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Sir Hukumchand & Mannalal Co Vs. Commissioner Of Income-Tax, Madhya Pradesh

the application is in order and that there is or was a firm in existence constituted as shown in the Instrument of Partnership, grant to the assessee a certificate signed and dated by him in the following form:xx xx xx xx xx Rule 6-B. In the event of the Income-tax Officer being satisfied that the certificate granted under R. 4, or under R. 6-A, has been obtained without there being a genuine firm in existence, he may cancel the certificate so granted. Section 30 (1). Any assessee ............ objecting to the cancellation by an Income-tax Officer of the registration of a firm under sub-section (4) of S. 23 or to a refusal to register a firm under sub-section (4) of S. 23 or S. 26-A ....... may appeal to the Appellate Assistant Commissioner against the assessment or against such refusal or order." The gist of the said provisions relevant to the present enquiry may be stated thus: Under S. 26-A of the Act an application may be made to the Income-tax Officer on behalf of a firm for registration for the purposes of the Act. Such an application has to be filed and disposed of in the manner prescribed in the Act. Under the Rules, an application for the renewal of registration of a firm which has already been registered in the previous years has to be filed before the Income-tax Officer. That application will be disposed of in the manner prescribed by Rr. 6-A and 6-B. Under those rules, the Income-tax Officer is authorised to make three kinds of orders, viz., (i) he can refuse to renew the registration of the firm; (ii) he can register the firm; and (iii) he can cancel the renewal of registration if he is satisfied that the renewal has been obtained without there being a genuine firm in existence. The crucial point to be noticed is that the said three kinds of orders, having regard to the circumstances of each case, will be made only in the application for renewed registration. The Rules do not provide for independent proceedings for the cancellation of the renewal certificate. In effect, the Income-tax Officer, after setting aside his earlier wrong order made under a misapprehension, refuses renewal of the certificate of registration. If so, it follows that the order cancelling registration is nothing more than refusing to renew the certificate of registration. If that be the construction of an order made cancelling the certificate renewed, such an order directly attracts the appellate jurisdiction conferred on the Appellate Assistant Commissioner under S. 30 of the Act. 4. But Mr. Viswanathan Sastry for the Revenue contended that there was internal evidence in S. 30 of the Act itself to show that such a construction was not possible. He further argued that under the Income-tax Law there was no scope for equitable considerations, and under the express provisions of S. 30 no appeal lay against the order of the Income-tax Officer cancelling the certificate of registration. In support of his contention he relied upon that part of S. 30 of the Act which we have extracted earlier and contended that when the Legislature in the context of the orders made under S. 23 (4) spoke separately of the order of registration of a firm and an order refusing to register a firm and in the same Section, in the context of S. 26-A, it mentioned only refusal to register a firm, it clearly expressed its mind that in the former case an appeal would lie against both the orders, whereas in the latter case an appeal would lie only against one of the orders. There is some force in this argument. But a careful reading of the provisions of S. 23 (4) and S. 6-A brings out the difference in the phraseology used in S. 30 in the matter of appeals against orders made under the said two Sections. The relevant parts of S. 23 (4) and S. 26-A (2) may be placed in juxtaposition:Section 23 (4)Section 26-A (2) ... the income-tax Officer... in the case of a firm, may refuse to register it or may cancel its registration if it is already registered The .... application shall be ... dealt with by the Income-tax Officer in such manner as may be prescribed." .............................. A comparative study of the relevant parts of these two provisions at once shows the distinction between the two. Under S. 23 (4) while the Income-tax Officer can make an order refusing to register a firm or may cancel the registration if it is already registered, under S. 26-A(2) he can only make an order in such manner as may be prescribed. The manner prescribed, as we have already indicated earlier, provides for three different kinds of orders to be made in the same application with the result that an order of refusal to renew a certificate and the order cancelling the certificate renewed are given the same effect, namely, refusal of the application to register. That apart, when S. 30 provides for an appeal against the orders under S. 23 (4) and also against orders under S. 26-A, it has incorporated the two forms of orders embodied in S. 23 (4) and used a general word in providing an appeal against an order under S. 26-A, for the nature of order is not described but left to be prescribed under the Rules. 5. If so, it follows that the words "refusal to register a firm" in S. 30 of the Act are wide enough to take in the orders made under Rr. 6-A and 6-B refusing to renew the registration and also cancelling the certificate so renewed. 6. By so holding we are not unaware that enquiry has no place in construing the provisions of the Income-tax Act. Indeed, we have not introduced any equitable consideration in the matter of construction. We have come to the conclusion on a fair reading of the relevant provisions of the Act and the Rules made thereunder. 7.

1[ds]There is some force in this argument. But a careful reading of the provisions of S. 23 (4) and S.A brings out the difference in the phraseology used in S. 30 in the matter of appeals against orders made under the said two Sections. The relevant parts of S. 23 (4) and S.A (2) may be placed in juxtaposition:Section 23 (4)Section... thex Officer... in the case of a firm, may refuse to register it or may cancel its registration if it is already registered The .... application shall be ... dealt with by theA comparative study of the relevant parts of these two provisions at once shows the distinction between the two. Under S. 23 (4) while thex Officer can make an order refusing to register a firm or may cancel the registration if it is already registered, under S.) he can only make an order in such manner as may be prescribed. The manner prescribed, as we have already indicated earlier, provides for three different kinds of orders to be made in the same application with the result that an order of refusal to renew a certificate and the order cancelling the certificate renewed are given the same effect, namely, refusal of the application to register. That apart, when S. 30 provides for an appeal against the orders under S. 23 (4) and also against orders under S., it has incorporated the two forms of orders embodied in S. 23 (4) and used a general word in providing an appeal against an order under S., for the nature of order is not described but left to be prescribed under the Rules5. If so, it follows that the words "refusal to register a firm" in S. 30 of the Act are wide enough to take in the orders made under Rr.A andB refusing to renew the registration and also cancelling the certificate so renewed6. By so holding we are not unaware that enquiry has no place in construing the provisions of thex Act. Indeed, we have not introduced any equitable consideration in the matter of construction. We have come to the conclusion on a fair reading of the relevant provisions of the Act and the Rules made thereunder.

### Instruction: From the information provided in the case proceeding, infer whether the court's decision will be positive (1) or negative (0) for the appellant. ### Input: the application is in order and that there is or was a firm in existence constituted as shown in the Instrument of Partnership, grant to the assessee a certificate signed and dated by him in the following form:xx xx xx xx xx Rule 6-B. In the event of the Income-tax Officer being satisfied that the certificate granted under R. 4, or under R. 6-A, has been obtained without there being a genuine firm in existence, he may cancel the certificate so granted. Section 30 (1). Any assessee ............ objecting to the cancellation by an Income-tax Officer of the registration of a firm under sub-section (4) of S. 23 or to a refusal to register a firm under sub-section (4) of S. 23 or S. 26-A ....... may appeal to the Appellate Assistant Commissioner against the assessment or against such refusal or order." The gist of the said provisions relevant to the present enquiry may be stated thus: Under S. 26-A of the Act an application may be made to the Income-tax Officer on behalf of a firm for registration for the purposes of the Act. Such an application has to be filed and disposed of in the manner prescribed in the Act. Under the Rules, an application for the renewal of registration of a firm which has already been registered in the previous years has to be filed before the Income-tax Officer. That application will be disposed of in the manner prescribed by Rr. 6-A and 6-B. Under those rules, the Income-tax Officer is authorised to make three kinds of orders, viz., (i) he can refuse to renew the registration of the firm; (ii) he can register the firm; and (iii) he can cancel the renewal of registration if he is satisfied that the renewal has been obtained without there being a genuine firm in existence. The crucial point to be noticed is that the said three kinds of orders, having regard to the circumstances of each case, will be made only in the application for renewed registration. The Rules do not provide for independent proceedings for the cancellation of the renewal certificate. In effect, the Income-tax Officer, after setting aside his earlier wrong order made under a misapprehension, refuses renewal of the certificate of registration. If so, it follows that the order cancelling registration is nothing more than refusing to renew the certificate of registration. If that be the construction of an order made cancelling the certificate renewed, such an order directly attracts the appellate jurisdiction conferred on the Appellate Assistant Commissioner under S. 30 of the Act. 4. But Mr. Viswanathan Sastry for the Revenue contended that there was internal evidence in S. 30 of the Act itself to show that such a construction was not possible. He further argued that under the Income-tax Law there was no scope for equitable considerations, and under the express provisions of S. 30 no appeal lay against the order of the Income-tax Officer cancelling the certificate of registration. In support of his contention he relied upon that part of S. 30 of the Act which we have extracted earlier and contended that when the Legislature in the context of the orders made under S. 23 (4) spoke separately of the order of registration of a firm and an order refusing to register a firm and in the same Section, in the context of S. 26-A, it mentioned only refusal to register a firm, it clearly expressed its mind that in the former case an appeal would lie against both the orders, whereas in the latter case an appeal would lie only against one of the orders. There is some force in this argument. But a careful reading of the provisions of S. 23 (4) and S. 6-A brings out the difference in the phraseology used in S. 30 in the matter of appeals against orders made under the said two Sections. The relevant parts of S. 23 (4) and S. 26-A (2) may be placed in juxtaposition:Section 23 (4)Section 26-A (2) ... the income-tax Officer... in the case of a firm, may refuse to register it or may cancel its registration if it is already registered The .... application shall be ... dealt with by the Income-tax Officer in such manner as may be prescribed." .............................. A comparative study of the relevant parts of these two provisions at once shows the distinction between the two. Under S. 23 (4) while the Income-tax Officer can make an order refusing to register a firm or may cancel the registration if it is already registered, under S. 26-A(2) he can only make an order in such manner as may be prescribed. The manner prescribed, as we have already indicated earlier, provides for three different kinds of orders to be made in the same application with the result that an order of refusal to renew a certificate and the order cancelling the certificate renewed are given the same effect, namely, refusal of the application to register. That apart, when S. 30 provides for an appeal against the orders under S. 23 (4) and also against orders under S. 26-A, it has incorporated the two forms of orders embodied in S. 23 (4) and used a general word in providing an appeal against an order under S. 26-A, for the nature of order is not described but left to be prescribed under the Rules. 5. If so, it follows that the words "refusal to register a firm" in S. 30 of the Act are wide enough to take in the orders made under Rr. 6-A and 6-B refusing to renew the registration and also cancelling the certificate so renewed. 6. By so holding we are not unaware that enquiry has no place in construing the provisions of the Income-tax Act. Indeed, we have not introduced any equitable consideration in the matter of construction. We have come to the conclusion on a fair reading of the relevant provisions of the Act and the Rules made thereunder. 7. ### Response: 1

Bimal Chandra Ranerjee Vs. State Of Madhya Pradesh

transported, or(d) manufactured, cultivated or collected under any licence granted under S. 13; or(e) manufactured in any distillery established, or any distillery or brewery licensed under this ActProvided that it shall be lawful for the State Government to exempt any excisable article from any duty to which the same may be liable under this Act.(2) Duty may be imposed under sub-section (1) at different rates according to the places to which any excisable article is to be removed or according to the strength and quality of such article.(3) Notwithstanding anything contained in sub-section (1) duty shall not be imposed thereunder on any article which has been imported into India and was liable, on such importation, to duty under the Sea Customs Act, VIII of 1878 or the Indian Tariff Act, VIII of 1894."13. Under this section excise duty or countervailing duty can be imposed on excisable articles when they are either imported or exported or transported or manufactured or cultivated or collected and not otherwise.14. Section 26 deals with the manner of levying the duty. It says:"Subject to such rules regulating the time, place and manner as the State Government may prescribe, such duty shall be levied rateably on the quantity of excisable articles imported, exported, transported, collected or manufactured in or issued from a distillery, brewery or warehouse.Provided that:(1) duty may be levied-(a) on intoxicating drugs by an acreage rate levied on the cultivation of the hemp plant or by a rate charged on the quantity collected;(b) on spirit or beer manufactured in any distillery established or any distillery or brewery licensed under this Act -(i) in accordance with such scale of equivalents calculated on the quantity of materials used, or by the degree of attenuation of the wash or wort, as the case may be, as the State Government may prescribe, or(ii) by rate charged directly on the materials used(c) on tari, by a tax on each tree from which the tari is drawn.(2) Where payment is made upon the issue of an excisable article for sale from a warehouse, it shall be at the rate of duty in force on the date of issue of such article from the warehouse."Section 27 says:"Payment for grant of leases: Instead of or in addition to any duty leviable under this chapter, the State Government may accept payment of a sum in consideration of the grant of any lease under section 18."15. Section 18 deals with the power to grant lease of right to manufacture or right to sell excisable articles.16. The only other relevant section for our present purpose is Section 62 which confers power on the State Government to make rules. Clause (1) of that section says:"The State Government may make rules for the purpose of carrying out the provisions of this Act."In Clause 2 reliance was placed on sub-cls. (d) and (h). Those sub-clauses read:"In particular, and without prejudice to the generality of the foregoing provision, the State Government may make rules. . .xx xx xx(d) regulating the import, export, transport, manufacture, collection, possession, supply or storage of any intoxicant, or the cultivation of the hemp plant and may, by such rules, among other matters-(i) regulate the tapping of tari producing trees, the drawing of tari from such trees, the marking of the same and the maintenance of such marks;(ii) declare the process by which spirit shall be denatured and the denaturation of spirit ascertained, and(iii) cause spirit to be denatured through the agency or under the supervision of its own officers;(d-l) regulating the import, export, transport, collection, possession, supply, storage or sale of Mahua flowers prescribing licences and permits therefor, throughout the State or in any specified area or for any specified period."x x x(h) prescribing the authority by the form in which and the terms and conditions on and subject to which any licence, permit or pass shall be granted, and may by such rules among other matters -(i) fix the period for which any licence, permit or pass shall continue in force(ii) prescribe, the scale of fees or the manner of fixing the fees payable in respect of any such license, permit or pass,(iii) prescribe the amount of security to be deposited by holders of any licence, permit or pass-for the performance of the conditions of the same;(iv) prescribe the account to be maintained and the returns to be submitted by licence holders, and(v) prohibit or regulate the partnership in or the transfer of, licences."17. Neither S. 25 or S. 26 or S. 27 or S. 62 (1) or cls. (d) and (h) of S. 62 (2) empower the rule-making authority viz. the State Government to levy tax on excisable articles which have not been either imported. exported, transported, manufactured, cultivated or collected under any licence granted under S. 13 or manufactured in any distillery established or any distillery or brewery licensed under the Act. The legislature has levied excise duty only on those articles which come within the scope of S. 25.The rule-making authority has not been conferred with any power to levy duty on any articles which do not fall within the scope of S. 25. Therefore it is not necessary to consider whether any such power can be conferred on that authority. Quite clearly the State Government purported to levy duty on liquor which the contractors failed to lift. In so doing it was attempting to exercise a power which it did not possess.18. No tax can be imposed by any bye-law or rule or regulation unless the statute under which the subordinate legislation is made specially authorises the imposition even if it is assumed that the power to tax. can be delegated to the executive. The basis of the statutory power conferred by the statute cannot he transgressed by the rule-making authority. A rulemaking authority has no plenary power. It has to act within the limits of the power granted to it.19. We are of the opinion that the impugned rule as well as the demands are not authorised by law.

1[ds]17. Neither S. 25 or S. 26 or S. 27 or S. 62 (1) or cls. (d) and (h) of S. 62 (2) empower the rule-making authority viz. the State Government to levy tax on excisable articles which have not been either imported. exported, transported, manufactured, cultivated or collected under any licence granted under S. 13 or manufactured in any distillery established or any distillery or brewery licensed under the Act. The legislature has levied excise duty only on those articles which come within the scope of S. 25.The rule-making authority has not been conferred with any power to levy duty on any articles which do not fall within the scope of S. 25. Therefore it is not necessary to consider whether any such power can be conferred on that authority. Quite clearly the State Government purported to levy duty on liquor which the contractors failed to lift. In so doing it was attempting to exercise a power which it did not possess.18. No tax can be imposed by any bye-law or rule or regulation unless the statute under which the subordinate legislation is made specially authorises the imposition even if it is assumed that the power to tax. can be delegated to the executive. The basis of the statutory power conferred by the statute cannot he transgressed by the rule-making authority. A rulemaking authority has no plenary power. It has to act within the limits of the power granted to it.19. We are of the opinion that the impugned rule as well as the demands are not authorised by law.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: transported, or(d) manufactured, cultivated or collected under any licence granted under S. 13; or(e) manufactured in any distillery established, or any distillery or brewery licensed under this ActProvided that it shall be lawful for the State Government to exempt any excisable article from any duty to which the same may be liable under this Act.(2) Duty may be imposed under sub-section (1) at different rates according to the places to which any excisable article is to be removed or according to the strength and quality of such article.(3) Notwithstanding anything contained in sub-section (1) duty shall not be imposed thereunder on any article which has been imported into India and was liable, on such importation, to duty under the Sea Customs Act, VIII of 1878 or the Indian Tariff Act, VIII of 1894."13. Under this section excise duty or countervailing duty can be imposed on excisable articles when they are either imported or exported or transported or manufactured or cultivated or collected and not otherwise.14. Section 26 deals with the manner of levying the duty. It says:"Subject to such rules regulating the time, place and manner as the State Government may prescribe, such duty shall be levied rateably on the quantity of excisable articles imported, exported, transported, collected or manufactured in or issued from a distillery, brewery or warehouse.Provided that:(1) duty may be levied-(a) on intoxicating drugs by an acreage rate levied on the cultivation of the hemp plant or by a rate charged on the quantity collected;(b) on spirit or beer manufactured in any distillery established or any distillery or brewery licensed under this Act -(i) in accordance with such scale of equivalents calculated on the quantity of materials used, or by the degree of attenuation of the wash or wort, as the case may be, as the State Government may prescribe, or(ii) by rate charged directly on the materials used(c) on tari, by a tax on each tree from which the tari is drawn.(2) Where payment is made upon the issue of an excisable article for sale from a warehouse, it shall be at the rate of duty in force on the date of issue of such article from the warehouse."Section 27 says:"Payment for grant of leases: Instead of or in addition to any duty leviable under this chapter, the State Government may accept payment of a sum in consideration of the grant of any lease under section 18."15. Section 18 deals with the power to grant lease of right to manufacture or right to sell excisable articles.16. The only other relevant section for our present purpose is Section 62 which confers power on the State Government to make rules. Clause (1) of that section says:"The State Government may make rules for the purpose of carrying out the provisions of this Act."In Clause 2 reliance was placed on sub-cls. (d) and (h). Those sub-clauses read:"In particular, and without prejudice to the generality of the foregoing provision, the State Government may make rules. . .xx xx xx(d) regulating the import, export, transport, manufacture, collection, possession, supply or storage of any intoxicant, or the cultivation of the hemp plant and may, by such rules, among other matters-(i) regulate the tapping of tari producing trees, the drawing of tari from such trees, the marking of the same and the maintenance of such marks;(ii) declare the process by which spirit shall be denatured and the denaturation of spirit ascertained, and(iii) cause spirit to be denatured through the agency or under the supervision of its own officers;(d-l) regulating the import, export, transport, collection, possession, supply, storage or sale of Mahua flowers prescribing licences and permits therefor, throughout the State or in any specified area or for any specified period."x x x(h) prescribing the authority by the form in which and the terms and conditions on and subject to which any licence, permit or pass shall be granted, and may by such rules among other matters -(i) fix the period for which any licence, permit or pass shall continue in force(ii) prescribe, the scale of fees or the manner of fixing the fees payable in respect of any such license, permit or pass,(iii) prescribe the amount of security to be deposited by holders of any licence, permit or pass-for the performance of the conditions of the same;(iv) prescribe the account to be maintained and the returns to be submitted by licence holders, and(v) prohibit or regulate the partnership in or the transfer of, licences."17. Neither S. 25 or S. 26 or S. 27 or S. 62 (1) or cls. (d) and (h) of S. 62 (2) empower the rule-making authority viz. the State Government to levy tax on excisable articles which have not been either imported. exported, transported, manufactured, cultivated or collected under any licence granted under S. 13 or manufactured in any distillery established or any distillery or brewery licensed under the Act. The legislature has levied excise duty only on those articles which come within the scope of S. 25.The rule-making authority has not been conferred with any power to levy duty on any articles which do not fall within the scope of S. 25. Therefore it is not necessary to consider whether any such power can be conferred on that authority. Quite clearly the State Government purported to levy duty on liquor which the contractors failed to lift. In so doing it was attempting to exercise a power which it did not possess.18. No tax can be imposed by any bye-law or rule or regulation unless the statute under which the subordinate legislation is made specially authorises the imposition even if it is assumed that the power to tax. can be delegated to the executive. The basis of the statutory power conferred by the statute cannot he transgressed by the rule-making authority. A rulemaking authority has no plenary power. It has to act within the limits of the power granted to it.19. We are of the opinion that the impugned rule as well as the demands are not authorised by law. ### Response: 1

AJITH K Vs. ANEESH K.S

12. On a careful analysis, it emerges that none of the conditions stipulated in Rule 10(a)(ii) have been fulfilled. The first situation contemplated by Rule 10(a)(ii) is where qualifications are recognized by executive orders or standing orders of the government as equivalent to a qualification specified for a post. This is not satisfied. With reference to the second situation contemplated in Rule 10(a)(ii) there was no determination by KPSC in accordance with Rule 13(b)(i) of the equivalence of the qualifications. Finally, the last condition contemplated in Rule 10(a)(ii) adverts to those qualifications which pre-suppose the acquisition of a lower qualification prescribed for a post. The expression pre-suppose means subsumed in. All that we find from the report of the three-member Committee are general observations about the duration of the DHIC being longer, of a similarity of the topics in the syllabi and a comparison between the number of theory and practical sessions. There has been no finding that the acquisition of the DHIC pre-supposes the completion of the certificate course. 13. The decision in Jyoti K K concerned a situation where KPSC invited applications for selection for the post of Sub-Engineers (Electrical) in the Kerala State Electricity Board . The technical qualifications prescribed were as follows: 2. Technical qualifications— (a) Diploma in Electrical Engineering of a recognised institution after 3 years course of study, OR (b) a certificate in Electrical Engineering from any one of the recognised technical schools shown below with five years service under the Kerala State Electricity Board, [Not fully extracted as not relevant] OR (c) MGTE/KGTE in electrical light and power (higher) with five years experience as IInd Grade Overseer (Electrical) under the Board. The appellants were B.Tech degree holders or Bachelors degree holders in electrical engineering. KPSC held that they were not eligible for selection. The candidates contended that they were persons possessing higher qualifications and hence could not be excluded. This Court interpreted the provisions in Rule 10(a)(i) and held: 7. It is no doubt true, as stated by the High Court that when a qualification has been set out under the relevant Rules, the same cannot be in any manner whittled down and a different qualification cannot be adopted. The High Court is also justified in stating that the higher qualification must clearly indicate or presuppose the acquisition of the lower qualification prescribed for that post in order to attract that part of the Rule to the effect that such of those higher qualifications which presuppose the acquisition of the lower qualifications prescribed for the post shall also be sufficient for the post. If a person has acquired higher qualifications in the same Faculty, such qualifications can certainly be stated to presuppose the acquisition of the lower qualifications prescribed for the post. In this case it may not be necessary to seek far. 8. Under the relevant Rules, for the post of Assistant Engineer, degree in Electrical Engineering of Kerala University or other equivalent qualification recognised or equivalent thereto has been prescribed. For a higher post when a direct recruitment has to be held, the qualification that has to be obtained, obviously gives an indication that such qualification is definitely higher qualification than what is prescribed for the lower post, namely, the post of SubEngineer. In that view of the matter the qualification of degree in Electrical Engineering presupposes the acquisition of the lower qualification of diploma in that subject prescribed for the post, shall be considered to be sufficient for that post. 14. The above extract indicates that the qualification for the promotional post of assistant engineer was a degree in engineering. Consequently, the acquisition of the degree was held to pre-suppose the acquisition of the =lower qualification of the diploma prescribed for the post of sub-engineer. This constitutes a distinguishing factor and hence the decision in Jyoti K K does not apply to the present facts. The decision in Jyoti K K was subsequently distinguished in State of Punjab v Anita (2015) 2 SCC 170 , as noted by this Court in a more recent decision in Zahoor Ahmad Rather v Sheikh Imtiyaz Ahmad (2019) 2 SCC 404. (See also in this context, the decision of the two judge Bench in P M Latha v State of Kerala (2003) 3 SCC 541.) 15. The Principal Secretary to the State Government (EU) in a communication dated 7 July 2017 to KPSC stated: Though, diploma in Health Inspector course having a duration of 2 years is not included in the qualifications required as per the notification for Junior Health Inspector, Grade II in Municipal Common Service, the PSC has included those candidates having qualifications in diploma in Health Inspectors Course shortlist of the said post by taking the same as an additional qualification to the rest of qualifications... Since in the circumstances that the report submitted by the Director of Health Department after conducting comparison study of syllabus of both the course, the diploma in Health Inspectors course is a higher qualification above the qualification prescribed under the concerned special rule and that diploma in Health Inspector course is accepted as a qualification to the post of Junior Health Inspector in the Health Department, the diploma in Health Inspectors Course can be accepted and reckoned as a higher qualification compared to the qualification prescribed to the post of Junior Health Inspector Grade II in Municipal Common Service. (Emphasis supplied) 16. The reference to the diploma being an additional qualification is extraneous to Rule 10(a)(ii). The reference to a diploma being acceptable in the Health Department is again an extraneous consideration. Ex facie, it is evident that in coming to the conclusion extracted above, there was no application of mind to the requirements contained in Rule 10(a)(ii). There was no determination of equivalence by any executive order or standing order of the State Government. Nor was there any finding that a DHIC pre-supposes the acquisition of the lower qualification. KPSC has not carried out any exercise as required by the provisions of the rule.

0[ds]11. The starting point of our enquiry in the present case is the order of the State Government dated 16 August 1972, published in the Kerala Gazette on 29 August 1972. It specifies the minimum qualifications required for the post of Health Inspector/ Food Inspector Grade-II. The qualification prescribed is a Sanitary Inspectors Certificate originating in specified institutions. The DHIC is admittedly not one of the specified qualifications for the post12. On a careful analysis, it emerges that none of the conditions stipulated in Rule 10(a)(ii) have been fulfilled. The first situation contemplated by Rule 10(a)(ii) is where qualifications are recognized by executive orders or standing orders of the government as equivalent to a qualification specified for a post. This is not satisfied. With reference to the second situation contemplated in Rule 10(a)(ii) there was no determination by KPSC in accordance with Rule 13(b)(i) of the equivalence of the qualifications. Finally, the last condition contemplated in Rule 10(a)(ii) adverts to those qualifications which pre-suppose the acquisition of a lower qualification prescribed for a post. The expression pre-suppose means subsumed in. All that wefind from the report of the three-member Committee are general observations about the duration of the DHIC being longer, of a similarity of the topics in the syllabi and a comparison between the number of theory and practical sessions. There has been no finding that the acquisition of the DHIC pre-supposes the completion of the certificate course.14. The above extract indicates that the qualification for the promotional post of assistant engineer was a degree in engineering. Consequently, the acquisition of the degree was held to pre-suppose the acquisition of the =lower qualification of the diploma prescribed for the post of sub-engineer. This constitutes a distinguishing factor and hence the decision in Jyoti K K does not apply to the present facts16. The reference to the diploma being an additional qualification is extraneous to Rule 10(a)(ii). The reference to a diploma being acceptable in the Health Department is again an extraneous consideration. Ex facie, it is evident that in coming to the conclusion extracted above, there was no application of mind to the requirements contained in Rule 10(a)(ii). There was no determination of equivalence by any executive order or standing order of the State Government. Nor was there any finding that a DHIC pre-supposes the acquisition of the lower qualification. KPSC has not carried out any exercise as required by the provisions of the rule.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: 12. On a careful analysis, it emerges that none of the conditions stipulated in Rule 10(a)(ii) have been fulfilled. The first situation contemplated by Rule 10(a)(ii) is where qualifications are recognized by executive orders or standing orders of the government as equivalent to a qualification specified for a post. This is not satisfied. With reference to the second situation contemplated in Rule 10(a)(ii) there was no determination by KPSC in accordance with Rule 13(b)(i) of the equivalence of the qualifications. Finally, the last condition contemplated in Rule 10(a)(ii) adverts to those qualifications which pre-suppose the acquisition of a lower qualification prescribed for a post. The expression pre-suppose means subsumed in. All that we find from the report of the three-member Committee are general observations about the duration of the DHIC being longer, of a similarity of the topics in the syllabi and a comparison between the number of theory and practical sessions. There has been no finding that the acquisition of the DHIC pre-supposes the completion of the certificate course. 13. The decision in Jyoti K K concerned a situation where KPSC invited applications for selection for the post of Sub-Engineers (Electrical) in the Kerala State Electricity Board . The technical qualifications prescribed were as follows: 2. Technical qualifications— (a) Diploma in Electrical Engineering of a recognised institution after 3 years course of study, OR (b) a certificate in Electrical Engineering from any one of the recognised technical schools shown below with five years service under the Kerala State Electricity Board, [Not fully extracted as not relevant] OR (c) MGTE/KGTE in electrical light and power (higher) with five years experience as IInd Grade Overseer (Electrical) under the Board. The appellants were B.Tech degree holders or Bachelors degree holders in electrical engineering. KPSC held that they were not eligible for selection. The candidates contended that they were persons possessing higher qualifications and hence could not be excluded. This Court interpreted the provisions in Rule 10(a)(i) and held: 7. It is no doubt true, as stated by the High Court that when a qualification has been set out under the relevant Rules, the same cannot be in any manner whittled down and a different qualification cannot be adopted. The High Court is also justified in stating that the higher qualification must clearly indicate or presuppose the acquisition of the lower qualification prescribed for that post in order to attract that part of the Rule to the effect that such of those higher qualifications which presuppose the acquisition of the lower qualifications prescribed for the post shall also be sufficient for the post. If a person has acquired higher qualifications in the same Faculty, such qualifications can certainly be stated to presuppose the acquisition of the lower qualifications prescribed for the post. In this case it may not be necessary to seek far. 8. Under the relevant Rules, for the post of Assistant Engineer, degree in Electrical Engineering of Kerala University or other equivalent qualification recognised or equivalent thereto has been prescribed. For a higher post when a direct recruitment has to be held, the qualification that has to be obtained, obviously gives an indication that such qualification is definitely higher qualification than what is prescribed for the lower post, namely, the post of SubEngineer. In that view of the matter the qualification of degree in Electrical Engineering presupposes the acquisition of the lower qualification of diploma in that subject prescribed for the post, shall be considered to be sufficient for that post. 14. The above extract indicates that the qualification for the promotional post of assistant engineer was a degree in engineering. Consequently, the acquisition of the degree was held to pre-suppose the acquisition of the =lower qualification of the diploma prescribed for the post of sub-engineer. This constitutes a distinguishing factor and hence the decision in Jyoti K K does not apply to the present facts. The decision in Jyoti K K was subsequently distinguished in State of Punjab v Anita (2015) 2 SCC 170 , as noted by this Court in a more recent decision in Zahoor Ahmad Rather v Sheikh Imtiyaz Ahmad (2019) 2 SCC 404. (See also in this context, the decision of the two judge Bench in P M Latha v State of Kerala (2003) 3 SCC 541.) 15. The Principal Secretary to the State Government (EU) in a communication dated 7 July 2017 to KPSC stated: Though, diploma in Health Inspector course having a duration of 2 years is not included in the qualifications required as per the notification for Junior Health Inspector, Grade II in Municipal Common Service, the PSC has included those candidates having qualifications in diploma in Health Inspectors Course shortlist of the said post by taking the same as an additional qualification to the rest of qualifications... Since in the circumstances that the report submitted by the Director of Health Department after conducting comparison study of syllabus of both the course, the diploma in Health Inspectors course is a higher qualification above the qualification prescribed under the concerned special rule and that diploma in Health Inspector course is accepted as a qualification to the post of Junior Health Inspector in the Health Department, the diploma in Health Inspectors Course can be accepted and reckoned as a higher qualification compared to the qualification prescribed to the post of Junior Health Inspector Grade II in Municipal Common Service. (Emphasis supplied) 16. The reference to the diploma being an additional qualification is extraneous to Rule 10(a)(ii). The reference to a diploma being acceptable in the Health Department is again an extraneous consideration. Ex facie, it is evident that in coming to the conclusion extracted above, there was no application of mind to the requirements contained in Rule 10(a)(ii). There was no determination of equivalence by any executive order or standing order of the State Government. Nor was there any finding that a DHIC pre-supposes the acquisition of the lower qualification. KPSC has not carried out any exercise as required by the provisions of the rule. ### Response: 0

Haryana Wakf Board Vs. State of Haryana & Others

learned Single Judge, it must be said, with great respect to him, is based on misconstruction of the provisions of sub-sections (2) and (3) of Section 18 of the Tenures Act. The value of the land envisages under sub-section (2) is not the market value of the land but the value of the land which should be the average price of land in the neighbourhood during 10 years preceding the date of making of the application by the tenant for purchase of land. What sub-section (3) says, is that the purchase price of the tenanted land must be three-fourths of the value of the land determined under sub-section (2), which means that the value of the tenanted land could only be three-fourths of the average value of the neighbouring land during ten years preceding the date of making of the application by the tenant for purchase. Here is a statutory measure required to be adopted to find out the purchase price of tenanted land and not the supposed market value of that land as on the date of making of the application for purchase. If that be so, we are unable to understand how the market value of the land which will be far different from the statutory value of the land could be regarded as the same, as has been done by the learned Single Judge. Hence, the contention raised on behalf of the appellant that the landowner would be entitled to three-fourths of the market value of the land becomes unsustainable. If we have regard to the provisions under sub-sections (2) and (3) of Section 18 of the Tenures Act, rightly adverted to by the learned Single Judge, the amount of compensation to which a landowner becomes entitled can only be the purchase price which he would be entitled under the said provisions for his land, which the tenant had a right to purchase thereunder. If the purchase in favour of the tenant was over, as indicated in sub-section (5) (sic) of Section 18, the purchase price, it must be kept in mind, could have been recovered by the landowner as arrears of revenue. Therefore, in our view, the tenant could have been entitled to get out of the component of compensation awardable as market value in answer item (I) referred to above and the solatium and interest payable thereon, only that amount of compensation which could be equivalent to the purchase price liable to be paid by the tenant to the landowner under Section 18 of the Tenures Act and nothing more or less. Hence, our answer to the question under consideration is, that if a tenanted land which its tenant was entitled to purchase under Section 18 of the Tenures Act did vest in the State by reason of its acquisition under the L.A. Act before he became its deemed owner as envisaged under sub-section (4) of Section 18 of the Tenures Act, the landowner of that tenanted land could have made a claim for compensation awardable therefor under the L.A. Act and his entitlement out of the said compensation could only be that falling in the component of compensation in item (i), the market value of that land together with solatium and interest, however, limited to the amount of purchase price which he was entitled to get for the land answered under Section 18 of the Tenures Act and nothing more or less."This Court in the aforesaid dictum has come to the eventual answer to the question raised for its consideration, that in such case the tenants should have been paid the compensation in its entirety as he had right to purchase property in accordance with provisions of the Tenancy Act, 1953. That is not the situation in the instant case available as per the provisions contained in the Wakf Act. 14. Thus, this Court in Mangat Ram (supra) relied upon the aforesaid two decisions in Inder Parshad (supra) and Harvinder Singh Brar (supra) which did not deal with nor laid down the law with respect to the rights of tenants for apportionment of compensation, who were not having any title or right of tenancy for exceeding a period of three years and such leases being void under aforesaid provisions of the Wakf Act. They will be deemed to be trespassers. This aspect was not raised for consideration nor decided in Mangat Ram (supra) or in relied upon cases. The ratios of relied upon cases was totally different and could not form the foundation for apportionment of compensation in Mangat Ram (supra). Thus, it could not be an authority on the said issue. Such person could at the most be granted 10% of the amount considering the long possession and for displacement. 15. We clarify that we are not holding that this ratio shall apply to other cases. But it will depend upon the facts and circumstances of each case and nature of rights. In any view of the matter, such tenants under void arrangement could not have been granted 3/4th compensation. 16. In the instant case, the possession has already been taken by the acquiring body and compensation has already been disbursed to the lessees. It is stated that they are poor persons and they were holding the said land as the only source of livelihood and by now have spent the amount paid to them, though undertaking was given to the Wakf Board to refund the amount. But as the amount has already been spent, the lessees being poor persons it would be difficult to them to refund the amount, in exercise of powers under Article 142 of the Constitution it is directed that there shall be no recovery of the amount paid to them under order of the High Court as that was based upon the decision of Mangat Ram (supra) which we have clarified in the present case. Thus, it is made clear that no recovery shall be made of the amount on the basis of the conclusion recorded by us.

