appears to have been a sever ance in status and it is not possible to give a finding that there has been no partition between the parties that the matter requires evidence on either side as to what extent the ground floor could have ever been considered as a family dwelling house that granting of interim mandatory injunc tion will have the effect of virtually deciding the suit without a trial and that the plaintiff has not made out a prima facie case that he would suffer irreparable damage if injunction was not granted or that the balance of conven ience was in his favour
In that view the learned Single Judge allowed the appeal and set aside the order granting the injunction
Before this Court it was also contended on behalf of the appellant that the fourth respondent was fully aware of the limited and restrictive title of respondents 1 2 and 3 and the bar for joint possession provided in the second para graph of section 44 of the Transfer of Property Act and having purchased with such full knowledge he tried to over reach 334 the Court by keeping the whole transaction secret and taking possession Of the property purchased before the appellant could get legal redress from the Court
Allowing the appeal this Court HELD 1 The courts can grant interlocutory mandatory injunction in certain special circumstances
340E 2 The relief of interlocutory mandatory injunction is granted generally to preserve or restore the status quo of the last non contested status which preceded the pending controversy until the final hearing when full relief may be granted
But since the granting or non granting of such an injunction may cause great injustice or irreparable harm to one of the parties the Courts have evolved certain guide lines
343F H 3 Generally stated the guidelines are 1 The plain tiff has a strong case for trial
That is it shall be of a higher standard than a prima facie case that is normally required for a prohibitory injunction 2 It is necessary to prevent irreparable or serious injury which normally cannot be compensated in terms of money 3 The balance of convenience is in favour of the one seeking such relief
344A B Shepherd Homes Ltd vs Sandham  Evans Marcgall  Co Ltd
Bertola SA  Films Rover International Ltd  Ors
vs Cannon Film Sales Ltd  Rasul Karim  Anr
vs Pirubhai Amirbhai ILR  Champsey Bgimji  Co vs The Jamna Flour Mills Co Ltd ILR 1914 16 Born
566 M Kandaswami Chetty vs P Subramania ILR  Israil vs Shamser Rahman ILR and Nandan Pictures Ltd vs Art Pictures AIR 1956 Cal
428 referred to
4 Being essentially an equitable relief the grant or refusal of an interlocutory mandatory injunction shall ultimately rest in the sound judicial discretion of the Court to be exercised in the light of the facts and circum stances in each case
344C 5 In considering the question of interim mandatory injunction in a suit filed under section 44 of the Act the Court has also to keep in mind the restriction on the rights of the transferee to joint possession under that section
344D 335 6 In order to attract the second paragraph of section 44 of the Act the subject matter of the transfer has to be dwelling house belonging to an undivided family and the transfer is of a share in the same to a person who is not a member of the family
345A Sultan Begam and Ors
vs Debi Prasad All 324 Khirode Chandra Ghoshal  Anr
vs Saroda Prasad Mitra  Nil Kamal Bhattacharjya  Anr
vs Kamakshya Charan Bhattacharjya  Anr  Sivaramayya vs Benkata Subbamma AIR 1930 Madras 561 Bhim Singh vs Ratnakar AIR 1971 Orissa 198 and Udayanath Sahu vs Ratnakar Bej AIR 1957 Orissa 139 referred to
7 The ratio of the decisions rendered under section 4 of the Partition Act equally apply to the interpretation of the second paragraph of section 44 as the provisions are complementary to each other and the terms undivided family and dwelling house have the same meaning in both the sections
349B 8 Even if the family is divided in status in the sense that they were holding the property as tenants in common but undivided qua the property that is the property had not been divided by metes and bounds it would be within the provisions of section 44 of the Act
350D 9 In the absence of a documents evidencing partition of the suit house by metes and bounds and on the documentary evidence showing that the property is held by the appellant and his brother in equal undivided shares the plaintiff appellant has shown a prima facie case that the dwelling house belonged to an undivided family consisting of himself and his brother
Therefore the transfer by defendants 1 to 3 would come within the mischief of second paragraph of section 44 of the Act
350B C 10 Clause 6 of the agreement to sell clearly shows that the fourth respondent knew that respondents 1 to 3 had only a limited right to transfer their undivided one half share to a stranger purchaser and they comtemplated litiga tion in this regard
The said sale was itself hurriedly executed in a hush hush manner keeping the entire transac tion secret from the appellant
The purchasers were also inducted in the premises in a manner which clearly suggests that the respondents were attempting to forestall the situa tion and to gain an undue advantage in hurried and clandes tine manner defeating the appellant s attempt to go 336 to court for appropriate relief
The respondents in such circumstances cannot be permitted to take advantage of their own acts and defeat the claim of the appellant in the suit by saying that old cause of action under section 44 of the Transfer of Property Act no longer survived in view of their taking possession
11 The facts in the instant case clearly establish that not only a refusal to grant an interim mandatory in junction will do irreparable injury to the appellant but also balance of convenience is in favour of the appellant for the grant of such injunction
352F