1[ds]8. Having heard learned counsel for the parties, in our opinion, a person in settled possession can be disbursed some compensation on account of displacement and deprivation of the possession by virtue of acquisition of land. However, the quantum of compensation to be apportioned between the lessee or a person in settled possession of the land and owner would depend upon nature of rights existing with a person in possession under the prevalent laws and arrangement under which he is holding the land. It is apparent that under the Wakf Act, 1954 the provisions contained in Sectionrestricts the powers to grant lease of Wakf property exceeding three years and the non obstante clause contained in Sectionprovides that such a transaction, if entered into, shall be void and of no effect until and unless it is made with the previous sanction of the Board. In this case, admittedly, there was no sanction of the Board. Thus, the arrangement entered into inexceeding three years would not confer any right, title or interest upon the lessee. Even if sanction had been granted by the Board it would not render lease void but would not confer any rights, under Tenancy Act, 1953.In view of theclause contained in provisions of Sectionof the Wakf Act, 1954 the provisions contained in Section 18 of the Tenancy Act, 1953 would not be applicable. In the instant case, it is apparent that even if we accept the submission raised by learned counsel appearing on behalf of some of the lessees that the arrangement was on thebasis it would not confer any right. In fact, leases were for the period exceeding three years. It was an impermissible and void arrangement as such no title would accrue to the lessee. They were holding Wakf property, which by its very nature was dedicated for the public purpose and no right could be conferred to the lessees on the basis of void leases. In such cases Section 18 of Tenancy Act, 1953 is not applicable. In such case, the status of the lessees would be that of a deemed trespasser and trespasser have no right to possess the property as such could not said to be entitled for disbursement of the compensation to the extent of 3/4th. Only some amount of compensation owing to displacement could have been given or in case there was a crop, for damage of the crop. They could not successfully claim apportionment on the basis of the price of the land as there was no ownership right or occupancy right vested with such lessees. The extent of compensation to be paid in such cases would depend upon the facts of each case, nature of possession, rights, if any, and noformula can be laid down in this regard. At the most in such a case where there is no right, title conferred or accrued by virtue of cultivation of the land of occupancy, the compensation to the extent of 5% to 15% could have been given for the purpose ofin view of the fact that a person had been displaced and deprived of right to livelihood. The major part of compensation must be paid to the owner in suchis settled proposition of law that a decision cannot be said to be an authority on the issue that has not beenthe cases at hand, there was no right conferred upon the tenant to become the occupancy tenant or lessee beyond three years, which could be said to have been taken away by the land acquisition. This Court has observed in Harinder Singh Brar (supra) that certain amount in respect of the purchase price would have to be paid by the tenant while exercising right, as per formulae provided under Section 18 of the Tenancy Act, 1953. The owner would not be entitled to anything more.Thus, this Court in Mangat Ram (supra) relied upon the aforesaid two decisions in Inder Parshad (supra) and Harvinder Singh Brar (supra) which did not deal with nor laid down the law with respect to the rights of tenants for apportionment of compensation, who were not having any title or right of tenancy for exceeding a period of three years and such leases being void under aforesaid provisions of the Wakf Act. They will be deemed to be trespassers. This aspect was not raised for consideration nor decided in Mangat Ram (supra) or in relied upon cases. The ratios of relied upon cases was totally different and could not form the foundation for apportionment of compensation in Mangat Ram (supra). Thus, it could not be an authority on the said issue. Such person could at the most be granted 10% of the amount considering the long possession and for displacement.We clarify that we are not holding that this ratio shall apply to other cases. But it will depend upon the facts and circumstances of each case and nature of rights. In any view of the matter, such tenants under void arrangement could not have been granted 3/4th compensation.In the instant case, the possession has already been taken by the acquiring body and compensation has already been disbursed to the lessees. It is stated that they are poor persons and they were holding the said land as the only source of livelihood and by now have spent the amount paid to them, though undertaking was given to the Wakf Board to refund the amount. But as the amount has already been spent, the lessees being poor persons it would be difficult to them to refund the amount, in exercise of powers under Article 142 of the Constitution it is directed that there shall be no recovery of the amount paid to them under order of the High Court as that was based upon the decision of Mangat Ram (supra) which we have clarified in the present case. Thus, it is made clear that no recovery shall be made of the amount on the basis of the conclusion recorded by us.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: learned Single Judge, it must be said, with great respect to him, is based on misconstruction of the provisions of sub-sections (2) and (3) of Section 18 of the Tenures Act. The value of the land envisages under sub-section (2) is not the market value of the land but the value of the land which should be the average price of land in the neighbourhood during 10 years preceding the date of making of the application by the tenant for purchase of land. What sub-section (3) says, is that the purchase price of the tenanted land must be three-fourths of the value of the land determined under sub-section (2), which means that the value of the tenanted land could only be three-fourths of the average value of the neighbouring land during ten years preceding the date of making of the application by the tenant for purchase. Here is a statutory measure required to be adopted to find out the purchase price of tenanted land and not the supposed market value of that land as on the date of making of the application for purchase. If that be so, we are unable to understand how the market value of the land which will be far different from the statutory value of the land could be regarded as the same, as has been done by the learned Single Judge. Hence, the contention raised on behalf of the appellant that the landowner would be entitled to three-fourths of the market value of the land becomes unsustainable. If we have regard to the provisions under sub-sections (2) and (3) of Section 18 of the Tenures Act, rightly adverted to by the learned Single Judge, the amount of compensation to which a landowner becomes entitled can only be the purchase price which he would be entitled under the said provisions for his land, which the tenant had a right to purchase thereunder. If the purchase in favour of the tenant was over, as indicated in sub-section (5) (sic) of Section 18, the purchase price, it must be kept in mind, could have been recovered by the landowner as arrears of revenue. Therefore, in our view, the tenant could have been entitled to get out of the component of compensation awardable as market value in answer item (I) referred to above and the solatium and interest payable thereon, only that amount of compensation which could be equivalent to the purchase price liable to be paid by the tenant to the landowner under Section 18 of the Tenures Act and nothing more or less. Hence, our answer to the question under consideration is, that if a tenanted land which its tenant was entitled to purchase under Section 18 of the Tenures Act did vest in the State by reason of its acquisition under the L.A. Act before he became its deemed owner as envisaged under sub-section (4) of Section 18 of the Tenures Act, the landowner of that tenanted land could have made a claim for compensation awardable therefor under the L.A. Act and his entitlement out of the said compensation could only be that falling in the component of compensation in item (i), the market value of that land together with solatium and interest, however, limited to the amount of purchase price which he was entitled to get for the land answered under Section 18 of the Tenures Act and nothing more or less."This Court in the aforesaid dictum has come to the eventual answer to the question raised for its consideration, that in such case the tenants should have been paid the compensation in its entirety as he had right to purchase property in accordance with provisions of the Tenancy Act, 1953. That is not the situation in the instant case available as per the provisions contained in the Wakf Act. 14. Thus, this Court in Mangat Ram (supra) relied upon the aforesaid two decisions in Inder Parshad (supra) and Harvinder Singh Brar (supra) which did not deal with nor laid down the law with respect to the rights of tenants for apportionment of compensation, who were not having any title or right of tenancy for exceeding a period of three years and such leases being void under aforesaid provisions of the Wakf Act. They will be deemed to be trespassers. This aspect was not raised for consideration nor decided in Mangat Ram (supra) or in relied upon cases. The ratios of relied upon cases was totally different and could not form the foundation for apportionment of compensation in Mangat Ram (supra). Thus, it could not be an authority on the said issue. Such person could at the most be granted 10% of the amount considering the long possession and for displacement. 15. We clarify that we are not holding that this ratio shall apply to other cases. But it will depend upon the facts and circumstances of each case and nature of rights. In any view of the matter, such tenants under void arrangement could not have been granted 3/4th compensation. 16. In the instant case, the possession has already been taken by the acquiring body and compensation has already been disbursed to the lessees. It is stated that they are poor persons and they were holding the said land as the only source of livelihood and by now have spent the amount paid to them, though undertaking was given to the Wakf Board to refund the amount. But as the amount has already been spent, the lessees being poor persons it would be difficult to them to refund the amount, in exercise of powers under Article 142 of the Constitution it is directed that there shall be no recovery of the amount paid to them under order of the High Court as that was based upon the decision of Mangat Ram (supra) which we have clarified in the present case. Thus, it is made clear that no recovery shall be made of the amount on the basis of the conclusion recorded by us. ### Response: 1

Bangalore Woollen, Cotton And Silk Mills Co. Ltd Vs. The Corporation Of The City Of Bangalore By Its

has been defined in Art. 366, clause (10), to mean,""Existing law" means any law, Ordinance, order, bye-law or regulation passed or made before the commencement of this Constitution by any Legislature, authority or person having power to make such a law, Ordinance, order, bye-law, rule or regulation;"and by Art. 372 all, laws in force in the territory of India immediately before the commencement of the Constitution shall continue to be in force until altered or repealed or amended by a competent legislature. It was these provisions which were relied upon as an answer to the question of the applicability of Art. 301. But the learned Attorney General argued that the action taken by the Municipal Corporation was after the coming into force of the Constitution, being a levy imposed as from January, 1955, that the imposition of the tax was subordinate legislation which could not be saved under Art. 305 and that the tax could only be imposed by resorting to the provisions of Art. 304 (b) which provides :10. Art. 304. "Notwithstanding anything in Article 301 or Article 303, the Legislature of a State may by law-(a) ..................................(b) impose such reasonable restrictions on the freedom of trade, commerce or intercourse with or within that State as may be required in the public interest:Provided that no Bill or amendment for the purpose of clause (b) shall be introduced or moved in the Legislature of a State without the previous sanction of the President." The argument therefore was this that the Act being an "existing law" might be saved under Art. 305 but that would operate on and save the taxes on articles specified in Schedule III of Part V, item18, i.e., octroi on animals and goods set out in classes I to VII of that Part but would not save the octroi on other articles under class VIII imposed after the Constitution because that would be an addition of a bye-law, rule or order and would not fall within the term "existing law". The impugned tax was levied under class VIII set out in part V which is as follows :Octroi Maximum rateClass VIII-Other articles which are not specified above and which may be approved by the Corporation by an order in this behalf. .......Rs. 2-0-0 percent ad valorem.Octroi is to be levied by reference to S. 130 of the Act which provides :-S. 130. "If the corporation by a resolution determines that an octroi should be levied on animals or goods brought within the octroi limits of the city, such octroi shall be levied on such articles or goods specified in Part V of Schedule III at such rates not exceeding those laid down in the said Part in such manner as may be determined by the corporation."11. Therefore under this section if the corporation resolved to levy octroi on animals or goods brought within the octroi limits of the city then this octroi was to be levied at rates not exceeding those laid down in that section. This, it was submitted, was subordinate legislation and therefore was not saved by Art. 305 because "existing law" as defined means any law, ordinance, order, by-law, rule or regulation passed before the Constitution and as the impugned tax was a new regulation passed after the Constitution it was not saved by Art. 305. In support of this reliance was placed on the observations of this Court in Hamdard Dawakhana v. Union of India, AIR 1960 SC 554 but as was observed by the Divisional Bench that case does not apply to the facts of the present case.12. For the respondent it was argued that (1) goods and animals were specified in the Act and therefore there was not making or passing of new regulations and (2) it is not a case of delegated legislation but is a case of conditional legislation. It was firstly submitted that there is sufficient specification in the Act itself of the articles on which the octroi duty could be levied. Section 97 of the Act gives the power to levy octroi duty on animals or goods without any exception which are brought within the octroi limits. Sections 98 and 130 lay down the procedure for the levying of taxes and impose a limitation on the extent of the tax to be levied and classes I to VII make certain articles taxable and class VIII makes other articles and goods taxable if they are approved by the Corporation. This approach to the subject has the support of a decision of this Court in Anwarkhan Mahboob Co. v. State of Bombay, AIR 1961 SC 213 where the facts were that the assessee was subjected to a purchase tax under S. 14(6) of the Bombay Sales Tax Act, 1953 (Act III of 1953). The contention of the assessee was that the goods had not been specified in the Sales Tax Act. In that Act in the Schedule were mentioned the goods the sale or purchase of which was subject to tax and the last entry was of "all goods other than those specified from time to time in Schedule A (and Section 7A) and in the preceding entries". The question for decision was whether that entry amounted to specification of goods for the purposes of Sales Tax and it was held that it was. This case was sought to be distinguished on the ground that the words there were "all goods other than.... ............" and those words would comprise every article which was not specifically mentioned in the Schedule. We are unable to accept this distinction because even though the words used in the present statute are different the combined effect of Ss. 97 and 130 and Part V of Schedule III including class VIII which have been set out above is that the words are of very general nature and would have the same effect as if, all articles were intended to be and were included. In view of this it is unnecessary to discuss the second contention.13.

0[ds]3. It is unnecessary in this case to discuss the relevance of marginal notes in the construction of S. 38(1) (b) because in our opinion the language is unambiguous and clear and it validates any defect in any act done or proceedings taken under the Act and makes it immune from being questioned on the ground of any defect or irregularity in such act or proceedings not affecting the merits of the case and merely because it is in a chapter dealing with Municipal Authorities or other parts of the section dealing with another subject is no reason for confining its operation to the defects contended for by thehistory of these taxes therefore shows that in the Devolution Rules underthe Government of India Act, 1915, octroi, terminal tax and taxes on professions and callings were three distinct heads of taxation. Similarly inthe Government of India Act, 1935, and in the Constitution the two entries are separate. Therefore when S. 142-A was added inthe Government of India Act, 1935, its operation was limited to entry 46 of List II and had no reference to entry 49 which deals with cesses on entry of goods. The position under the Constitution is exactly the same and therefore neither S. 142-A ofthe Government of India Act, 1935 nor Art. 276 has any effect on entry 49 inthe Government of India Act, 1935 or entry 52 in the Constitution. The learned Attorney General in support of his argument that the impugned tax is a tax on trade, relied upon three judgments: Municipality of Chopda v. Motilal Manekchand, ILR (1958) Bom 483 : (AIR 1958 Bom 487 ), Gajadhar Hiralal Firm v. Municipal Committee, Washim, ILR (1958) Bom 625 : (AIR 1958 Bom 378 ) and Municipal Committee Karanja v. New East India Press Co. Ltd., Bombay, AIR 1949 Nag 215.None of these cases has any applicability to the tax now impugned because the facts were different and the imposition was of a different character. The attack on the constitutionality of the impugned tax on the ground of contravention of Art. 276 is therefore not sustainable and must beunder this section if the corporation resolved to levy octroi on animals or goods brought within the octroi limits of the city then this octroi was to be levied at rates not exceeding those laid down in that section. This, it was submitted, was subordinate legislation and therefore was not saved by Art. 305 because "existing law" as defined means any law, ordinance, order, by-law, rule or regulation passed before the Constitution and as the impugned tax was a new regulation passed after the Constitution it was not saved by Art. 305. In support of this reliance was placed on the observations of this Court in Hamdard Dawakhana v. Union of India, AIR 1960 SC 554 but as was observed by the Divisional Bench that case does not apply to the facts of the presentare unable to accept this distinction because even though the words used in the present statute are different the combined effect of Ss. 97 and 130 and Part V of Schedule III including class VIII which have been set out above is that the words are of very general nature and would have the same effect as if, all articles were intended to be and were included. In view of this it is unnecessary to discuss the second contention.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: has been defined in Art. 366, clause (10), to mean,""Existing law" means any law, Ordinance, order, bye-law or regulation passed or made before the commencement of this Constitution by any Legislature, authority or person having power to make such a law, Ordinance, order, bye-law, rule or regulation;"and by Art. 372 all, laws in force in the territory of India immediately before the commencement of the Constitution shall continue to be in force until altered or repealed or amended by a competent legislature. It was these provisions which were relied upon as an answer to the question of the applicability of Art. 301. But the learned Attorney General argued that the action taken by the Municipal Corporation was after the coming into force of the Constitution, being a levy imposed as from January, 1955, that the imposition of the tax was subordinate legislation which could not be saved under Art. 305 and that the tax could only be imposed by resorting to the provisions of Art. 304 (b) which provides :10. Art. 304. "Notwithstanding anything in Article 301 or Article 303, the Legislature of a State may by law-(a) ..................................(b) impose such reasonable restrictions on the freedom of trade, commerce or intercourse with or within that State as may be required in the public interest:Provided that no Bill or amendment for the purpose of clause (b) shall be introduced or moved in the Legislature of a State without the previous sanction of the President." The argument therefore was this that the Act being an "existing law" might be saved under Art. 305 but that would operate on and save the taxes on articles specified in Schedule III of Part V, item18, i.e., octroi on animals and goods set out in classes I to VII of that Part but would not save the octroi on other articles under class VIII imposed after the Constitution because that would be an addition of a bye-law, rule or order and would not fall within the term "existing law". The impugned tax was levied under class VIII set out in part V which is as follows :Octroi Maximum rateClass VIII-Other articles which are not specified above and which may be approved by the Corporation by an order in this behalf. .......Rs. 2-0-0 percent ad valorem.Octroi is to be levied by reference to S. 130 of the Act which provides :-S. 130. "If the corporation by a resolution determines that an octroi should be levied on animals or goods brought within the octroi limits of the city, such octroi shall be levied on such articles or goods specified in Part V of Schedule III at such rates not exceeding those laid down in the said Part in such manner as may be determined by the corporation."11. Therefore under this section if the corporation resolved to levy octroi on animals or goods brought within the octroi limits of the city then this octroi was to be levied at rates not exceeding those laid down in that section. This, it was submitted, was subordinate legislation and therefore was not saved by Art. 305 because "existing law" as defined means any law, ordinance, order, by-law, rule or regulation passed before the Constitution and as the impugned tax was a new regulation passed after the Constitution it was not saved by Art. 305. In support of this reliance was placed on the observations of this Court in Hamdard Dawakhana v. Union of India, AIR 1960 SC 554 but as was observed by the Divisional Bench that case does not apply to the facts of the present case.12. For the respondent it was argued that (1) goods and animals were specified in the Act and therefore there was not making or passing of new regulations and (2) it is not a case of delegated legislation but is a case of conditional legislation. It was firstly submitted that there is sufficient specification in the Act itself of the articles on which the octroi duty could be levied. Section 97 of the Act gives the power to levy octroi duty on animals or goods without any exception which are brought within the octroi limits. Sections 98 and 130 lay down the procedure for the levying of taxes and impose a limitation on the extent of the tax to be levied and classes I to VII make certain articles taxable and class VIII makes other articles and goods taxable if they are approved by the Corporation. This approach to the subject has the support of a decision of this Court in Anwarkhan Mahboob Co. v. State of Bombay, AIR 1961 SC 213 where the facts were that the assessee was subjected to a purchase tax under S. 14(6) of the Bombay Sales Tax Act, 1953 (Act III of 1953). The contention of the assessee was that the goods had not been specified in the Sales Tax Act. In that Act in the Schedule were mentioned the goods the sale or purchase of which was subject to tax and the last entry was of "all goods other than those specified from time to time in Schedule A (and Section 7A) and in the preceding entries". The question for decision was whether that entry amounted to specification of goods for the purposes of Sales Tax and it was held that it was. This case was sought to be distinguished on the ground that the words there were "all goods other than.... ............" and those words would comprise every article which was not specifically mentioned in the Schedule. We are unable to accept this distinction because even though the words used in the present statute are different the combined effect of Ss. 97 and 130 and Part V of Schedule III including class VIII which have been set out above is that the words are of very general nature and would have the same effect as if, all articles were intended to be and were included. In view of this it is unnecessary to discuss the second contention.13. ### Response: 0

Commissioner of Central Excise Vs. M/S. Modernova Plastyles Private Limited & Another

this Court in Misc. Civil Application No.606/2002 dated 15th July, 2009 as well as dated 31st August, 2010 in Central Excise Appeal No.2 of 2006 in the case of The Commissioner of Central Excise V/s. M/s. Nylocraft Precision Plastics Pvt. Ltd. and Others. He further relies on the judgments rendered by two other High Courts, namely, Gujarat and Punjab & Haryana reported in 2010 (262) E.L.T. 110 (Gujarat) and 2009 (236) E.L.T. 660 (P & H) respectively.10. Sub-rule (3) of Rule 57R which read before amendment as:(3) No credit of the specified duty paid on the capital goods shall be allowed if such capital goods are acquired by a manufacturer on lease, hire-purchase, loan or by any other transaction other than direct purchase, whereby the property in the said capital goods is not transferred to such manufacturer.9. After amendment in 1994, the sub-rule (3) of Rule 57R read thus:-(3) The credit of the specified duty paid on the capital goods shall be allowed to a manufacturer if the capital goods are acquired by the manufacturer on lease, hire-purchase or loan agreement, from a financing company subject to the following procedure, namely:(i) The manufacturer shall file a declaration before the Assistant Commissioner of Central Excise as required under rule 57T;(ii) The manufacturer availing credit of the specified duty paid on capital goods, who has entered into a financial arrangement, -(a) for financing the cost of such capital goods excluding the specified duty, shall produce a copy of the invoice referred to in rule 57T, evidencing payment of specified duty along with a copy of the agreement entered into by him with the said financing company; or(b) for financing the cost of such capital goods including the specified duty, shall produce a certificate from the financing company to the effect that the duty specified on such capital goods has been paid by the said manufacturer to such financing company, prior to payment of first lease rental installment or first hire-purchase installment or first installment of repayment of loan, as the case may be, along with a copy of the agreement entered into with the said financing company;(iii) The manufacturer and the financing company shall not claim depreciation under the Income-tax laws on that part of the value of capital goods which represents the amount of specified duty paid on such capital goods.(iv) The relevant documents required for the purpose of availing credit of the specified duty paid on such capital goods under rule 57T shall bear the name of the manufacturer along with that of the financing company.11. In the present case undisputedly the respondent-assessee is engaged in manufacturer of plastic articles /components and parts by using injection moulding machines and manufactures finished goods as per the requirement of the original equipment manufacturers. It is not in dispute that the moulds supplied by the supplier are capital goods. The moulds used for injection moulding machine to manufacture the goods/finished products were supplied to the respondent assessee by original equipment manufacturer. These were duty paid moulds by the original manufacturer. Credit of the duties on moulds was being taken by the assessee. It is also not in dispute that the moulds supplied by the supplier are capital goods.12. Though reliance is being placed by the appellant in the case of Terene Fibres India Pvt. Ltd. vs. Commissioner of Central Excise, Mumbai VI. In said case ultimate decision after difference of opinion between the members in the Division Bench of the Tribunal has been rendered in favour of the assessee holding that the demand is unsustainable. From the Judgment as has been rendered it is difficult to consider that there is a clear decision by the Tribunal that modvat credit would not be available to the respondent-assessee if the property in capital goods continued to vest in the supplier.13. However, various citations relied on behalf of the respondents by Mr. M.H. Patil, learned counsel for the assessee, are pointer to the prevailing position in the matter. The assumption that, in case the property in capital goods continued to be in original equipment manufacturers, credit cannot be taken by the vendor manufacturer-assessee would not be proper. There is considerable force in the submissions of Mr. Patil that it is not necessary that capital goods shall be owned or be acquired by the vendor/manufacturer-assessee and that assessee cannot be denied credit on the said ground.14. In the present case there is no dispute that duty paid on capital goods-moulds, were supplied by the original manufacturer to the assessee. Perusal of rules before and after amendment the requirement of ownership was in the erst while regime upto 1994 as governed by then subsisting rules. After 1994, sub rule 3 of Rule 57R having under gone amendment to it, removed such requirement of ownership/acquisition from financing agency. For taking credit of duty paid on said goods, it would not be necessary that capital goods shall either be owned by the assessee or those shall be acquired by finance from financing agency. Denial of credit based on such ground is unsustainable.15. We therefore consider that having regard to the prevailing legal position applicable to the case of the respondent assessee, Modvat/Cenvat credit cannot be disallowed to the assessee and it would be entitled to the same. We also consider that the decision of the Tribunal in the case of Terene Fibres India Pvt. Ltd. vs. Commissioner of Central Excise Mumbai VI would be of no assistance to the appellant Revenue to carry forward its case, for, it cannot be said that in the said case there has been conclusive decision as is being assumed by the appellant revenue. Further having regard to the various decisions relied on behalf of the respondent assessee the decision relied on behalf of the appellant revenue is of little efficacy from position emerging from decision rendered by the Supreme Court in Marmagoa Steel Ltd. (supra) and other orders passed by this Court as well as decisions of Gujrat and Punjab & Haryana High Courts.

0[ds]11. In the present case undisputedly theis engaged in manufacturer of plastic articles /components and parts by using injection moulding machines and manufactures finished goods as per the requirement of the original equipment manufacturers. It is not in dispute that the moulds supplied by the supplier are capital goods. The moulds used for injection moulding machine to manufacture the goods/finished products were supplied to the respondent assessee by original equipment manufacturer. These were duty paid moulds by the original manufacturer. Credit of the duties on moulds was being taken by the assessee. It is also not in dispute that the moulds supplied by the supplier are capitalis considerable force in the submissions of Mr. Patil that it is not necessary that capital goods shall be owned or be acquired by theand that assessee cannot be denied credit on the said ground.14. In the present case there is no dispute that duty paid on capitalwere supplied by the original manufacturer to the assessee. Perusal of rules before and after amendment the requirement of ownership was in the erst while regime upto 1994 as governed by then subsisting rules. After 1994, sub rule 3 of Rule 57R having under gone amendment to it, removed such requirement of ownership/acquisition from financing agency. For taking credit of duty paid on said goods, it would not be necessary that capital goods shall either be owned by the assessee or those shall be acquired by finance from financing agency. Denial of credit based on such ground is unsustainable.15. We therefore consider that having regard to the prevailing legal position applicable to the case of the respondent assessee, Modvat/Cenvat credit cannot be disallowed to the assessee and it would be entitled to the same. We also consider that the decision of the Tribunal in the case of Terene Fibres India Pvt. Ltd. vs. Commissioner of Central Excise Mumbai VI would be of no assistance to the appellant Revenue to carry forward its case, for, it cannot be said that in the said case there has been conclusive decision as is being assumed by the appellant revenue. Further having regard to the various decisions relied on behalf of the respondent assessee the decision relied on behalf of the appellant revenue is of little efficacy from position emerging from decision rendered by the Supreme Court in Marmagoa Steel Ltd. (supra) and other orders passed by this Court as well as decisions of Gujrat and PunjabHaryana High Courts.

### Instruction: From the information provided in the case proceeding, infer whether the court's decision will be positive (1) or negative (0) for the appellant. ### Input: this Court in Misc. Civil Application No.606/2002 dated 15th July, 2009 as well as dated 31st August, 2010 in Central Excise Appeal No.2 of 2006 in the case of The Commissioner of Central Excise V/s. M/s. Nylocraft Precision Plastics Pvt. Ltd. and Others. He further relies on the judgments rendered by two other High Courts, namely, Gujarat and Punjab & Haryana reported in 2010 (262) E.L.T. 110 (Gujarat) and 2009 (236) E.L.T. 660 (P & H) respectively.10. Sub-rule (3) of Rule 57R which read before amendment as:(3) No credit of the specified duty paid on the capital goods shall be allowed if such capital goods are acquired by a manufacturer on lease, hire-purchase, loan or by any other transaction other than direct purchase, whereby the property in the said capital goods is not transferred to such manufacturer.9. After amendment in 1994, the sub-rule (3) of Rule 57R read thus:-(3) The credit of the specified duty paid on the capital goods shall be allowed to a manufacturer if the capital goods are acquired by the manufacturer on lease, hire-purchase or loan agreement, from a financing company subject to the following procedure, namely:(i) The manufacturer shall file a declaration before the Assistant Commissioner of Central Excise as required under rule 57T;(ii) The manufacturer availing credit of the specified duty paid on capital goods, who has entered into a financial arrangement, -(a) for financing the cost of such capital goods excluding the specified duty, shall produce a copy of the invoice referred to in rule 57T, evidencing payment of specified duty along with a copy of the agreement entered into by him with the said financing company; or(b) for financing the cost of such capital goods including the specified duty, shall produce a certificate from the financing company to the effect that the duty specified on such capital goods has been paid by the said manufacturer to such financing company, prior to payment of first lease rental installment or first hire-purchase installment or first installment of repayment of loan, as the case may be, along with a copy of the agreement entered into with the said financing company;(iii) The manufacturer and the financing company shall not claim depreciation under the Income-tax laws on that part of the value of capital goods which represents the amount of specified duty paid on such capital goods.(iv) The relevant documents required for the purpose of availing credit of the specified duty paid on such capital goods under rule 57T shall bear the name of the manufacturer along with that of the financing company.11. In the present case undisputedly the respondent-assessee is engaged in manufacturer of plastic articles /components and parts by using injection moulding machines and manufactures finished goods as per the requirement of the original equipment manufacturers. It is not in dispute that the moulds supplied by the supplier are capital goods. The moulds used for injection moulding machine to manufacture the goods/finished products were supplied to the respondent assessee by original equipment manufacturer. These were duty paid moulds by the original manufacturer. Credit of the duties on moulds was being taken by the assessee. It is also not in dispute that the moulds supplied by the supplier are capital goods.12. Though reliance is being placed by the appellant in the case of Terene Fibres India Pvt. Ltd. vs. Commissioner of Central Excise, Mumbai VI. In said case ultimate decision after difference of opinion between the members in the Division Bench of the Tribunal has been rendered in favour of the assessee holding that the demand is unsustainable. From the Judgment as has been rendered it is difficult to consider that there is a clear decision by the Tribunal that modvat credit would not be available to the respondent-assessee if the property in capital goods continued to vest in the supplier.13. However, various citations relied on behalf of the respondents by Mr. M.H. Patil, learned counsel for the assessee, are pointer to the prevailing position in the matter. The assumption that, in case the property in capital goods continued to be in original equipment manufacturers, credit cannot be taken by the vendor manufacturer-assessee would not be proper. There is considerable force in the submissions of Mr. Patil that it is not necessary that capital goods shall be owned or be acquired by the vendor/manufacturer-assessee and that assessee cannot be denied credit on the said ground.14. In the present case there is no dispute that duty paid on capital goods-moulds, were supplied by the original manufacturer to the assessee. Perusal of rules before and after amendment the requirement of ownership was in the erst while regime upto 1994 as governed by then subsisting rules. After 1994, sub rule 3 of Rule 57R having under gone amendment to it, removed such requirement of ownership/acquisition from financing agency. For taking credit of duty paid on said goods, it would not be necessary that capital goods shall either be owned by the assessee or those shall be acquired by finance from financing agency. Denial of credit based on such ground is unsustainable.15. We therefore consider that having regard to the prevailing legal position applicable to the case of the respondent assessee, Modvat/Cenvat credit cannot be disallowed to the assessee and it would be entitled to the same. We also consider that the decision of the Tribunal in the case of Terene Fibres India Pvt. Ltd. vs. Commissioner of Central Excise Mumbai VI would be of no assistance to the appellant Revenue to carry forward its case, for, it cannot be said that in the said case there has been conclusive decision as is being assumed by the appellant revenue. Further having regard to the various decisions relied on behalf of the respondent assessee the decision relied on behalf of the appellant revenue is of little efficacy from position emerging from decision rendered by the Supreme Court in Marmagoa Steel Ltd. (supra) and other orders passed by this Court as well as decisions of Gujrat and Punjab & Haryana High Courts. ### Response: 0

UNION OF INDIA & ORS Vs. AGRICAS LLP & ORS

WTO member countries, yet safeguard measures in the form of Quantitative Restrictions are not provided for under any Indian law. This is in accordance with the provision to incorporate safeguard measures in the form of Quantitative Restrictions, as provided in Article XIX of GATT and the WTO Agreement on Safeguards. Section 9A substantially incorporates, with some modifications, provisions of Article XIX of GATT-1994. Rules made in 2012 are also in conformity with the provisions of the WTO Agreement on Safeguards made in terms of Article XIX of GATT-1994. Sub-rule (3) to Rule 5 of the Safeguard Measures (Quantitative Restrictions) Rules, 2012 states and sets out the conditions for applicability of Rule 9A, which are: (i) increased imports; (ii) serious injury or threat of serious injury; and (iii) a causal link between increased imports and alleged serious injury or threat of serious injury. The expression increased imports has been defined in terms of increased quantity to mean increase in imports in absolute terms or relative to domestic production. The expressions serious injury and threat of serious injury have been defined in clauses (c) and (d) of sub-clause (4) to Section 9A to mean injury causing significant overall impairment in the position of a domestic industry and a clear and imminent danger of serious injury respectively. The expression domestic industry has also been defined in clause (b) to sub-section (4) to Section 9A. Similarly, the expression interested party has been defined in sub-rule (d) to Rule 2 of the Safeguard Measures (Quantitative Restriction) Rules, 2012 and includes exporter or foreign producer or the importer of goods for the purposes of imposition of safeguard quantitative restrictions on trade or business association. It also includes the government of the exporting country or producer of goods or directly competitive goods in India or a trade or business association . 41. The need to enact Section 9A arose from the obligations flowing from Article XIX, as restriction in form of quantitative restriction, require a procedure to be followed. Affected parties including exporters, importers have to be heard. Consequently, act of transformation was required. Article XIX of GATT-1994 is an escape provision, i.e. a provision which entitles a contracting state to escape from the rigours of paragraph (1) of Article XI of GATT- 1994. Similar acts of transformation have been undertaken by enacting Custom Valuation Rules, provision of antidumping, countervailing duty etc. but the entire GATT-1994 does not stand transposed and enacted by way of statutory law or delegated legislation. 42. This being the position, Section 9A has to be interpreted as an escape provision when the Central Government i.e. the Union of India may escape the rigours of paragraph (1) of Article XIX of GATT-1994. Section 9A is not a provision which incorporates or transposes paragraph (1) of Article XI into the domestic law either expressly or by necessary implication. To hold to the contrary, we would be holding that the Central Government has no right and power to impose quantitative restrictions except under Section 9A of the FTDR Act. This would be contrary to the legislative intent and objective. Section 9A of the FTDR Act does not elide or negate the power of the Central Government to impose restrictions on imports under sub-section (2) to Section 3 of the FTDR Act. 43. In other words, the impugned notifications would be valid as they have been issued in accordance with the power conferred in the Central Government in terms of sub-section (2) to Section 3 of the FTDR Act. The powers of the Central Government by an order imposing restriction on imports under sub-section (2) to Section 3 is, therefore, not entirely curtailed by Section 9A of the FTDR Act. 44. To be fair, learned counsel appearing for the importers had conceded that they cannot enforce or claim violation of paragraph (1) of Article XI of GATT-1994 in the domestic courts in India unless the said Article has been expressly or by necessary implication incorporated and transposed in the domestic law, that is, the FTDR Act. 45. In the present case, this Court is not called upon to decide and examine the obligations of the Contracting Parties in terms of GATT-1994. Our findings and ratio are confined and restricted to interpretation of Section 3 and 9A of the FTDR Act and in that context we have referred to GATT-1994. D. Contention of the importers of bona fide imports under interim orders and prayer for partial relief. 46. Learned counsel for some of the importers had placed reliance on Raj Prakash Chemical v. Union of India (1986) 2 SCC 297 , which judgment, in our opinion, has no application. In Raj Prakash Chemical (supra), the petitioner had acted under a bona fide belief in view of judgments and orders of High Courts and the interpretation placed by the authorities. In this background, observations were made to giving benefit to the importers, despite the contrary legal interpretation. In the instant case, the importers rely upon the interim orders passed by the High Courts whereas on the date when they filed the Writ Petitions and had obtained interim orders, the Madras High Court had dismissed the Writ Petition upholding the notification. Similarly, the High Court of adjudicature at Bombay, High Court of Gujarat and the High Court of Madhya Pradesh had dismissed the Writ Petitions filed before them and upheld the notifications and the trade notices. Notwithstanding the dismissals, the importers took their chance, obviously for personal gains and profits. They would accordingly face the consequences in law. In these circumstances, the importers it cannot be said had bona fide belief in the right pleaded. E. What is not decided 47. Learned counsel for some of the importers had submitted that they have preferred statutory appeals against orders suspending or terminating import export code. The said aspect has not been examined and decided and hence we make no comment and observation. The statutory appeals, if any, preferred by the importer(s) will be decided in accordance with law. F. Conclusion

0[ds]15. At the outset, we must record that the importers, and in our opinion rightly, have not raised the contention that the DGFT could not have notified the impugned notifications. The notifications themselves record that they were published by the Ministry of Commerce and Industry, Department of Commerce, Directorate General of Foreign Trade. The first paragraph of the notification states that they had been issued by the Central Government in exercise of powers conferred under Article 77 of the Constitution. Clearly, the notifications were issued by the Central Government, and not the DGFT that had performed the ministerial act of publication. The decision to amend and issue the notification was of the Central Government. Neither Section 3(2) nor Section 6(3) of the FTDR Act was violated. This Court in Delhi International Airport Limited v. International Lease Finance Corporation and others (2015) 8 SCC 446 , had referred to Articles 77 and 166 of the Constitution and held that the Constitution stipulates that whenever executive action is taken by way of an order or instrument it shall be expressed to be taken in the name of the President and Governor in whose name the executive power of the Union and the States, respectively, are vested. Article 77 does not provide for delegation of any power, albeit under sub-section (3) of Article 77, the President is to make Rules for more convenient transaction of business and allocation of same amongst Ministers. Under the Government of India (Transaction of Business) Rules, 1961, the government business is divided amongst Ministers and specific functions are allocated to different Ministries. The Director General of Foreign Trade is an ex officio Additional Secretary in the Government of India and is appointed by the Central Government under sub-section (1) to Section 6 of the FTDR Act to advise the Central Government in formulation and carrying out the Foreign Trade Policy. Wherefore, even the website of the Ministry of Commerce and Industry, Department of Commerce, states that the DGFT is an agent of the Central Government and attached office to it. Further, clause (2) of Article 77 provides that validity of an order or instrument made or executed in the name of the President, authenticated in the manner specified in the Rules made by the President, shall not be called in question on the ground that it is not an order or an instrument made or executed by the President. Therefore, the contention of issuance of the impugned notification sans authority, cannot be sustained.17. We would also without any hesitation reject the contention raised by some of the importers that the impugned notification is illegal because of vagueness or allows restricted quantity of 1/1.5 lakh MT of Peas (Pisum Sativum) including Yellow Peas, Green Peas, Dun Peas and Kaspa Peas as against a licence, meaning thereby each licensee is allowed to import the maximum quantity specified in the notification. In other words, the total quantity specified in the notification is per licensee and not for the total imports of the commodity specified in the notification. The submission has no merit as the notification expressly uses the expression total quantity of the commodity specified which could be imported. There is no ambiguity or vagueness in the notifications, relevant portions of which have been quoted above. Even otherwise the expression total quantity cannot be construed as quantity per licence issued as the number of licences issued concerning the subject goods could be numerable (as per the Union of India 2248,1016 and 2915 licences were issued in 2019-20 for import of Tur, Moong and Urad dals against restricted quota of 4,1.5 and 4 lakh MT, respectively). If each licence holder is allowed to import 1/1.5 lakh MT of Peas, the total import would well exceed the total annual consumption after we account for the production within India. In our opinion, the plea and interpretation of the importers if accepted will not only be contrary to the express language of the notification but would frustrate the intent and object of restricting the imports of the stated goods by prescribing a quota. We decline and would not accept this farfetched and somewhat drivel interpretation of simple and straight forward words.18. We would also reject the contention raised by the importers that the Trade Notices issued by the DGFT violate Sections 3 and 5 read with sub-section (3) of Section 6 of the FTDR Act as they had the effect of superseding the Notifications or imposing a new criterion and eligibility condition not envisaged by the notifications. The legal effect of the notifications was to amend the EXIM policy whereby the specified commodities would henceforth not be free (importable without restriction) but would fall in the restricted category. Once the commodities were shifted to the restricted category, the requirement of licence would flow from the mandate of Section 3 of the FTDR Act read with Rule 4 of the Foreign Trade (Regulation) Rules, 1993.Paragraph 2.10 sets the matter beyond controversy as it states that the goods which are freely importable without a restriction may be imported by any person. However, if goods require authorisation, actual user alone may import such goods. However, the DGFT can dilute and dispense with the actual user condition.19. The effect of the Notifications, as noticed and beyond doubt, is to bring the specified commodities from free to the restricted category and therefore the imports in question would require a prior authorisation for import. The requirement of licence is nothing but authorisation. Therefore, in terms of paragraph 2.10, the imports of the specified commodities would only be by the actual user, unless the actual user condition was specifically dispensed with or diluted by the DGFT. The Directorate by specifying that the licence would be issued to the miller or refiner has, therefore, just clarified that the actual user alone will be permitted to import the restricted goods mentioned in the notification for which a prior authorisation or licence is required. The importers are traders and it is not the case of any of the importers that they are the actual users. Further, none of the importers have applied for a licence or authorisation for import of the restricted commodities. Violation of clause 9.03 of the EXIM Policy defining the expression Actual User, is neither alleged nor argued before us.20. The importers have raised the contention that the expression if such imports used in the second sentence of paragraph 2.10 only qualifies the first sentence of paragraph 2.10. We do not accept the contention, for paragraph 2.10 consists of two parts. The first part relates to goods which are freely importable without any licence and states that such goods that can be imported by any person. The second part refers to such imports which require authorisation and not the imports which are freely importable without any restriction. Actual user condition, therefore, applies by default when imports require an authorisation. However, the DGFT can specifically dispense with or dilute the actual user condition.27. While interpreting the domestic law enshrining Human Rights (and sometimes environment issues) this Court on some occasions has relied on international conventions and treaties where the terms of any legislation are absent, not clear or are reasonably capable of more than one meaning. In such cases, where there are statutes, rules etc. the meaning which in consonance with the treaties can be relied upon, for there is a prima facie presumption that the Parliament did not intend to act in breach of international law, including State treaty obligations. Part-III of the Indian Constitution a-priori incorporates and recognises the Human Rights, consequently recourse to international conventions can be made to interpret and borrow explicit terminologies and nuances to bailiwick Human Right jurisprudence. However, in the present case we are examining an economic and fiscal legislation or rather economic policy decision taken by the Union of India. These decisions on human rights therefore would not be of much assistance.29. Indian Parliament, two years prior to the signing of GATT-1994, had enacted the FTDR Act which was enforced with effect from 7 th August 1992. Sections 11 to 14 of the FTDR Act came into force immediately and other provisions came into force on 19 th June 1992. The FTDR Act had repealed the Imports and Exports (Control) Act, 1947 and the Foreign Trade (Development and Regulation) Ordinance, 1992 with the stipulation that anything done or any action taken under the Ordinance shall be deemed to have been done or taken under the corresponding provisions of the FTDR Act. The Statement of Objects and Reasons for enacting the FTDR Act, as recorded, are to acknowledge that foreign trade is the driving force of economic activity as this spurs economic growth and there is increasing interdependence and that the goals of the new policy were to increase productivity and competitiveness by ensuring that the trade policies serve as an instrument to create an environment that will provide a strong impetus to exports, facilitate imports and render export activity more profitable.31. Section 9A of the FTDR Act is the only section in Chapter IIIA with the heading Quantitative Restrictions and this section was inserted by Amendment Act 25 of 2010 with effect from 27 th August 2010. Subsequently, in exercise of powers conferred by sub-section (3) to Section 9A of the FTDR Act, the Central Government had published and notified the Safeguard Measures (Quantitative Restrictions) Rules, 2012, which became applicable on the date of their publication in the Gazette of India dated 24 th May 2012Sub-section (1) of Section 3 states that the Central Government may, by an Order published in the Official Gazette, make provision for the development and regulation of foreign trade by facilitating imports and increasing exports. It is a general provision which has no reference to GATT-1994. It authorises the Central Government to publish an order in the Official Gazette for development and regulation of foreign trade, i.e. imports and exports. Sub-section (2) states that the Central Government can, by an order in the Official Gazette, make a provision for prohibiting or restricting or otherwise regulating, in all or specified cases and subject to such exceptions, if any, the import or export of goods and after the amendment vide Act 25 of 2010, services or technology. Sub-section (2) to Section 3, therefore, authorises the Central Government to, by an Order published in the Official Gazette, make provisions restricting the imports or exports. Imposition of quantitative restrictions on imports or exports would clearly fall within sub-section (2) to Section 3 of the FTDR Act. We are not concerned with the proviso to sub-section (2) in the present case. Sub-section (3) to Section 3 states that where an order is passed under sub-section (2) whereby the import or export of goods is prohibited, restricted or otherwise regulated, the goods in question would be deemed to be prohibited goods under Section 11 of the Customs Act, 1962 and accordingly the provisions of the latter Act would apply.36. Sub-section (4) to Section 9A of the FTDR Act introduced by Act 25 of 2010 with effect from 27 th August 2010, requires some elucidation. The sub-section on one hand states that no permit or licence shall be necessary for imports or exports of goods, nor any goods shall be prohibited from import or export, except as may be required under the FTDR Act, or the rules or orders made thereunder. At the same time, by using the phrase without prejudice to anything contained in any other law, rule, regulation, notification or order, it protects the operation of the other law, rule, regulation, notification or order to the extent that they do not directly or indirectly deal with the permit or licence necessary for import or export of goods or prohibit import or export of goods. Operation of such law, rule, regulation, notification or order not dealing with the permit or licence necessary for import or export on a prohibition of import of goods is, therefore, protected and not overridden. Sub-section (4) to Section 3 therefore gives limited primacy to the FTDR Act, restricting it to the scope and subject matter of the FTDR Act, and not to override other laws. This is also clear from Section 18A of the FTDR Act which was also enacted and inserted by Act 25 of 2010 with effect from 27 th August 2010The provisions of FTDR Act, therefore, are in addition to, and not in derogation of, the provisions of any other law for the time being in force. This would be the correct way to harmoniously read and interpret sub-section (4) to Section 3 and Section 18A of the FTDR Act. We may, at this stage, notice that the original amendment had used the phrase Notwithstanding anything contained in any other law, rule, regulation, notification or order, but the Standing Committee had noticed the contradiction and also the object and purpose behind enacting sub-rule (4) and had recommended that the said expression should be replaced with the expression Without prejudice to anything contained in any other law, rule, regulation, notification or order. Sub-section (4) to Section 3 of the FTDR Act, therefore, in the context of import and exports or prohibition of imports or exports of goods states that no permit or licence shall be necessary or required except as may be required under the FTDR Act, rules or orders made thereunder. The expression order, as per clause (h) to Section (2) of the FTA means any Order made by the Central Government under Section 3. It is, therefore, clear to us that there is no violation of Section 3 of the FTDR Act in the issuance of the impugned notifications or orders, which are intra vires and not ultra vires.37. We have already reproduced and quoted Article XI (Paragraph 47 (supra).) of the GATT- 1994 and have to say that the same has not been statutorily made a subject of act of transformation and incorporated in the domestic legislation, i.e. the FTDR Act. The FTDR Act does not legislate and transform Article XI of the GATT-1994. As noticed above, Section 3 of the FTDR Act empowers and authorises the Central Government, i.e. the Union of India to frame policy, rules or regulations for import or export of goods. The policy is framed under Section 5 of the ActThe policy is framed under Section 5 of thereads as under:5. Foreign Trade Policy. – The Central Government may, from time to time, formulate and announce, by notification in the Official Gazette, the foreign trade policy and may also, in like manner, amend that policy:Provided that the Central Government may direct that, in respect of the Special Economic Zones, the foreign trade policy shall apply to the goods, services and technology with such exceptions, modifications and adaptations, as may be specified by it by notification in the Official Gazette.Thus, the Central Government i.e. the Union of India has been given the necessary discretion and election with regard to framing of policies for import and export of goods, services and technology. Therefore, implementation of GATT-1994, including Article XI, is left to the Central Government by means of delegated legislation.38. Clause (2) of Article XI of GATT-1994 states that provisions of paragraph (1) shall not extend to three specified situations as stated in sub-clauses (a), (b) or (c). Clause (c) deals with import restrictions on any agricultural or fisheries product, imported in any form necessary for enforcement of governmental measures specified therein. Similarly, Article XII of GATT-1994 states that notwithstanding the provisions of paragraph (1) of Article XI, any contracting party, in order to safeguard its external financial position and its balance of payments, may restrict the quantity or value of merchandise permitted to be imported, subject to the provisions of paragraphs of that Article. Paragraph 23 (supra) lists a number of other provisions, which allow and permit exceptions. We have referred to these provisions to highlight that paragraph (1) to Article XI is not an absolute rule. It is subject to exceptions in the form of paragraph (2) to Article XI, Article XII and other provisions. Of course, the conditions specified the respective Articles have to be satisfied for a contracting party to be GATT- 1994 compliant.39. Reference to this position is necessary and required when we interpret Section 9A of the FTDR Act which we would accept incorporates into the domestic law Article XIX of GATT-1994, but neither Article XI and nor all exceptions by implication. Consequently, Section 9A for the FTDR Act, is to be understood an enabling provision empowering imposition of quantitative restrictions after following the procedure in the situations referred to therein. However it does not limit and restrict the expans and power of the Central Government to prohibit, regulate or restrict imports of goods in terms of Section 3(2) of the FTDR Act. As a sequitur, it has to be held that notwithstanding Section 9A, the Central Government continues and has authority to impose quantitative restrictions by an order under Section 3(2) of the FTDR Act. Principle of Lex specialis derogat legi generali, therefore, is not applicable to the case in hand.Section 9A substantially incorporates, with some modifications, provisions of Article XIX of GATT-1994. Rules made in 2012 are also in conformity with the provisions of the WTO Agreement on Safeguards made in terms of Article XIX of GATT-1994. Sub-rule (3) to Rule 5 of the Safeguard Measures (Quantitative Restrictions) Rules, 2012 states and sets out the conditions for applicability of Rule 9A, which are: (i) increased imports; (ii) serious injury or threat of serious injury; and (iii) a causal link between increased imports and alleged serious injury or threat of serious injury. The expression increased imports has been defined in terms of increased quantity to mean increase in imports in absolute terms or relative to domestic production. The expressions serious injury and threat of serious injury have been defined in clauses (c) and (d) of sub-clause (4) to Section 9A to mean injury causing significant overall impairment in the position of a domestic industry and a clear and imminent danger of serious injury respectively. The expression domestic industry has also been defined in clause (b) to sub-section (4) to Section 9A. Similarly, the expression interested party has been defined in sub-rule (d) to Rule 2 of the Safeguard Measures (Quantitative Restriction) Rules, 2012 and includes exporter or foreign producer or the importer of goods for the purposes of imposition of safeguard quantitative restrictions on trade or business association. It also includes the government of the exporting country or producer of goods or directly competitive goods in India or a trade or business association .41. The need to enact Section 9A arose from the obligations flowing from Article XIX, as restriction in form of quantitative restriction, require a procedure to be followed. Affected parties including exporters, importers have to be heard. Consequently, act of transformation was required. Article XIX of GATT-1994 is an escape provision, i.e. a provision which entitles a contracting state to escape from the rigours of paragraph (1) of Article XI of GATT- 1994. Similar acts of transformation have been undertaken by enacting Custom Valuation Rules, provision of antidumping, countervailing duty etc. but the entire GATT-1994 does not stand transposed and enacted by way of statutory law or delegated legislation.42. This being the position, Section 9A has to be interpreted as an escape provision when the Central Government i.e. the Union of India may escape the rigours of paragraph (1) of Article XIX of GATT-1994. Section 9A is not a provision which incorporates or transposes paragraph (1) of Article XI into the domestic law either expressly or by necessary implication. To hold to the contrary, we would be holding that the Central Government has no right and power to impose quantitative restrictions except under Section 9A of the FTDR Act. This would be contrary to the legislative intent and objective. Section 9A of the FTDR Act does not elide or negate the power of the Central Government to impose restrictions on imports under sub-section (2) to Section 3 of the FTDR Act.43. In other words, the impugned notifications would be valid as they have been issued in accordance with the power conferred in the Central Government in terms of sub-section (2) to Section 3 of the FTDR Act. The powers of the Central Government by an order imposing restriction on imports under sub-section (2) to Section 3 is, therefore, not entirely curtailed by Section 9A of the FTDR Act.45. In the present case, this Court is not called upon to decide and examine the obligations of the Contracting Parties in terms of GATT-1994. Our findings and ratio are confined and restricted to interpretation of Section 3 and 9A of the FTDR Act and in that context we have referred to GATT-1994.46. Learned counsel for some of the importers had placed reliance on Raj Prakash Chemical v. Union of India (1986) 2 SCC 297 , which judgment, in our opinion, has no application. In Raj Prakash Chemical (supra), the petitioner had acted under a bona fide belief in view of judgments and orders of High Courts and the interpretation placed by the authorities. In this background, observations were made to giving benefit to the importers, despite the contrary legal interpretation. In the instant case, the importers rely upon the interim orders passed by the High Courts whereas on the date when they filed the Writ Petitions and had obtained interim orders, the Madras High Court had dismissed the Writ Petition upholding the notification. Similarly, the High Court of adjudicature at Bombay, High Court of Gujarat and the High Court of Madhya Pradesh had dismissed the Writ Petitions filed before them and upheld the notifications and the trade notices. Notwithstanding the dismissals, the importers took their chance, obviously for personal gains and profits. They would accordingly face the consequences in law. In these circumstances, the importers it cannot be said had bona fide belief in the right pleaded.E. What is not decided47. Learned counsel for some of the importers had submitted that they have preferred statutory appeals against orders suspending or terminating import export code. The said aspect has not been examined and decided and hence we make no comment and observation. The statutory appeals, if any, preferred by the importer(s) will be decided in accordance with law.6. Application of treaties into national legal systems and the hierarchical status of the norms to be so applied are extraordinarily complex and vary from country to country depending upon constitutional and other municipal rules. Further, a number of legal and constitutional issues regarding international treaties arise in domestic law, like the power to negotiate, sign and exit a binding international obligation or treaty, validity of a treaty under the national constitutional law, power to implement the treaty obligations and applicability of treaty in domestic law including the principle of invocability or justiciability as contrasted from direct applicability and hierarchy of norms in domestic law where the treaty norms conflict with the norms of the domestic law. There is no uniformity in approach on these aspects as there are different national systems of treaty applications . Two aspects relevant in the present case are; (i) applicability of the international treaty in domestic law and (ii) invocability of the treaty in municipal law and before the municipal courts.7. In spite of there being different constitutional and statutory approaches on applicability, the States as signatories to the international treaty are under an obligation to act in conformity and bear responsibility for breaches, be it as a consequence of legislative enactment, executive action or even judicial decisions. The State cannot plead and rely upon internal law including judicial decisions as a defence to a claim for breach of an international obligation. Acts of legislation, executive measures and judicial decision making are not treated as third party acts for which the State is not responsible. The national law, executive mandate and action and the decisions of the domestic courts are facts which express the will and constitutes activities of the State. In international law, municipal laws cannot prevail upon the treaties as internal actions must comply with the international obligation. They may constitute breach of the treaty.8. Thus, breach of a stipulation in international law cannot be justified by the State by referring to its domestic legal position. This rule of international law is unexceptionable and prosaic, as the contra view would permit the international obligations to be evaded by the simple method of domestic legislation, executive action or judicial decision. Contracting States are under an obligation to act in conformity with the rules of international law and bear responsibility for breaches whether committed by the legislature, executive or even judiciary. In a way, therefore, international treaties are constraint on sovereign activity, albeit voluntarily agreed.9. For the purpose of GATT-1994, municipal laws are evidences of fact, including evidence of conduct in violation of the norms and objective of the treaty. At the same time, failure to enact an internal domestic law in conformity with the international obligation is not a breach of international law, unless there is such requirement and obligation created by the international treaty. In the absence of any such binding clause, breach arises only when the State concerned fails to observe its obligation on a specific occasion.Invocability in simple terms refers to justiciability; admissibility of a claim before the national courts. It is not connected with the defence or merits of the defence. In case where an act of transformation is required, treaties may partially or entirely become part of the domestic law. Where the treaty or portion thereof become a part of the domestic law by act of transformation, it is obvious that only the part incorporated or transformed into domestic law is invocable and justiciable and not the parts that are not codified into domestic law. However, invocability can embrace several ideas which are intertwined and is of specific concern in cases of constitutions allowing direct application. Here invocability is a generic term which means to embrace a small inventory of means of judicial control over the use in a particular law suit of the direct applicability of the treaty. As in case of act of transformation, even in direct application cases, some jurisdictions accept the principle of partial direct application and, therefore, the treaty is directly applicable for some purposes and not others.11. Most jurists draw distinction between direct application of treaties in domestic law, and national legal systems that mandate and require act of transformation for an international treaty to apply and be a part of domestic law. Direct application means and mandates that the treaty norms, either wholly or to some extent, are directly treated as norms of domestic law and enjoy the statutory law status by default in the domestic legal system. The term direct application will also cover situations in which government or different levels of government utilise treaty norms as part of domestic jurisprudence and is not limited to situations in which private parties can sue on the basis of the treaty norms. As explained below, there is distinction between direct application and invocability. Act of transformation principle means and implies that an international treaty is not directly applicable in the domestic law system and requires provision in the domestic rules before it is applied. Transformation is a word of wide amplitude and does not refer to mere implementation as it includes the right of the country to adopt, amend or modify the treaty language into domestic jurisprudence. The act of transformation is different from direct application as in the former the treaty is not received and treated as part of domestic jurisprudence until it is published and made part of the domestic jurisdiction in the same manner as other law.Except to the extent that a treaty becomes incorporated into the laws by a statute, the courts in United Kingdom have no power to enforce treaty rights and obligations at the behest of foreign government or even a citizen of the United Kingdom. It has been also held that decision as to whether the terms of the treaty have been complied with are matters exclusively for the Crown as the court must speak with the same voice as the executive (Lonrho Exports v. ECGD, [1998] 3 W.L.R 394.) . This principle is subject to the exceptions in cases where reference to the treaty is needed to explain the relevant factual background in cases where terms of the treaty are incorporated in a contract or the legislation refers to a relevant but un-incorporated treaty. However, an unincorporated international treaty can give rise to legitimate expectations that the executive, in the absence of statutory or executive indications to the contrary, will act in conformity with the treaty. In all other cases, rights and duties of the British subjects are affected by an Act of Parliament which is necessary for the provisions of the particular treaty to be operative within the United Kingdom. Further and at the same time, there is a presumption in English law that legislation is to be construed as to avoid conflict with international law. This specifically applies when interpretation to the Act of Parliament is in question, i.e. while interpreting the enactment as a consequence of the act of transformation. The courts would intend to bring the treaty into effect if the provisions are unambiguous unless they have no choice. In United Kingdom, the legislature is required to enact laws, that incorporate and transform treaties or treaty norms into domestic law. Variation of this approach is to be found in other countries like Germany and Italy. Thus, there is great diversity of national constitutional systems regarding international treaty application.15. The law in India is not very different from other Commonwealth Countries. Article 73 of the Constitution delineates the extent of executive power of the Union which extends to all matters with respect to which the Parliament has the power to make laws and it extends to the exercise of such rights, authority and jurisdiction as are exercisable by the Central Government by virtue of any treaty or agreement. Proviso to the Article deals with limitation of the executive power under sub-clause (a) with which we are not concerned. Chapter I of Part XI of the Constitution, captioned Relations between the Union and the Sates vide different Articles stipulates that in respect of List 1 of the 7th Schedule the Parliament has exclusive power to make laws for the whole or any of the territory of India; in respect of List II (State List) the legislatures of the States have exclusive power to make laws for the whole or any part of the States; and in respect of List III (Concurrent List) the Parliament and the State Legislatures have the power to make laws. For the purpose of the present case, Article 253 of the Constitution is important as it states that notwithstanding anything in the foregoing provisions of this Chapter, the Parliament has the power to make laws for the whole or any part of the territory of India for implementing any treaty, agreement or convention with any other country or countries or decisions made at any international conference, association or body.17. More important for our purpose is the concurring opinion of Shah, J. who had quoted the effect of international treaty on the rights of the citizen/subjects of the State as stated in Oppenheims International Law, 8 th Edition, in the following words:...Such treaties as affect private rights and, generally, as required for their enforcement by English Courts a modification of common law or of a statute must receive parliamentary assent through an enabling Act of Parliament. To that extent binding treaties which are part of International Law do not form part of the law of the land unless expressly made so by the Legislature.(page 40)The binding force of a treaty concerns in principle the contracting States only, and not their subjects. As International Law is primarily a law between States only and exclusively, treaties can normally have effect upon States only. This rule can, as has been pointed out by the Permanent Court of International Justice, be altered by the express or implied terms of the treaty, in which case its provisions become self- executory. Otherwise, if treaties contain provisions with regard to rights and duties of the subjects of the contracting States, their Courts, officials, and the like, these States must take steps as are necessary according to their Municipal Law, to make these provisions binding upon their subjects, Courts, officials, and the like.(page 924)Referring to the power under Article 73 of the Constitution and the power of the Parliament to make laws in terms of Article 253, Shah, J. had further observed:80...By Article 73, subject to the provisions of the Constitution, the executive power of the Union extends to the matters with respect to which the Parliament has power to make laws. Our Constitution makes no provision making legislation a condition of the entry into an international treaty in times either of war or peace. The executive power of the Union is vested in the President and is exercisable in accordance with the Constitution. The Executive is qua the State competent to represent the State in all matters international and may by agreement, convention or treaties incur obligations which in international law are binding upon the State. But the obligations arising under the agreement or treaties are not by their own force binding upon Indian nationals. The power to legislate in respect of treaties lies with the Parliament under Entries 10 and 14 of List I of the Seventh Schedule. But making of law under that authority is necessary when the treaty or agreement operates to restrict the rights of citizens or others or modifies the laws of the State. If the rights of the citizens or others which are justiciable are not affected, no legislative measure is needed to give effect to the agreement or treaty.. It was also clarified that Article 253 deals with the legislative power of the Parliament and thereby confers power on the Parliament which it may not otherwise possess. This provision does not seek to circumscribe the extent of power conferred under Article 73. In other words, in consequence of the exercise of executive power, rights of the citizens or others are restricted or infringed, or laws are modified, the exercise of power must be supported by legislation; where there is no such restriction, infringement of the right or modification of the laws, the executive is competent to exercise the power.21. Afore-quoted decisions are on the legal effect of international treaties in the domestic law in India. The ratio of these decisions primarily relates to and is confined to the requirement and mandate of the need for act of transformation to be a part and parcel of domestic law, which confers a right to invocability. The ratio of the above decisions has to be distinguished from decisions interpreting domestic law after the act of transformation consequent to which portions of GATT-1994 stand enacted thereby conferring right of invocability to parties.GATT-1994 is an international convention framed after great deliberation and exercise, to develop and promote international trade.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: WTO member countries, yet safeguard measures in the form of Quantitative Restrictions are not provided for under any Indian law. This is in accordance with the provision to incorporate safeguard measures in the form of Quantitative Restrictions, as provided in Article XIX of GATT and the WTO Agreement on Safeguards. Section 9A substantially incorporates, with some modifications, provisions of Article XIX of GATT-1994. Rules made in 2012 are also in conformity with the provisions of the WTO Agreement on Safeguards made in terms of Article XIX of GATT-1994. Sub-rule (3) to Rule 5 of the Safeguard Measures (Quantitative Restrictions) Rules, 2012 states and sets out the conditions for applicability of Rule 9A, which are: (i) increased imports; (ii) serious injury or threat of serious injury; and (iii) a causal link between increased imports and alleged serious injury or threat of serious injury. The expression increased imports has been defined in terms of increased quantity to mean increase in imports in absolute terms or relative to domestic production. The expressions serious injury and threat of serious injury have been defined in clauses (c) and (d) of sub-clause (4) to Section 9A to mean injury causing significant overall impairment in the position of a domestic industry and a clear and imminent danger of serious injury respectively. The expression domestic industry has also been defined in clause (b) to sub-section (4) to Section 9A. Similarly, the expression interested party has been defined in sub-rule (d) to Rule 2 of the Safeguard Measures (Quantitative Restriction) Rules, 2012 and includes exporter or foreign producer or the importer of goods for the purposes of imposition of safeguard quantitative restrictions on trade or business association. It also includes the government of the exporting country or producer of goods or directly competitive goods in India or a trade or business association . 41. The need to enact Section 9A arose from the obligations flowing from Article XIX, as restriction in form of quantitative restriction, require a procedure to be followed. Affected parties including exporters, importers have to be heard. Consequently, act of transformation was required. Article XIX of GATT-1994 is an escape provision, i.e. a provision which entitles a contracting state to escape from the rigours of paragraph (1) of Article XI of GATT- 1994. Similar acts of transformation have been undertaken by enacting Custom Valuation Rules, provision of antidumping, countervailing duty etc. but the entire GATT-1994 does not stand transposed and enacted by way of statutory law or delegated legislation. 42. This being the position, Section 9A has to be interpreted as an escape provision when the Central Government i.e. the Union of India may escape the rigours of paragraph (1) of Article XIX of GATT-1994. Section 9A is not a provision which incorporates or transposes paragraph (1) of Article XI into the domestic law either expressly or by necessary implication. To hold to the contrary, we would be holding that the Central Government has no right and power to impose quantitative restrictions except under Section 9A of the FTDR Act. This would be contrary to the legislative intent and objective. Section 9A of the FTDR Act does not elide or negate the power of the Central Government to impose restrictions on imports under sub-section (2) to Section 3 of the FTDR Act. 43. In other words, the impugned notifications would be valid as they have been issued in accordance with the power conferred in the Central Government in terms of sub-section (2) to Section 3 of the FTDR Act. The powers of the Central Government by an order imposing restriction on imports under sub-section (2) to Section 3 is, therefore, not entirely curtailed by Section 9A of the FTDR Act. 44. To be fair, learned counsel appearing for the importers had conceded that they cannot enforce or claim violation of paragraph (1) of Article XI of GATT-1994 in the domestic courts in India unless the said Article has been expressly or by necessary implication incorporated and transposed in the domestic law, that is, the FTDR Act. 45. In the present case, this Court is not called upon to decide and examine the obligations of the Contracting Parties in terms of GATT-1994. Our findings and ratio are confined and restricted to interpretation of Section 3 and 9A of the FTDR Act and in that context we have referred to GATT-1994. D. Contention of the importers of bona fide imports under interim orders and prayer for partial relief. 46. Learned counsel for some of the importers had placed reliance on Raj Prakash Chemical v. Union of India (1986) 2 SCC 297 , which judgment, in our opinion, has no application. In Raj Prakash Chemical (supra), the petitioner had acted under a bona fide belief in view of judgments and orders of High Courts and the interpretation placed by the authorities. In this background, observations were made to giving benefit to the importers, despite the contrary legal interpretation. In the instant case, the importers rely upon the interim orders passed by the High Courts whereas on the date when they filed the Writ Petitions and had obtained interim orders, the Madras High Court had dismissed the Writ Petition upholding the notification. Similarly, the High Court of adjudicature at Bombay, High Court of Gujarat and the High Court of Madhya Pradesh had dismissed the Writ Petitions filed before them and upheld the notifications and the trade notices. Notwithstanding the dismissals, the importers took their chance, obviously for personal gains and profits. They would accordingly face the consequences in law. In these circumstances, the importers it cannot be said had bona fide belief in the right pleaded. E. What is not decided 47. Learned counsel for some of the importers had submitted that they have preferred statutory appeals against orders suspending or terminating import export code. The said aspect has not been examined and decided and hence we make no comment and observation. The statutory appeals, if any, preferred by the importer(s) will be decided in accordance with law. F. Conclusion ### Response: 0

M.P. State Co-op. Dairy Fedn. Ltd. & Another Vs. Rajnesh Kumar Jamindar & Others

taken in the counter-affidavit before the High Court.42. Strong reliance has been placed by Mr. Sreekumar on a recent decision of this Court in Mundrika Dubey and Others v. State of Bihar and Others [(2008) 4 SCC 458] wherein orders of compulsory retirement by way of an economic measure had been found to be in the interest of the employer.43. It may be placed on record that neither there exist any such provision nor such a stand had been taken before the High Court. Furthermore, it is well-settled that while a power is exercised by an authority, ordinarily, the reasons contained in the order should be supported by the materials on records.44. Submission of Mr. Sreekumar, that the High Court should not have interfered with the order of compulsory retirement keeping in view the fact that no malafide has been alleged in the Scrutiny Committee nor any case of discrimination has been made out, cannot be accepted. It is one thing to say that a yardstick has been fixed for the purpose of taking recourse to the power of compulsory retirement but there cannot be any doubt or dispute that such yardstick must be based on relevant criteria. If the relevant criteria, as has been laid down by the State, which has been adopted by the Federation, had not been acted upon, the order must be held to have been suffering from jurisdictional error.45. It may be true that the superior courts in exercise of their power of judicial review ordinarily would not go into the factual findings as to which section of the employees should be brought within the parameters of Regulation 13 of the Regulations and which of them would not, but, in this case, we are concerned with a different question.46. We, therefore, do not find any infirmity in the judgment of the High Court.47. So far as the question of payment of back wages is concerned, we may notice Regulation 49(2) of the Regulations, which reads as under: "49 (2) When the termination or retirement of an employee from his service has been set aside by the court and the employee is reinstated without any further departmental proceeding, then the period of absence from the period of suspension, will be treated s the period on duty for all purposes including the grant of salary and allowances. The amount of subsistence allowance to him if has been paid will be deducted from the payable amount under this sub rule." A bare perusal of the said Regulation would clearly show that it applies in a case where an order of dismissal and/ or compulsory retirement by way of punishment is set aside. It is not a case where order of compulsory retirement had been passed by way of punishment. Respondents - employees herein were not charged with any misconduct. The order of compulsory retirement was issued in terms of the Regulation 13 of the Regulations only.48. Various decisions have been placed before us with regard to grant of back wages. Even the learned Single Judge had granted 50% back wages in favour of 16 employees. The Division Bench did not interfere therewith. We, therefore, fail to understand as to why the Division Bench thought fit to grant 20% back wages in respect of other employees. The decisions placed before us show that this Court keeping in view the facts and circumstances of each case had refused to grant 75% back wages.49. We, therefore, are of the opinion that 50% back wages should have been granted.50. In Civil Appeal arising out of SLP (C) No. 17705 of 2008, as noticed hereinbefore, an additional ground has been taken that Section 47 of the 1995 Act would be attracted in the case of the appellant. Section 47 of the 1995 Act reads as under: "47 - Non-discrimination in Government employment(1) No establishment shall dispense with, or reduce in rank, an employee who acquires a disability during his service:Provided that, if an employee, after acquiring disability is not suitable for the post he was holding, could be shifted to some other post with the same pay scale and service benefits:Provided further that if it is not possible to adjust the employee against any post, he may be kept on a supernumerary post until a suitable post is available or he attains the age of superannuation, whichever is earlier.(2) No promotion shall be denied to a person merely on the ground of his disability:Provided that the appropriate Government may, having regard to the type of work carried on in any establishment, by notification and subject to such conditions, if any, as may be specified in such notification, exempt any establishment from the provisions of this section." 51. The learned counsel submits that his client suffered disability in 1991. The 1995 Act, thus, did not come into force at that point of time. His services were continued not as a disabled person within the provisions of the 1995 Act. He was treated equally and, thus, we see no reason as to why the entire back wages should be granted in his favour whereas all other employees would be given 50% of their back wages.52. Furthermore, such a contention had not been raised before the Division Bench. It may be true that in a given case, this Court may allow the appellant to raise such a contention, as was done in the case of Kunal Singh v. Union of India and Another [(2003) 4 SCC 524] whereupon strong reliance has been placed, but it is not automatic.It is evident from the record that even before the learned Single Judge the said contention was not raised at the first instance. Only in the review petition, the said contention was raised. But, the said review petition was dismissed. As indicated hereinbefore, the said contention was again not raised before the Division Bench. We, therefore, are not inclined to agree with the contention that in terms of the 1995 Act, the appellant should be given 100% back wages.

0[ds]28. We have noticed the history of the Federation. It was a part of the Department of the Government. It not only carries on commercial activities, it works for achieving the better economic development of a section of the people. It seeks to achieve the principles laid down in Article 47 of the Constitution of India, viz., nutritional value and health. It undertakes a training and research work. Guidelines issued by it are binding on the societies. It monitors the functioning of the societies under it. It is an apex body.29. We, therefore, are of the opinion that the appellant herein would come within the purview of the definition of `State as contained in Article 12 of the Constitution of India.30. The learned Single Judge called for the records. It was found that the Regulations were amended in conformity with the government circulars and, thus, the said amendment was valid. It was noticed that at least in cases of 16 employees, the average grading being "good", their services could not have been dispensed with.Before us, like before the learned Single Judge and the Division Bench of the High Court, various discrepancies in the report of the Scrutiny Committee as approved by the Review Committee were pointed out. The examples placed before us clearly demonstrate that neither the Scrutiny Committee nor the Review Committee took into consideration the relevant factors germane for the purpose of passing such an order and in fact had taken into consideration irrelevant factors which were not germane therefor.34. Some of the employees, for a number of years, had been shown to be good officers; ACRs of some of whom in some of the years have been "very good". As has been noticed hereinbefore, the Scrutiny Committee as also the Review Committee proceeded to determine each individual case keeping in view the ACRs of the employees concerned from 1980, since when the Federation had started functioning, to the year 2000, when the decision had been taken to compulsorily retire the employees, by amending the Regulations. We have noticed hereinbefore that although criteria adopted by the State were required to be considered for the purpose of determining the suitability or otherwise of the employees to continue in service, the necessity to give special consideration to the performance of the employees for the last five years before the order was passed had been given a completeThe learned Single Judge as also the Division Bench, as noticed hereinbefore, clearly held that for the purpose of weeding out the dead wood, it was absolutely necessary to take into consideration the performance of each of the employees at least for the last two years.35. Each case, thus, was required to be considered on its own merit. The broad criteria, which are not only applicable generally for the aforementioned purpose, were required to be followed but there cannot be any doubt or dispute that the criteria laid down by the State was imperative in character. Thus, the Federation adopted the rules and circulars made or issued by the State Government. The Federation itself having formulated the criteria required to be applied for passing orders of compulsory retirement was, thus, bound thereby. It is now aprinciple of law that the employer would be bound by the rule of game. It must follow the standard laid down by itself. If procedures have been laid down for arriving at some kinds of decisions, the same should substantially be complied with even if the same are directory in nature.It is also aprinciple of law that an authority discharging a public function must act fairly. It, for the aforementioned purpose, cannot take into consideration an irrelevant or extraneous matter which is not germane for the purpose for which the power is sought to be exercised. The Scrutiny Committee as also the Review Committee was required to pose unto themselves a correct question of law so as to enable them to find out a correct answer. It was, therefore, imperative that the criteria laid down in the circulars issued by the State of Madhya Pradesh should have been scrupulously followed.40. Federation, therefore, in our opinion, having regard to the fact that there was no material to show that the respondentsemployees had become dead wood, inefficient or corrupt, must be held to have abused its power.41. `Interest of the Federation as contained in Regulation 13 of the Regulations would not mean that services of a large number of employees should be dispensed with only for the purpose of cutting administrative expenses. Even such a power does not exist in terms of the Regulations nor any such ground had been taken in thebefore the High Court.42. Strong reliance has been placed by Mr. Sreekumar on a recent decision of this Court in Mundrika Dubey and Others v. State of Bihar and Others [(2008) 4 SCC 458] wherein orders of compulsory retirement by way of an economic measure had been found to be in the interest of the employer.43. It may be placed on record that neither there exist any such provision nor such a stand had been taken before the High Court. Furthermore, it isthat while a power is exercised by an authority, ordinarily, the reasons contained in the order should be supported by the materials on records.44. Submission of Mr. Sreekumar, that the High Court should not have interfered with the order of compulsory retirement keeping in view the fact that no malafide has been alleged in the Scrutiny Committee nor any case of discrimination has been made out, cannot be accepted. It is one thing to say that a yardstick has been fixed for the purpose of taking recourse to the power of compulsory retirement but there cannot be any doubt or dispute that such yardstick must be based on relevant criteria. If the relevant criteria, as has been laid down by the State, which has been adopted by the Federation, had not been acted upon, the order must be held to have been suffering from jurisdictional error.45. It may be true that the superior courts in exercise of their power of judicial review ordinarily would not go into the factual findings as to which section of the employees should be brought within the parameters of Regulation 13 of the Regulations and which of them would not, but, in this case, we are concerned with a different question.46. We, therefore, do not find any infirmity in the judgment of the High Court.47. So far as the question of payment of back wages is concerned, we may notice Regulation 49(2) of the Regulations, which reads as(2) When the termination or retirement of an employee from his service has been set aside by the court and the employee is reinstated without any further departmental proceeding, then the period of absence from the period of suspension, will be treated s the period on duty for all purposes including the grant of salary and allowances. The amount of subsistence allowance to him if has been paid will be deducted from the payable amount under this subbare perusal of the said Regulation would clearly show that it applies in a case where an order of dismissal and/ or compulsory retirement by way of punishment is set aside. It is not a case where order of compulsory retirement had been passed by way of punishment. Respondentsemployees herein were not charged with any misconduct. The order of compulsory retirement was issued in terms of the Regulation 13 of the Regulations only.48. Various decisions have been placed before us with regard to grant of back wages. Even the learned Single Judge had granted 50% back wages in favour of 16 employees. The Division Bench did not interfere therewith. We, therefore, fail to understand as to why the Division Bench thought fit to grant 20% back wages in respect of other employees. The decisions placed before us show that this Court keeping in view the facts and circumstances of each case had refused to grant 75% back wages.49. We, therefore, are of the opinion that 50% back wages should have been granted.50. In Civil Appeal arising out of SLP (C) No. 17705 of 2008, as noticed hereinbefore, an additional ground has been taken that Section 47 of the 1995 Act would be attracted in the case of the appellant. Section 47 of the 1995 Act reads asn in Government employment(1) No establishment shall dispense with, or reduce in rank, an employee who acquires a disability during his service:Provided that, if an employee, after acquiring disability is not suitable for the post he was holding, could be shifted to some other post with the same pay scale and service benefits:Provided further that if it is not possible to adjust the employee against any post, he may be kept on a supernumerary post until a suitable post is available or he attains the age of superannuation, whichever is earlier.(2) No promotion shall be denied to a person merely on the ground of his disability:Provided that the appropriate Government may, having regard to the type of work carried on in any establishment, by notification and subject to such conditions, if any, as may be specified in such notification, exempt any establishment from the provisions of this section.The learned counsel submits that his client suffered disability in 1991. The 1995 Act, thus, did not come into force at that point of time. His services were continued not as a disabled person within the provisions of the 1995 Act. He was treated equally and, thus, we see no reason as to why the entire back wages should be granted in his favour whereas all other employees would be given 50% of their back wages.52. Furthermore, such a contention had not been raised before the Division Bench. It may be true that in a given case, this Court may allow the appellant to raise such a contention, as was done in the case of Kunal Singh v. Union of India and Another [(2003) 4 SCC 524] whereupon strong reliance has been placed, but it is not automatic.It is evident from the record that even before the learned Single Judge the said contention was not raised at the first instance. Only in the review petition, the said contention was raised. But, the said review petition was dismissed. As indicated hereinbefore, the said contention was again not raised before the Division Bench. We, therefore, are not inclined to agree with the contention that in terms of the 1995 Act, the appellant should be given 100% back wages.

### Instruction: Delve into the case proceeding and predict the outcome: is the judgment expected to be in support (1) or in denial (0) of the appeal? ### Input: taken in the counter-affidavit before the High Court.42. Strong reliance has been placed by Mr. Sreekumar on a recent decision of this Court in Mundrika Dubey and Others v. State of Bihar and Others [(2008) 4 SCC 458] wherein orders of compulsory retirement by way of an economic measure had been found to be in the interest of the employer.43. It may be placed on record that neither there exist any such provision nor such a stand had been taken before the High Court. Furthermore, it is well-settled that while a power is exercised by an authority, ordinarily, the reasons contained in the order should be supported by the materials on records.44. Submission of Mr. Sreekumar, that the High Court should not have interfered with the order of compulsory retirement keeping in view the fact that no malafide has been alleged in the Scrutiny Committee nor any case of discrimination has been made out, cannot be accepted. It is one thing to say that a yardstick has been fixed for the purpose of taking recourse to the power of compulsory retirement but there cannot be any doubt or dispute that such yardstick must be based on relevant criteria. If the relevant criteria, as has been laid down by the State, which has been adopted by the Federation, had not been acted upon, the order must be held to have been suffering from jurisdictional error.45. It may be true that the superior courts in exercise of their power of judicial review ordinarily would not go into the factual findings as to which section of the employees should be brought within the parameters of Regulation 13 of the Regulations and which of them would not, but, in this case, we are concerned with a different question.46. We, therefore, do not find any infirmity in the judgment of the High Court.47. So far as the question of payment of back wages is concerned, we may notice Regulation 49(2) of the Regulations, which reads as under: "49 (2) When the termination or retirement of an employee from his service has been set aside by the court and the employee is reinstated without any further departmental proceeding, then the period of absence from the period of suspension, will be treated s the period on duty for all purposes including the grant of salary and allowances. The amount of subsistence allowance to him if has been paid will be deducted from the payable amount under this sub rule." A bare perusal of the said Regulation would clearly show that it applies in a case where an order of dismissal and/ or compulsory retirement by way of punishment is set aside. It is not a case where order of compulsory retirement had been passed by way of punishment. Respondents - employees herein were not charged with any misconduct. The order of compulsory retirement was issued in terms of the Regulation 13 of the Regulations only.48. Various decisions have been placed before us with regard to grant of back wages. Even the learned Single Judge had granted 50% back wages in favour of 16 employees. The Division Bench did not interfere therewith. We, therefore, fail to understand as to why the Division Bench thought fit to grant 20% back wages in respect of other employees. The decisions placed before us show that this Court keeping in view the facts and circumstances of each case had refused to grant 75% back wages.49. We, therefore, are of the opinion that 50% back wages should have been granted.50. In Civil Appeal arising out of SLP (C) No. 17705 of 2008, as noticed hereinbefore, an additional ground has been taken that Section 47 of the 1995 Act would be attracted in the case of the appellant. Section 47 of the 1995 Act reads as under: "47 - Non-discrimination in Government employment(1) No establishment shall dispense with, or reduce in rank, an employee who acquires a disability during his service:Provided that, if an employee, after acquiring disability is not suitable for the post he was holding, could be shifted to some other post with the same pay scale and service benefits:Provided further that if it is not possible to adjust the employee against any post, he may be kept on a supernumerary post until a suitable post is available or he attains the age of superannuation, whichever is earlier.(2) No promotion shall be denied to a person merely on the ground of his disability:Provided that the appropriate Government may, having regard to the type of work carried on in any establishment, by notification and subject to such conditions, if any, as may be specified in such notification, exempt any establishment from the provisions of this section." 51. The learned counsel submits that his client suffered disability in 1991. The 1995 Act, thus, did not come into force at that point of time. His services were continued not as a disabled person within the provisions of the 1995 Act. He was treated equally and, thus, we see no reason as to why the entire back wages should be granted in his favour whereas all other employees would be given 50% of their back wages.52. Furthermore, such a contention had not been raised before the Division Bench. It may be true that in a given case, this Court may allow the appellant to raise such a contention, as was done in the case of Kunal Singh v. Union of India and Another [(2003) 4 SCC 524] whereupon strong reliance has been placed, but it is not automatic.It is evident from the record that even before the learned Single Judge the said contention was not raised at the first instance. Only in the review petition, the said contention was raised. But, the said review petition was dismissed. As indicated hereinbefore, the said contention was again not raised before the Division Bench. We, therefore, are not inclined to agree with the contention that in terms of the 1995 Act, the appellant should be given 100% back wages. ### Response: 0

Rev. Mons. Sebastiao Francisco Xavier Dos Remedios Monteiro Vs. State of Goa

territory. Anticipated annexation by unilateral action is not true annexation. True annexation is only so when the territory is conquered and subjugated.(See Oppenheim International Law (7th End.). pp. 846-847 (Vol. I) 566 (Vol. I), pp. 448/52 (Vol. II), 430-439 (Vol. II) and 599 et. Seq. (Vol II), Greenspan (ibid) pp. 215 et. Seq. 600-603; Could : Introduction to International Law pp. 652-656, 662-663; Briefly : Law of Nations p. 155. 25. The Conventions rightly lay down that annexation has no effect on the protection. But they speak of premature or anticipated annexation. Premature or anticipated annexation has no effect. Such a plea was negatived for the same reason by the Nuremberg Tribunal.In fact, when the Convention itself was being drafted the experts were half-inclined to add the word alleged before annexation in Article 47 to distinguish between annexation following conquest and subjugation and annexation made while hostilities are going on. Subjugation puts an end to the State of war and destroys the source of authority of the existing Government . In subjugation , which is recognized as one of the modes of acquiring title, not the de facto but also the de jure title passes to the conqueror.After subjugation the inhabitants must obey the laws such as are made and not resist them. 26. Thus the principle which is accepted is that the Occupying Power must apply the Convention even when it claims during conflict to have annexed the occupied territory. However, then the conflict is over and there is no hostile army in the field, annexation has the effect of creating a title to the territory. It may be asked why does Article 6 then mention a period of one year ? The reason given is that if the Occupied Power turns victorious the land would be freed in one year and if the Occupying Power remains victorious, as hostilities cease, strong measures against the civilian population are no longer necessary. In this, as in other laws, a line is drawn arbitrarily and it is at the end of one year. Otherwise also, occupation which means belligerent occupation, comes to an end when hostilities cease and the territory becomes a part of the Occupying Power. Annexation may sometimes be peaceful, as for example, Texas and Hawaiian Island were peacefully annexed by the United States or after war, as the annexation of South Africa and Orange Free State by Britain. 27. The question, when does title to the new territory begin, is not easy to answer. Some would make title depend upon recognition. Mr. Stimsons doctrine of non-recognition in cases where a State of things has been brought about contrary to the Pact of Paris was intended to deny root of title conquest but when Italy conquered Abyssinia, the conquest was recognized because it was thought that the state of affairs had come to stay . Thus, although the United Nations Charter includes the obligation that force would not be used against the territorial integrity of other States (Art. 2 Para 4), events after the Second World War have shown that transfer of title to territory by conquest is still recognized. Prof. R. Y. Jennings poses the question :"What is the legal position where a conqueror having no title by conquest is nevertheless in full possession of the territorial power, and not apparently to be ousted ?" He recommends the recognition of this fact between the two States. If cession after defeat can create title, occupation combined with absence of opposition must lead to the same kind of title. 28. In the present case the facts are that the military engagement was only a few hours duration and then there was no resistance at all. It is hardly necessary to try to establish title by history traced to the early days as was done in the Minquiers and Encrenos case, 1953 SCJ 47. Nor is there any room for the thesis of Dr. Schwarzenberger (A Manual of International Law, 5th Edn. P. 12) that title is relative and grows with recognition.True annexation followed here so close upon military occupation as to leave no real hiatus. We can only take the critical date of true and final annexation as December 20, 1961 when the entire government and administration were taken over and there was no army in occupation and no army in opposition. The occupation on December 20, 1961 was neither belligerent occupation nor anticipated occupation, but true annexation by conquest and subjugation. It must be remembered that Mr. Gardiner concedes that the annexation was lawful. Therefore since occupation in the sense used in Article 47 had ceased, the protection must cease also. We are, therefore, of opinion that in the present case there was no breach of the Geneva Conventions. 29. We were invited to look at the matter from another point of view, namely, even if the protection against deportation envisaged by Arts. 47 and 49 were taken to be continued, what is the remedy which the Municipal Courts can give? It was said, the act was an act of State. In view of what we have already held it is not necessary to pronounce our opinion on this argument. 30. The national status of subjects of the subjugated State is a matter for the State, and courts of law can have no say in the matter. As Oppenheim (Vol. 1 p. 573) puts it:"The subjugating State can, if it likes, allow them to emigrate, and to renounce their newly acquired citizenship, and its Municipal law can put them in any position it likes, and can in particular grant or refuse them the same rights as those which its citizens by birth enjoy." 31. The Geneva Convention ceased to apply after December 20, 1961. The Indian Government offered Rev. Father Monteiro Indian nationality and citizenship which he refused and retained his Portuguese nationality. As a Portuguese national he could only stay in India on taking out a permit. He was, therefore, rightly prosecuted under the law applicable to him.

0[ds]6. The argument overlooks one cardinal principle of International Law and it is this. Rev. Father Monterio by his declaration retained his Portuguese nationality.His sojourn in India was subject to such laws as existed in India in general and in Goa in particular. It cannot be doubted that the reception and residence of an alien is a matter of discretion and every State has, by reason of its own territorial supremacy, not only the legal right but also the competence to exclude aliens from the whole or any part of its territory. This proposition is so well-grounded in International Law that every country has adopted the passport system, which document certifies nationality and entry into any State is only possible with the concurrence of that State. Again a State exercises territory supremacy over persons in its territory, whether its own subjects or aliens and can make laws for regulating the entry, residence and eviction of aliens. Therefore, the application of the Foreigners Act, the Registration of Foreigners Act and the Orders passed under them, to Rev. Father Monterio was legally competent. A considerable body of writers on International Law support the proposition and it is sufficient to refer only to Oppenheim (Vol. I) pp. 675/676 and Brierly Law of Nations p. 217.If authority were needed the proposition would be found supported in the decision of the Privy Council inMusgrove v. Chun Teeong Toy 1891 AC. The Lord Chancellor in that case denied that an alien excluded from British Territory could maintain an action in a British Court to enforce such a rightBy Articles 1 and 2 there is an undertaking to respect and ensure respect for the Conventions in all circumstances of declared war or of any other armed conflict even if the state of war is not recognized by one of the parties and to all cases of partial or total occupation of the territory of a High Contracting Party even if the occupation meets with no armed resistance. Article 4 defines a protected person and the expression includes those who at a given moment and in any manner whatsoever, find themselves, in case of conflict or occupation, in the hands of a Party to the conflict or Occupying Power of which they are not nationals. Article 6 then lays down the beginning and end of application of the Convention. The Convention applies from the outset of any conflict or occupation. In the territory of Parties to the conflict, the application of the Convection cases on the general close of Military operation. In the occupied territory it ceases one year after the general close of military operation but the occupying Power is bound for the duration of occupation, to the extent that such Power exercises the functions of Government in such territory, by Articles 1-12, 27, 29-34, 47, 49, 51, 52, 53, 59, 61-73 and 143We are of opinion that the pleas of Mr. Gardner that the Geneva Conventions Act makes dispunishable the conduct of Rev. Father Moterio, must failWe may, therefore, say a few words about the Geneva Conventions, particularly Schedule IV, which deals with the protection of civilian persons in time of war. In the past protection of civilian population was inadequately provided in Conventions and treaties. The four conventions came at different times, the oldest in 1864 and the last in 1949. The Fourth Hague Convention of 1907 contained Articles 42-56, but this protection was restricted to occupation by an enemy army. The Regulations merely stated the principles and enjoined maintenance of law and order and regard for family rights, lives of persons and private property, and prohibited collective punishments. In effect, these were confined to the forward areas of war and did not apply when total war took place and the civilian population was as much exposed to the dangers of war as the military. The example of the First World War showed that civilian population was exposed to exactions. At the time when the Hague regulations were done, it was though that such matters as non-internment of the nationals of the adversary would be observed. But the First World War proved to the contrary. It was in 1921 that the International Committee of the Red Cross produced a draft Convention which among other things enjoined that the inhabitants of the occupied territory should not be deported and civilians in enemy territory must be allowed to return to their homes unless there were reasons of State security and the internees must receive the same treatment as prisoners of war. The Diplomatic Conference of 1929 and the Red Cross Conference of 1934 made useful studies but action scheduled to take place in 1940 could not be implemented as the Second World War broke out. Although the belligerent countries had accepted that the 1929 Convention regarding prisoners of war was applicable to civilians, the lessons of the Second World War were different. We know the treatment of civilians by Germany and the horrid deaths and privations inflicted on them. War, though outlawed, continues still and as President Max Huber said :-War, as it becomes more and more total, annuls the differences which formerly existed between armies and civilian populations in regard to exposure to injury and danger."17. At the termination of the last war the International Red Cross Conference at Stockholm prepared a draft in 1948, which became the basis of the deliberations of the Diplomatic Conference which met at Geneva from April 21 to August 12, 1949 and the present Convention was framed. The Regulations were not revised or incorporated. The 1949 Conventions are additional to the Regulations and it is expressly so laid down in Article 154 of the Geneva Conventions18. The Hague Regulations, Arts. 42 - 56, contained some limited and general rule for the protection of inhabitants of occupied territory. The Regulations are supplementary. Regulations 43 and 55 which have no counterpart in the Geneva Conventions must be read. They are not relevant here. Similarly, as there is no definition of occupation in the Geneva Conventions, Article 42 of the Regulation must be read as it contains a definition:"42. A territory is considered as occupied when it finds itself in fact placed under the authority of hostile army."19. The Regulations further charge the authority having power over the territory to take all measures to establish and assure law and order. The Regulations generally charged the occupying power to respect the persons and property of the inhabitants of the occupied territory. There was no provision showing when occupation commenced and when it came to an end. It is because of this omission that it is claimed in this case that occupation continues so long as there is no cession of the territory by the conquered or withdrawal by the conqueror and that till then the protection of the Geneva Conventions obtains. However, Article 6 which provides about the beginning and end of the application of the Conventions throws some light on this matter21. The definitions of occupation in the Regulations must be read since the regulations are the original rules and the Conventions only supplement the Regulations. We have already quoted the definition and it shows that a territory is considered as occupied when it finds itself in fact placed under the authority of a hostile army. This means that occupation is by military authorities.In the Justice cased States v. Attstoctcer, et al. (1947) U. S. Military Tribunal, Nuremberg L. R. 3 T. N. C. vi.) it was stated that the laws of belligerent occupation apply only to an occupation during the course of actual warfare and that once the enemy has been totally defeated those laws do not apply to the ensuing occupation22. The question thus resolves itself into this: Is occupation in Article 47 belligerent occupation or occupation which continues after the total defeat of the enemy ? In this connection courts must take the Facts of State from the declaration of State authorities. Military occupation is temporary de facto situation which does not deprive the Occupied Power of its sovereignty nor does it take away its Statehood. All that happens is that pro tempore the Occupied Power cannot exercise its rights. In other words belligerent occupation means that the Government cannot function and authority is exercised by the occupying force23. Annexation, on the other hand, occurs when the Occupying Power acquires and makes the occupied territory as its own. Annexation gives a de jure right to administer the territory. Annexation means that there is not only possession but uncontested sovereignty over the territory.As Greenspan - The Modern Law of Land Warfare put it (p. 215) military occupation must be distinguished from subjugation , where a territory is not only conquered, but annexed by the conqueror24. There is, however, a difference between true annexation on the one hand and premature annexation, or as it is sometimes called anticipated annexation, on the other. Jurists regard annexation as premature so long as hostilities are continuing and there is an opposing army in the field even if the Occupied Power is wholly excluded from the territory. Anticipated annexation by unilateral action is not true annexation. True annexation is only so when the territory is conquered and subjugated.(See Oppenheim International Law (7th End.). pp. 846-847 (Vol. I) 566 (Vol. I), pp. 448/52 (Vol. II), 430-439 (Vol. II) and 599 et. Seq. (Vol II), Greenspan (ibid) pp. 215 et. Seq. 600-603; Could : Introduction to International Law pp. 652-656, 662-663; Briefly : Law of Nations p. 15525. The Conventions rightly lay down that annexation has no effect on the protection. But they speak of premature or anticipated annexation. Premature or anticipated annexation has no effect. Such a plea was negatived for the same reason by the Nuremberg Tribunal.In fact, when the Convention itself was being drafted the experts were half-inclined to add the word alleged before annexation in Article 47 to distinguish between annexation following conquest and subjugation and annexation made while hostilities are going on. Subjugation puts an end to the State of war and destroys the source of authority of the existing Government . In subjugation , which is recognized as one of the modes of acquiring title, not the de facto but also the de jure title passes to the conqueror.After subjugation the inhabitants must obey the laws such as are made and not resist themthe principle which is accepted is that the Occupying Power must apply the Convention even when it claims during conflict to have annexed the occupied territory. However, then the conflict is over and there is no hostile army in the field, annexation has the effect of creating a title to the territory. It may be asked why does Article 6 then mention a period of one year ? The reason given is that if the Occupied Power turns victorious the land would be freed in one year and if the Occupying Power remains victorious, as hostilities cease, strong measures against the civilian population are no longer necessary. In this, as in other laws, a line is drawn arbitrarily and it is at the end of one year. Otherwise also, occupation which means belligerent occupation, comes to an end when hostilities cease and the territory becomes a part of the Occupying Power. Annexation may sometimes be peaceful, as for example, Texas and Hawaiian Island were peacefully annexed by the United States or after war, as the annexation of South Africa and Orange Free State by Britain27. The question, when does title to the new territory begin, is not easy to answer. Some would make title depend upon recognition. Mr. Stimsons doctrine of non-recognition in cases where a State of things has been brought about contrary to the Pact of Paris was intended to deny root of title conquest but when Italy conquered Abyssinia, the conquest was recognized because it was thought that the state of affairs had come to stay . Thus, although the United Nations Charter includes the obligation that force would not be used against the territorial integrity of other States (Art. 2 Para 4), events after the Second World War have shown that transfer of title to territory by conquest is still recognized. Prof. R. Y. Jennings poses the questiont is the legal position where a conqueror having no title by conquest is nevertheless in full possession of the territorial power, and not apparently to be ousted ?"He recommends the recognition of this fact between the two States. If cession after defeat can create title, occupation combined with absence of opposition must lead to the same kind of title28. In the present case the facts are that the military engagement was only a few hours duration and then there was no resistance at all. It is hardly necessary to try to establish title by history traced to the early days as was done in the Minquiers and Encrenos case, 1953 SCJ 47. Nor is there any room for the thesis of Dr. Schwarzenberger (A Manual of International Law, 5th Edn. P. 12) that title is relative and grows with recognition.True annexation followed here so close upon military occupation as to leave no real hiatus. We can only take the critical date of true and final annexation as December 20, 1961 when the entire government and administration were taken over and there was no army in occupation and no army in opposition. The occupation on December 20, 1961 was neither belligerent occupation nor anticipated occupation, but true annexation by conquest and subjugation. It must be remembered that Mr. Gardiner concedes that the annexation was lawful. Therefore since occupation in the sense used in Article 47 had ceased, the protection must cease also. We are, therefore, of opinion that in the present case there was no breach of the Geneva Conventions29. We were invited to look at the matter from another point of view, namely, even if the protection against deportation envisaged by Arts. 47 and 49 were taken to be continued, what is the remedy which the Municipal Courts can give? It was said, the act was an act of State. In view of what we have already held it is not necessary to pronounce our opinion on this argument30. The national status of subjects of the subjugated State is a matter for the State, and courts of law can have no say in the matter. As Oppenheim (Vol. 1 p. 573) puts it:"The subjugating State can, if it likes, allow them to emigrate, and to renounce their newly acquired citizenship, and its Municipal law can put them in any position it likes, and can in particular grant or refuse them the same rights as those which its citizens by birth enjoy."The Geneva Convention ceased to apply after December 20, 1961. The Indian Government offered Rev. Father Monteiro Indian nationality and citizenship which he refused and retained his Portuguese nationality. As a Portuguese national he could only stay in India on taking out a permit. He was, therefore, rightly prosecuted under the law applicable to him.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: territory. Anticipated annexation by unilateral action is not true annexation. True annexation is only so when the territory is conquered and subjugated.(See Oppenheim International Law (7th End.). pp. 846-847 (Vol. I) 566 (Vol. I), pp. 448/52 (Vol. II), 430-439 (Vol. II) and 599 et. Seq. (Vol II), Greenspan (ibid) pp. 215 et. Seq. 600-603; Could : Introduction to International Law pp. 652-656, 662-663; Briefly : Law of Nations p. 155. 25. The Conventions rightly lay down that annexation has no effect on the protection. But they speak of premature or anticipated annexation. Premature or anticipated annexation has no effect. Such a plea was negatived for the same reason by the Nuremberg Tribunal.In fact, when the Convention itself was being drafted the experts were half-inclined to add the word alleged before annexation in Article 47 to distinguish between annexation following conquest and subjugation and annexation made while hostilities are going on. Subjugation puts an end to the State of war and destroys the source of authority of the existing Government . In subjugation , which is recognized as one of the modes of acquiring title, not the de facto but also the de jure title passes to the conqueror.After subjugation the inhabitants must obey the laws such as are made and not resist them. 26. Thus the principle which is accepted is that the Occupying Power must apply the Convention even when it claims during conflict to have annexed the occupied territory. However, then the conflict is over and there is no hostile army in the field, annexation has the effect of creating a title to the territory. It may be asked why does Article 6 then mention a period of one year ? The reason given is that if the Occupied Power turns victorious the land would be freed in one year and if the Occupying Power remains victorious, as hostilities cease, strong measures against the civilian population are no longer necessary. In this, as in other laws, a line is drawn arbitrarily and it is at the end of one year. Otherwise also, occupation which means belligerent occupation, comes to an end when hostilities cease and the territory becomes a part of the Occupying Power. Annexation may sometimes be peaceful, as for example, Texas and Hawaiian Island were peacefully annexed by the United States or after war, as the annexation of South Africa and Orange Free State by Britain. 27. The question, when does title to the new territory begin, is not easy to answer. Some would make title depend upon recognition. Mr. Stimsons doctrine of non-recognition in cases where a State of things has been brought about contrary to the Pact of Paris was intended to deny root of title conquest but when Italy conquered Abyssinia, the conquest was recognized because it was thought that the state of affairs had come to stay . Thus, although the United Nations Charter includes the obligation that force would not be used against the territorial integrity of other States (Art. 2 Para 4), events after the Second World War have shown that transfer of title to territory by conquest is still recognized. Prof. R. Y. Jennings poses the question :"What is the legal position where a conqueror having no title by conquest is nevertheless in full possession of the territorial power, and not apparently to be ousted ?" He recommends the recognition of this fact between the two States. If cession after defeat can create title, occupation combined with absence of opposition must lead to the same kind of title. 28. In the present case the facts are that the military engagement was only a few hours duration and then there was no resistance at all. It is hardly necessary to try to establish title by history traced to the early days as was done in the Minquiers and Encrenos case, 1953 SCJ 47. Nor is there any room for the thesis of Dr. Schwarzenberger (A Manual of International Law, 5th Edn. P. 12) that title is relative and grows with recognition.True annexation followed here so close upon military occupation as to leave no real hiatus. We can only take the critical date of true and final annexation as December 20, 1961 when the entire government and administration were taken over and there was no army in occupation and no army in opposition. The occupation on December 20, 1961 was neither belligerent occupation nor anticipated occupation, but true annexation by conquest and subjugation. It must be remembered that Mr. Gardiner concedes that the annexation was lawful. Therefore since occupation in the sense used in Article 47 had ceased, the protection must cease also. We are, therefore, of opinion that in the present case there was no breach of the Geneva Conventions. 29. We were invited to look at the matter from another point of view, namely, even if the protection against deportation envisaged by Arts. 47 and 49 were taken to be continued, what is the remedy which the Municipal Courts can give? It was said, the act was an act of State. In view of what we have already held it is not necessary to pronounce our opinion on this argument. 30. The national status of subjects of the subjugated State is a matter for the State, and courts of law can have no say in the matter. As Oppenheim (Vol. 1 p. 573) puts it:"The subjugating State can, if it likes, allow them to emigrate, and to renounce their newly acquired citizenship, and its Municipal law can put them in any position it likes, and can in particular grant or refuse them the same rights as those which its citizens by birth enjoy." 31. The Geneva Convention ceased to apply after December 20, 1961. The Indian Government offered Rev. Father Monteiro Indian nationality and citizenship which he refused and retained his Portuguese nationality. As a Portuguese national he could only stay in India on taking out a permit. He was, therefore, rightly prosecuted under the law applicable to him. ### Response: 0

Manilal Mohanlal Shah And Others Vs. Sardar Sayed Ahmed Sayed Mahmad And Another

court to re-sell the property is imperative. A further consequence of non-payment is that the defaulting purchaser forfeits all claim to the property ... (Rule 86).9. It is not denied that the purchasers had not obtained any decree on foot of their mortgage and the claim of Rs. 1,20,000 which they put forward before the execution court had not been adjudicated upon or determined. The mortgagees, one of whom is a Pleader, applied on the day of the sale claiming a set off on foot of the mortgage. The Court without applying its mind to the question immediately passed the order allowing the set-off. This claim was obviously not admissible under the provisions of rule 84 which applies only to the decree-holder. The court had clearly no jurisdiction to allow a set off. The appellants misled the court into passing a wrong order and obtaining the advantage of a set-off while they know perfectly well that they had got no decree on foot of the mortgage and their claim was undetermined,There was default in depositing 25 percent of the purchase money and further there was no payment of the full amount of the purchase money within fifteen days from the date if the sale. Both the deposit and the payment of the purchase money being mandatory under the combined effect of rules 84 and 85, the Court has the discretion to forfeit the deposit but it was bound to re-sell the property with the result that on default the purchaser forfeited all claim to the property. These provisions leave no doubt that unless the deposit and the payment are made as required by the mandatory provisions of the rules there is no sale in the eye of law in favour of the defaulting purchaser and no right to own and possess the property accrues to him.10. In two cases decided by Calcutta High Court, viz., --- Munshi Md. Ali v. Kibria Khatun, 15, Cal WN 350 (B) and --- Sm. Annapurna Dasi v. Bazely Karim Mia, AIR 1941 Cal 85 (C) the sale was held to be no sale where the purchaser had failed to deposit the balance of the purchase money as required by rule 85. A similar view was taken by a Division Bench of the Allahabad High Court in------: Nawal Kishore v. Butta Mal, AIR 1935 All 243 (D). The provisions of rule 86 were held to be mandatory in another decision of the same Court --- "Haji Inam Ullah v. Mohamad Idris, AIR 1943 All 282 (E) and it was held that the court was bound to re-sell the property upon default irrespective of any application being made by any party to the proceedings.The case of ---Bhim Singh v. Sarwan Singh 16 Cal 33 (F) was a case of failure to make a deposit as required by Section 306 of the Code of 1882 (corresponding to rule 85 of the present Code). The court treated it as a material irregularity in conducting the sale which must be enquired into upon the application under Section 311, (corresponding to rule 90 of the present Code), and not by a separate suit to set aside the sale. The Court did not apply its mind to the question whether the provisions of Section 306 being mandatory sale should not be treated as a nullity for non-compliance with those provisions.The decision of a single Judge (app J.) in --- Nathu Mal v. Malawa Mal, AIR 1931 Lah 15 (G) is distinguishable upon its facts. There the auction-purchaser had actually tendered the money but the payment was postponed by consent of parties pending the disposal of the objection by the judgment-debtor. We do not agree with the remark made in that case that the provisions of rule 85 are intended "to be directory only and not absolutely mandatory". A Division Bench of the same court (Tek Chand and Abdul Rashid JJ.) held in --- A. R. Davar v. Jhinda Ram;, AIR 1938 Lah 198 (H) that the court had no jurisdiction to extend the time for the payment of the balance of the purchase money under rule 85 and must order resale under rule 86.11. Having examined the language of the relevant rules and the judicial decisions bearing upon the subject we are of opinion that the provisions of the rules requiring the deposit of 25 per cent. of the purchase money immediately on the person being declared as a purchaser and the payment of the balance within 15 days of the sale are mandatory and upon non-compliance with these provisions there is no sale at all. The rules do not contemplate that there can be any sale in favour of a purchaser without depositing 25 per cent of the purchase money in the first instance and the balance within 15 days. When there is no-sale within the contemplation of these rules, there can be no question of material irregularly in the conduct of the sale. Non-payment of the price of the part of the defaulting purchaser renders the sale proceedings as a complete nullity. The very fact that the court is bound to re-sell the property in the event of a default shows that the previous proceedings for sale are completely wiped out as if they do not exist in the eye of law. We hold, therefore, that in the circumstances of the present case there was no sale and the purchasers acquired no rights at all.12. It was urged before us that the court could allow a set-off in execution proceedings under its inherent powers apart from the provisions of Order 21, rule 19 of the Civil Procedure Code. We do not think that the inherent powers of the Court could be invoked to circumvent the mandatory provisions of the Code and relive the purchasers of their obligation to make the deposit. The appellant by misleading the court want to benefit by the mistake to which they themselves contributed. They cannot be allowed to take advantage of their own wrong.

0[ds]ut for the mistake we are of opinion that both the contentions are devoid of substance.It is not denied that the purchasers had not obtained any decree on foot of their mortgage and the claim of Rs. 1,20,000 which they put forward before the execution court had not been adjudicated upon or determined. The mortgagees, one of whom is a Pleader, applied on the day of the sale claiming a set off on foot of the mortgage. The Court without applying its mind to the question immediately passed the order allowing the set-off. This claim was obviously not admissible under the provisions of rule 84 which applies only to the decree-holder. The court had clearly no jurisdiction to allow a set off. The appellants misled the court into passing a wrong order and obtaining the advantage of a set-off while they know perfectly well that they had got no decree on foot of the mortgage and their claim was undetermined,There was default in depositing 25 percent of the purchase money and further there was no payment of the full amount of the purchase money within fifteen days from the date if the sale. Both the deposit and the payment of the purchase money being mandatory under the combined effect of rules 84 and 85, the Court has the discretion to forfeit the deposit but it was bound to re-sell the property with the result that on default the purchaser forfeited all claim to the property. These provisions leave no doubt that unless the deposit and the payment are made as required by the mandatory provisions of the rules there is no sale in the eye of law in favour of the defaulting purchaser and no right to own and possess the property accrues to him.Having examined the language of the relevant rules and the judicial decisions bearing upon the subject we are of opinion that the provisions of the rules requiring the deposit of 25 per cent. of the purchase money immediately on the person being declared as a purchaser and the payment of the balance within 15 days of the sale are mandatory and upon non-compliance with these provisions there is no sale at all. The rules do not contemplate that there can be any sale in favour of a purchaser without depositing 25 per cent of the purchase money in the first instance and the balance within 15 days. When there is no-sale within the contemplation of these rules, there can be no question of material irregularly in the conduct of the sale. Non-payment of the price of the part of the defaulting purchaser renders the sale proceedings as a complete nullity. The very fact that the court is bound to re-sell the property in the event of a default shows that the previous proceedings for sale are completely wiped out as if they do not exist in the eye of law. We hold, therefore, that in the circumstances of the present case there was no sale and the purchasers acquired no rights atdo not think that the inherent powers of the Court could be invoked to circumvent the mandatory provisions of the Code and relive the purchasers of their obligation to make the deposit. The appellant by misleading the court want to benefit by the mistake to which they themselves contributed. They cannot be allowed to take advantage of their own wrong.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: court to re-sell the property is imperative. A further consequence of non-payment is that the defaulting purchaser forfeits all claim to the property ... (Rule 86).9. It is not denied that the purchasers had not obtained any decree on foot of their mortgage and the claim of Rs. 1,20,000 which they put forward before the execution court had not been adjudicated upon or determined. The mortgagees, one of whom is a Pleader, applied on the day of the sale claiming a set off on foot of the mortgage. The Court without applying its mind to the question immediately passed the order allowing the set-off. This claim was obviously not admissible under the provisions of rule 84 which applies only to the decree-holder. The court had clearly no jurisdiction to allow a set off. The appellants misled the court into passing a wrong order and obtaining the advantage of a set-off while they know perfectly well that they had got no decree on foot of the mortgage and their claim was undetermined,There was default in depositing 25 percent of the purchase money and further there was no payment of the full amount of the purchase money within fifteen days from the date if the sale. Both the deposit and the payment of the purchase money being mandatory under the combined effect of rules 84 and 85, the Court has the discretion to forfeit the deposit but it was bound to re-sell the property with the result that on default the purchaser forfeited all claim to the property. These provisions leave no doubt that unless the deposit and the payment are made as required by the mandatory provisions of the rules there is no sale in the eye of law in favour of the defaulting purchaser and no right to own and possess the property accrues to him.10. In two cases decided by Calcutta High Court, viz., --- Munshi Md. Ali v. Kibria Khatun, 15, Cal WN 350 (B) and --- Sm. Annapurna Dasi v. Bazely Karim Mia, AIR 1941 Cal 85 (C) the sale was held to be no sale where the purchaser had failed to deposit the balance of the purchase money as required by rule 85. A similar view was taken by a Division Bench of the Allahabad High Court in------: Nawal Kishore v. Butta Mal, AIR 1935 All 243 (D). The provisions of rule 86 were held to be mandatory in another decision of the same Court --- "Haji Inam Ullah v. Mohamad Idris, AIR 1943 All 282 (E) and it was held that the court was bound to re-sell the property upon default irrespective of any application being made by any party to the proceedings.The case of ---Bhim Singh v. Sarwan Singh 16 Cal 33 (F) was a case of failure to make a deposit as required by Section 306 of the Code of 1882 (corresponding to rule 85 of the present Code). The court treated it as a material irregularity in conducting the sale which must be enquired into upon the application under Section 311, (corresponding to rule 90 of the present Code), and not by a separate suit to set aside the sale. The Court did not apply its mind to the question whether the provisions of Section 306 being mandatory sale should not be treated as a nullity for non-compliance with those provisions.The decision of a single Judge (app J.) in --- Nathu Mal v. Malawa Mal, AIR 1931 Lah 15 (G) is distinguishable upon its facts. There the auction-purchaser had actually tendered the money but the payment was postponed by consent of parties pending the disposal of the objection by the judgment-debtor. We do not agree with the remark made in that case that the provisions of rule 85 are intended "to be directory only and not absolutely mandatory". A Division Bench of the same court (Tek Chand and Abdul Rashid JJ.) held in --- A. R. Davar v. Jhinda Ram;, AIR 1938 Lah 198 (H) that the court had no jurisdiction to extend the time for the payment of the balance of the purchase money under rule 85 and must order resale under rule 86.11. Having examined the language of the relevant rules and the judicial decisions bearing upon the subject we are of opinion that the provisions of the rules requiring the deposit of 25 per cent. of the purchase money immediately on the person being declared as a purchaser and the payment of the balance within 15 days of the sale are mandatory and upon non-compliance with these provisions there is no sale at all. The rules do not contemplate that there can be any sale in favour of a purchaser without depositing 25 per cent of the purchase money in the first instance and the balance within 15 days. When there is no-sale within the contemplation of these rules, there can be no question of material irregularly in the conduct of the sale. Non-payment of the price of the part of the defaulting purchaser renders the sale proceedings as a complete nullity. The very fact that the court is bound to re-sell the property in the event of a default shows that the previous proceedings for sale are completely wiped out as if they do not exist in the eye of law. We hold, therefore, that in the circumstances of the present case there was no sale and the purchasers acquired no rights at all.12. It was urged before us that the court could allow a set-off in execution proceedings under its inherent powers apart from the provisions of Order 21, rule 19 of the Civil Procedure Code. We do not think that the inherent powers of the Court could be invoked to circumvent the mandatory provisions of the Code and relive the purchasers of their obligation to make the deposit. The appellant by misleading the court want to benefit by the mistake to which they themselves contributed. They cannot be allowed to take advantage of their own wrong. ### Response: 0

The State Of West Bengal Vs. The Indian Iron & Steel Co. Ltd

as amended in Bihar - which amendments are not material for the decision of this case, - where activities other than mere winning the ore are carried on by an assessee with a view to convert the ore into a finished product and there is a transaction of sale of the ultimate product, the profit derived from the working of the mine is imbedded in the final realisation, and the profit which accrues to the assessee from the mining operation can be disintegrated from the total profit and ascertained and cess levied thereon. Mr. Chagla, learned Counsel for the assessee tried to distinguish that decision on the ground that in Tata Iron and Steel case, the iron ore won became imbedded in the steel produced but that is not the position in the present case as no part of the coal raised got imbedded in the ultimate product namely the steel. This difference in fact has no bearing on the ratio of the decision. The rule laid down in Tata Iron and Steel case is that, where the profit derived from the working of a mine is imbedded in the profits earned by the sale of the ultimate product, it is open for the assessing authority to disintegrate that profit and to find out the profits earned by the mine. The fact that in the one case the winning was that of the iron and in the order it is coal makes no difference in principle. In that case this Court ruled that the winning of the ore and converting it into a finished product could not be construed as two transactions conducted by them but it should be viewed as a single integrated undertaking for the production of steel and steel products. Similar is the position in the present case. Hence we hold that it was open to the assessing authority to take into consideration the value of the coal supplied to the factories and workshops referred to earlier in computing the profits of the colliery.9. Mr. Chagla next assailed the cesses imposed on another ground. He contended that in view of the decision of this Court in Tata Iron and Steel Companys case it was not open to the assessing authority to value the coal supplied to the factories and workshops at the controlled rate; he should have as suggested in that decision disintegrated the ultimate profits earned and found out the profit earned by the mine. We are of the opinion that it is impermissible for us to go into that question in these proceedings. The liability to pay tax is one thing and mode of computation of the net profit is another. The mode of computation is a matter for the assessing authorities except where the computation is done in violation of any provision of law. If there was any mistake in the computation, that mistake should have been got rectified by following the procedure prescribed in the Act. If the respondent company was aggrieved by the mode of computation adopted by the assessing authority, it should have agitated that question firstly before that authority and thereafter before the appellate authority. Having not done so, the company cannot be permitted to raise that question in the present suit; otherwise the finality contemplated by Section 102 of the Act would become illusory. It is true, as observed by Lord Thankerton in Secy. of State v. Mask and Co., 67 Ind App 222 = (AIR 1940 PC 105 ) that it is settled law that the exclusion of jurisdiction of a civil court is not to be readily inferred but that such exclusion must either be explicitly expressed or clearly implied. It is also well settled as observed by his Lordship that even if the jurisdiction is so excluded, the civil courts have jurisdiction to examine into cases where the provisions of the Act have not been complied with, or the statutory tribunal has not acted in conformity with the fundamental principles of judicial procedure. In the present case what is contended is not that any provision in the Act had been ignored by the assessing authority but that Section 72 thereof has not been properly interpreted by that authority. If the provisions of the Act form a precise, self-contained code, as we hold them to be, the assessee cannot be permitted to challenge the levy on the ground that the levy imposed on him is excessive. It must be remembered that the levy under the Act is imposed by a special law which law also provides its own remedies for correcting the errors that may be committed by the assessing authority. Where a liability not existing previously is created by a statute which statute at the same time provides a special or particular remedy for correcting any mistake that may occur in its enforcement the aggrieved party must adopt the form of remedy given by the statute and no other. In Dhulabhai v. State of Madhya Pradesh , (1968) 3 SCR 662 = (AIR 1969 SC 78 ) our present Chief Justice speaking for the Court has formulated the circumstances under which the jurisdiction of the civil court can be invoked in the matter of a levy of tax. Therein this Court has laid down that where the statute gives a finality to the orders of the special tribunals, the civil courts jurisdiction must be held to be excluded, if there is adequate remedy to do what the civil court would normally do in a suit. It is further laid down in that case that question of the correctness of the assessment apart from their constitutionality are for the decision of the authorities and a civil suit does not lie if the orders of the authority are declared final or there is an express prohibition under the particular Act. We do not think that the civil courts have jurisdiction to examine the correctness of the computation of the net profits made by the authorities under the Act.

1[ds]This contention has to be rejected in view of the decision of this Court in Tata Iron and Steel Co. Ltd. v. State of Bihar, (1963) Supp 1 SCR 199 = (AIR 1963 SC 577 ). The ratio of that decision directly bears on the point under consideration. It may be noted that the appellant therein as well as the respondent in this appeal are both Tata concerns. In that case the appellant company was the owner of certain mines in Bihar from where it extracted iron ore which it utilised in its factory at Jamshedpur for making iron and steel. Under Sections 5 and 6 of the Act as amended in Bihar all immovable property situate in any part of the State of Bihar was liable to the payment of local cess which in the case of mines was to be assessed on the annual profit earned by them. For the assessment years 1954-56, the company was assessed by the Cess Deputy Collector on the basis that it had made profits of Rs. 4/7/- per ton of iron ore extracted. Tata Iron and Steel Co. Ltd. claimed that it was not liable to the payment of cess as it did not sell any ore as such and could not therefore be treated as having made any profit from the mines within the meaning of Section 6 of the Act. The question in that case was whether the appellant company could in law be said to have derived "profits" from the mines when the ore extracted was not sold by it as such but was utilised by it for the purpose of manufacturing finished products which it sold. This Court ruled in that appeal that on a true construction of Sections 6 and 72 of the Act as amended in Bihar - which amendments are not material for the decision of this case, - where activities other than mere winning the ore are carried on by an assessee with a view to convert the ore into a finished product and there is a transaction of sale of the ultimate product, the profit derived from the working of the mine is imbedded in the final realisation, and the profit which accrues to the assessee from the mining operation can be disintegrated from the total profit and ascertained and cess levieddifference in fact has no bearing on the ratio of the decision. The rule laid down in Tata Iron and Steel case is that, where the profit derived from the working of a mine is imbedded in the profits earned by the sale of the ultimate product, it is open for the assessing authority to disintegrate that profit and to find out the profits earned by the mine. The fact that in the one case the winning was that of the iron and in the order it is coal makes no difference in principle. In that case this Court ruled that the winning of the ore and converting it into a finished product could not be construed as two transactions conducted by them but it should be viewed as a single integrated undertaking for the production of steel and steel products. Similar is the position in the present case. Hence we hold that it was open to the assessing authority to take into consideration the value of the coal supplied to the factories and workshops referred to earlier in computing the profits of theare of the opinion that it is impermissible for us to go into that question in these proceedings. The liability to pay tax is one thing and mode of computation of the net profit is another. The mode of computation is a matter for the assessing authorities except where the computation is done in violation of any provision of law. If there was any mistake in the computation, that mistake should have been got rectified by following the procedure prescribed in the Act. If the respondent company was aggrieved by the mode of computation adopted by the assessing authority, it should have agitated that question firstly before that authority and thereafter before the appellate authority. Having not done so, the company cannot be permitted to raise that question in the present suit; otherwise the finality contemplated by Section 102 of the Act would become illusory.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: as amended in Bihar - which amendments are not material for the decision of this case, - where activities other than mere winning the ore are carried on by an assessee with a view to convert the ore into a finished product and there is a transaction of sale of the ultimate product, the profit derived from the working of the mine is imbedded in the final realisation, and the profit which accrues to the assessee from the mining operation can be disintegrated from the total profit and ascertained and cess levied thereon. Mr. Chagla, learned Counsel for the assessee tried to distinguish that decision on the ground that in Tata Iron and Steel case, the iron ore won became imbedded in the steel produced but that is not the position in the present case as no part of the coal raised got imbedded in the ultimate product namely the steel. This difference in fact has no bearing on the ratio of the decision. The rule laid down in Tata Iron and Steel case is that, where the profit derived from the working of a mine is imbedded in the profits earned by the sale of the ultimate product, it is open for the assessing authority to disintegrate that profit and to find out the profits earned by the mine. The fact that in the one case the winning was that of the iron and in the order it is coal makes no difference in principle. In that case this Court ruled that the winning of the ore and converting it into a finished product could not be construed as two transactions conducted by them but it should be viewed as a single integrated undertaking for the production of steel and steel products. Similar is the position in the present case. Hence we hold that it was open to the assessing authority to take into consideration the value of the coal supplied to the factories and workshops referred to earlier in computing the profits of the colliery.9. Mr. Chagla next assailed the cesses imposed on another ground. He contended that in view of the decision of this Court in Tata Iron and Steel Companys case it was not open to the assessing authority to value the coal supplied to the factories and workshops at the controlled rate; he should have as suggested in that decision disintegrated the ultimate profits earned and found out the profit earned by the mine. We are of the opinion that it is impermissible for us to go into that question in these proceedings. The liability to pay tax is one thing and mode of computation of the net profit is another. The mode of computation is a matter for the assessing authorities except where the computation is done in violation of any provision of law. If there was any mistake in the computation, that mistake should have been got rectified by following the procedure prescribed in the Act. If the respondent company was aggrieved by the mode of computation adopted by the assessing authority, it should have agitated that question firstly before that authority and thereafter before the appellate authority. Having not done so, the company cannot be permitted to raise that question in the present suit; otherwise the finality contemplated by Section 102 of the Act would become illusory. It is true, as observed by Lord Thankerton in Secy. of State v. Mask and Co., 67 Ind App 222 = (AIR 1940 PC 105 ) that it is settled law that the exclusion of jurisdiction of a civil court is not to be readily inferred but that such exclusion must either be explicitly expressed or clearly implied. It is also well settled as observed by his Lordship that even if the jurisdiction is so excluded, the civil courts have jurisdiction to examine into cases where the provisions of the Act have not been complied with, or the statutory tribunal has not acted in conformity with the fundamental principles of judicial procedure. In the present case what is contended is not that any provision in the Act had been ignored by the assessing authority but that Section 72 thereof has not been properly interpreted by that authority. If the provisions of the Act form a precise, self-contained code, as we hold them to be, the assessee cannot be permitted to challenge the levy on the ground that the levy imposed on him is excessive. It must be remembered that the levy under the Act is imposed by a special law which law also provides its own remedies for correcting the errors that may be committed by the assessing authority. Where a liability not existing previously is created by a statute which statute at the same time provides a special or particular remedy for correcting any mistake that may occur in its enforcement the aggrieved party must adopt the form of remedy given by the statute and no other. In Dhulabhai v. State of Madhya Pradesh , (1968) 3 SCR 662 = (AIR 1969 SC 78 ) our present Chief Justice speaking for the Court has formulated the circumstances under which the jurisdiction of the civil court can be invoked in the matter of a levy of tax. Therein this Court has laid down that where the statute gives a finality to the orders of the special tribunals, the civil courts jurisdiction must be held to be excluded, if there is adequate remedy to do what the civil court would normally do in a suit. It is further laid down in that case that question of the correctness of the assessment apart from their constitutionality are for the decision of the authorities and a civil suit does not lie if the orders of the authority are declared final or there is an express prohibition under the particular Act. We do not think that the civil courts have jurisdiction to examine the correctness of the computation of the net profits made by the authorities under the Act. ### Response: 1

State Of A.P Vs. M/S.Kone Elevators (I)Ltd

the customer shall approve the drawings and shall make machine room Hoistway and the Lift Shaft including power supply for the assessee to commence installation at the time of the delivery of the lift. The contractual obligations of the assessee regarding installation included employing labour to complete the mechanical erection, electrical wiring testing and commissioning of the lift. The assessee agreed that it shall commence installation only after the lifts arrived at the site and upon intimation from the customer that the site was ready as per the drawings. As soon as the lift stood installed, the customer was to take over. It was further agreed that any material supplied by the assessee shall remain their property till the lift was handed over to the customer. The contract in question consisted of certain obligations on the part of the customers under the heading Customers Contractual Obligations. Under this clause, the customer was obliged to undertake the work of civil constructions consisting of:- a) A properly enclosed lift Hoistway.b) A lift pit of proper depth;c) Properly lighted machine room; andd) Private pockets on the lift well walls. 11. Further, certain obligations were passed on the customer under the Delivery Schedule which are reproduced herein below:- "The General Agreement Drawing in triplicate will be forwarded to you in approximately six weeks from the date of receipt of complete site details along with the order and advance payment. The purpose of this drawing is to clearly indicate to you pertinent dimensional details of the lift shaft, pit, machine room, car and landing entrances etc. if any modification is required by you in our General Arrangement Drawing it is advisable to hold on construction till the revised General Arrangement Drawing is approved by you.Within six weeks from the date of receipt of all the site details, the same should be returned to us within two weeks from the date of submission, duly approved by you. We reserve the rights to charge extra for subsequent GAD revisions if full site particulars are not made available to us at the time of placing of the order (or) any modification is desired regarding the building structure resulting in revision of GADs.We shall deliver the materials for each Elevator by the end of 6 months from the date of receipt of approved General Arrangement Drawing and shall complete the installation thereafter by the end of 2 months provided the lift shall including power supply as per our requirements is made ready for us to commence installations at the time of delivery of materials.We shall commence the installation after the materials arrive at the job site and upon intimation from you that the site is ready as per the approved General Arrangement Drawing. If the site is not ready for taking up installation when the materials arrive at the job site, we shall depute an installation team on hearing from you that the site, is ready in all respects as required by us." 12. On a careful study of the aforestated clause in the Delivery Schedule, it is clear that the customer was required to do the actual work at site for installation of lift. On reading the above clause, it may be observed that the entire onus of preparation and making ready of the site for installation of lift was on the customer. It was agreed that under no circumstances, the assessee shall undertake installation of lift if the site is not kept ready by the customer. Under Clause 4(g) of the Customers Contractual Obligations", the assessee reserved the right to charge the customer for delays in providing the required facilities. These facts clearly indicate that the assessee divided the execution of the contract into two parts, namely, the work to be initially done in accordance with the specifications laid down by the assessee and the supply of lift by the assessee. The work part in the contract was assigned to the customer and the supply part was assigned to the assessee This supply part included installation of lift. Therefore, contractual obligation of the assessee was only to supply and install the lift, while the customers obligation was to undertake the word connected in keeping the site ready for installation as per the drawings. In view of the contractual obligations of the customer and the fact that the assessee undertook exclusive installation of the lifts manufactured and brought to the site in knocked-down state to be assembled by the assessee, it is clear that the transaction in question was a contract of sale and not a works-contract. Moreover, on perusal of the brochure of the assessee Company, one finds that the assessee is in the business of manufacturing of various types of lifts, namely, Passenger lifts, Freight elevators, Transport elevators and Scenic lifts. A combined study of the above models, mentioned in the brochure, indicate that the assessee has been exhibiting various models of lifts for sale. These lifts are sold in various colours with various capacities and variable voltage. According to the brochure, it is open for a prospective buyer to place purchase order for supply for lifts as per his convenience and choice. Therefore, the assessee satisfies, on facts, the twin requirements to attract the charge of tax under the 1957 Act, namely, that it carries on business of selling the lifts and elevators and it has sold the lifts and elevators during the relevant period in the course of its business. In the present case, on facts, we find that the major component of the end-product is the material consumed in producing the lift to be delivered and the skill and labour employed for converting the main components into the end-product was only incidentally used and, therefore, the delivery of the end-product by the assessee to the customer constituted a sale and not a works-contract. Hence, transactions in question constitute sale in terms of entry 82 of the first schedule to the said Act and, therefore, section 5G of the said Act was not applicable.

1[ds]5. It can be treated as well settled that there is no standard formula by which one can distinguish a contract for sale from a works-contract. The question is largely one of fact depending upon the terms of the contract including the nature of the obligations to be discharged thereunder and the surrounding circumstances. If the intention is to transfer for a price a chattel in which the transferee had no previous property, then the contract is a contract for sale. Ultimately, the true effect of an accretion made pursuant to a contract has to be judged not by artificial rules but from the intention of the parties to the contract. In a contract of sale, the main object is the transfer of property and delivery of possession of the property, whereas the main object in a contract for work is not the transfer of the property but it is one for work and labour. Another test often to be applied to is: when and how the property of the dealer in such a transaction passes to the customer; is it by transfer at the time of delivery of the finished article as a chattel or by accession during the procession of work on fusion to the movable property of the customer? If it is the former, it is a sale, if it is the latter, it is a works-contract. Therefore, in judging whether the contract is for a sale or for work and labour, the essence of the contract or the reality of the transaction as a whole has to be taken into consideration. The pre-dominant object of the contract, the circumstances of the case and the custom of the trade provides a guide in deciding whether transaction is a sale or a works-contract. Essentially, the question is of interpretation of the contract. It is settled law that the substance and not the form of the contract is material in determining the nature of transaction. No definite rule can be formulated to determine the question as to whether a particular given contract is a contract for sale of goods or is a works-contract. Ultimately, the terms of a given contract would be determinative of the nature of the transaction, whether it is a sale or a works-contract. Therefore, this question has to be ascertained on facts of each case, on proper construction of terms and conditions of the contract between the parties.In the case of Hindustan Shipyard Ltd. vs. State of Andhra Pradesh reported in (2001) 119 STC 533), this Court held that if the during to be delivered has any individual existence before the delivery as the sole property of the party who is to deliver it, then it is a sale. If the bulk of material used in construction belongs to the manufacture who sells the end-product for a price, then it is a strong pointer to the conclusion that the contract is in substance one for the sale of goods and not one for labour. However, the test is not decisive. It is not the bulk of the material alone but the relative importance of the material qua the work, still and labour of the payee which also has to be seen. If the major component of the end-product is the material consumed in producing the chattel to be delivered and skill and labour are employed for converting the main components into the end-products, the skill and labour are only incidentally used, the delivery of the end-product by the seller to the buyer would constitute a sale. On the other hand, if the main object of the contract is to avail the skill and labour of the seller though some material or components may be incidentally used during the process of the end-product being brought into existence by the investment of skill and labour of the supplier, the transaction would be a contract for work and labour.10. Applying the above tests, we may now proceed to notice the relevant recitals of the contracts in questions. Under the price schedule the assessee agreed to supply and install a Kone Elevator for Rs. 3,30,000/-. It was agreed that the customer shall approve the drawings and shall make machine room Hoistway and the Lift Shaft including power supply for the assessee to commence installation at the time of the delivery of the lift. The contractual obligations of the assessee regarding installation included employing labour to complete the mechanical erection, electrical wiring testing and commissioning of the lift. The assessee agreed that it shall commence installation only after the lifts arrived at the site and upon intimation from the customer that the site was ready as per the drawings. As soon as the lift stood installed, the customer was to take over. It was further agreed that any material supplied by the assessee shall remain their property till the lift was handed over to the customer. The contract in question consisted of certain obligations on the part of the customers under the heading Customers Contractual Obligations. Under this clause, the customer was obliged to undertake the work of civilOn a careful study of the aforestated clause in the Delivery Schedule, it is clear that the customer was required to do the actual work at site for installation of lift. On reading the above clause, it may be observed that the entire onus of preparation and making ready of the site for installation of lift was on the customer. It was agreed that under no circumstances, the assessee shall undertake installation of lift if the site is not kept ready by the customer. Under Clause 4(g) of the Customers Contractual Obligations", the assessee reserved the right to charge the customer for delays in providing the required facilities. These facts clearly indicate that the assessee divided the execution of the contract into two parts, namely, the work to be initially done in accordance with the specifications laid down by the assessee and the supply of lift by the assessee. The work part in the contract was assigned to the customer and the supply part was assigned to the assessee This supply part included installation of lift. Therefore, contractual obligation of the assessee was only to supply and install the lift, while the customers obligation was to undertake the word connected in keeping the site ready for installation as per the drawings. In view of the contractual obligations of the customer and the fact that the assessee undertook exclusive installation of the lifts manufactured and brought to the site in knocked-down state to be assembled by the assessee, it is clear that the transaction in question was a contract of sale and not a works-contract. Moreover, on perusal of the brochure of the assessee Company, one finds that the assessee is in the business of manufacturing of various types of lifts, namely, Passenger lifts, Freight elevators, Transport elevators and Scenic lifts. A combined study of the above models, mentioned in the brochure, indicate that the assessee has been exhibiting various models of lifts for sale. These lifts are sold in various colours with various capacities and variable voltage. According to the brochure, it is open for a prospective buyer to place purchase order for supply for lifts as per his convenience and choice. Therefore, the assessee satisfies, on facts, the twin requirements to attract the charge of tax under the 1957 Act, namely, that it carries on business of selling the lifts and elevators and it has sold the lifts and elevators during the relevant period in the course of its business. In the present case, on facts, we find that the major component of the end-product is the material consumed in producing the lift to be delivered and the skill and labour employed for converting the main components into the end-product was only incidentally used and, therefore, the delivery of the end-product by the assessee to the customer constituted a sale and not a works-contract. Hence, transactions in question constitute sale in terms of entry 82 of the first schedule to the said Act and, therefore, section 5G of the said Act was not applicable.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: the customer shall approve the drawings and shall make machine room Hoistway and the Lift Shaft including power supply for the assessee to commence installation at the time of the delivery of the lift. The contractual obligations of the assessee regarding installation included employing labour to complete the mechanical erection, electrical wiring testing and commissioning of the lift. The assessee agreed that it shall commence installation only after the lifts arrived at the site and upon intimation from the customer that the site was ready as per the drawings. As soon as the lift stood installed, the customer was to take over. It was further agreed that any material supplied by the assessee shall remain their property till the lift was handed over to the customer. The contract in question consisted of certain obligations on the part of the customers under the heading Customers Contractual Obligations. Under this clause, the customer was obliged to undertake the work of civil constructions consisting of:- a) A properly enclosed lift Hoistway.b) A lift pit of proper depth;c) Properly lighted machine room; andd) Private pockets on the lift well walls. 11. Further, certain obligations were passed on the customer under the Delivery Schedule which are reproduced herein below:- "The General Agreement Drawing in triplicate will be forwarded to you in approximately six weeks from the date of receipt of complete site details along with the order and advance payment. The purpose of this drawing is to clearly indicate to you pertinent dimensional details of the lift shaft, pit, machine room, car and landing entrances etc. if any modification is required by you in our General Arrangement Drawing it is advisable to hold on construction till the revised General Arrangement Drawing is approved by you.Within six weeks from the date of receipt of all the site details, the same should be returned to us within two weeks from the date of submission, duly approved by you. We reserve the rights to charge extra for subsequent GAD revisions if full site particulars are not made available to us at the time of placing of the order (or) any modification is desired regarding the building structure resulting in revision of GADs.We shall deliver the materials for each Elevator by the end of 6 months from the date of receipt of approved General Arrangement Drawing and shall complete the installation thereafter by the end of 2 months provided the lift shall including power supply as per our requirements is made ready for us to commence installations at the time of delivery of materials.We shall commence the installation after the materials arrive at the job site and upon intimation from you that the site is ready as per the approved General Arrangement Drawing. If the site is not ready for taking up installation when the materials arrive at the job site, we shall depute an installation team on hearing from you that the site, is ready in all respects as required by us." 12. On a careful study of the aforestated clause in the Delivery Schedule, it is clear that the customer was required to do the actual work at site for installation of lift. On reading the above clause, it may be observed that the entire onus of preparation and making ready of the site for installation of lift was on the customer. It was agreed that under no circumstances, the assessee shall undertake installation of lift if the site is not kept ready by the customer. Under Clause 4(g) of the Customers Contractual Obligations", the assessee reserved the right to charge the customer for delays in providing the required facilities. These facts clearly indicate that the assessee divided the execution of the contract into two parts, namely, the work to be initially done in accordance with the specifications laid down by the assessee and the supply of lift by the assessee. The work part in the contract was assigned to the customer and the supply part was assigned to the assessee This supply part included installation of lift. Therefore, contractual obligation of the assessee was only to supply and install the lift, while the customers obligation was to undertake the word connected in keeping the site ready for installation as per the drawings. In view of the contractual obligations of the customer and the fact that the assessee undertook exclusive installation of the lifts manufactured and brought to the site in knocked-down state to be assembled by the assessee, it is clear that the transaction in question was a contract of sale and not a works-contract. Moreover, on perusal of the brochure of the assessee Company, one finds that the assessee is in the business of manufacturing of various types of lifts, namely, Passenger lifts, Freight elevators, Transport elevators and Scenic lifts. A combined study of the above models, mentioned in the brochure, indicate that the assessee has been exhibiting various models of lifts for sale. These lifts are sold in various colours with various capacities and variable voltage. According to the brochure, it is open for a prospective buyer to place purchase order for supply for lifts as per his convenience and choice. Therefore, the assessee satisfies, on facts, the twin requirements to attract the charge of tax under the 1957 Act, namely, that it carries on business of selling the lifts and elevators and it has sold the lifts and elevators during the relevant period in the course of its business. In the present case, on facts, we find that the major component of the end-product is the material consumed in producing the lift to be delivered and the skill and labour employed for converting the main components into the end-product was only incidentally used and, therefore, the delivery of the end-product by the assessee to the customer constituted a sale and not a works-contract. Hence, transactions in question constitute sale in terms of entry 82 of the first schedule to the said Act and, therefore, section 5G of the said Act was not applicable. ### Response: 1

Dabur (Dr. S. K. Burman) Private Ltd. Deoghar, Bihar Vs. The Workmen

was the further finding that the workmen were all discharged from service as they had demanded increase in rates of wages and had also claimed that Sundays should be made paid holidays. Against this award, the appellant filed a petition under Art. 226 of the Constitution in the High Court of Patna requesting that Court to quash the award. That Court upheld the award and dismissed the writ petition. Consequently, the appellant has come up to this Court by special leave against that Judgment of the High Court. 3. Mr. Gokhale, appearing on behalf of the appellant, emphatically urged that both the Labour Court, Ranchi as well as the Patna High Court were wrong in holding that the reference to the Labour Court, Ranchi, was competent even after the reference had originally been made to the Labour Court, Patna. He relied on the principle laid down by this Court that once the Government has made a reference to a particular Labour Court, it is that Labour Court which becomes seized of that industrial dispute and, thereafter, the Government has no jurisdiction either to withdraw that reference or cancel it. In this case, however, as is clear from the judgment of the High Court, the question that arose was entirely different. The High Court has clearly held that this was not a case where the Government either withdrew or cancelled the reference to the Labour Court, Patna. The High Court has held that, from the facts stated by the appellant in the writ petition filed in that Court, it appeared that the alteration in the order of reference was a mere correction of a clerical error, because, by mistake, Patna had been mentioned in place of Ranchi in the first notification. The second notification merely corrected that mistake. Mr. Gokhale wanted us to hold that the High Court was wrong in its view that the Government had merely made correction of a clerical error and that we should accept the submission on behalf of the appellant that, in fact, the State Government had first intentionally referred the dispute to the Labour Court, Patna, and issued the corrigendum only when the Government decided that the reference should go to the Labour Court, Ranchi and not Labour Court, Patna, because Labour Court, Patna had no jurisdiction to entertain the reference. We are unable to accept this submission made on behalf of the appellant. The High Court drew an inference from the facts stated in the writ petition filed by the appellant itself that this was a case of mere correction of a clerical error.This finding recorded by the High Court on the basis of the facts given in the writ petition is not now open to challenge in this special appeal, particularly because even a copy of that writ petition has not been made a part of the paper-book before us. We cannot see how any objection can be taken to the competence of the State Government to make a correction of a mere clerical error. The finding that it was a clerical error means that the Government in fact intended to make the reference to the Labour Court, Ranchi; but while actually scribing the order of reference, a mistake was committed by the writer of putting down Patna instead of Ranchi. Such a clerical error can always be corrected and such a correction does not amount either to the withdrawal of the reference from, or cancellation of the reference to, the Labour Court, Patna. The High Court was, therefore, right in rejecting this contention on behalf of the appellant. 4. On merits, Mr. Gokhale wanted to urge only two points before us. One was that the Labour Court committed a manifest error of law apparent on the face of the record in holding that the workmen concerned were not casual workers. The judgment of the High Court, however, shows that before that Court it was nowhere urged or argued that any such error of law apparent on the face of the record had been committed by the Labour Court. What was urged before the High Court was that even on the ex parte evidence on record, the Labour Court ought to have held that the workmen were mere casual labourers.The High Court was right in holding that this point urged on behalf of the appellant essentially raised a question of fact only and that Court, in its jurisdiction under Art. 226 of the Constitution, could not interfere on such a question of fact. Since no submission was made before the High Court that the finding of the Labour Court that the workmen are not casual labourers suffers from any manifest error of law apparent on the face of the record, the appellant is not entitled to raise this point in this special appeal before us.On the finding actually recorded by the Labour Court and upheld by the High Court, the order of the Labour Court directing reinstatement of these workmen is fully justified so that the order made by the Labour Court, insofar as it is against the interests of the appellant, is correct and must he upheld. In view of this position, it is unnecessary to go into the question whether the Labour Court was or was not right in recording the finding as to male fides. 5. The only other point urged was that the Labour Court should not have proceeded ex parte when material was placed before that Court on behalf of the appellant to show that its local Manager, Sri Basant Jha, was in fact lying ill. The question whether an adjournment should or should not have been granted on this ground was in the discretion of the Labour Court. Even the order by which the Labour Court rejected that application for adjournment is not before us and, consequently, it cannot be held that the Labour Court committed any such error in rejecting the application for adjournment and proceeding ex parte as would justify interference by this Court.

0[ds]In this case, however, as is clear from the judgment of the High Court, the question that arose was entirely different. The High Court has clearly held that this was not a case where the Government either withdrew or cancelled the reference to the Labour Court, Patna. The High Court has held that, from the facts stated by the appellant in the writ petition filed in that Court, it appeared that the alteration in the order of reference was a mere correction of a clerical error, because, by mistake, Patna had been mentioned in place of Ranchi in the first notification. The second notification merely corrected that mistake. Mr. Gokhale wanted us to hold that the High Court was wrong in its view that the Government had merely made correction of a clerical error and that we should accept the submission on behalf of the appellant that, in fact, the State Government had first intentionally referred the dispute to the Labour Court, Patna, and issued the corrigendum only when the Government decided that the reference should go to the Labour Court, Ranchi and not Labour Court, Patna, because Labour Court, Patna had no jurisdiction to entertain the reference. We are unable to accept this submission made on behalf of the appellant. The High Court drew an inference from the facts stated in the writ petition filed by the appellant itself that this was a case of mere correction of a clerical error.This finding recorded by the High Court on the basis of the facts given in the writ petition is not now open to challenge in this special appeal, particularly because even a copy of that writ petition has not been made a part of the paper-book before us. We cannot see how any objection can be taken to the competence of the State Government to make a correction of a mere clerical error. The finding that it was a clerical error means that the Government in fact intended to make the reference to the Labour Court, Ranchi; but while actually scribing the order of reference, a mistake was committed by the writer of putting down Patna instead of Ranchi. Such a clerical error can always be corrected and such a correction does not amount either to the withdrawal of the reference from, or cancellation of the reference to, the Labour Court, Patna. The High Court was, therefore, right in rejecting this contention on behalf of the appellantThe High Court was right in holding that this point urged on behalf of the appellant essentially raised a question of fact only and that Court, in its jurisdiction under Art. 226 of the Constitution, could not interfere on such a question of fact. Since no submission was made before the High Court that the finding of the Labour Court that the workmen are not casual labourers suffers from any manifest error of law apparent on the face of the record, the appellant is not entitled to raise this point in this special appeal before us.On the finding actually recorded by the Labour Court and upheld by the High Court, the order of the Labour Court directing reinstatement of these workmen is fully justified so that the order made by the Labour Court, insofar as it is against the interests of the appellant, is correct and must he upheld. In view of this position, it is unnecessary to go into the question whether the Labour Court was or was not right in recording the finding as to male fidesThe question whether an adjournment should or should not have been granted on this ground was in the discretion of the Labour Court. Even the order by which the Labour Court rejected that application for adjournment is not before us and, consequently, it cannot be held that the Labour Court committed any such error in rejecting the application for adjournment and proceeding ex parte as would justify interference by this Court.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: was the further finding that the workmen were all discharged from service as they had demanded increase in rates of wages and had also claimed that Sundays should be made paid holidays. Against this award, the appellant filed a petition under Art. 226 of the Constitution in the High Court of Patna requesting that Court to quash the award. That Court upheld the award and dismissed the writ petition. Consequently, the appellant has come up to this Court by special leave against that Judgment of the High Court. 3. Mr. Gokhale, appearing on behalf of the appellant, emphatically urged that both the Labour Court, Ranchi as well as the Patna High Court were wrong in holding that the reference to the Labour Court, Ranchi, was competent even after the reference had originally been made to the Labour Court, Patna. He relied on the principle laid down by this Court that once the Government has made a reference to a particular Labour Court, it is that Labour Court which becomes seized of that industrial dispute and, thereafter, the Government has no jurisdiction either to withdraw that reference or cancel it. In this case, however, as is clear from the judgment of the High Court, the question that arose was entirely different. The High Court has clearly held that this was not a case where the Government either withdrew or cancelled the reference to the Labour Court, Patna. The High Court has held that, from the facts stated by the appellant in the writ petition filed in that Court, it appeared that the alteration in the order of reference was a mere correction of a clerical error, because, by mistake, Patna had been mentioned in place of Ranchi in the first notification. The second notification merely corrected that mistake. Mr. Gokhale wanted us to hold that the High Court was wrong in its view that the Government had merely made correction of a clerical error and that we should accept the submission on behalf of the appellant that, in fact, the State Government had first intentionally referred the dispute to the Labour Court, Patna, and issued the corrigendum only when the Government decided that the reference should go to the Labour Court, Ranchi and not Labour Court, Patna, because Labour Court, Patna had no jurisdiction to entertain the reference. We are unable to accept this submission made on behalf of the appellant. The High Court drew an inference from the facts stated in the writ petition filed by the appellant itself that this was a case of mere correction of a clerical error.This finding recorded by the High Court on the basis of the facts given in the writ petition is not now open to challenge in this special appeal, particularly because even a copy of that writ petition has not been made a part of the paper-book before us. We cannot see how any objection can be taken to the competence of the State Government to make a correction of a mere clerical error. The finding that it was a clerical error means that the Government in fact intended to make the reference to the Labour Court, Ranchi; but while actually scribing the order of reference, a mistake was committed by the writer of putting down Patna instead of Ranchi. Such a clerical error can always be corrected and such a correction does not amount either to the withdrawal of the reference from, or cancellation of the reference to, the Labour Court, Patna. The High Court was, therefore, right in rejecting this contention on behalf of the appellant. 4. On merits, Mr. Gokhale wanted to urge only two points before us. One was that the Labour Court committed a manifest error of law apparent on the face of the record in holding that the workmen concerned were not casual workers. The judgment of the High Court, however, shows that before that Court it was nowhere urged or argued that any such error of law apparent on the face of the record had been committed by the Labour Court. What was urged before the High Court was that even on the ex parte evidence on record, the Labour Court ought to have held that the workmen were mere casual labourers.The High Court was right in holding that this point urged on behalf of the appellant essentially raised a question of fact only and that Court, in its jurisdiction under Art. 226 of the Constitution, could not interfere on such a question of fact. Since no submission was made before the High Court that the finding of the Labour Court that the workmen are not casual labourers suffers from any manifest error of law apparent on the face of the record, the appellant is not entitled to raise this point in this special appeal before us.On the finding actually recorded by the Labour Court and upheld by the High Court, the order of the Labour Court directing reinstatement of these workmen is fully justified so that the order made by the Labour Court, insofar as it is against the interests of the appellant, is correct and must he upheld. In view of this position, it is unnecessary to go into the question whether the Labour Court was or was not right in recording the finding as to male fides. 5. The only other point urged was that the Labour Court should not have proceeded ex parte when material was placed before that Court on behalf of the appellant to show that its local Manager, Sri Basant Jha, was in fact lying ill. The question whether an adjournment should or should not have been granted on this ground was in the discretion of the Labour Court. Even the order by which the Labour Court rejected that application for adjournment is not before us and, consequently, it cannot be held that the Labour Court committed any such error in rejecting the application for adjournment and proceeding ex parte as would justify interference by this Court. ### Response: 0

MAHARASHTRA ARCHERY ASSOCIATION Vs. RAHUL MEHRA

Smt. Damyanti Naranga Vs. The Union of India and Ors. (1971) 1 SCC 678 , which had approved the exposition in G.K. Ghose and Anr. Vs. E.X. Joseph.(1963) Supp. 3 SCR 789 In that case, this Court had held that the right to form an Association was conditioned by the existence of the recognition of the said Association by the Government. In that case the Court had held: It is not disputed that the Fundamental Rights guaranteed by Article 19 can be claimed by Government servants. Article 33 which confers power on the Parliament to modify the rights in their application, to the Armed Forces, clearly brings out the fact that all citizens, including Government servants, are entitled to claim the rights guaranteed by Article 19. Thus, the validity of the impugned rule has to be judged on the basis that the respondent and his co¬ employees are entitled to form Associations or Unions. It is clear that Rule 4-B imposes a restriction on this right. It virtually compels a Government servant to withdraw his membership of the Service Association of Government servants as soon as recognition accorded to the said Association is withdraw or if, after the Association is formed, no recognition is accorded to it within six months. In other words, the right to form an Association is conditioned by the existence of the recognition of the said Association by the Government. If the Association obtains the recognition and continues to enjoy it, Government servants can become members of the said Association; if the Association does not secure recognition from the Government or recognition granted to it is withdrawn, Government servants must cease to be the members of the said Association. That is the plain effect of the impugned rule. 17. This dictum was quoted with approval by the Constitution Bench to conclude that the right to form an Association included the right to its continuance and any law altering the composition of the Association compulsorily will be a breach of the right to form the Association. Thus understood, the steps taken by the Administrator beyond the scope of the authority bestowed upon him in terms of the order of this Court dated 4 th December, 2017, cannot be validated by the Court but must be treated as non est in law. It would have been a different matter if the Administrator had presented the additional amendments before this Court and invited this Court to approve the same after hearing the concerned parties. 18. Be that as it may, the question as to whether the amendments incorporated by the Administrator are justified and proper or, so to speak, essential as per the exposition of this Court in Board of Control for Cricket Vs. Cricket Association of Bihar and Ors. (2016) 8 SCC 535 , need not detain us. For, the further amendments to the Constitution could be effected only in the manner provided by the Constitution of the AAI including in terms of the order dated 4 th December, 2017. It is thus not necessary for us to examine as to whether, in fact, there is any deviation or not from the dispensation predicated in the National Sports Code, as contended by the respondents and the counsel appearing for the Administrator. 19. For the time being, without any hesitation, we are of the considered opinion that all steps taken by the Administrator, including the elections conducted by him on the basis of the Constitution (as amended by him), will have to be treated as null and void and non est in law. The parties will have to be relegated to the position as on 4 th December, 2017, consequent to incorporation of the four amendments approved in terms of the same order. After carrying out those four amendments in the Constitution, the election will have to be conducted to constitute the new body, which would then take steps to introduce further amendments to the Constitution, if so required, to bring it in line with the National Sports Code, after giving an opportunity to all concerned. Only after the amendments are accepted and approved, fresh elections be conducted for constituting a new body in conformity with such duly amended Constitution. 20. In reference to certain apprehensions expressed by the respondents due to reactions of the World Archery body, we must observe that the controversy cannot be adjudicated on the basis of perception of the World Archery body. Similarly, we do not wish to expand the scope of the present proceedings as the main writ petition is still pending before the High Court of Delhi, where all issues can be deliberated and answered appropriately. While doing so, the High Court, no doubt, would be guided by the exposition in Sheela Barse Vs. Union of India and Ors. (1988) 4 SCC 226 ( para 1) , K. Murugan Vs. Fencing Association of India, Jabalpur and Ors. (1991) 2 SCC 412 ( para 12) , and Board of Control for Cricket in India Vs. Cricket Association of Bihar and Ors, (2015) 3 SCC 251 ( para 100¬103) on which reliance has been placed by the counsel representing the newly elected body of AAI and the respondents, for issuing appropriate directions in a public interest litigation. In other words, the High Court will examine all aspects of the matter on their own merits in accordance with law. 21. We make it clear that the High Court may also consider the stand taken by the appellant(s) and Union of India that the decision of this Court in Board of Control for Cricket (supra) (2016) 8 SCC 535 will be of no avail to the present case, because the National Sports Code takes within its fold fifty¬two disciplines of sports and Cricket is not one of the scheduled sports. In other words, the dispensation to be followed must be in conformity with the National Sports Code in so far as AAI is concerned. We keep this issue open to be considered at the appropriate stage.

1[ds]The background in which the said order came to be passed after hearing the parties, leaves no manner of doubt that it had modified the impugned order of the High Court dated 10 th August, 2017. Further, the contentious issues regarding the proposed amendment in the Constitution stood answered to that extent. In that, this Court passed a peremptory order not only for approving the proposed amendments, as noted in the order dated 4 th December, 2017, but also directed the Administrator to conduct elections in consonance thereto within a period of four weeks, after incorporating the amendments within one week from the date of the order. That was the limited mandate given to the Administrator. Indeed, this Court had given liberty to the Administrator to seek clarification or directions if and when necessary. That liberty, however, by no stretch of imagination could be mistaken as authorising the Administrator to carry out amendments in the Constitution beyond the four amendments referred to in the order dated 4 th December, 2017, much less to do so unilaterally without any prior notice to all the stakeholders and due deliberations with them as mandated by the Constitution of the AAI. In any case, any further amendments to the Constitution could be incorporated only after taking prior permission of this Court which was still in seisen of the matter. The Administrator was also ill¬advised not to seek extension of time for completion of election process, which was to be completed not later than five weeks from 4 th December, 201713. The stand taken by the Administrator is that the order dated 4 th December, 2017 gave him liberty to ensure that the Constitution of the Association is strictly in accordance with the Sports Code and only thereafter to proceed with the election. Indeed, liberty was given to the Administrator in the last paragraph of the order dated 4 th December, 2017. However, the order if read as a whole and keeping in mind the spirit of the order, it had directed the Administrator to ensure timely completion of election within five weeks from the date of the order on the basis of four amendments approved by the Court, which were required to be incorporated by the Administrator within one week from the date of the order. No more and no less. For any other doubt or deviation, the Administrator was obliged to seek clarification and appropriate directions from this Court, before the expiry of the timeline given in the order dated 4 th December, 2017. The Administrator, however, merely filed a compliance report on 24 th September, 2018, in the Registry of this Court without attempting even once to invite the attention of this Court thereto. The Administrator has also filed a further report in terms of the order dated 28 th March, 2019. On perusal of the said reports, we may hasten to accept the plea that the steps taken by the Administrator were under a mistaken beliefthat he had the authority to proceed in the manner that he did and including to amend the Constitution beyond the four amendments referred to in the order dated 4 th December, 2017. It is not a case of defiance or disobedience of the Courts order as such15. We are in agreement with the stand taken by the appellant(s) that the Administrator could have taken only such steps as were permitted by this Court vide order dated 4 th December, 2017, in their letter and spirit. Indisputably, the additional amendments incorporated by the Administrator have resulted in denial of right to represent in and contest elections of the AAI for the existing members. Notably, even the direction given by the High Court whilst appointing the Administrator vide the impugned judgment, in no way gave authority to the Administrator to amend the Constitution, but was limited to conduct elections on the basis of the Constitution as it stood then. As ordered by the High Court, it was for the newly elected body to take steps in the right earnest to amend the Constitution to bring it in line with the National Sports Code on specified matters and then to conduct fresh elections on the basis of such amended Constitution. In other words, the Constitution could be amended only in accordance with law, which means by the elected body after interacting with all the stakeholders and members. The Administrator had no power to amend the Constitution, much less unilaterally, except for the four amendments approved by this Court, for which no further formality was required to be undertaken. The Administrator was obliged to conduct elections on the basis of such amended Constitution in terms of the order of this Court dated 4 th December, 2017. No more and no less17. This dictum was quoted with approval by the Constitution Bench to conclude that the right to form an Association included the right to its continuance and any law altering the composition of the Association compulsorily will be a breach of the right to form the Association. Thus understood, the steps taken by the Administrator beyond the scope of the authority bestowed upon him in terms of the order of this Court dated 4 th December, 2017, cannot be validated by the Court but must be treated as non est in law. It would have been a different matter if the Administrator had presented the additional amendments before this Court and invited this Court to approve the same after hearing the concerned parties18. Be that as it may, the question as to whether the amendments incorporated by the Administrator are justified and proper or, so to speak, essential as per the exposition of this Court in Board of Control for Cricket Vs. Cricket Association of Bihar and Ors. (2016) 8 SCC 535 , need not detain us. For, the further amendments to the Constitution could be effected only in the manner provided by the Constitution of the AAI including in terms of the order dated 4 th December, 2017. It is thus not necessary for us to examine as to whether, in fact, there is any deviation or not from the dispensation predicated in the National Sports Code, as contended by the respondents and the counsel appearing for the Administrator19. For the time being, without any hesitation, we are of the considered opinion that all steps taken by the Administrator, including the elections conducted by him on the basis of the Constitution (as amended by him), will have to be treated as null and void and non est in law. The parties will have to berelegated to the position as on 4 th December, 2017, consequent to incorporation of the four amendments approved in terms of the same order. After carrying out those four amendments in the Constitution, the election will have to be conducted to constitute the new body, which would then take steps to introduce further amendments to the Constitution, if so required, to bring it in line with the National Sports Code, after giving an opportunity to all concerned. Only after the amendments are accepted and approved, fresh elections be conducted for constituting a new body in conformity with such duly amended Constitution20. In reference to certain apprehensions expressed by the respondents due to reactions of the World Archery body, we must observe that the controversy cannot be adjudicated on the basis of perception of the World Archery body. Similarly, we do not wish to expand the scope of the present proceedings as the main writ petition is still pending before the High Court of Delhi, where all issues can be deliberated and answered appropriately. While doing so, the High Court, no doubt, would be guided by the exposition in Sheela Barse Vs. Union of India and Ors. (1988) 4 SCC 226 ( para 1) , K. Murugan Vs. Fencing Association of India, Jabalpur and Ors.(1991) 2 SCC 412 ( para 12) , and Board of Control for Cricket in India Vs. Cricket Association of Bihar and Ors, (2015) 3 SCC 251 ( para 100¬103) on which reliance has been placed by the counsel representing the newly elected body of AAI and the respondents, for issuing appropriate directions in a public interest litigation. In other words, the High Court will examine all aspects of the matter on their own merits in accordance with law21. We make it clear that the High Court may also consider the stand taken by the appellant(s) and Union of India that the decision of this Court in Board of Control for Cricket (supra) (2016) 8 SCC 535 will be of no avail to the present case, because the National Sports Code takes within its fold fifty¬two disciplines of sports and Cricket is not one of the scheduled sports. In other words, the dispensation to be followed must be in conformity with the National Sports Code in so far as AAI isconcerned. We keep this issue open to be considered at the appropriate stage.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: Smt. Damyanti Naranga Vs. The Union of India and Ors. (1971) 1 SCC 678 , which had approved the exposition in G.K. Ghose and Anr. Vs. E.X. Joseph.(1963) Supp. 3 SCR 789 In that case, this Court had held that the right to form an Association was conditioned by the existence of the recognition of the said Association by the Government. In that case the Court had held: It is not disputed that the Fundamental Rights guaranteed by Article 19 can be claimed by Government servants. Article 33 which confers power on the Parliament to modify the rights in their application, to the Armed Forces, clearly brings out the fact that all citizens, including Government servants, are entitled to claim the rights guaranteed by Article 19. Thus, the validity of the impugned rule has to be judged on the basis that the respondent and his co¬ employees are entitled to form Associations or Unions. It is clear that Rule 4-B imposes a restriction on this right. It virtually compels a Government servant to withdraw his membership of the Service Association of Government servants as soon as recognition accorded to the said Association is withdraw or if, after the Association is formed, no recognition is accorded to it within six months. In other words, the right to form an Association is conditioned by the existence of the recognition of the said Association by the Government. If the Association obtains the recognition and continues to enjoy it, Government servants can become members of the said Association; if the Association does not secure recognition from the Government or recognition granted to it is withdrawn, Government servants must cease to be the members of the said Association. That is the plain effect of the impugned rule. 17. This dictum was quoted with approval by the Constitution Bench to conclude that the right to form an Association included the right to its continuance and any law altering the composition of the Association compulsorily will be a breach of the right to form the Association. Thus understood, the steps taken by the Administrator beyond the scope of the authority bestowed upon him in terms of the order of this Court dated 4 th December, 2017, cannot be validated by the Court but must be treated as non est in law. It would have been a different matter if the Administrator had presented the additional amendments before this Court and invited this Court to approve the same after hearing the concerned parties. 18. Be that as it may, the question as to whether the amendments incorporated by the Administrator are justified and proper or, so to speak, essential as per the exposition of this Court in Board of Control for Cricket Vs. Cricket Association of Bihar and Ors. (2016) 8 SCC 535 , need not detain us. For, the further amendments to the Constitution could be effected only in the manner provided by the Constitution of the AAI including in terms of the order dated 4 th December, 2017. It is thus not necessary for us to examine as to whether, in fact, there is any deviation or not from the dispensation predicated in the National Sports Code, as contended by the respondents and the counsel appearing for the Administrator. 19. For the time being, without any hesitation, we are of the considered opinion that all steps taken by the Administrator, including the elections conducted by him on the basis of the Constitution (as amended by him), will have to be treated as null and void and non est in law. The parties will have to be relegated to the position as on 4 th December, 2017, consequent to incorporation of the four amendments approved in terms of the same order. After carrying out those four amendments in the Constitution, the election will have to be conducted to constitute the new body, which would then take steps to introduce further amendments to the Constitution, if so required, to bring it in line with the National Sports Code, after giving an opportunity to all concerned. Only after the amendments are accepted and approved, fresh elections be conducted for constituting a new body in conformity with such duly amended Constitution. 20. In reference to certain apprehensions expressed by the respondents due to reactions of the World Archery body, we must observe that the controversy cannot be adjudicated on the basis of perception of the World Archery body. Similarly, we do not wish to expand the scope of the present proceedings as the main writ petition is still pending before the High Court of Delhi, where all issues can be deliberated and answered appropriately. While doing so, the High Court, no doubt, would be guided by the exposition in Sheela Barse Vs. Union of India and Ors. (1988) 4 SCC 226 ( para 1) , K. Murugan Vs. Fencing Association of India, Jabalpur and Ors. (1991) 2 SCC 412 ( para 12) , and Board of Control for Cricket in India Vs. Cricket Association of Bihar and Ors, (2015) 3 SCC 251 ( para 100¬103) on which reliance has been placed by the counsel representing the newly elected body of AAI and the respondents, for issuing appropriate directions in a public interest litigation. In other words, the High Court will examine all aspects of the matter on their own merits in accordance with law. 21. We make it clear that the High Court may also consider the stand taken by the appellant(s) and Union of India that the decision of this Court in Board of Control for Cricket (supra) (2016) 8 SCC 535 will be of no avail to the present case, because the National Sports Code takes within its fold fifty¬two disciplines of sports and Cricket is not one of the scheduled sports. In other words, the dispensation to be followed must be in conformity with the National Sports Code in so far as AAI is concerned. We keep this issue open to be considered at the appropriate stage. ### Response: 1

Dharmabiri Rana Vs. Pramod Kumar Sharma (D) Thr. Lrs. & Another

of the plaintiff seeking execution of agreement to sell, we now proceed to consider the findings recorded by the First Appellate Court.7. It is relevant to notice that before the trial court in spite of there being denial of title to the property by the defendants, no finding was returned by the trial court that defendants are the owner of the property, competent to enter into agreement to sell. The trial court also noticed that defendant No.1 in the written statement has pleaded that he has no right, title or interest of any nature in the suit property but no finding was returned that defendant No.1 is the owner of the property. The entire discussion by the trial court is in Para 10 of the judgment, which is as follows:-"ISSUE NO.3, the onus is on the plaintiff to show that she is entitled for a decree of performance of a agreement to sell. In the written statement defendant No.1 has stated that he has no right title interest of any nature whatsoever in respect of suit property and he has been unnecessarily dragged. It is stated that the defendant No.1 is neither the owner of the suit property nor ever entered into agreement called respect to the same with any person what to talked, of the alleged agreement with the plaintiff. The defendant No.2 has also deliberately denied the averments of the plaintiff. DW2 Krishan Kumar has even denied his signature on EX.PW1/4. In the written statement they have not disclosed that Rakesh Kumar is the owner of the property and earlier Prabhu Dayal Sharma was the owner of the suit property, DW3 Naveen Gautam has also stated in his testimony about the document having been executed in his presence. He has admitted his signature at Mark `C in Ex.D1 mark `C Ex.D2 and mark `C in Ex.D3. He further stated that he cannot be said if the document D1, D2 and D23 are forged and genuine documents. DW1 is Rakesh Kumar has stated that he is owner of the suit property and earlier Sh. Prabhu Dayal was owner of the suit property and he had purchased the same for a sum of L70,000/- on 12.12.1986. He has stated in his cross examination that he does not remember the same from Sh.Prabhu Dayal at the time of execution of Power of Attorney as to whether there is any litigation on the plot in question. He has further stated that he did not receive any receipt of Rs. 70000/- as consideration of the suit property nor it was ever executed. From the testimony of DW1 & DW2 and DW3, it is clear that the document D1, D2 and D3 were manipulated at a later stage. The testimony of DW1, DW2 and DW3 does not inspire any confidence. Therefore, I hold that he plaintiff is entitled for a decree of specific performance of agreement to sell. Issue No.3 is decided in favour of plaintiff and against the defendant."8. The First Appellate Court has after considering the entire evidence have returned following findings:-(i) It is not established that agreements had actually been executed by defendant No.2.(ii) There is no evidence on record to prove the title of the defendant No.1 in respect of the suit land.(iii) There is no evidence to establish that the defendant No.1 had ever authorized defendant No.2 to enter into agreement to sell.9. In paragraph 12 of the judgment, after considering the entire oral evidence, the First Appellate Court held that it is not established that the agreement had actually been executed by appellant No.2 (defendant No.2). Further following findings have been recorded in paragraph 15:-"The result of the aforesaid discussion is that in the absence of any evidence coming on record that appellant No.1 was owner of the suit property or appellant No.2 was having any power of attorney on behalf of appellant No.1 execute the agreements in favour of the respondent, no documents for transfer of title in respect of suit land can be directed to be executed by the appellants by way of a decree for specific performance of agreement of sell vide Ex.PW1/1 and PW1/3. The agreements are thus illegal, unenforceable and to decree for specific performance can therefore be passed in favour of the respondent."10. That after returning the aforesaid findings, the appeal was allowed and suit was dismissed. The High Court vide its judgment dated 19.07.2005 has confirmed the findings recorded by the First Appellate Court. The High Court held that alleged agreement claimed by the plaintiff was not enforceable. The High Court held that there is no substantial question of law, hence the Second Appeal was dismissed.11. The Court can order specific performance of an agreement only when it is proved that a person allegedly executing an agreement to sell has right of transferring the property. When defendants have denied their entitlement and right, title and interest in the suit property, the said question was necessary to be answered before decreeing the suit. The trial court after noticing the said pleading on behalf of the defendants did not enter into this question or returned any finding that defendants are owner of the suit property. Further, essential findings pertaining to right of the defendant to transfer the property being not there, the passing of a decree of specific performance was clearly erroneous. The Appellate Court has rightly set aside the decree of specific performance of contract after recording the finding that defendant No.1 is not the owner of the property. It is not proved that any power of attorney was executed so as to enable defendant No.2 to enter into agreement to sell and further the execution of agreement has also not been proved. Although, copy of alleged power of attorney dated 04.11.1986 which is admittedly an unregistered document has been filed by appellant before this Court as Annexure-P12, but both the Courts having not considered the same, it is not necessary for this Court to consider the same in this Civil Appeal.

0[ds]The defendant No.2 has clearly pleaded that he is not the power of attorney holder of defendant No.1 and further both the defendants having pleaded that they are not owner of the property, the trial court ought to have framed a specific issue so as to focus its judgment on relevant issues, which have come before it for consideration.That after returning the aforesaid findings, the appeal was allowed and suit was dismissed. The High Court vide its judgment dated 19.07.2005 has confirmed the findings recorded by the First Appellate Court. The High Court held that alleged agreement claimed by the plaintiff was not enforceable. The High Court held that there is no substantial question of law, hence the Second Appeal was dismissed.11. The Court can order specific performance of an agreement only when it is proved that a person allegedly executing an agreement to sell has right of transferring the property. When defendants have denied their entitlement and right, title and interest in the suit property, the said question was necessary to be answered before decreeing the suit. The trial court after noticing the said pleading on behalf of the defendants did not enter into this question or returned any finding that defendants are owner of the suit property. Further, essential findings pertaining to right of the defendant to transfer the property being not there, the passing of a decree of specific performance was clearly erroneous. The Appellate Court has rightly set aside the decree of specific performance of contract after recording the finding that defendant No.1 is not the owner of the property. It is not proved that any power of attorney was executed so as to enable defendant No.2 to enter into agreement to sell and further the execution of agreement has also not been proved. Although, copy of alleged power of attorney dated 04.11.1986 which is admittedly an unregistered document has been filed by appellant before this Court asbut both the Courts having not considered the same, it is not necessary for this Court to consider the same in this Civil Appeal.

### Instruction: From the information provided in the case proceeding, infer whether the court's decision will be positive (1) or negative (0) for the appellant. ### Input: of the plaintiff seeking execution of agreement to sell, we now proceed to consider the findings recorded by the First Appellate Court.7. It is relevant to notice that before the trial court in spite of there being denial of title to the property by the defendants, no finding was returned by the trial court that defendants are the owner of the property, competent to enter into agreement to sell. The trial court also noticed that defendant No.1 in the written statement has pleaded that he has no right, title or interest of any nature in the suit property but no finding was returned that defendant No.1 is the owner of the property. The entire discussion by the trial court is in Para 10 of the judgment, which is as follows:-"ISSUE NO.3, the onus is on the plaintiff to show that she is entitled for a decree of performance of a agreement to sell. In the written statement defendant No.1 has stated that he has no right title interest of any nature whatsoever in respect of suit property and he has been unnecessarily dragged. It is stated that the defendant No.1 is neither the owner of the suit property nor ever entered into agreement called respect to the same with any person what to talked, of the alleged agreement with the plaintiff. The defendant No.2 has also deliberately denied the averments of the plaintiff. DW2 Krishan Kumar has even denied his signature on EX.PW1/4. In the written statement they have not disclosed that Rakesh Kumar is the owner of the property and earlier Prabhu Dayal Sharma was the owner of the suit property, DW3 Naveen Gautam has also stated in his testimony about the document having been executed in his presence. He has admitted his signature at Mark `C in Ex.D1 mark `C Ex.D2 and mark `C in Ex.D3. He further stated that he cannot be said if the document D1, D2 and D23 are forged and genuine documents. DW1 is Rakesh Kumar has stated that he is owner of the suit property and earlier Sh. Prabhu Dayal was owner of the suit property and he had purchased the same for a sum of L70,000/- on 12.12.1986. He has stated in his cross examination that he does not remember the same from Sh.Prabhu Dayal at the time of execution of Power of Attorney as to whether there is any litigation on the plot in question. He has further stated that he did not receive any receipt of Rs. 70000/- as consideration of the suit property nor it was ever executed. From the testimony of DW1 & DW2 and DW3, it is clear that the document D1, D2 and D3 were manipulated at a later stage. The testimony of DW1, DW2 and DW3 does not inspire any confidence. Therefore, I hold that he plaintiff is entitled for a decree of specific performance of agreement to sell. Issue No.3 is decided in favour of plaintiff and against the defendant."8. The First Appellate Court has after considering the entire evidence have returned following findings:-(i) It is not established that agreements had actually been executed by defendant No.2.(ii) There is no evidence on record to prove the title of the defendant No.1 in respect of the suit land.(iii) There is no evidence to establish that the defendant No.1 had ever authorized defendant No.2 to enter into agreement to sell.9. In paragraph 12 of the judgment, after considering the entire oral evidence, the First Appellate Court held that it is not established that the agreement had actually been executed by appellant No.2 (defendant No.2). Further following findings have been recorded in paragraph 15:-"The result of the aforesaid discussion is that in the absence of any evidence coming on record that appellant No.1 was owner of the suit property or appellant No.2 was having any power of attorney on behalf of appellant No.1 execute the agreements in favour of the respondent, no documents for transfer of title in respect of suit land can be directed to be executed by the appellants by way of a decree for specific performance of agreement of sell vide Ex.PW1/1 and PW1/3. The agreements are thus illegal, unenforceable and to decree for specific performance can therefore be passed in favour of the respondent."10. That after returning the aforesaid findings, the appeal was allowed and suit was dismissed. The High Court vide its judgment dated 19.07.2005 has confirmed the findings recorded by the First Appellate Court. The High Court held that alleged agreement claimed by the plaintiff was not enforceable. The High Court held that there is no substantial question of law, hence the Second Appeal was dismissed.11. The Court can order specific performance of an agreement only when it is proved that a person allegedly executing an agreement to sell has right of transferring the property. When defendants have denied their entitlement and right, title and interest in the suit property, the said question was necessary to be answered before decreeing the suit. The trial court after noticing the said pleading on behalf of the defendants did not enter into this question or returned any finding that defendants are owner of the suit property. Further, essential findings pertaining to right of the defendant to transfer the property being not there, the passing of a decree of specific performance was clearly erroneous. The Appellate Court has rightly set aside the decree of specific performance of contract after recording the finding that defendant No.1 is not the owner of the property. It is not proved that any power of attorney was executed so as to enable defendant No.2 to enter into agreement to sell and further the execution of agreement has also not been proved. Although, copy of alleged power of attorney dated 04.11.1986 which is admittedly an unregistered document has been filed by appellant before this Court as Annexure-P12, but both the Courts having not considered the same, it is not necessary for this Court to consider the same in this Civil Appeal. ### Response: 0

Commissioner of Income Tax, Madras Vs. Rm. Ar. Ar. Veerappa Chettiar

the duty which was levied together with Rs. 7, 97, 072 as interest due from the date on which the estate duty was collected. 2. After the death of A. Senior, there were disputes between the three widows Lakshman Achi, Nachiar Achi and Uniayal Achi, and each widow adopted a son to her deceased husband. A suit for, partition of the joint family property was then filed in the Civil Court at Deokotai. Under a settlement reached on February 17, 1949 between the three widows and the adopted son of A. Junior (whom we will hereinafter call the assessee) was held entitled, to 5/24th share in the estate. 3. This appeal relates to the liability to income-tax on the share of the assessee in the amount of interest paid on the estate duty which was refunded by the Ceylon Government after the Judicial, Committee set aside the order levying the estate duty.The Income-Tax officer, karaikudi brought to tax the, assessees share of the amount interest received from the Ceylon Government on the estate duty. The Income-tax Officer rejected the, contention of the assessee that the receipt was of a capital nature, : and that in any case it was a casual receipt and on that account exempt from tax under S. 4(3) (vii) of the Income-tax Act, 1922 The order was confirmed by the Appellate Assistant Commissioner. The Income-tax Appellate Tribunal, however, reversed the order holding that the amount of interest received by the assessee was of a capital nature and was on that account not liable to tax. The Tribunal referred the following question to the High Court of Madras under s. 66(1) of the Income-tax Act, 1922 Whether the sum of Rs. 1, 20, 830 or Any part thereof is assessable to tax ? 4. The High Court was of the opinion that the assessees share in the interest attributable to the period ending February 17, 1947 was not taxable, but the share attributable to the period between that date and the date of payment by the Ceylon Government was taxable. Against that decision, with certificate granted by the High Court the Commissioner of Income-tax has appealed to this Court. The assessee has not appealed against the opinion insofar as it was held that the receipt to the extent to which it related to a period subsequent to February 17, 1947 is taxable. In the view of. the High Court the amounts paid as estate duty must be deemed in law to have come from the joint family, estate and on severance of the joint family status, in February, 1947, each adopted son received his share in the estate then existing as capital. Counsel for the Revenue countended that the High Court erred in holding that the assessees share in the amount of interest received from the Ceylon Government Was of the nature of capital. Counsel submitted that the character of the receipt which was revenue when received by the joint family, could not be altered when it was divided between the members of the family. Counsel also contended that this Court has held that the share in the amount of interest on estate duty received by the son adopted by Nachiar Achi was liable to be taxed as income: RM. AR. AR. RM. AR. AR. Ramanathan Chettiar v. Commissioner of Income-tax Madras(63. T.T.R. 458.) . But that case has no relevance here. for the only argument advanced before the Tribunal and the High Court in that case was. that the receipt was of a casual, and non-recurring nature and was on that account exempt from tax under s. 4(3) (vii) of the Income-tax Act. This Court negatived the contention. The Court declined to consider the argument advanced at the Bar that the share allotted to the adopted son of Nachiar Achi being a share in the estate of A. Senior was of the nature of capital, because the question did not arise out of the order made by the Income-tax Appellate Tribunal and was not made the subject-matter of lie reference. In RM. AR. AR. RM. AR. AR. Ramanathan Chettiars case(63 I.T.R. 459.) the question argued before the High Court in this case was not raised before the income-tax Appellate Tribunal and was not decided.After the death of A. Senior the property was held by the three widows as members of the Hindu Undevided family. Under the Hindu Law it is not predicted of a Hindu Joint family that there must be a male member in existence. Even after the death of the sole male member, so long as the property which was originally of the Joint Hindu family remains in the hands of the widows of the members of the family and is not divided among them, the joint family continues. Payment of the estate duty was doubtless made out of the joint family fund and the interest which accrued due, also acquired the character of joint family property when received. The joint family status came to an end only on February 17, 1947. On the severance of the joint status the assessee became entitled to a share in the family estate. The amount of interest on the estate duty accrued as income to the joint family but it was income of the joint family and not of the individual members. But when a share out of the estate which included the interest on estate duty was received by the assessee it had not the character of income. Once the. income was received by the joint family, the amount lost its character of income: it became merged in the joint family assets and became the capital Of the family. The share received by the assessee was therefore a share in the capital of the family. The share in the joint family property which included interest on the estate duty which accrued prior to February 17, 1947 was rightly held by the High Court to be not of the nature of revenue and accordingly not taxable. 5.

1[ds]But that case has no relevance here. for the only argument advanced before the Tribunal and the High Court in that case was. that the receipt was of a casual, and non-recurring nature and was on that account exempt from tax under s. 4(3) (vii) of the Income-tax Act. This Court negatived the contention. The Court declined to consider the argument advanced at the Bar that the share allotted to the adopted son of Nachiar Achi being a share in the estate of A. Senior was of the nature of capital, because the question did not arise out of the order made by the Income-tax Appellate Tribunal and was not made the subject-matter of lie reference. In RM. AR. AR. RM. AR. AR. Ramanathan Chettiars case(63 I.T.R. 459.) the question argued before the High Court in this case was not raised before the income-tax Appellate Tribunal and was not decided.After the death of A. Senior the property was held by the three widows as members of the Hindu Undevided family. Under the Hindu Law it is not predicted of a Hindu Joint family that there must be a male member in existence. Even after the death of the sole male member, so long as the property which was originally of the Joint Hindu family remains in the hands of the widows of the members of the family and is not divided among them, the joint family continues. Payment of the estate duty was doubtless made out of the joint family fund and the interest which accrued due, also acquired the character of joint family property when received. The joint family status came to an end only on February 17, 1947. On the severance of the joint status the assessee became entitled to a share in the family estate. The amount of interest on the estate duty accrued as income to the joint family but it was income of the joint family and not of the individual members. But when a share out of the estate which included the interest on estate duty was received by the assessee it had not the character of income. Once the. income was received by the joint family, the amount lost its character of income: it became merged in the joint family assets and became the capital Of the family. The share received by the assessee was therefore a share in the capital of the family. The share in the joint family property which included interest on the estate duty which accrued prior to February 17, 1947 was rightly held by the High Court to be not of the nature of revenue and accordingly not taxable.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: the duty which was levied together with Rs. 7, 97, 072 as interest due from the date on which the estate duty was collected. 2. After the death of A. Senior, there were disputes between the three widows Lakshman Achi, Nachiar Achi and Uniayal Achi, and each widow adopted a son to her deceased husband. A suit for, partition of the joint family property was then filed in the Civil Court at Deokotai. Under a settlement reached on February 17, 1949 between the three widows and the adopted son of A. Junior (whom we will hereinafter call the assessee) was held entitled, to 5/24th share in the estate. 3. This appeal relates to the liability to income-tax on the share of the assessee in the amount of interest paid on the estate duty which was refunded by the Ceylon Government after the Judicial, Committee set aside the order levying the estate duty.The Income-Tax officer, karaikudi brought to tax the, assessees share of the amount interest received from the Ceylon Government on the estate duty. The Income-tax Officer rejected the, contention of the assessee that the receipt was of a capital nature, : and that in any case it was a casual receipt and on that account exempt from tax under S. 4(3) (vii) of the Income-tax Act, 1922 The order was confirmed by the Appellate Assistant Commissioner. The Income-tax Appellate Tribunal, however, reversed the order holding that the amount of interest received by the assessee was of a capital nature and was on that account not liable to tax. The Tribunal referred the following question to the High Court of Madras under s. 66(1) of the Income-tax Act, 1922 Whether the sum of Rs. 1, 20, 830 or Any part thereof is assessable to tax ? 4. The High Court was of the opinion that the assessees share in the interest attributable to the period ending February 17, 1947 was not taxable, but the share attributable to the period between that date and the date of payment by the Ceylon Government was taxable. Against that decision, with certificate granted by the High Court the Commissioner of Income-tax has appealed to this Court. The assessee has not appealed against the opinion insofar as it was held that the receipt to the extent to which it related to a period subsequent to February 17, 1947 is taxable. In the view of. the High Court the amounts paid as estate duty must be deemed in law to have come from the joint family, estate and on severance of the joint family status, in February, 1947, each adopted son received his share in the estate then existing as capital. Counsel for the Revenue countended that the High Court erred in holding that the assessees share in the amount of interest received from the Ceylon Government Was of the nature of capital. Counsel submitted that the character of the receipt which was revenue when received by the joint family, could not be altered when it was divided between the members of the family. Counsel also contended that this Court has held that the share in the amount of interest on estate duty received by the son adopted by Nachiar Achi was liable to be taxed as income: RM. AR. AR. RM. AR. AR. Ramanathan Chettiar v. Commissioner of Income-tax Madras(63. T.T.R. 458.) . But that case has no relevance here. for the only argument advanced before the Tribunal and the High Court in that case was. that the receipt was of a casual, and non-recurring nature and was on that account exempt from tax under s. 4(3) (vii) of the Income-tax Act. This Court negatived the contention. The Court declined to consider the argument advanced at the Bar that the share allotted to the adopted son of Nachiar Achi being a share in the estate of A. Senior was of the nature of capital, because the question did not arise out of the order made by the Income-tax Appellate Tribunal and was not made the subject-matter of lie reference. In RM. AR. AR. RM. AR. AR. Ramanathan Chettiars case(63 I.T.R. 459.) the question argued before the High Court in this case was not raised before the income-tax Appellate Tribunal and was not decided.After the death of A. Senior the property was held by the three widows as members of the Hindu Undevided family. Under the Hindu Law it is not predicted of a Hindu Joint family that there must be a male member in existence. Even after the death of the sole male member, so long as the property which was originally of the Joint Hindu family remains in the hands of the widows of the members of the family and is not divided among them, the joint family continues. Payment of the estate duty was doubtless made out of the joint family fund and the interest which accrued due, also acquired the character of joint family property when received. The joint family status came to an end only on February 17, 1947. On the severance of the joint status the assessee became entitled to a share in the family estate. The amount of interest on the estate duty accrued as income to the joint family but it was income of the joint family and not of the individual members. But when a share out of the estate which included the interest on estate duty was received by the assessee it had not the character of income. Once the. income was received by the joint family, the amount lost its character of income: it became merged in the joint family assets and became the capital Of the family. The share received by the assessee was therefore a share in the capital of the family. The share in the joint family property which included interest on the estate duty which accrued prior to February 17, 1947 was rightly held by the High Court to be not of the nature of revenue and accordingly not taxable. 5. ### Response: 1

Britannia Engineering Company, Limited, West Bengal Vs. Their Workmen

such dispute. The balance sheet and profit and loss account were certified and must be presumed to be correct unless they are challenged and demonstrated to be wrong. In our judgment this addition was also improper. The next two items give no trouble at all. The sum of Rs. 6, 533, representing interest paid for the previous year is accepted on behalf of the company and must be added. The sum of Rs. 12, 983, it is accepted by the unions, must be deducted. The latter represents income from other sources or, in other words, income which was earned without the assistance of labour. The adjusted gross profits, therefore, stand thus : Rs. Net profits . . 6, 63, 065 Add-back depreciation . . 5, 48, 717 Add-back provision for tax . . 5, 32, 000 Add-back interest for previous year . . 6, 533 ------------- 17, 40, 315 Deduct extraneous income . . 12, 983 -------------- Adjusted gross profits . . 17, 27, 332From the adjusted gross income the prior charges may now be deducted according to the formula. The first item to go out is the normal notional depreciation which in this case is Rs. 5, 22, 289. The next item to deduct is income tax on the balance at 45 per cent. It will be recalled that the development rebate reserve of Rs. 1, 00, 000 was not added back. The amount on which tax is to be calculated must be reduced by Rs. 1, 00, 000 as that amount will not bear tax. The return on the capital accounting to Rs. 3, 03, 226 is not challenged and that amount will also be deducted. Return on the working capital has been calculated at 2 per cent instead of the usual 4 per cent. This is strongly supported on behalf of the unions. The tribunal reduced the percentage on the ground that the working capital was not utilized. On the other hand, it is pointed out that the company had to borrow from the bank. The tribunal has again made a surmise that the whole of the amount was not used as working capital though there was no evidence that it was kept apart. In our judgment, there was no justification for reducing the amount to half. The proper reduction to make is thus Rs. 1, 65, 056. The amount of rehabilitation charges, which the tribunal placed at Rs. 1, 96, 067, is not challenged by Sri Niren De who submitted that in view of the resulting figure it was hardly necessary to do so. The account, therefore, stands thus : Rs. Adjusted gross profits . . 17, 27, 332 Deduct normal notional depreciation . . 5, 22, 289 ---------- 12, 05, 043 Deduct - Income tax (tax on Rs. 11, 05, 043 : (12, 05, 03 minus Rs. 1, 00, 000 development rebate reserve) . . 4, 97, 270 7, 07, 773 Returns on paid-up capital . . 3, 03, 226 4, 04, 547 Return on working capital . . 1, 65, 066 2, 39, 481 Rehabilitation charge . . 1, 96, 05743, 424 --------------- 8. It was contented that the rehabilitation charges should not be allowed because rehabilitation amount of previous year is still available and further that the old machines are being still used or kept to claim rehabilitation. The evidence on the latter part is interested and cannot be believed. It was contented that as the accumulated depreciation reserve not having been taken into account rehabilitation may not be admissible and reliance is placed on Associated Cement Companies, Ltd. v. Their workmen [1959 - I L.L.J. 644]. The company pointed out that the total rehabilitation charges for the year amounted to Rs. 5, 94, 943 for machinery (annexure E.1) and Rs. 1, 53, 471 on buildings (annexure E. 2). From these amounts the company, in its claim, deducted (as per annexure E. 3) Rs. 4, 03, 919 and 65, 350 as representing depreciation on the block leaving a net rehabilitation requirement of Rs. 2, 79, 145 for the year. The amount of depreciation totalling Rs. 5, 22, 289 has been deducted in arriving at the net rehabilitation charges and that amount (Rs. 2, 79, 145) has been further reduced to Rs. 1, 96, 067. The point raised by the unions does not survive. 9. The amount of available surplus to Rs. 43, 424. In view, however, of the fact that one months wages have already been distributed and the wage-bill is Rs. 1, 63, 859 per month, there is no further surplus available. The point referred for the decision of the tribunal was whether the workmen were entitled to bonus in addition to the one months basic wages already distributed. The answer to this question clearly is in the negative view of the fact that no more surplus is available. 10. A further questions raised by the unions was that in the previous award delivered by Sri P. K. Sarkar on 22 May, 1961, the question of puja bonus was gone into and the payment of one months bonus for the year 1959 should not be treated as profit bonus. Reference to made to the observation of the tribunal :"The company already paid one months basic wages to the workmen as bonus for the year under reference. That was an unconditional payment. The unions stated about payments of puja bonus as of right in their written statement. That is not the issue before me and I refrain from making any observation in regard to the question of puja bonus." 11. The unions apprehend a break in the continuity of payments of customary bonus and think that above remarks likely to be construed as meaning that what was paid was profit bonus. In this connexion it is only necessary to point out that payment of one months bonus was unconditional and the apprehensions are perhaps not real. Beyond this it is not proper for us to say what was the nature of the payment.

1[ds]The main dispute centres round the calculation of the available surplus by the tribunal from which the bonus is payable. Both sides have fairly conceded that the approach to the problem by the tribunal was full of errors. This appears be due to a misunderstanding of the balance sheet and the profit and loss account of the company. It is not necessary for us to enter too elaborately into the dispute, for our decision can be stated in very short and simple terms. It is agreed on both sides that the not profits same to Rs. 6, 23, 065 and to it must be added Rs. 5, 48, 717 for depreciation and Rs. 5, 32, 000 provision for taxation. This addition gives a figure of Rs. 17, 33, 782 and so far there is no dispute. The dispute arises over some of the other" and the deduction of "prior charges" as laid down in what is popularly known as the Full Bench formulas.The tribunal added back to the sum of Rs. 17, 33, 782 certain sums to arrive at the adjusted gross profits before making deductions for prior charges and we shall review these additions separately. The first sum added back is Rs. 29, 884 which was claimed as a part of expenditure on account of canteen. In Ex. G. 8 which is a part of the accounts dealing with miscellaneous expenses, a sum of Rs. 59, 768 is shown as made up of two items. Rs. 18, 838 (medical expenses) and Rs. 40, 930 for welfare (including subsidy to works, canteen, pantry expenses and tiffin expenses, etc.). The workmen asked that the whole of this amount should be added back. Evidence led on behalf of the workmen was that they were not given any tiffin allowance and that the canteen served only the manual and clerical staff or visitors. The management, in its evidence, established that the workmen get a cup of tea at the concessional rate of 3 paise. All this is not much to the purpose. The fact is that the canteen was subsidised and the amount was actually spent. The tribunal attempted some kind of justice by adding back half of the amount, overlooking in the first instance that a part of the sum medical expenses) was in a different category altogether and in the next that no suchk was possible when the next amount was proved to be spent. In our opinion thek of Rs. 29, 884 must be cancelledThe general items of wages and consumption of stores in the profit and loss account, of course, did not include the items (a) and (b) above5. The tribunal held that some person should have come forward on behalf of the company to deny that the sum of Rs. 1, 51, 302 was not spent on capital account, and the tribunal added back, excusing, as it said,d in the companys favour. This was quite erroneous. There was nothing to show that the profit and loss account was wrong and no error in it was pointed out by the tribunal. The balance sheet and the profit and loss account were not held by any authority (such as thex Department) to be wrong. Ordinarily the balance sheet and the profit and loss account are accepted as correct and more was this the case here because no objection was raised and no inquiry was made. The tribunal was surmising when it attributed a part of the expenditure on repairs to the capital account. In our judgment, the whole of thisk must be cancelled.The tribunal next added back a sum of Rs. 1, 00, 000 which was transferred to the development rebate reserve. There is no reason given by the tribunal for this action. The balance of profits which was carried down to the appropriation account consisted of this sum and a further sum Rs. 78, 052 which was the balance brought forward from the previous year. In this way the company had Rs. 7, 31, 117 in the appropriation account. Additions to machinery as shown in the "fixed assets" were Rs. 4, 96, 464 (roundly Rs. 5 lakhs). The company could earn rebate in income tax if it transferred a minimum of 75 per cent of 20 per cent of that sum. It transferred Rs. 1, 00, 000 which was 100 per cent of 20 per cent of Rs. 5 lakhs. The company next distributed Rs. 4, 48, 636 as dividends and carried to the balance sheet the sum of Rs. 1, 82, 4816. As the transfer was made after the net profits were calculated the amount could not be added back. It would have been different if it had been transferred before the calculation of net profits. However, in the calculation of income tax the company would get a deduction of Rs. 45, 000 arising from the transfer of the sum to the development rebate reserve. That we shall adjust later when we set down the calculations. The" must be excluded in adjusting the gross profits. The tribunal thought that a small portion of it (5 per cent) could be added back as expense on capital account. In doing so the tribunal was perhaps influenced by Burn & Co. case [1964I L.L.J. 370] (vide supra). But in that case an issue was joined and the case cannot be followed where there was no such dispute. The balance sheet and profit and loss account were certified and must be presumed to be correct unless they are challenged and demonstrated to be wrong. In our judgment this addition was also improper. In our judgment, there was no justification for reducing the amount to half. The proper reduction to make is thus Rs. 1, 65, 056. The amount of rehabilitation charges, which the tribunal placed at Rs. 1, 96, 067, is not challenged by Sri Niren De who submitted that in view of the resulting figure it was hardly necessary to do so.9. The amount of available surplus to Rs. 43, 424. In view, however, of the fact that one months wages have already been distributed and thel is Rs. 1, 63, 859 per month, there is no further surplus available. The point referred for the decision of the tribunal was whether the workmen were entitled to bonus in addition to the one months basic wages already distributed. The answer to this question clearly is in the negative view of the fact that no more surplus is available10. A further questions raised by the unions was that in the previous award delivered by Sri P. K. Sarkar on 22 May, 1961, the question of puja bonus was gone into and the payment of one months bonus for the year 1959 should not be treated as profit bonus. Reference to made to the observation of the tribunal :"The company already paid one months basic wages to the workmen as bonus for the year under reference. That was an unconditional payment. The unions stated about payments of puja bonus as of right in their written statement. That is not the issue before me and I refrain from making any observation in regard to the question of puja bonus."11. The unions apprehend a break in the continuity of payments of customary bonus and think that above remarks likely to be construed as meaning that what was paid was profit bonus. In this connexion it is only necessary to point out that payment of one months bonus was unconditional and the apprehensions are perhaps not real. Beyond this it is not proper for us to say what was the nature of the payment.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: such dispute. The balance sheet and profit and loss account were certified and must be presumed to be correct unless they are challenged and demonstrated to be wrong. In our judgment this addition was also improper. The next two items give no trouble at all. The sum of Rs. 6, 533, representing interest paid for the previous year is accepted on behalf of the company and must be added. The sum of Rs. 12, 983, it is accepted by the unions, must be deducted. The latter represents income from other sources or, in other words, income which was earned without the assistance of labour. The adjusted gross profits, therefore, stand thus : Rs. Net profits . . 6, 63, 065 Add-back depreciation . . 5, 48, 717 Add-back provision for tax . . 5, 32, 000 Add-back interest for previous year . . 6, 533 ------------- 17, 40, 315 Deduct extraneous income . . 12, 983 -------------- Adjusted gross profits . . 17, 27, 332From the adjusted gross income the prior charges may now be deducted according to the formula. The first item to go out is the normal notional depreciation which in this case is Rs. 5, 22, 289. The next item to deduct is income tax on the balance at 45 per cent. It will be recalled that the development rebate reserve of Rs. 1, 00, 000 was not added back. The amount on which tax is to be calculated must be reduced by Rs. 1, 00, 000 as that amount will not bear tax. The return on the capital accounting to Rs. 3, 03, 226 is not challenged and that amount will also be deducted. Return on the working capital has been calculated at 2 per cent instead of the usual 4 per cent. This is strongly supported on behalf of the unions. The tribunal reduced the percentage on the ground that the working capital was not utilized. On the other hand, it is pointed out that the company had to borrow from the bank. The tribunal has again made a surmise that the whole of the amount was not used as working capital though there was no evidence that it was kept apart. In our judgment, there was no justification for reducing the amount to half. The proper reduction to make is thus Rs. 1, 65, 056. The amount of rehabilitation charges, which the tribunal placed at Rs. 1, 96, 067, is not challenged by Sri Niren De who submitted that in view of the resulting figure it was hardly necessary to do so. The account, therefore, stands thus : Rs. Adjusted gross profits . . 17, 27, 332 Deduct normal notional depreciation . . 5, 22, 289 ---------- 12, 05, 043 Deduct - Income tax (tax on Rs. 11, 05, 043 : (12, 05, 03 minus Rs. 1, 00, 000 development rebate reserve) . . 4, 97, 270 7, 07, 773 Returns on paid-up capital . . 3, 03, 226 4, 04, 547 Return on working capital . . 1, 65, 066 2, 39, 481 Rehabilitation charge . . 1, 96, 05743, 424 --------------- 8. It was contented that the rehabilitation charges should not be allowed because rehabilitation amount of previous year is still available and further that the old machines are being still used or kept to claim rehabilitation. The evidence on the latter part is interested and cannot be believed. It was contented that as the accumulated depreciation reserve not having been taken into account rehabilitation may not be admissible and reliance is placed on Associated Cement Companies, Ltd. v. Their workmen [1959 - I L.L.J. 644]. The company pointed out that the total rehabilitation charges for the year amounted to Rs. 5, 94, 943 for machinery (annexure E.1) and Rs. 1, 53, 471 on buildings (annexure E. 2). From these amounts the company, in its claim, deducted (as per annexure E. 3) Rs. 4, 03, 919 and 65, 350 as representing depreciation on the block leaving a net rehabilitation requirement of Rs. 2, 79, 145 for the year. The amount of depreciation totalling Rs. 5, 22, 289 has been deducted in arriving at the net rehabilitation charges and that amount (Rs. 2, 79, 145) has been further reduced to Rs. 1, 96, 067. The point raised by the unions does not survive. 9. The amount of available surplus to Rs. 43, 424. In view, however, of the fact that one months wages have already been distributed and the wage-bill is Rs. 1, 63, 859 per month, there is no further surplus available. The point referred for the decision of the tribunal was whether the workmen were entitled to bonus in addition to the one months basic wages already distributed. The answer to this question clearly is in the negative view of the fact that no more surplus is available. 10. A further questions raised by the unions was that in the previous award delivered by Sri P. K. Sarkar on 22 May, 1961, the question of puja bonus was gone into and the payment of one months bonus for the year 1959 should not be treated as profit bonus. Reference to made to the observation of the tribunal :"The company already paid one months basic wages to the workmen as bonus for the year under reference. That was an unconditional payment. The unions stated about payments of puja bonus as of right in their written statement. That is not the issue before me and I refrain from making any observation in regard to the question of puja bonus." 11. The unions apprehend a break in the continuity of payments of customary bonus and think that above remarks likely to be construed as meaning that what was paid was profit bonus. In this connexion it is only necessary to point out that payment of one months bonus was unconditional and the apprehensions are perhaps not real. Beyond this it is not proper for us to say what was the nature of the payment. ### Response: 1

Ttk Biomed Limited Vs. Arebee Star Maritime Agencies Private Limited & Others

allowing the above Notice of Motion, whereby the Plaint is rejected against Defendant No.6, and he submitted that the said issue of limitation ought to have been decided at the trial, after allowing the parties to lead evidence. 13. Mr. Sancheti for original Defendant Nos.5 and 6 contended that the learned Single Judges order was fully justifiable, as the suit claim against the above Defendants is clearly barred by law of Limitation and that there is no cause of action against them. Mr. Sancheti pointed out that in the facts and circumstances of the case in Mahajan Silk Mills Pvt. Ltd., the learned Single Judge was of the view that the plea of suit being barred by law of limitation could be decided only by leading evidence as the same was not clear from plaint itself. 14. Mr. Sancheti, the learned Counsel for Respondent Nos.1 and 2 very categorically contended that the suit claim is ex-facie barred by law of limitation, as the same is very clear from the pleadings in the plaint. There is a clear failure on the part of the Plaintiff to file a suit within either 9 months or one year as per the provisions of Clause 23 of the Bill of Lading dated 09/10/1996, paragraph 6 of Article III of the Rules Relating to Bills of Lading, (Schedule to The Indian Carriage of Goods by Sea Act, 1925) respectively, results in the Plaintiffs remedy and rights being extinguished. Further, Mr. Sancheti strongly relied on the judgment of the Honble Supreme Court in the case of East and West Steamship Co. Vs. S.K. Ramalingam Chettiar, (AIR 1960 SC 1058 ), wherein the Honble Supreme Court held that paragraph 6 of Article III of the Indian Carriage of Goods by Sea Act, 1925 provides full immunity to carriers from all liability, if a suit is not instituted for recovery of the amount of loss that is caused within one year, and the suit is thereafter barred, and in fact the right to claim gets extinguished. The relevant part of the judgment reads as under: 18. It is worth noting in this connection that while paragraph 5 makes it clear that loss there means loss to the carrier and paragraph 8 speaks of loss or damage to or in connection with the goods, the Legislature has in the 6th paragraph of this Article left the words "loss or damage" unqualified. The object of the rule however being to give immunity to the carriers and the shippers from claims of compensation made by the owners of the goods in respect of loss sustained by them it will be unreasonable to read the words "loss" in that paragraph as restricted to only loss "of the goods". When the object of this particular paragraph and the setting of this paragraph in the Article after the previous paragraphs are considered there remains no doubt whatsoever that the learned Judges of the Bombay High Court were right in their conclusion that the loss or damage in this paragraph is a wide expression used by the Legislature to include any loss or damage caused to shipper or consignee in respect of which he makes a grievance and in respect of which he claims compensation from the shipping company. 19. The argument that loss due to failure to deliver the goods is not covered by this clause is merely to be mentioned to deserve rejection. The very use of the words "the date on which the goods should have been delivered" clearly contemplates a case where the goods have not been delivered. The clause gives the owner of the goods one years time to bring the suit the year to be calculated from the date of the delivery of the goods where the goods have been delivered and from the date when the goods should have been delivered where all or some of the goods have not been delivered........................................................... 15. Mr. Sancheti also strongly relied on clause 3 of paragraph 6 of Article III of the Schedule to the Indian Carriage of Goods by Sea Act, 1925, which reads as under: "In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered." 16. Mr. Sancheti, the learned Counsel for Defendant No.6 pointed out that as per the averments in the plaint, the wrongful delivery was effected by Defendant No.6 in March, 1997. Hence, the suit should have been instituted within one year from March, 1997 and as the present suit has been instituted in October, 1999, it would be clearly barred by law of Limitation. Mr. Sancheti contended that the right to sue itself got extinguished after a year. 17. Thereafter, Mr. Sancheti referred to and relied upon Saleem Bhai Vs. State of Maharashtra (2003) 1 SCC 557 ) to contend that the application under Order VII Rule 11 of the Code of Civil Procedure should be decided only on the basis of averments in the Plaint, and there is no need of written statement and the said application should not be postponed to the stage of trial. 18. After hearing both the learned Counsel, it is explicitly clear from the pleadings in the Plaint itself, that the suit is filed against Defendant No.6 much after the expiry of one year. There is absolutely no ambiguity and there is no evidence needed for establishing the same. 19. In the light of East & West Steampship Co. Case as held by the Honble Supreme Court, the Appellants right to sue itself gets extinguished after a lapse of one year after the delivery of the goods. 20. Saleem Bhais case also makes it clear that the application under Order VII Rule 11 of the Code of Civil Procedure should be decided on the basis of pleadings in the Plaint and need not wait till the trial.

0[ds]18. After hearing both the learned Counsel, it is explicitly clear from the pleadings in the Plaint itself, that the suit is filed against Defendant No.6 much after the expiry of one year. There is absolutely no ambiguity and there is no evidence needed for establishing the same. 19. In the light of EastWest Steampship Co. Case as held by the Honble Supreme Court, the Appellants right to sue itself gets extinguished after a lapse of one year after the delivery of the goods. 20. Saleem Bhais case also makes it clear that the application under Order VII Rule 11 of the Code of Civil Procedure should be decided on the basis of pleadings in the Plaint and need not wait till the trial.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: allowing the above Notice of Motion, whereby the Plaint is rejected against Defendant No.6, and he submitted that the said issue of limitation ought to have been decided at the trial, after allowing the parties to lead evidence. 13. Mr. Sancheti for original Defendant Nos.5 and 6 contended that the learned Single Judges order was fully justifiable, as the suit claim against the above Defendants is clearly barred by law of Limitation and that there is no cause of action against them. Mr. Sancheti pointed out that in the facts and circumstances of the case in Mahajan Silk Mills Pvt. Ltd., the learned Single Judge was of the view that the plea of suit being barred by law of limitation could be decided only by leading evidence as the same was not clear from plaint itself. 14. Mr. Sancheti, the learned Counsel for Respondent Nos.1 and 2 very categorically contended that the suit claim is ex-facie barred by law of limitation, as the same is very clear from the pleadings in the plaint. There is a clear failure on the part of the Plaintiff to file a suit within either 9 months or one year as per the provisions of Clause 23 of the Bill of Lading dated 09/10/1996, paragraph 6 of Article III of the Rules Relating to Bills of Lading, (Schedule to The Indian Carriage of Goods by Sea Act, 1925) respectively, results in the Plaintiffs remedy and rights being extinguished. Further, Mr. Sancheti strongly relied on the judgment of the Honble Supreme Court in the case of East and West Steamship Co. Vs. S.K. Ramalingam Chettiar, (AIR 1960 SC 1058 ), wherein the Honble Supreme Court held that paragraph 6 of Article III of the Indian Carriage of Goods by Sea Act, 1925 provides full immunity to carriers from all liability, if a suit is not instituted for recovery of the amount of loss that is caused within one year, and the suit is thereafter barred, and in fact the right to claim gets extinguished. The relevant part of the judgment reads as under: 18. It is worth noting in this connection that while paragraph 5 makes it clear that loss there means loss to the carrier and paragraph 8 speaks of loss or damage to or in connection with the goods, the Legislature has in the 6th paragraph of this Article left the words "loss or damage" unqualified. The object of the rule however being to give immunity to the carriers and the shippers from claims of compensation made by the owners of the goods in respect of loss sustained by them it will be unreasonable to read the words "loss" in that paragraph as restricted to only loss "of the goods". When the object of this particular paragraph and the setting of this paragraph in the Article after the previous paragraphs are considered there remains no doubt whatsoever that the learned Judges of the Bombay High Court were right in their conclusion that the loss or damage in this paragraph is a wide expression used by the Legislature to include any loss or damage caused to shipper or consignee in respect of which he makes a grievance and in respect of which he claims compensation from the shipping company. 19. The argument that loss due to failure to deliver the goods is not covered by this clause is merely to be mentioned to deserve rejection. The very use of the words "the date on which the goods should have been delivered" clearly contemplates a case where the goods have not been delivered. The clause gives the owner of the goods one years time to bring the suit the year to be calculated from the date of the delivery of the goods where the goods have been delivered and from the date when the goods should have been delivered where all or some of the goods have not been delivered........................................................... 15. Mr. Sancheti also strongly relied on clause 3 of paragraph 6 of Article III of the Schedule to the Indian Carriage of Goods by Sea Act, 1925, which reads as under: "In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered." 16. Mr. Sancheti, the learned Counsel for Defendant No.6 pointed out that as per the averments in the plaint, the wrongful delivery was effected by Defendant No.6 in March, 1997. Hence, the suit should have been instituted within one year from March, 1997 and as the present suit has been instituted in October, 1999, it would be clearly barred by law of Limitation. Mr. Sancheti contended that the right to sue itself got extinguished after a year. 17. Thereafter, Mr. Sancheti referred to and relied upon Saleem Bhai Vs. State of Maharashtra (2003) 1 SCC 557 ) to contend that the application under Order VII Rule 11 of the Code of Civil Procedure should be decided only on the basis of averments in the Plaint, and there is no need of written statement and the said application should not be postponed to the stage of trial. 18. After hearing both the learned Counsel, it is explicitly clear from the pleadings in the Plaint itself, that the suit is filed against Defendant No.6 much after the expiry of one year. There is absolutely no ambiguity and there is no evidence needed for establishing the same. 19. In the light of East & West Steampship Co. Case as held by the Honble Supreme Court, the Appellants right to sue itself gets extinguished after a lapse of one year after the delivery of the goods. 20. Saleem Bhais case also makes it clear that the application under Order VII Rule 11 of the Code of Civil Procedure should be decided on the basis of pleadings in the Plaint and need not wait till the trial. ### Response: 0

U.P. State Sugar & Cane Development Ltd Vs. Raza Buland Sugar Co. Ltd.

encumbrance or lien, trust or similar obligation (excepting any lien or other obligation) in respect of any advance on the security of any sugar stock or other stock-in-trade) attaching to the undertaking;Provided that any such debt, mortgage, charge or other encumbrance or lien, trust or similar obligation shall attach to the compensation referred to in Section 7, in accordance with the provisions of that section, in substitution for the undertaking;Provided further that a debt, mortgage, charge or other encumbrance or lien, trust or similar obligation created after the scheduled undertaking or any property or asset comprised therein had been attached, or a receiver appointed over it, in any proceedings for realization of any tax or cess or other dues recoverable as arrears of revenue shall be void as against all claims for dues recoverable as arrears of revenue." 6. On a bare reading of Section 2(h) the position is clear that the Act intends to keep in tact the identity of the company. It is only the scheduled undertaking as defined under Section 2(h) of the Act. It vests in the Corporation under Section 3 of the Act. Therefore, as noted above, the real controversy is in regard to interpretation of clause (vi) of Section 2(h) of the Act which relates to land and buildings of the company which have been acquired under the Act. Clause (vi) can be divided into two parts i.e. (i) land and (ii) buildings. The same reads as follows: "(1) all lands other than the lands held or occupied for the purpose of cultivation and grove lands.(2) Buildings - held or occupied of that factory including buildings pertaining to any of the properties and assets hereinbefore specified, and guest houses and residences of directors, managerial personnel, staff and workers or of any other person as lessee or licensee and any store houses, molasses, tanks, roads, bridges, drains, culverts, tube-wells, water storage or distribution system and other civil engineering works including any leasehold interest therein." 7. The definition in respect of land contemplates that every kind of land shall stand vested under section 3 of the Act except such lands which are held or occupied for the purpose of cultivation and grove land of the company whose land has been acquired. The burden of proof is upon the company to establish that the lands or any specified part of it were held or occupied for the purpose of cultivation or it was grove land because it is the company which has the knowledge about the nature of user of the land which was in its occupation. This can be established by evidence. It is required to be established that the land was held or occupied for the purpose of cultivation and grove land. If the company fails to prove that aspect, the land vests in the Corporation under Section 3 of the Act and be deemed to have been transferred to the Corporation. 8. In respect of buildings the burden of proof was on the Corporation to establish that the buildings were held or occupied for the purpose of factory. The description of buildings under clause (vi) of Section 2(h) is not in the same language as in respect of lands. While defining lands the words used are "other than" but in respect of buildings such words are missing and therefore the Corporation has to lead the evidence to prove that the buildings held or occupied by the company were used for the purpose of factory and obviously the burden is on the person who claims exclusion. 9. In New Satgram Engineering Works and Anr. v. Union of India (AIR 1981 SC 124 ) this Court held that the difference in the language between the two expressions "used substantially" and "solely used" was obvious. It was emphasized that the user must be seen on the date of vesting. It was further made clear that the workshop or building constructed initially for the purpose of coal mine cannot by itself being diverted to other purpose and ceased to belong to the mines. It was noted that what is of the essence is whether the workshop or the building originally formed a part and parcel. The subsequent user may not be very material. In M/s Doypack System Pvt. Ltd. v. Union of India and Ors. (AIR 1988 SC 782 ) this Court explained the meaning of phrases "pertaining to" and "in relation to" and "arising out of". It was clarified that these expressions used in the deeming provisions are used in the expansive sense. It was observed as follows: "The words "pertaining to" and "in relation to" have the same wide meaning and have been used interchangeably for among other reasons which may include avoidance of repetition of the same phrase in the same clause or sentence, a method followed in good drafting. The word "pertain" is synonymous with the word "relate". The expression "in relation to" (so also "pertaining to") is a very broad expression which presupposes another subject matter." 10. In the instant case, only PW-1 was examined by the plaintiffs whose evidence does not in any way help the plaintiffs. 11. So far as the shops are concerned in respect of which relief has been granted to the plaintiffs, it is noted that they came into existence after construction in 1974 i.e. subsequent to 1971. It has also come in evidence that the properties have been purchased and acquired out of the fund of the company. The trial Court categorically held that there was no evidence to show that any other business was being carried on there. In Writ Petition No.315 of 1980 it was brought on record that the Sugar Undertaking was held by the plaintiffs from July 1971 to January 1979 on behalf of the Corporation. Hence, the shops on Nainital Road were constructed out of the funds of the Sugar Undertaking and since the cash was converted into immovable properties, those shops were clearly covered by the definition of scheduled undertaking. 12.

1[ds]In respect of buildings the burden of proof was on the Corporation to establish that the buildings were held or occupied for the purpose of factory. The description of buildings under clause (vi) of Section 2(h) is not in the same language as in respect of lands. While defining lands the words used are "other than" but in respect of buildings such words are missing and therefore the Corporation has to lead the evidence to prove that the buildings held or occupied by the company were used for the purpose of factory and obviously the burden is on the person who claims exclusion.So far as the shops are concerned in respect of which relief has been granted to the plaintiffs, it is noted that they came into existence after construction in 1974 i.e. subsequent to 1971. It has also come in evidence that the properties have been purchased and acquired out of the fund of the company. The trial Court categorically held that there was no evidence to show that any other business was being carried on there. In Writ Petition No.315 of 1980 it was brought on record that the Sugar Undertaking was held by the plaintiffs from July 1971 to January 1979 on behalf of the Corporation. Hence, the shops on Nainital Road were constructed out of the funds of the Sugar Undertaking and since the cash was converted into immovable properties, those shops were clearly covered by the definition of scheduled

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: encumbrance or lien, trust or similar obligation (excepting any lien or other obligation) in respect of any advance on the security of any sugar stock or other stock-in-trade) attaching to the undertaking;Provided that any such debt, mortgage, charge or other encumbrance or lien, trust or similar obligation shall attach to the compensation referred to in Section 7, in accordance with the provisions of that section, in substitution for the undertaking;Provided further that a debt, mortgage, charge or other encumbrance or lien, trust or similar obligation created after the scheduled undertaking or any property or asset comprised therein had been attached, or a receiver appointed over it, in any proceedings for realization of any tax or cess or other dues recoverable as arrears of revenue shall be void as against all claims for dues recoverable as arrears of revenue." 6. On a bare reading of Section 2(h) the position is clear that the Act intends to keep in tact the identity of the company. It is only the scheduled undertaking as defined under Section 2(h) of the Act. It vests in the Corporation under Section 3 of the Act. Therefore, as noted above, the real controversy is in regard to interpretation of clause (vi) of Section 2(h) of the Act which relates to land and buildings of the company which have been acquired under the Act. Clause (vi) can be divided into two parts i.e. (i) land and (ii) buildings. The same reads as follows: "(1) all lands other than the lands held or occupied for the purpose of cultivation and grove lands.(2) Buildings - held or occupied of that factory including buildings pertaining to any of the properties and assets hereinbefore specified, and guest houses and residences of directors, managerial personnel, staff and workers or of any other person as lessee or licensee and any store houses, molasses, tanks, roads, bridges, drains, culverts, tube-wells, water storage or distribution system and other civil engineering works including any leasehold interest therein." 7. The definition in respect of land contemplates that every kind of land shall stand vested under section 3 of the Act except such lands which are held or occupied for the purpose of cultivation and grove land of the company whose land has been acquired. The burden of proof is upon the company to establish that the lands or any specified part of it were held or occupied for the purpose of cultivation or it was grove land because it is the company which has the knowledge about the nature of user of the land which was in its occupation. This can be established by evidence. It is required to be established that the land was held or occupied for the purpose of cultivation and grove land. If the company fails to prove that aspect, the land vests in the Corporation under Section 3 of the Act and be deemed to have been transferred to the Corporation. 8. In respect of buildings the burden of proof was on the Corporation to establish that the buildings were held or occupied for the purpose of factory. The description of buildings under clause (vi) of Section 2(h) is not in the same language as in respect of lands. While defining lands the words used are "other than" but in respect of buildings such words are missing and therefore the Corporation has to lead the evidence to prove that the buildings held or occupied by the company were used for the purpose of factory and obviously the burden is on the person who claims exclusion. 9. In New Satgram Engineering Works and Anr. v. Union of India (AIR 1981 SC 124 ) this Court held that the difference in the language between the two expressions "used substantially" and "solely used" was obvious. It was emphasized that the user must be seen on the date of vesting. It was further made clear that the workshop or building constructed initially for the purpose of coal mine cannot by itself being diverted to other purpose and ceased to belong to the mines. It was noted that what is of the essence is whether the workshop or the building originally formed a part and parcel. The subsequent user may not be very material. In M/s Doypack System Pvt. Ltd. v. Union of India and Ors. (AIR 1988 SC 782 ) this Court explained the meaning of phrases "pertaining to" and "in relation to" and "arising out of". It was clarified that these expressions used in the deeming provisions are used in the expansive sense. It was observed as follows: "The words "pertaining to" and "in relation to" have the same wide meaning and have been used interchangeably for among other reasons which may include avoidance of repetition of the same phrase in the same clause or sentence, a method followed in good drafting. The word "pertain" is synonymous with the word "relate". The expression "in relation to" (so also "pertaining to") is a very broad expression which presupposes another subject matter." 10. In the instant case, only PW-1 was examined by the plaintiffs whose evidence does not in any way help the plaintiffs. 11. So far as the shops are concerned in respect of which relief has been granted to the plaintiffs, it is noted that they came into existence after construction in 1974 i.e. subsequent to 1971. It has also come in evidence that the properties have been purchased and acquired out of the fund of the company. The trial Court categorically held that there was no evidence to show that any other business was being carried on there. In Writ Petition No.315 of 1980 it was brought on record that the Sugar Undertaking was held by the plaintiffs from July 1971 to January 1979 on behalf of the Corporation. Hence, the shops on Nainital Road were constructed out of the funds of the Sugar Undertaking and since the cash was converted into immovable properties, those shops were clearly covered by the definition of scheduled undertaking. 12. ### Response: 1

Jambu Rao Satappa Kocheri Vs. Neminath Appayya Hanammannaver

appellant agreed to sell jirayat land admeasuring 41 acres 26 gunthas for a price of Rs. 32,000. The consideration of the agreement per se was not unlawful, for there is no provision in the Act which expressly or by implication forbids a contract for sale of agricultural lands between two agriculturists. Nor is the object of the agreement to defeat the provisions of any law. The Act has imposed no restriction upon the transfer of agricultural lands from one agriculturist to another. It is true that by S. 35 a person who comes to hold, after the appointed day, agricultural land in excess of the ceiling the lands having been acquired either by purchase assignment, lease, surrender or by bequest, the acquisition in excess of the ceiling is invalid. The expression "acquisition of such excess land shall be invalid" may appear somewhat ambiguous. But when the scheme of the Act is examined, it is clear that the legislature has not declared the transfer or bequest invalid, for S. 84-C provides that the land in excess of the ceiling shall be at the disposal of the Government when an order is made by the Mamlatdar. The invalidity of the acquisition is therefore only to the extent to which the holding exceeds the ceiling prescribed by S. 5, and involves the consequence that the land will vest in the Government.7. By the acquisition declared invalid under S. 35, the land does not revert to the transferor or the testator the land is deemed to be of the ownership of the person acquiring it by transfer or by bequest and on the Mamlatdar making the order, the land in excess of the ceiling vests in the Government. It only will mean that the purchaser will not be entitled to hold the land in excess of the ceiling and the excess will be at the disposal of the Government.8. An agreement to sell land does not under the Transfer of Property Act create any interest in the land in the purchaser. By agreeing to purchase land, a person cannot be said in law to hold that land.It is only when land is conveyed to the purchaser that he holds that land. Undoubtedly the respondent was holding some area of land at the date of the agreement and at the date of the suit, but on that account it cannot be inferred that by agreeing to purchase land under the agreement in question his object was to hold in excess of the ceiling.It was open to the respondent to transfer or dispose of the land held by him to another agriculturist. The Act contains no general restrictions upon such transfers, and unless at the date of the acquisition the transferee holds land in excess of the ceiling, the acquisition to the extent of the excess over the ceiling will not be invalid. There is nothing in the agreement, nor can it be implied from the circumstances, that it was the object of the parties that the provisions of the Act relating to the ceiling should be transgressed. The mere possibility that the respondent may not have disposed of his original holding at the date of the acquisition of title pursuant to the agreement entered into between him and the appellant will not, in our judgment, render the object of the agreement such, that, if permitted, it would defeat the provisions of any law. The Court, it is true, will not enforce a contract which is expressly or impliedly prohibited by statute, whatever may be the intention of the parties, but there is nothing to indicate that the Legislature has prohibited a contract to transfer land between one agriculturist and another. The inability of the transferee to hold land in excess of the ceiling prescribed by the statute has no effect upon the contract or the operation of the transfer. The statutory forfeiture incurred in the event of the transferee coming to hold land in excess of the ceiling does not invalidate the transfer between the parties.9. We hold that a contract for purchase of land entered into with the knowledge that the purchaser may hold land in excess of the ceiling is not void, and the seller cannot resist enforcement thereof on the ground that if permitted, it will result in transgression of the law.10. There is no substance in the argument that the civil court had no jurisdiction to entertain and decree a suit for specific performance of an agreement to sell land. Section 70 of the Act sets out the duties and functions of the Mamlatdar and, amongst the duties and functions which the Mamlatdar for the purpose of the Act shall discharge or perform is the duty and function to decide under S. 48-C whether a transfer or acquisition of land is invalid and to dispose of the land as provided in S. 84-C. Section 85 of the Act excludes from the jurisdiction of the civil court proceedings to settle decide or deal with questions which are required by S. 70 (mb) to be settled, decided or dealt with by the authorities specified in that behalf. Power to decide whether the transfer or acquisition is invalid under Section 84-C and to dispose of the land as provided in that section is undoubtedly conferred upon the Mamlatdar, and the civil court has no jurisdiction in that behalf. But there is nothing in Clause (mb) of Section 70 which excludes the jurisdiction of the civil Court to entertain a suit for specific performance of a contract to sell land. An inquiry under Section 84-C to determine whether the transfer or acquisition is invalid may be made only after the acquisition of title pursuant to a decree for specific performance or otherwise. The civil- court has no jurisdiction to determine whether the acquisition is invalid, but there is nothing in Section 70 or in other provisions of the Act which excludes the civil courts jurisdiction to decree specific performance of a contract to transfer land.

0[ds]5. The evidence on the record about the area of lands held by the respondent at the relevant time is obscure. The agreement was dated July 20, 1958. On April 1, 1960, the respondent filed a statement in the Court the, barring lands which were liable to be excluded in determining whether the holding exceeded the ceiling, he was in possession of 11 acres 1 guntha of jirayat land. If that holding were to be taken into account, and if in pursuance of a decree for specific performance the respondent acquired possession of the land agreed to be sold, his total holding would exceed the ceiling. In the Trial Court the parties proceeded to trial on the footing that if the agreement was enforced specifically, the holding of the respondent would exceed the ceiling area. In appeal, the High Court observed that there was no evidence that the respondent was a holder of land in excess of the ceiling area on the date of the agreement, nor was there evidence to show that he was holding an area of land in excess of the ceiling area on the date of the suit or even at the date of the statement dated April 1, 1960, and therefore S. 34 had no relevance. The High Court observed in the last paragraph of the judgment that they had not recorded any finding about the actual area of jirayat land in the possession of the respondent at any point of time either on the date of the suit or on April 1, 1960, and the question was left open as desired by the parties. Since in the Trial Court the parties chose to go to the trial on the footing that if the contract is specifically enforced, having regard to the holding of the respondent, the total area would exceed the ceiling, we proceed to decide the appeal on thatis true that by S. 35 a person who comes to hold, after the appointed day, agricultural land in excess of the ceiling the lands having been acquired either by purchase assignment, lease, surrender or by bequest, the acquisition in excess of the ceiling is invalid. The expression "acquisition of such excess land shall be invalid" may appear somewhat ambiguous. But when the scheme of the Act is examined, it is clear that the legislature has not declared the transfer or bequest invalid, for S. 84-C provides that the land in excess of the ceiling shall be at the disposal of the Government when an order is made by the Mamlatdar. The invalidity of the acquisition is therefore only to the extent to which the holding exceeds the ceiling prescribed by S. 5, and involves the consequence that the land will vest in the Government.Government.8. An agreement to sell land does not under the Transfer of Property Act create any interest in the land in the purchaser. By agreeing to purchase land, a person cannot be said in law to hold that land.It is only when land is conveyed to the purchaser that he holds that land. Undoubtedly the respondent was holding some area of land at the date of the agreement and at the date of the suit, but on that account it cannot be inferred that by agreeing to purchase land under the agreement in question his object was to hold in excess of the ceiling.It was open to the respondent to transfer or dispose of the land held by him to another agriculturist. The Act contains no general restrictions upon such transfers, and unless at the date of the acquisition the transferee holds land in excess of the ceiling, the acquisition to the extent of the excess over the ceiling will not be invalid. There is nothing in the agreement, nor can it be implied from the circumstances, that it was the object of the parties that the provisions of the Act relating to the ceiling should be transgressed. The mere possibility that the respondent may not have disposed of his original holding at the date of the acquisition of title pursuant to the agreement entered into between him and the appellant will not, in our judgment, render the object of the agreement such, that, if permitted, it would defeat the provisions of any law. The Court, it is true, will not enforce a contract which is expressly or impliedly prohibited by statute, whatever may be the intention of the parties, but there is nothing to indicate that the Legislature has prohibited a contract to transfer land between one agriculturist and another. The inability of the transferee to hold land in excess of the ceiling prescribed by the statute has no effect upon the contract or the operation of the transfer. The statutory forfeiture incurred in the event of the transferee coming to hold land in excess of the ceiling does not invalidate the transfer between the parties.9. We hold that a contract for purchase of land entered into with the knowledge that the purchaser may hold land in excess of the ceiling is not void, and the seller cannot resist enforcement thereof on the ground that if permitted, it will result in transgression of the law.10. There is no substance in the argument that the civil court had no jurisdiction to entertain and decree a suit for specific performance of an agreement to sell land. Section 70 of the Act sets out the duties and functions of the Mamlatdar and, amongst the duties and functions which the Mamlatdar for the purpose of the Act shall discharge or perform is the duty and function to decide under S. 48-C whether a transfer or acquisition of land is invalid and to dispose of the land as provided in S. 84-C. Section 85 of the Act excludes from the jurisdiction of the civil court proceedings to settle decide or deal with questions which are required by S. 70 (mb) to be settled, decided or dealt with by the authorities specified in that behalf. Power to decide whether the transfer or acquisition is invalid under Section 84-C and to dispose of the land as provided in that section is undoubtedly conferred upon the Mamlatdar, and the civil court has no jurisdiction in that behalf. But there is nothing in Clause (mb) of Section 70 which excludes the jurisdiction of the civil Court to entertain a suit for specific performance of a contract to sell land. An inquiry under Section 84-C to determine whether the transfer or acquisition is invalid may be made only after the acquisition of title pursuant to a decree for specific performance or otherwise. The civil- court has no jurisdiction to determine whether the acquisition is invalid, but there is nothing in Section 70 or in other provisions of the Act which excludes the civil courts jurisdiction to decree specific performance of a contract to transfer land.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: appellant agreed to sell jirayat land admeasuring 41 acres 26 gunthas for a price of Rs. 32,000. The consideration of the agreement per se was not unlawful, for there is no provision in the Act which expressly or by implication forbids a contract for sale of agricultural lands between two agriculturists. Nor is the object of the agreement to defeat the provisions of any law. The Act has imposed no restriction upon the transfer of agricultural lands from one agriculturist to another. It is true that by S. 35 a person who comes to hold, after the appointed day, agricultural land in excess of the ceiling the lands having been acquired either by purchase assignment, lease, surrender or by bequest, the acquisition in excess of the ceiling is invalid. The expression "acquisition of such excess land shall be invalid" may appear somewhat ambiguous. But when the scheme of the Act is examined, it is clear that the legislature has not declared the transfer or bequest invalid, for S. 84-C provides that the land in excess of the ceiling shall be at the disposal of the Government when an order is made by the Mamlatdar. The invalidity of the acquisition is therefore only to the extent to which the holding exceeds the ceiling prescribed by S. 5, and involves the consequence that the land will vest in the Government.7. By the acquisition declared invalid under S. 35, the land does not revert to the transferor or the testator the land is deemed to be of the ownership of the person acquiring it by transfer or by bequest and on the Mamlatdar making the order, the land in excess of the ceiling vests in the Government. It only will mean that the purchaser will not be entitled to hold the land in excess of the ceiling and the excess will be at the disposal of the Government.8. An agreement to sell land does not under the Transfer of Property Act create any interest in the land in the purchaser. By agreeing to purchase land, a person cannot be said in law to hold that land.It is only when land is conveyed to the purchaser that he holds that land. Undoubtedly the respondent was holding some area of land at the date of the agreement and at the date of the suit, but on that account it cannot be inferred that by agreeing to purchase land under the agreement in question his object was to hold in excess of the ceiling.It was open to the respondent to transfer or dispose of the land held by him to another agriculturist. The Act contains no general restrictions upon such transfers, and unless at the date of the acquisition the transferee holds land in excess of the ceiling, the acquisition to the extent of the excess over the ceiling will not be invalid. There is nothing in the agreement, nor can it be implied from the circumstances, that it was the object of the parties that the provisions of the Act relating to the ceiling should be transgressed. The mere possibility that the respondent may not have disposed of his original holding at the date of the acquisition of title pursuant to the agreement entered into between him and the appellant will not, in our judgment, render the object of the agreement such, that, if permitted, it would defeat the provisions of any law. The Court, it is true, will not enforce a contract which is expressly or impliedly prohibited by statute, whatever may be the intention of the parties, but there is nothing to indicate that the Legislature has prohibited a contract to transfer land between one agriculturist and another. The inability of the transferee to hold land in excess of the ceiling prescribed by the statute has no effect upon the contract or the operation of the transfer. The statutory forfeiture incurred in the event of the transferee coming to hold land in excess of the ceiling does not invalidate the transfer between the parties.9. We hold that a contract for purchase of land entered into with the knowledge that the purchaser may hold land in excess of the ceiling is not void, and the seller cannot resist enforcement thereof on the ground that if permitted, it will result in transgression of the law.10. There is no substance in the argument that the civil court had no jurisdiction to entertain and decree a suit for specific performance of an agreement to sell land. Section 70 of the Act sets out the duties and functions of the Mamlatdar and, amongst the duties and functions which the Mamlatdar for the purpose of the Act shall discharge or perform is the duty and function to decide under S. 48-C whether a transfer or acquisition of land is invalid and to dispose of the land as provided in S. 84-C. Section 85 of the Act excludes from the jurisdiction of the civil court proceedings to settle decide or deal with questions which are required by S. 70 (mb) to be settled, decided or dealt with by the authorities specified in that behalf. Power to decide whether the transfer or acquisition is invalid under Section 84-C and to dispose of the land as provided in that section is undoubtedly conferred upon the Mamlatdar, and the civil court has no jurisdiction in that behalf. But there is nothing in Clause (mb) of Section 70 which excludes the jurisdiction of the civil Court to entertain a suit for specific performance of a contract to sell land. An inquiry under Section 84-C to determine whether the transfer or acquisition is invalid may be made only after the acquisition of title pursuant to a decree for specific performance or otherwise. The civil- court has no jurisdiction to determine whether the acquisition is invalid, but there is nothing in Section 70 or in other provisions of the Act which excludes the civil courts jurisdiction to decree specific performance of a contract to transfer land. ### Response: 0

Indra Pal Gupta Vs. Managing Committee, Model Inter College Thora

governing the termination of the services of a probationer. In Parshotam Lal Dhingras case (supra), this Court observed at page 862 thus:"In short, if the termination of service is founded on the right flowing from contract or the service rules then, prima facie, the termination is not a punishment and carries with it no evil consequences and so Art. 311 is not attracted But even if the Government has, by contract or under the rules, the right to terminate the employment without going through the procedure prescribed for inflicting the punishment of dismissal or removal or reduction in rank, the Government may, nevertheless, choose to punish the servant and if the termination of service is sought to be founded on misconduct, negligence, inefficiency or other disqualification, then it is a punishment and the requirements of Art. 311 must be complied with."5. The above rule applies to probationers too.Admittedly no enquiry was held in this case as provided in Regulations 35 and 36 of the Regulations made under the Act. Apparently in the light of the principles enunciated in Parshotam Lal Dhingras case (supra) the learned Single Judge who decided the Writ Petition at the first instance in the High Court observed in the course of his order thus:"In this petition under Article 226 of the Constitution the petitioner questions the validity of the so-called termination of his service by the resolution passed by the Managing Committee on 27.4.1969. His case is that the termination in the circumstances in which it has been made by the Managing Committee amounts to punishment of removal or dismissal from service and the punishment having been imposed upon him without following the procedure prescribed under sec. 16- G of the Intermediate Education Act and the regulations framed thereunder becomes vitiated. Indeed it has not been denied or controverted in the counter affidavit that the action against the petitioner was taken by the Managing Committee on serious charges of mismanagement brought against the Principal by the Manager. But it has submitted by the learned counsel for the opposite parties that a reasonable opportunity was afforded to the petitioner by the Managing Committee when he was faced with the charges and asked to explain on 27.4.69, at the meeting of the Managing Committee. But the learned counsel for opposite parties when faced with t he relevant regulations and Sec. 16-G of the Intermediate Education Act found it difficult to justify that what was done at the meeting of the Managing Committee on 27.4.1969 complies with those provisions. The attack made b y the petitioner based on non-compliance of the relevant regulations and the provisions of Sec. 16-G of the Act on the validity of the action taken, appear to be sound and sustainable. No matter the petitioner was not a permanent Principal yet he was entitled to a regular show cause notice against the charges brought and an opportunity to be heard as required by the regulations. The impugned order of termination thus was a mere camouflage an d cannot be regarded in the. circumstances as having been passed by the Managing Committee in the normal course. The District Inspector of Schools was in error in approving the termination in those circumstances."But the Division Bench of the High Court took a contrary view. The first error in the judgment of the Division Bench lies in its observation:Firstly the order of termination is innocuous. It does not refer to any allegations or even t o the report of the Manager.It is seen from the letter dated June 30, 1969 by which the services of the appellant were terminated that the resolution of the Managing Committee dated April 27, 1969 is made a part of it by treating it a s an enclosure to that letter. The resolution actually begins with a reference to the report of the Manager, and slates that the facts contained in the report were serious and not in the interests of the institution. It further refers t o the fact that the appellant was asked to give his explanation to the allegations made in the said report. That report stated:"It is also evident that the seriousness of the lapses is enough to justify dismissal but no educational institution should take that botheration."6. The above report was the real foundation on which the decision of the Managing Committee was based. This is a case where the order of termination issued is merely a camouflage for an order imposing the penalty of termination of service on the ground of misconduct. Secondly, the Division Bench has tried to justify the action of the Management by observing that since the management had to secure the approval of the District Inspector to its action, it was necessary for it to give its assessment of the work of the appellant as Principal and, therefore. in the. context of the statutory requirements, it cannot be said that merely because the Managers report or the resolution of the Managing Committee refers to the various aspects of the assessment of the performance of the Principal in terms unfavourable to him, it would in law, amount to casting a stigma upon the Principal. It is difficult to engraft an exception of the above type to the well-settled rule that if the order of termination carries a stigma, it has to fall to the ground unless it is proceeded by an enquiry as contemplated by law. A reading of the letter of termination o f the service and the resolution which forms part of that letter clearly shows that they bear a mark of disgrace or infamy and that the appellant is visited with evil consequences as explained in Parshotam Lal Dhingras case (supra). The Division Bench, therefore, erred in holding that on the facts and in the circumstances of the case, the order of termination was an innocuous one and did not carry any stigma. The order of the Division Bench is, our opinion, an unsustainable one and is liable to the set aside.I

1[ds]The above report was the real foundation on which the decision of the Managing Committee was based. This is a case where the order of termination issued is merely a camouflage for an order imposing the penalty of termination of service on the ground of misconduct. Secondly, the Division Bench has tried to justify the action of the Management by observing that since the management had to secure the approval of the District Inspector to its action, it was necessary for it to give its assessment of the work of the appellant as Principal and, therefore. in the. context of the statutory requirements, it cannot be said that merely because the Managers report or the resolution of the Managing Committee refers to the various aspects of the assessment of the performance of the Principal in terms unfavourable to him, it would in law, amount to casting a stigma upon the Principal. It is difficult to engraft an exception of the above type to the well-settled rule that if the order of termination carries a stigma, it has to fall to the ground unless it is proceeded by an enquiry as contemplated by law. A reading of the letter of termination o f the service and the resolution which forms part of that letter clearly shows that they bear a mark of disgrace or infamy and that the appellant is visited with evil consequences as explained in Parshotam Lal Dhingras case (supra). The Division Bench, therefore, erred in holding that on the facts and in the circumstances of the case, the order of termination was an innocuous one and did not carry any stigma. The order of the Division Bench is, our opinion, an unsustainable one and is liable to the set aside.In the result, we allow this appeal, set aside the judgment of the Division Bench of the High Court and restore the judgment of the learned Single Judge.

### Instruction: Delve into the case proceeding and predict the outcome: is the judgment expected to be in support (1) or in denial (0) of the appeal? ### Input: governing the termination of the services of a probationer. In Parshotam Lal Dhingras case (supra), this Court observed at page 862 thus:"In short, if the termination of service is founded on the right flowing from contract or the service rules then, prima facie, the termination is not a punishment and carries with it no evil consequences and so Art. 311 is not attracted But even if the Government has, by contract or under the rules, the right to terminate the employment without going through the procedure prescribed for inflicting the punishment of dismissal or removal or reduction in rank, the Government may, nevertheless, choose to punish the servant and if the termination of service is sought to be founded on misconduct, negligence, inefficiency or other disqualification, then it is a punishment and the requirements of Art. 311 must be complied with."5. The above rule applies to probationers too.Admittedly no enquiry was held in this case as provided in Regulations 35 and 36 of the Regulations made under the Act. Apparently in the light of the principles enunciated in Parshotam Lal Dhingras case (supra) the learned Single Judge who decided the Writ Petition at the first instance in the High Court observed in the course of his order thus:"In this petition under Article 226 of the Constitution the petitioner questions the validity of the so-called termination of his service by the resolution passed by the Managing Committee on 27.4.1969. His case is that the termination in the circumstances in which it has been made by the Managing Committee amounts to punishment of removal or dismissal from service and the punishment having been imposed upon him without following the procedure prescribed under sec. 16- G of the Intermediate Education Act and the regulations framed thereunder becomes vitiated. Indeed it has not been denied or controverted in the counter affidavit that the action against the petitioner was taken by the Managing Committee on serious charges of mismanagement brought against the Principal by the Manager. But it has submitted by the learned counsel for the opposite parties that a reasonable opportunity was afforded to the petitioner by the Managing Committee when he was faced with the charges and asked to explain on 27.4.69, at the meeting of the Managing Committee. But the learned counsel for opposite parties when faced with t he relevant regulations and Sec. 16-G of the Intermediate Education Act found it difficult to justify that what was done at the meeting of the Managing Committee on 27.4.1969 complies with those provisions. The attack made b y the petitioner based on non-compliance of the relevant regulations and the provisions of Sec. 16-G of the Act on the validity of the action taken, appear to be sound and sustainable. No matter the petitioner was not a permanent Principal yet he was entitled to a regular show cause notice against the charges brought and an opportunity to be heard as required by the regulations. The impugned order of termination thus was a mere camouflage an d cannot be regarded in the. circumstances as having been passed by the Managing Committee in the normal course. The District Inspector of Schools was in error in approving the termination in those circumstances."But the Division Bench of the High Court took a contrary view. The first error in the judgment of the Division Bench lies in its observation:Firstly the order of termination is innocuous. It does not refer to any allegations or even t o the report of the Manager.It is seen from the letter dated June 30, 1969 by which the services of the appellant were terminated that the resolution of the Managing Committee dated April 27, 1969 is made a part of it by treating it a s an enclosure to that letter. The resolution actually begins with a reference to the report of the Manager, and slates that the facts contained in the report were serious and not in the interests of the institution. It further refers t o the fact that the appellant was asked to give his explanation to the allegations made in the said report. That report stated:"It is also evident that the seriousness of the lapses is enough to justify dismissal but no educational institution should take that botheration."6. The above report was the real foundation on which the decision of the Managing Committee was based. This is a case where the order of termination issued is merely a camouflage for an order imposing the penalty of termination of service on the ground of misconduct. Secondly, the Division Bench has tried to justify the action of the Management by observing that since the management had to secure the approval of the District Inspector to its action, it was necessary for it to give its assessment of the work of the appellant as Principal and, therefore. in the. context of the statutory requirements, it cannot be said that merely because the Managers report or the resolution of the Managing Committee refers to the various aspects of the assessment of the performance of the Principal in terms unfavourable to him, it would in law, amount to casting a stigma upon the Principal. It is difficult to engraft an exception of the above type to the well-settled rule that if the order of termination carries a stigma, it has to fall to the ground unless it is proceeded by an enquiry as contemplated by law. A reading of the letter of termination o f the service and the resolution which forms part of that letter clearly shows that they bear a mark of disgrace or infamy and that the appellant is visited with evil consequences as explained in Parshotam Lal Dhingras case (supra). The Division Bench, therefore, erred in holding that on the facts and in the circumstances of the case, the order of termination was an innocuous one and did not carry any stigma. The order of the Division Bench is, our opinion, an unsustainable one and is liable to the set aside.I ### Response: 1

Afnees (Unconscious) Rep. Thr Mother Vs. Oriental Insurance Co. Ltd. Vadakara & Others

accident, the cost of his medical treatment and care is likely to be very high. In cases involving total or partial disablement, the term compensation used in Section 166 of the Motor Vehicles Act, 1988 (for short, the Act) would include not only the expenses incurred for immediate treatment, but also the amount likely to be incurred for future medical treatment/care necessary for a particular injury or disability caused by an accident. 15. In R.D. Hattangadi v. Pest Control (India) Private Limited, (1995) 1 SCC 551 , this Court while dealing with a case involving claim of compensation under the Motor Vehicles Act, 1939, referred to the judgment of the Court of Appeal in Ward v. James (1965) 1 All ER 563, Halsburys Laws of England, 4th Edition, Volume 12 (page 446) and observed: Broadly speaking while fixing an amount of compensation payable to a victim of an accident, the damages have to be assessed separately as pecuniary damages and special damages. Pecuniary damages are those which the victim has actually incurred and which are capable of being calculated in terms of money; whereas non-pecuniary damages are those which are incapable of being assessed by arithmetical calculations. In order to appreciate two concepts pecuniary damages may include expenses incurred by the claimant: (i) medical attendance; (ii) loss of earning of profit up to the date of trial; (iii) other material loss. So far non-pecuniary damages are concerned, they may include (i) damages for mental and physical shock, pain and suffering, already suffered or likely to be suffered in future; (ii) damages to compensate for the loss of amenities of life which may include a variety of matters i.e. on account of injury the claimant may not be able to walk, run or sit; (iii) damages for the loss of expectation of life, i.e., on account of injury the normal longevity of the person concerned is shortened; (iv) inconvenience, hardship, discomfort, disappointment, frustration and mental stress in life. In the same case, the Court further observed: In its very nature whenever a tribunal or a court is required to fix the amount of compensation in cases of accident, it involves some guesswork, some hypothetical consideration, some amount of sympathy linked with the nature of the disability caused. But all the aforesaid elements have to be viewed with objective standards. 16. In Raj Kumar v. Ajay Kumar, (2011) 1 SCC 343 , the Court considered some of the precedents and held: The provision of the Motor Vehicles Act, 1988 makes it clear that the award must be just, which means that compensation should, to the extent possible, fully and adequately restore the claimant to the position prior to the accident. The object of awarding damages is to make good the loss suffered as a result of wrong done as far as money can do so, in a fair, reasonable and equitable manner. The court or the Tribunal shall have to assess the damages objectively and exclude from consideration any speculation or fancy, though some conjecture with reference to the nature of disability and its consequences, is inevitable. A person is not only to be compensated for the physical injury, but also for the loss which he suffered as a result of such injury. This means that he is to be compensated for his inability to lead a full life, his inability to enjoy those normal amenities which he would have enjoyed but for the injuries, and his inability to earn as much as he used to earn or could have earned. The heads under which compensation is awarded in personal injury cases are the following: Pecuniary damages (Special damages) (i) Expenses relating to treatment, hospitalisation, medicines, transportation, nourishing food, and miscellaneous expenditure. (ii) Loss of earnings (and other gains) which the injured would have made had he not been injured, comprising: (a) Loss of earning during the period of treatment; (b) Loss of future earnings on account of permanent disability. (iii) Future medical expenses. Non-pecuniary damages (General damages) (iv) Damages for pain, suffering and trauma as a consequence of the injuries. (v) Loss of amenities (and/or loss of prospects of marriage). (vi) Loss of expectation of life (shortening of normal longevity). In routine personal injury cases, compensation will be awarded only under heads (i), (ii) (a) and (iv). It is only in serious cases of injury, where there is specific medical evidence corroborating the evidence of the claimant, that compensation will be granted under any of the heads (ii)(b), (iii), (v) and (vi) relating to loss of future earnings on account of permanent disability, future medical expenses, loss of amenities (and/or loss of prospects of marriage) and loss of expectation of life. 17. In the circumstances, we shall now consider whether the compensation awarded to the appellant is just and reasonable or he is entitled to enhanced compensation. 18. In our view, considering the age of the petitioner and the fact that he is fairly educated, it can be reasonably assumed that he would have earned at least Rs.3,000/- per month taking into account the disability of the petitioner to be 100%, the Tribunal rightly awarded the multiplier of 18 and came to a figure of Rs. 6,48,000/- and the High Court is wrong in allowing the appeal of the Insurance Company assessing the disability compensation at Rs. 5,76,000/- by adopting the multiplier of 16. (See Sarla Verma v. Delhi Transport Corporation, (2009) 6 SCC 121 ) 19. Though the appellant had claimed an amount of Rs. 22,00,000/- under different heads as compensation, the Tribunal has granted a meagre sum of Rs. 10,88,000/- and the High Court further reduced the compensation amount. We are of the view that the compensation of Rs. 1 lakh awarded by the High Court for future treatment was wholly inadequate as the High Court without considering the fact that the appellant because of the accident has to remain in the bed in his remaining life and he needs a person for his care and caution every time.

1[ds]This Court has, from time to time, expressed concern over the increasing number of motor accidents and pendency of large number of cases involving adjudication of claims made by the legal representatives of the deceased as also by those who suffer permanent injuries and disabilities of various types as a result of accidents18. In our view, considering the age of the petitioner and the fact that he is fairly educated, it can be reasonably assumed that he would have earned at least Rs.3,000/per month taking into account the disability of the petitioner to be 100%, the Tribunal rightly awarded the multiplier of 18 and came to a figure of Rs. 6,48,000/and the High Court is wrong in allowing the appeal of the Insurance Company assessing the disability compensation at Rs. 5,76,000/by adopting the multiplier of 1619. Though the appellant had claimed an amount of Rs. 22,00,000/under different heads as compensation, the Tribunal has granted a meagre sum of Rs. 10,88,000/and the High Court further reduced the compensation amount. We are of the view that the compensation of Rs. 1 lakh awarded by the High Court for future treatment was wholly inadequate as the High Court without considering the fact that the appellant because of the accident has to remain in the bed in his remaining life and he needs a person for his care and caution every time

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: accident, the cost of his medical treatment and care is likely to be very high. In cases involving total or partial disablement, the term compensation used in Section 166 of the Motor Vehicles Act, 1988 (for short, the Act) would include not only the expenses incurred for immediate treatment, but also the amount likely to be incurred for future medical treatment/care necessary for a particular injury or disability caused by an accident. 15. In R.D. Hattangadi v. Pest Control (India) Private Limited, (1995) 1 SCC 551 , this Court while dealing with a case involving claim of compensation under the Motor Vehicles Act, 1939, referred to the judgment of the Court of Appeal in Ward v. James (1965) 1 All ER 563, Halsburys Laws of England, 4th Edition, Volume 12 (page 446) and observed: Broadly speaking while fixing an amount of compensation payable to a victim of an accident, the damages have to be assessed separately as pecuniary damages and special damages. Pecuniary damages are those which the victim has actually incurred and which are capable of being calculated in terms of money; whereas non-pecuniary damages are those which are incapable of being assessed by arithmetical calculations. In order to appreciate two concepts pecuniary damages may include expenses incurred by the claimant: (i) medical attendance; (ii) loss of earning of profit up to the date of trial; (iii) other material loss. So far non-pecuniary damages are concerned, they may include (i) damages for mental and physical shock, pain and suffering, already suffered or likely to be suffered in future; (ii) damages to compensate for the loss of amenities of life which may include a variety of matters i.e. on account of injury the claimant may not be able to walk, run or sit; (iii) damages for the loss of expectation of life, i.e., on account of injury the normal longevity of the person concerned is shortened; (iv) inconvenience, hardship, discomfort, disappointment, frustration and mental stress in life. In the same case, the Court further observed: In its very nature whenever a tribunal or a court is required to fix the amount of compensation in cases of accident, it involves some guesswork, some hypothetical consideration, some amount of sympathy linked with the nature of the disability caused. But all the aforesaid elements have to be viewed with objective standards. 16. In Raj Kumar v. Ajay Kumar, (2011) 1 SCC 343 , the Court considered some of the precedents and held: The provision of the Motor Vehicles Act, 1988 makes it clear that the award must be just, which means that compensation should, to the extent possible, fully and adequately restore the claimant to the position prior to the accident. The object of awarding damages is to make good the loss suffered as a result of wrong done as far as money can do so, in a fair, reasonable and equitable manner. The court or the Tribunal shall have to assess the damages objectively and exclude from consideration any speculation or fancy, though some conjecture with reference to the nature of disability and its consequences, is inevitable. A person is not only to be compensated for the physical injury, but also for the loss which he suffered as a result of such injury. This means that he is to be compensated for his inability to lead a full life, his inability to enjoy those normal amenities which he would have enjoyed but for the injuries, and his inability to earn as much as he used to earn or could have earned. The heads under which compensation is awarded in personal injury cases are the following: Pecuniary damages (Special damages) (i) Expenses relating to treatment, hospitalisation, medicines, transportation, nourishing food, and miscellaneous expenditure. (ii) Loss of earnings (and other gains) which the injured would have made had he not been injured, comprising: (a) Loss of earning during the period of treatment; (b) Loss of future earnings on account of permanent disability. (iii) Future medical expenses. Non-pecuniary damages (General damages) (iv) Damages for pain, suffering and trauma as a consequence of the injuries. (v) Loss of amenities (and/or loss of prospects of marriage). (vi) Loss of expectation of life (shortening of normal longevity). In routine personal injury cases, compensation will be awarded only under heads (i), (ii) (a) and (iv). It is only in serious cases of injury, where there is specific medical evidence corroborating the evidence of the claimant, that compensation will be granted under any of the heads (ii)(b), (iii), (v) and (vi) relating to loss of future earnings on account of permanent disability, future medical expenses, loss of amenities (and/or loss of prospects of marriage) and loss of expectation of life. 17. In the circumstances, we shall now consider whether the compensation awarded to the appellant is just and reasonable or he is entitled to enhanced compensation. 18. In our view, considering the age of the petitioner and the fact that he is fairly educated, it can be reasonably assumed that he would have earned at least Rs.3,000/- per month taking into account the disability of the petitioner to be 100%, the Tribunal rightly awarded the multiplier of 18 and came to a figure of Rs. 6,48,000/- and the High Court is wrong in allowing the appeal of the Insurance Company assessing the disability compensation at Rs. 5,76,000/- by adopting the multiplier of 16. (See Sarla Verma v. Delhi Transport Corporation, (2009) 6 SCC 121 ) 19. Though the appellant had claimed an amount of Rs. 22,00,000/- under different heads as compensation, the Tribunal has granted a meagre sum of Rs. 10,88,000/- and the High Court further reduced the compensation amount. We are of the view that the compensation of Rs. 1 lakh awarded by the High Court for future treatment was wholly inadequate as the High Court without considering the fact that the appellant because of the accident has to remain in the bed in his remaining life and he needs a person for his care and caution every time. ### Response: 1

Pala Singh & Anr Vs. State Of Punjab

Kohli, the learned counsel for the appellants, took us through the relevant evidence and the judgments of the two courts below. The principal argument pressed by him in support of this appeal was that the learned Additional Sessions Judge had on a consideration of the entire evidence come to a conclusion which is reasonable and had, on the basis of that conclusion, held that the prosecution witnesses were not reliable and that the accused were, therefore, entitled to acquittal. The High Court, according to this submission, was not justified in reappraising the evidence for itself and in disagreeing with the reasoning of the trial Court for convicting the appellants on appeal against acquittal. (His Lordship then discussed the evidence in Paras 5 and 6 and proceeded.) 7. Shri Kohli strongly criticised the fact that the occurrence report contemplated by S. 157, Cr. P.C. was sent to the magistrate concerned very late. Indeed, this challenge, like the argument of interpolation and belated despatch of the inquest report, was developed for the purpose of showing that the investigation was not just, fair and forthright and, therefore, the prosecution case must be looked at with great suspicion. This argument is also unacceptable. No doubt, the report reached the magistrate at about 6 p. m. S.157, Cr. P. C. requires such report to be sent forthwith by the police officer concerned to a magistrate empowered to take cognizance of such offence. This is really designed to keep the magistrate informed of the investigation of such cognizable offence so as to be able to control the investigation and if necessary to give appropriate direction under S. 159. But when we find in this case that the F. I. R. was actually recorded without delay and the investigation started on the basis of that F. I.R. and there is no other infirmity brought to our notice, then, however improper or objectionable the delayed receipt of the report by the magistrate concerned it cannot by itself justify the conclusion that the investigation was tainted and the prosecution insupportable. It is not the appellants case that they have been prejudiced by this delay. 8. Shri Kohli took us through the evidence of the eye-witnesses and pointed out certain minor discrepancies. But his main contention was based on the argument that the judgment of the trial Court was reasonable and it was open to a court to come to the conclusion to which it came. The High Court was, therefore, not justified in reversing the judgment of acquittal into one of conviction. In support of his sub-mission of relied on three decisions of this Court: 1. Sanwant Singh v. State of Rajasthan, (1961) 3 SCR 120 = (AIR 1961 SC 715 ) 2. Ramabhupala Reddy v. State of A. P., AIR 1971 SC 460 . 3. Bansidhar Mohanty v. State of Orissa, AIR 1955 SC 585 . In the latest decision of this Court in Ramabhupala Reddy (supra) it has been observed that the controversy in regard to the scope of an appeal against an order of acquittal has been settled by this Court in Sanwant Singh (supra) in which the legal position was summarised thus: "1. An appellate Court has full powers to review the evidence upon which the order of acquittal is founded; 2. The principles laid down in Sheo Swarups case, 61 Ind App 308 = (AIR 1934 PC 227 ) afforded a correct guide for the appellate courts approach to a case disposing of such an appeal; 3. the different phraseology used in the judgments of this court such as: (a) substantial and compelling reasons ; (b) good and sufficiently cogent reasons. (c) strong reasons are not intended to curtail the undoubted power of an appellate court in an appeal against acquittal to review the entire evidence and to come to its own conclusion, but in doing so it should not only consider every matter on record having a bearing on the questions of fact and the reasons given by the court below in support of its order of acquittal but should express the reasons in its judgment which led it to hold that the acquittal was not justified." This, in our view, correctly summarises the legal position as finally settled by this Court, The submission urged by Shri Kohli, therefore, that merely because the judgment of the trial court prima facie seems reasonable there is no scope for reassessment of the evidence by the appellate court is unacceptable. The court of appeal has full power under the statute to go into the entire evidence and all the relevant circumstances of the case for coming to its own conclusion about the guilt or innocence of the accused bearing in mind the initial presumption of the innocence of an accused person. We do not think that the High Court committed any error in the appraisal of the evidence on the record and in arriving at its own conclusion as to the guilt of the appellants. The criticism about the insertion of S. 120B in the plan Ex. PH/1, in our view, may raise slight suspicion but in view of the trustworthiness of the prosecution evidence led in the case we do not think that in any way justifies any grave suspicion of the prosecution story. 9. Besides, the case is now before us under Art. 136 of the Constitution, We allowed Shri Kohli not only to state the case broadly and to take us through the judgments of the two courts below but also to take us through such evidence as he considered proper for persuading us to hold that the High Court had not followed the principles laid down in Sanwant Singhs case, (1961) 3 SCR 120 = (AIR 1961 SC 715 ) (supra) or that its conclusions were otherwise so erroneous as to justify interference by this Court under Article 136 of the Constitution. We are not persuaded to hold that there is any ground for differing with the conclusion of the High Court.

0[ds]This, in our view, correctly summarises the legal position as finally settled by this Court, The submission urged by Shri Kohli, therefore, that merely because the judgment of the trial court prima facie seems reasonable there is no scope for reassessment of the evidence by the appellate court is unacceptable. The court of appeal has full power under the statute to go into the entire evidence and all the relevant circumstances of the case for coming to its own conclusion about the guilt or innocence of the accused bearing in mind the initial presumption of the innocence of an accused person. We do not think that the High Court committed any error in the appraisal of the evidence on the record and in arriving at its own conclusion as to the guilt of the appellants. The criticism about the insertion of S. 120B in the plan Ex. PH/1, in our view, may raise slight suspicion but in view of the trustworthiness of the prosecution evidence led in the case we do not think that in any way justifies any grave suspicion of the prosecution story9. Besides, the case is now before us under Art. 136 of the Constitution, We allowed Shri Kohli not only to state the case broadly and to take us through the judgments of the two courts below but also to take us through such evidence as he considered proper for persuading us to hold that the High Court had not followed the principles laid down in Sanwant Singhs case, (1961) 3 SCR 120 = (AIR 1961 SC 715 ) (supra) or that its conclusions were otherwise so erroneous as to justify interference by this Court under Article 136 of the Constitution. We are not persuaded to hold that there is any ground for differing with the conclusion of the High Court.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: Kohli, the learned counsel for the appellants, took us through the relevant evidence and the judgments of the two courts below. The principal argument pressed by him in support of this appeal was that the learned Additional Sessions Judge had on a consideration of the entire evidence come to a conclusion which is reasonable and had, on the basis of that conclusion, held that the prosecution witnesses were not reliable and that the accused were, therefore, entitled to acquittal. The High Court, according to this submission, was not justified in reappraising the evidence for itself and in disagreeing with the reasoning of the trial Court for convicting the appellants on appeal against acquittal. (His Lordship then discussed the evidence in Paras 5 and 6 and proceeded.) 7. Shri Kohli strongly criticised the fact that the occurrence report contemplated by S. 157, Cr. P.C. was sent to the magistrate concerned very late. Indeed, this challenge, like the argument of interpolation and belated despatch of the inquest report, was developed for the purpose of showing that the investigation was not just, fair and forthright and, therefore, the prosecution case must be looked at with great suspicion. This argument is also unacceptable. No doubt, the report reached the magistrate at about 6 p. m. S.157, Cr. P. C. requires such report to be sent forthwith by the police officer concerned to a magistrate empowered to take cognizance of such offence. This is really designed to keep the magistrate informed of the investigation of such cognizable offence so as to be able to control the investigation and if necessary to give appropriate direction under S. 159. But when we find in this case that the F. I. R. was actually recorded without delay and the investigation started on the basis of that F. I.R. and there is no other infirmity brought to our notice, then, however improper or objectionable the delayed receipt of the report by the magistrate concerned it cannot by itself justify the conclusion that the investigation was tainted and the prosecution insupportable. It is not the appellants case that they have been prejudiced by this delay. 8. Shri Kohli took us through the evidence of the eye-witnesses and pointed out certain minor discrepancies. But his main contention was based on the argument that the judgment of the trial Court was reasonable and it was open to a court to come to the conclusion to which it came. The High Court was, therefore, not justified in reversing the judgment of acquittal into one of conviction. In support of his sub-mission of relied on three decisions of this Court: 1. Sanwant Singh v. State of Rajasthan, (1961) 3 SCR 120 = (AIR 1961 SC 715 ) 2. Ramabhupala Reddy v. State of A. P., AIR 1971 SC 460 . 3. Bansidhar Mohanty v. State of Orissa, AIR 1955 SC 585 . In the latest decision of this Court in Ramabhupala Reddy (supra) it has been observed that the controversy in regard to the scope of an appeal against an order of acquittal has been settled by this Court in Sanwant Singh (supra) in which the legal position was summarised thus: "1. An appellate Court has full powers to review the evidence upon which the order of acquittal is founded; 2. The principles laid down in Sheo Swarups case, 61 Ind App 308 = (AIR 1934 PC 227 ) afforded a correct guide for the appellate courts approach to a case disposing of such an appeal; 3. the different phraseology used in the judgments of this court such as: (a) substantial and compelling reasons ; (b) good and sufficiently cogent reasons. (c) strong reasons are not intended to curtail the undoubted power of an appellate court in an appeal against acquittal to review the entire evidence and to come to its own conclusion, but in doing so it should not only consider every matter on record having a bearing on the questions of fact and the reasons given by the court below in support of its order of acquittal but should express the reasons in its judgment which led it to hold that the acquittal was not justified." This, in our view, correctly summarises the legal position as finally settled by this Court, The submission urged by Shri Kohli, therefore, that merely because the judgment of the trial court prima facie seems reasonable there is no scope for reassessment of the evidence by the appellate court is unacceptable. The court of appeal has full power under the statute to go into the entire evidence and all the relevant circumstances of the case for coming to its own conclusion about the guilt or innocence of the accused bearing in mind the initial presumption of the innocence of an accused person. We do not think that the High Court committed any error in the appraisal of the evidence on the record and in arriving at its own conclusion as to the guilt of the appellants. The criticism about the insertion of S. 120B in the plan Ex. PH/1, in our view, may raise slight suspicion but in view of the trustworthiness of the prosecution evidence led in the case we do not think that in any way justifies any grave suspicion of the prosecution story. 9. Besides, the case is now before us under Art. 136 of the Constitution, We allowed Shri Kohli not only to state the case broadly and to take us through the judgments of the two courts below but also to take us through such evidence as he considered proper for persuading us to hold that the High Court had not followed the principles laid down in Sanwant Singhs case, (1961) 3 SCR 120 = (AIR 1961 SC 715 ) (supra) or that its conclusions were otherwise so erroneous as to justify interference by this Court under Article 136 of the Constitution. We are not persuaded to hold that there is any ground for differing with the conclusion of the High Court. ### Response: 0

Ajit Singh Vs. State of Punjab & Another

the second proviso since their land is not acquired as contemplated therein. We cannot accept this argument.33. Article 31-A deals with a special subject, namely, the saving of laws providing for acquisition of estate. This article saves any law from an attack under Articles 14, l9 and 31 provided it is for the acquisition by the State of an estate or of any rights therein or the extinguishment or modification of any such rights. It will be noticed that here the article does not refer to property as such, but speaks of an estate as defined in the Article and also of rights in the estate. Estate is defined to include, among other things, "any land held or let for purposes of agriculture or for purposes ancillary thereto, including waste land, forest land, land for pasture or sites of buildings and other structures occupied by cultivators of land, agricultural labourers and village artisans". Applying the definition, the lands under cultivation must be regarded as estate. Now the intention underlying Article 31-A is to give protection to State action against Articles 14, 19 and 31 so long as the acquisition is by the State of any estate or of any rights therein or the extinguishment or modification of any such rights. To this protection there is only one exception and that is to be found in the second proviso. It is that land under the personal cultivation of any estate holder of any kind which is within the ceiling limit applicable to such person, shall not be acquired, unless at least market value of the land is given as compensation. Such land can be acquired but only on compensation which is not less than the market value. The word "acquisition" used in the proviso must take its colour from the same word used earlier and not from the word as used in the earlier article in juxtaposition with the word requisition. The word must denote not only the acquisition of ownership, that is to say, the entire bundle of rights but also acquisition of some rights particularly in acquisition which leaves the person an owner in name only.34. Article 31-A, it is submitted by the State, introduces two further concepts, viz., extinguishment of rights and modification of rights. In the case of extinguishment, if all the rights in the property are extinguished, the result would be nothing else than acquisition, for, no property can remain in suspense without the rights therein being vested in someone or the other. In this case the property goes to the Panchayat which is included in State. In the case of modification of rights all the rights of ownership remain in the owner except that they would be modified by some statutory provisions. In such a case the conception either of acquisition or requisition may not apply. In the present case bits of properties are being taken from the lands belonging to the appellants and others and are thrown in a common lot. The ownership is supposed to be vested in a proprietary body consisting of several proprietors. The statute provides that though ownership is vested in the said proprietary body the management of the land would be with the Panchayat. The only obligation thrown on the Panchayat is that the income arising from such land should be utilized for the common benefit not only of the proprietors but also of non-proprietors in the Panchayat area. The result of these provisions are (1) that a proprietor is undoubtedly deprived of his property howsoever small a proportion it may be thereof; (2) the ownership in such a property is transferred to another body which under the statute is an entity different from the proprietor himself; (3) though the ownership is vested in such a proprietary body all rights with regard to the management and income thereof are vested in as Panchayat; and (4) the benefit of the income from such lands goes not to the proprietor but to all the proprietors as well as non-proprietors in the Panchayat area. Although the property is not actually vested either in the State Government or the Panchayat a device is being made in the Act to escape the concept of acquisition to avoid the payment of compensation required under the second proviso to Article 31-A. In substance and in effect this is nothing but a colourable use of the provisions of Article 31-A by making out a case of modification of rights when there is in reality an acquisition, mainly for the sake of avoiding compensation.35. Therefore, when the State acquires almost the entire bundle of rights, it is acquisition within the second proviso and compensation at market rates must be given. It is not at all difficult to determine this compensation. The total land of the holder must be assessed at market value and the value of the dimunition of the area determined proportionately. The appellant is thus entitled to compensation and he cannot be deprived of land within his ceiling without payment of compensation calculated in the manner indicated. It is admitted that his land has been reduced to something less than the ceiling applicable to him.36. It is contended that what is acquired is a small bit from each landholder and that is not of much significance. We do not know what rule is in contemplation. If it is the de minimis rule, we can only say that it would be a most unsatisfactory mode of avoidance of the constitutional provision. What is a small bit is a very vague and uncertain expression. The safe rule is that the Constitution means what it says, that is, land within the ceiling is not to be touched unless compensation at market rate is given. We would, therefore, reject the plea that we should ignore these small bits of land especially as they will be used for the general good and will confer some benefit also upon those who will lose them.37. We would accordingly allow the appeal with costs.ORDER38.

0[ds]4. There seems to be substance in the first two points. It seems to us clear that before a person can start acting as a Consolidation Officer he must be appointed as such. Before he is appointed he has no authority to exercise any of the functions of a Consolidation Officer. What he does purporting to act as a Consolidation Officer has no binding force on the owners and other persons affected in the estate. The Government cannot by appointing him retrospectively clothe him with authority retrospectively. This can he done only by the Legislature subject to the provisions of the Constitution.5. But the appellant cannot succeed on these grounds because the High Court in its discretion has held that the appellant is not entitled to rely on these objections because of laches.We cannot say that the discretion has been exercised wrongly. After the notification was published on May 11, l962. appointing Gurkirpal Singh retrospectively invite effect from November 4, 1961, it must have been clear to the appellant that Gurkirpal Singh had not been appointed Consolidation Officer before he started preparing consolidation proceedings.No adequate explanation has been given for the delay. Further it has not been shown that there has been any manifest injustice.It would be noticed that Article .31-A (1) (a) mentions four categories; first acquisition by the State of an estate; second, acquisition by the State of rights in an estate; third, the extinguishment of rights in an estate, and, fourthly, the modification of rights in an estate. These four categories are mentioned separately and are different. In the first two categories the State "acquires" either an estate or rights in an estate. In other words, there is a transference of an estate or the rights in an estate to the State.When there is a transference of an estate to State, it could be said that all the rights of the holder of the estate have been extinguished. But if the result in the case of the extinguishment is the transference of all the rights in an estate to the State, it would properly fall within the expression "acquisition by the State of an estate". Similarly, in the case of an acquisition by the State of a right in an estate it could also be said that the rights of the owner have been modified since one of the rights of the owner has been acquired.8. It seems to us that there is this essential difference between "acquisition by the State" on the one hand and "modification or extinguishment of rights" on the other that in the first case the beneficiary is the State while in the latter case the beneficiary of the modification or the extinguishment is not the State. For example, suppose the State is the landlord of an estate and there is a lease of that property, and law provides for the extinguishment of leases held in estate. In one sense ii would he an extinguishment of the rights of a lessee, hill it would properly fall under the category of acquisition by the State because the beneficiary of the extinguishment could be the State.Does such taking away of property then amount to acquisition by the State of any land? Who is the real beneficiary? Is it the Panchayat? It is clear that the title remains in the proprietary body and in the revenue records the land would be shown as belonging to `all the owners and other right holders in proportion to their areas." The Panchayat will manage it on behalf of the proprietors and use it for common purposes; it cannot use it for any other purpose. The proprietors enjoy the benefits derived from the use of land for common purposes. It is true that the non-proprietors also derive benefit but their satisfaction and advancement enures in the end to the advantage of the proprietors in the form of a more efficient agricultural community. The Panchayat as such does not enjoy any benefit. On the facts of this case it seems to us that the beneficiary of the modification of rights is not the State, and therefore there is no acquisition by the State within the second proviso.15. In the context of the 2nd proviso, which is trying to preserve the rights of a person holding land under his personal cultivation, it is impossible to conceive that such adjustment of the rights of persons holding land under their personal cultivation in the interest of village economy was regarded something to be compensated for in cash.16. In this view of the matter it is not necessary to deal with the fourth point raised by the learned, counsel for the appellant because it does not matter whether the acquisition is complete or not, as even if we hold that the acquisition is not complete and it has yet to be completed, the second proviso to Art. 31A (1) would not prevent the State from proceeding with the acquisition.To determine the correct meaning it is necessary to view Arts. 31 and 31-A together. The State seeks to establish a contrast between acquisition and requisition and contends that "acquisition" means a total deprivation of the property for all time and "requisition" means either a partial deprivation or deprivation for a time. It submits that by the former there is a change of ownership and by the latter a change in possession or enjoyment without a change in ownership. This contrast the State seeks to establish from the way in which the words "acquisition" and "requisition" and "acquired" and "requisitioned" are used in juxtaposition in the two Articles. We have, therefore, to examine the scheme of the two Articles to see if they throw any light upon the matter.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: the second proviso since their land is not acquired as contemplated therein. We cannot accept this argument.33. Article 31-A deals with a special subject, namely, the saving of laws providing for acquisition of estate. This article saves any law from an attack under Articles 14, l9 and 31 provided it is for the acquisition by the State of an estate or of any rights therein or the extinguishment or modification of any such rights. It will be noticed that here the article does not refer to property as such, but speaks of an estate as defined in the Article and also of rights in the estate. Estate is defined to include, among other things, "any land held or let for purposes of agriculture or for purposes ancillary thereto, including waste land, forest land, land for pasture or sites of buildings and other structures occupied by cultivators of land, agricultural labourers and village artisans". Applying the definition, the lands under cultivation must be regarded as estate. Now the intention underlying Article 31-A is to give protection to State action against Articles 14, 19 and 31 so long as the acquisition is by the State of any estate or of any rights therein or the extinguishment or modification of any such rights. To this protection there is only one exception and that is to be found in the second proviso. It is that land under the personal cultivation of any estate holder of any kind which is within the ceiling limit applicable to such person, shall not be acquired, unless at least market value of the land is given as compensation. Such land can be acquired but only on compensation which is not less than the market value. The word "acquisition" used in the proviso must take its colour from the same word used earlier and not from the word as used in the earlier article in juxtaposition with the word requisition. The word must denote not only the acquisition of ownership, that is to say, the entire bundle of rights but also acquisition of some rights particularly in acquisition which leaves the person an owner in name only.34. Article 31-A, it is submitted by the State, introduces two further concepts, viz., extinguishment of rights and modification of rights. In the case of extinguishment, if all the rights in the property are extinguished, the result would be nothing else than acquisition, for, no property can remain in suspense without the rights therein being vested in someone or the other. In this case the property goes to the Panchayat which is included in State. In the case of modification of rights all the rights of ownership remain in the owner except that they would be modified by some statutory provisions. In such a case the conception either of acquisition or requisition may not apply. In the present case bits of properties are being taken from the lands belonging to the appellants and others and are thrown in a common lot. The ownership is supposed to be vested in a proprietary body consisting of several proprietors. The statute provides that though ownership is vested in the said proprietary body the management of the land would be with the Panchayat. The only obligation thrown on the Panchayat is that the income arising from such land should be utilized for the common benefit not only of the proprietors but also of non-proprietors in the Panchayat area. The result of these provisions are (1) that a proprietor is undoubtedly deprived of his property howsoever small a proportion it may be thereof; (2) the ownership in such a property is transferred to another body which under the statute is an entity different from the proprietor himself; (3) though the ownership is vested in such a proprietary body all rights with regard to the management and income thereof are vested in as Panchayat; and (4) the benefit of the income from such lands goes not to the proprietor but to all the proprietors as well as non-proprietors in the Panchayat area. Although the property is not actually vested either in the State Government or the Panchayat a device is being made in the Act to escape the concept of acquisition to avoid the payment of compensation required under the second proviso to Article 31-A. In substance and in effect this is nothing but a colourable use of the provisions of Article 31-A by making out a case of modification of rights when there is in reality an acquisition, mainly for the sake of avoiding compensation.35. Therefore, when the State acquires almost the entire bundle of rights, it is acquisition within the second proviso and compensation at market rates must be given. It is not at all difficult to determine this compensation. The total land of the holder must be assessed at market value and the value of the dimunition of the area determined proportionately. The appellant is thus entitled to compensation and he cannot be deprived of land within his ceiling without payment of compensation calculated in the manner indicated. It is admitted that his land has been reduced to something less than the ceiling applicable to him.36. It is contended that what is acquired is a small bit from each landholder and that is not of much significance. We do not know what rule is in contemplation. If it is the de minimis rule, we can only say that it would be a most unsatisfactory mode of avoidance of the constitutional provision. What is a small bit is a very vague and uncertain expression. The safe rule is that the Constitution means what it says, that is, land within the ceiling is not to be touched unless compensation at market rate is given. We would, therefore, reject the plea that we should ignore these small bits of land especially as they will be used for the general good and will confer some benefit also upon those who will lose them.37. We would accordingly allow the appeal with costs.ORDER38. ### Response: 0

Kerala Private Hospital Association & Others Vs. State of Kerala & Others

etc . -Each of the committees, sub-committees and the Advisory Board shall consist of persons to be nominated by the appropriate Government representing employers and employees in the scheduled employments, who shall be equal in number, and independent persons not exceeding one-third of its total number of members; one of such independent persons shall be appointed the Chairman by the appropriate Government."23. Section 9 deals with constitution of various Committees for due performance of several acts specified under the Act. An appropriate Government is empowered to constitute a Committee whose composition consists of members by nomination to represent the employers and employees interest in equal numbers. The independent persons are also the members of the Committee whose number should not exceed one third of its total number of the members. The Chairman of the Board by the Central Government is empowered to appoint one independent person.24. The Minimum Wages (Central) Rules, 1950 (hereinafter referred to as "the Rules") prescribes, inter alia, a term of office of the members of the Committee and the Advisory Committee(Rule 3), Nomination of substitute-members (Rule 4A), eligibility for re-nomination of the members of the Committee, Advisory Committee and the Board (Rule 7), resignation of the Chairman and members of the Committee/Board and filling of the casual vacancies (Rule 8) and disqualification (Rule 10). The Rules nowhere provide as to who should be nominated as representative of employer in the Committee.25. Now coming to the facts of the case on hand, there lies a fallacy in the submissions urged by the learned counsel for the appellant.26. A person, who is nominated to represent the interest of his employer, in our considered opinion, need not necessarily be the employer himself. If on the other hand, his employee is nominated to represent his employers interest, such nomination is in accordance with the requirement of Section 9 of the Act. It is for the reason that such nominee once nominated would defend his employers interest and not individual interest as an employee in the Committee. In other words, a nominee in such a case does not participate in his individual capacity as an employee in the Committee but participates as a representative of his employer.27. A representation, by way of nomination, is a well accepted phenomenon. A fortiori, an employee while in the employment of his employer, when nominated as his employers representative in the Committee then such employee, who is well-versed with the working of his organization and the subject, is regarded as a competent person(nominee) to represent the interest of his master(employer). No fault can thus be found in such nomination when made by the State while constituting the Committee. It is more so when we find that the employer did not object to such nomination made by the State of their employee in the Committee.28. We consider it apposite to refer here a three- Judge Bench decision of this Court in Ministry of Labour & Rehabilitation & Anr. v. Tiffins Barytes Asbestos & Paints Ltd. and Anr., AIR 1985 SC 1391 wherein the challenge laid to constitution of Committee and the resultant notification issued under Section 5(1) read with Section 9 of the Act fixing minimum wages for the workers working in Manganese, Gypsum, Barytes and Bauxite Mines was repelled by upholding the constitution of the Committee and the notification with following pertinent observation. The learned Judge, Chinnappa Reddy, J. succinctly observed as under:"3.............................We are afraid that the approach of the High Court was entirely wrong. For the purpose of appointing the committee to represent the employers in a scheduled employment, it was not necessary that the person appointed should be engaged for profit in the particular employment. It is enough if a nexus exists between the persons so appointed to represent the employers in the particular employment and the particular employment concerned. For example it may be absurd to appoint persons engaged in the newspaper industry to a committee to represent employers concerned in the employment of Barytes mines or Bauxite mines................................................................We also wish to emphasise that notifications fixing minimum wages are not to be lightly interfered with under Art.226 of the Constitution on the ground of some irregularities in the constitution of the committee or in the procedure adopted by the committee. It must be remembered that the committee acts only as a recommendatory body and the final notification fixing minimum wages has to be made by the Government. A notification fixing minimum wages, in a country where wages are already minimal should not be interfered with under Art.226 of the Constitution except on the most substantial of grounds. The legislation is a social welfare legislation undertaken to further the Directive Principles of State Policy and action taken pursuant to it cannot be struck down on mere technicalities."29. In the case at hand, we find that equal representation is given to both - employer and employee (13 persons each) in the Committee.30. So far as the employers representation is concerned, we find that there exists a nexus between the persons who are nominated and for whom they are nominated. We also find that the employees who are nominated, are working as Head of Human Resources Department in their respective organizations (see at serial Nos. 4, 7, 8 and 9), they are thus well-versed in the subject in question by virtue of the posts held by them in their respective employment.31. In our opinion, we have not been able to notice any flaw or illegality in the constitution of the Committee or/and in nominating the members by the State. It is in accordance with the requirement of Section 9 of the Act and hence does not call for any interference. It was, therefore, rightly repelled by the Single Judge and Division Bench of the High Court.32. There is no challenge to the constitution of Committee on any other ground except the one which we have dealt with supra. In this view of the matter, the impugned judgment deserves to be upheld. It is accordingly upheld.

0[ds]21. Having heard the learned counsel for the parties and on perusal of the record of the case, we find no merit in the appeal.Now coming to the facts of the case on hand, there lies a fallacy in the submissions urged by the learned counsel for the appellant.26. A person, who is nominated to represent the interest of his employer, in our considered opinion, need not necessarily be the employer himself. If on the other hand, his employee is nominated to represent his employers interest, such nomination is in accordance with the requirement of Section 9 of the Act. It is for the reason that such nominee once nominated would defend his employers interest and not individual interest as an employee in the Committee. In other words, a nominee in such a case does not participate in his individual capacity as an employee in the Committee but participates as a representative of his employer.27. A representation, by way of nomination, is a well accepted phenomenon. A fortiori, an employee while in the employment of his employer, when nominated as his employers representative in the Committee then such employee, who iswith the working of his organization and the subject, is regarded as a competent person(nominee) to represent the interest of his master(employer). No fault can thus be found in such nomination when made by the State while constituting the Committee. It is more so when we find that the employer did not object to such nomination made by the State of their employee in the Committee.In the case at hand, we find that equal representation is given to bothemployer and employee (13 persons each) in the Committee.30. So far as the employers representation is concerned, we find that there exists a nexus between the persons who are nominated and for whom they are nominated. We also find that the employees who are nominated, are working as Head of Human Resources Department in their respective organizations (see at serial Nos. 4, 7, 8 and 9), they are thusin the subject in question by virtue of the posts held by them in their respective employment.31. In our opinion, we have not been able to notice any flaw or illegality in the constitution of the Committee or/and in nominating the members by the State. It is in accordance with the requirement of Section 9 of the Act and hence does not call for any interference. It was, therefore, rightly repelled by the Single Judge and Division Bench of the High Court.32. There is no challenge to the constitution of Committee on any other ground except the one which we have dealt with supra. In this view of the matter, the impugned judgment deserves to be upheld. It is accordingly upheld.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: etc . -Each of the committees, sub-committees and the Advisory Board shall consist of persons to be nominated by the appropriate Government representing employers and employees in the scheduled employments, who shall be equal in number, and independent persons not exceeding one-third of its total number of members; one of such independent persons shall be appointed the Chairman by the appropriate Government."23. Section 9 deals with constitution of various Committees for due performance of several acts specified under the Act. An appropriate Government is empowered to constitute a Committee whose composition consists of members by nomination to represent the employers and employees interest in equal numbers. The independent persons are also the members of the Committee whose number should not exceed one third of its total number of the members. The Chairman of the Board by the Central Government is empowered to appoint one independent person.24. The Minimum Wages (Central) Rules, 1950 (hereinafter referred to as "the Rules") prescribes, inter alia, a term of office of the members of the Committee and the Advisory Committee(Rule 3), Nomination of substitute-members (Rule 4A), eligibility for re-nomination of the members of the Committee, Advisory Committee and the Board (Rule 7), resignation of the Chairman and members of the Committee/Board and filling of the casual vacancies (Rule 8) and disqualification (Rule 10). The Rules nowhere provide as to who should be nominated as representative of employer in the Committee.25. Now coming to the facts of the case on hand, there lies a fallacy in the submissions urged by the learned counsel for the appellant.26. A person, who is nominated to represent the interest of his employer, in our considered opinion, need not necessarily be the employer himself. If on the other hand, his employee is nominated to represent his employers interest, such nomination is in accordance with the requirement of Section 9 of the Act. It is for the reason that such nominee once nominated would defend his employers interest and not individual interest as an employee in the Committee. In other words, a nominee in such a case does not participate in his individual capacity as an employee in the Committee but participates as a representative of his employer.27. A representation, by way of nomination, is a well accepted phenomenon. A fortiori, an employee while in the employment of his employer, when nominated as his employers representative in the Committee then such employee, who is well-versed with the working of his organization and the subject, is regarded as a competent person(nominee) to represent the interest of his master(employer). No fault can thus be found in such nomination when made by the State while constituting the Committee. It is more so when we find that the employer did not object to such nomination made by the State of their employee in the Committee.28. We consider it apposite to refer here a three- Judge Bench decision of this Court in Ministry of Labour & Rehabilitation & Anr. v. Tiffins Barytes Asbestos & Paints Ltd. and Anr., AIR 1985 SC 1391 wherein the challenge laid to constitution of Committee and the resultant notification issued under Section 5(1) read with Section 9 of the Act fixing minimum wages for the workers working in Manganese, Gypsum, Barytes and Bauxite Mines was repelled by upholding the constitution of the Committee and the notification with following pertinent observation. The learned Judge, Chinnappa Reddy, J. succinctly observed as under:"3.............................We are afraid that the approach of the High Court was entirely wrong. For the purpose of appointing the committee to represent the employers in a scheduled employment, it was not necessary that the person appointed should be engaged for profit in the particular employment. It is enough if a nexus exists between the persons so appointed to represent the employers in the particular employment and the particular employment concerned. For example it may be absurd to appoint persons engaged in the newspaper industry to a committee to represent employers concerned in the employment of Barytes mines or Bauxite mines................................................................We also wish to emphasise that notifications fixing minimum wages are not to be lightly interfered with under Art.226 of the Constitution on the ground of some irregularities in the constitution of the committee or in the procedure adopted by the committee. It must be remembered that the committee acts only as a recommendatory body and the final notification fixing minimum wages has to be made by the Government. A notification fixing minimum wages, in a country where wages are already minimal should not be interfered with under Art.226 of the Constitution except on the most substantial of grounds. The legislation is a social welfare legislation undertaken to further the Directive Principles of State Policy and action taken pursuant to it cannot be struck down on mere technicalities."29. In the case at hand, we find that equal representation is given to both - employer and employee (13 persons each) in the Committee.30. So far as the employers representation is concerned, we find that there exists a nexus between the persons who are nominated and for whom they are nominated. We also find that the employees who are nominated, are working as Head of Human Resources Department in their respective organizations (see at serial Nos. 4, 7, 8 and 9), they are thus well-versed in the subject in question by virtue of the posts held by them in their respective employment.31. In our opinion, we have not been able to notice any flaw or illegality in the constitution of the Committee or/and in nominating the members by the State. It is in accordance with the requirement of Section 9 of the Act and hence does not call for any interference. It was, therefore, rightly repelled by the Single Judge and Division Bench of the High Court.32. There is no challenge to the constitution of Committee on any other ground except the one which we have dealt with supra. In this view of the matter, the impugned judgment deserves to be upheld. It is accordingly upheld. ### Response: 0

M/S. Bengal Bhatdee Coal Co Vs. Shri Ram Prabesh Singh & Ors

even, though it might be misconduct meriting dismissal. But it pointed out that the misconduct complained of in this case entailed fine, suspension or dismissal of the workmen, and the appellants chose dismissal, which was the extreme penalty. It referred to a decision of the Calcutta High Court in National Tabacco Co., Ltd. v. Fourth Industrial Tribunal, 1960-2 Lab LJ 175 : (AIR 1960 Cal 249 ) where it was held that in a case where the punishment meted out was unconscionable or grossly out of proportion to the nature of the offence that may itself be a ground for holding that the dismissal was an act of victimisation. It seems to have held that the punishment of dismissal in this case was unconscionable or at any rate grossly out of proportion to the nature of the offence and therefore came to the conclusion that this was a case of victimisation. 6. Now there is no doubt that though in a case of proved misconduct, normally the imposition of a penalty may be within the discretion of the management there may be cases where the punishment of dismissal for the misconduct proved may be so unconscionable or so grossly out of proportion to the nature of offence that the tribunal may be able to draw in inference of victimisation merely from the punishment inflicted. But we are of opinion that the present is not such a case and no inference of victimisation can be made merely from the fact that punishment of dismissal was imposed in this case and not either fine or suspension. It is not in dispute that a strike was going on during those days when the misconduct was committed. It was the case of the appellant that the strike was unjustified and illegal and it appears that the Regional Labour Commissioner, Central, Dhanbad, agreed with this view of the appellant. It was during such a strike that the misconduct in question took place and the misconduct was that these thirteen workmen physically obstructed other workmen who were willing to work from doing their work by sitting down between the tramlines. This was in our opinion serious misconduct on the part of the thirteen workmen and if it is found - as it has been found - proved punishment of dismissal would be perfectly justified. It cannot therefore be said looking at the nature of the offence that the punishment inflicted in this case was grossly out of proportion or was unconscionable, and the tribunal was not justified in coming to the conclusion that this was a case of victimisation because the appellant decided to dismiss these workmen and was not prepared to let them off with fine or suspension. 7. There is practically no other evidence in support of the finding of the tribunal. It is true that the relations between the appellant and the union to which these workmen belonged were not happy. It is also proved that there was another union in existence in this concern. Perhaps the fact that there were two unions would in itself explain why the relations of the appellant with one of the unions to which these workmen belonged were not happy. But the fact that the relations between an employer and the union were not happy and the workmen concerned were office-bearers or active workmen of the union would by itself be no evidence to prove victimisation, for if that were so, it would mean that the office-bearers and active workers of a union with which the employer is not on good terms would have a carte blanche to commit any misconduct and get away with it on the ground that relations between the employer and the union were not happy. We are therefore of opinion that the findings of victimisation in this case is based merely on conjectures and surmises. We have already considered the main reasons given by the tribunal, namely the nature of the punishment, and have held that cannot be said to be unconscionable or grossly out of proportion to the nature of the offence. 8. Another reason given by the tribunal in support of the finding of victimisation is also patently wrong. The tribunal says that in reports made to the police certain persons were mentioned as having taken part in the misconduct of October 27, 1959; but in the written-statement filed by the appellant two other persons, namely. Ratan Gope and Sohan Gope who were not mentioned in the police report, were also mentioned as having taken part in the incident of 27th October. The tribunal thereby concluded that Sohan Gope and Ratan Gope were falsely implicated in the incident of 27th October. Curiously, however, it went on to say that this might be a mistake but added that it meant dismissal of these people and the finding in this respect was not only wrong but perverse. It does appear that by mistake in para 5 of the appellants written statement before the tribunal names of Ratan Gope and Sohan Gope are mentioned as having taken part in the incident of 27th October. But the charge sheets which were given to them were only about the incident of 20th October. So it seems that there was no justification for the tribunal to hold that the finding was perverse, because there was no finding that these two persons had taken part in the incident of 27th October. There can be little doubt that there was a mistake in the written statement of the appellant for there was no charge against these two people about the incident of 27th October and no finding about it by the Welfare Officer. The tribunal therefore was patently wrong in using this mistake as evidence of victimisation. We are therefore of opinion that there is no evidence worth the name in the present case to support the tribunals finding as to victimisation and consequent want of good faith. In the circumstances the tribunals award must be set aside.

1[ds]We are of opinion that this contention of the appellant must prevail. The tribunal was not unaware of the fact that where a domestic inquiry is held properly, the tribunal does not sit in appeal on the findings of the domestic tribunal and it can only interfere with the punishment inflicted as a result of the domestic inquiry where there is want of good faith or basic error or violation of the principles of natural justice, or where the findings are perverse or baseless or the case is one of victimisation or unfair labour practice. We have already indicated that the tribunal did not find that there was any basic error or violation of the principles of natural justice in the holding of the inquiry; nor did it find that the findings of the inquiry officer were perverse or baseless. It could hardly do so in the face of its own approval of the action taken on applications made to it under S. 33 (2) (b) of the Act, for if it had found that the inquiry was not proper, it would not have approved of the action taken against the workmen by the appellant when it was approached under S. 33 (2) (b). We must therefore proceed on the assumption that the inquiry was held properly and the inquiry officer who held the inquiry was justified on the evidence before him in coming to the conclusion which he did, namely, that the charges had been provedThe tribunal was, however, conscious that merely because certain workmen were protected workmen they were not thereby given complete immunity for anything that they might do even, though it might be misconduct meriting dismissal. But it pointed out that the misconduct complained of in this case entailed fine, suspension or dismissal of the workmen, and the appellants chose dismissal, which was the extreme penalty6. Now there is no doubt that though in a case of proved misconduct, normally the imposition of a penalty may be within the discretion of the management there may be cases where the punishment of dismissal for the misconduct proved may be so unconscionable or so grossly out of proportion to the nature of offence that the tribunal may be able to draw in inference of victimisation merely from the punishment inflicted. But we are of opinion that the present is not such a case and no inference of victimisation can be made merely from the fact that punishment of dismissal was imposed in this case and not either fine or suspension. It is not in dispute that a strike was going on during those days when the misconduct was committed. It was the case of the appellant that the strike was unjustified and illegal and it appears that the Regional Labour Commissioner, Central, Dhanbad, agreed with this view of the appellant. It was during such a strike that the misconduct in question took place and the misconduct was that these thirteen workmen physically obstructed other workmen who were willing to work from doing their work by sitting down between the tramlines. This was in our opinion serious misconduct on the part of the thirteen workmen and if it is found - as it has been found - proved punishment of dismissal would be perfectly justified. It cannot therefore be said looking at the nature of the offence that the punishment inflicted in this case was grossly out of proportion or was unconscionable, and the tribunal was not justified in coming to the conclusion that this was a case of victimisation because the appellant decided to dismiss these workmen and was not prepared to let them off with fine or suspension7. There is practically no other evidence in support of the finding of the tribunal. It is true that the relations between the appellant and the union to which these workmen belonged were not happy. It is also proved that there was another union in existence in this concern. Perhaps the fact that there were two unions would in itself explain why the relations of the appellant with one of the unions to which these workmen belonged were not happy. But the fact that the relations between an employer and the union were not happy and the workmen concerned were office-bearers or active workmen of the union would by itself be no evidence to prove victimisation, for if that were so, it would mean that the office-bearers and active workers of a union with which the employer is not on good terms would have a carte blanche to commit any misconduct and get away with it on the ground that relations between the employer and the union were not happy. We are therefore of opinion that the findings of victimisation in this case is based merely on conjectures and surmises. We have already considered the main reasons given by the tribunal, namely the nature of the punishment, and have held that cannot be said to be unconscionable or grossly out of proportion to the nature of the offence8. Another reason given by the tribunal in support of the finding of victimisation is also patently wrong. The tribunal says that in reports made to the police certain persons were mentioned as having taken part in the misconduct of October 27, 1959; but in the written-statement filed by the appellant two other persons, namely. Ratan Gope and Sohan Gope who were not mentioned in the police report, were also mentioned as having taken part in the incident of 27th October. The tribunal thereby concluded that Sohan Gope and Ratan Gope were falsely implicated in the incident of 27th October. Curiously, however, it went on to say that this might be a mistake but added that it meant dismissal of these people and the finding in this respect was not only wrong but perverse. It does appear that by mistake in para 5 of the appellants written statement before the tribunal names of Ratan Gope and Sohan Gope are mentioned as having taken part in the incident of 27th October. But the charge sheets which were given to them were only about the incident of 20th October. So it seems that there was no justification for the tribunal to hold that the finding was perverse, because there was no finding that these two persons had taken part in the incident of 27th October. There can be little doubt that there was a mistake in the written statement of the appellant for there was no charge against these two people about the incident of 27th October and no finding about it by the Welfare Officer. The tribunal therefore was patently wrong in using this mistake as evidence of victimisation. We are therefore of opinion that there is no evidence worth the name in the present case to support the tribunals finding as to victimisation and consequent want of good faith. In the circumstances the tribunals award must be set aside.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: even, though it might be misconduct meriting dismissal. But it pointed out that the misconduct complained of in this case entailed fine, suspension or dismissal of the workmen, and the appellants chose dismissal, which was the extreme penalty. It referred to a decision of the Calcutta High Court in National Tabacco Co., Ltd. v. Fourth Industrial Tribunal, 1960-2 Lab LJ 175 : (AIR 1960 Cal 249 ) where it was held that in a case where the punishment meted out was unconscionable or grossly out of proportion to the nature of the offence that may itself be a ground for holding that the dismissal was an act of victimisation. It seems to have held that the punishment of dismissal in this case was unconscionable or at any rate grossly out of proportion to the nature of the offence and therefore came to the conclusion that this was a case of victimisation. 6. Now there is no doubt that though in a case of proved misconduct, normally the imposition of a penalty may be within the discretion of the management there may be cases where the punishment of dismissal for the misconduct proved may be so unconscionable or so grossly out of proportion to the nature of offence that the tribunal may be able to draw in inference of victimisation merely from the punishment inflicted. But we are of opinion that the present is not such a case and no inference of victimisation can be made merely from the fact that punishment of dismissal was imposed in this case and not either fine or suspension. It is not in dispute that a strike was going on during those days when the misconduct was committed. It was the case of the appellant that the strike was unjustified and illegal and it appears that the Regional Labour Commissioner, Central, Dhanbad, agreed with this view of the appellant. It was during such a strike that the misconduct in question took place and the misconduct was that these thirteen workmen physically obstructed other workmen who were willing to work from doing their work by sitting down between the tramlines. This was in our opinion serious misconduct on the part of the thirteen workmen and if it is found - as it has been found - proved punishment of dismissal would be perfectly justified. It cannot therefore be said looking at the nature of the offence that the punishment inflicted in this case was grossly out of proportion or was unconscionable, and the tribunal was not justified in coming to the conclusion that this was a case of victimisation because the appellant decided to dismiss these workmen and was not prepared to let them off with fine or suspension. 7. There is practically no other evidence in support of the finding of the tribunal. It is true that the relations between the appellant and the union to which these workmen belonged were not happy. It is also proved that there was another union in existence in this concern. Perhaps the fact that there were two unions would in itself explain why the relations of the appellant with one of the unions to which these workmen belonged were not happy. But the fact that the relations between an employer and the union were not happy and the workmen concerned were office-bearers or active workmen of the union would by itself be no evidence to prove victimisation, for if that were so, it would mean that the office-bearers and active workers of a union with which the employer is not on good terms would have a carte blanche to commit any misconduct and get away with it on the ground that relations between the employer and the union were not happy. We are therefore of opinion that the findings of victimisation in this case is based merely on conjectures and surmises. We have already considered the main reasons given by the tribunal, namely the nature of the punishment, and have held that cannot be said to be unconscionable or grossly out of proportion to the nature of the offence. 8. Another reason given by the tribunal in support of the finding of victimisation is also patently wrong. The tribunal says that in reports made to the police certain persons were mentioned as having taken part in the misconduct of October 27, 1959; but in the written-statement filed by the appellant two other persons, namely. Ratan Gope and Sohan Gope who were not mentioned in the police report, were also mentioned as having taken part in the incident of 27th October. The tribunal thereby concluded that Sohan Gope and Ratan Gope were falsely implicated in the incident of 27th October. Curiously, however, it went on to say that this might be a mistake but added that it meant dismissal of these people and the finding in this respect was not only wrong but perverse. It does appear that by mistake in para 5 of the appellants written statement before the tribunal names of Ratan Gope and Sohan Gope are mentioned as having taken part in the incident of 27th October. But the charge sheets which were given to them were only about the incident of 20th October. So it seems that there was no justification for the tribunal to hold that the finding was perverse, because there was no finding that these two persons had taken part in the incident of 27th October. There can be little doubt that there was a mistake in the written statement of the appellant for there was no charge against these two people about the incident of 27th October and no finding about it by the Welfare Officer. The tribunal therefore was patently wrong in using this mistake as evidence of victimisation. We are therefore of opinion that there is no evidence worth the name in the present case to support the tribunals finding as to victimisation and consequent want of good faith. In the circumstances the tribunals award must be set aside. ### Response: 1

Aslam Mohd. Merchant Vs. Competent Authority

facts necessary for his assessment during the concluded assessment proceedings, any part of his income, profits or gains chargeable to income-tax has escaped assessment. He may start reassessment proceedings either because some fresh facts had come to light which were not previously disclosed or some information with regard to the facts previously disclosed comes into his possession which tends to expose the untruthfulness of those facts. In such situations, it is not a case of mere change of opinion or the drawing of a different inference from the same facts as were earlier available but acting on fresh information. Since the belief is that of the Income-tax Officer, the sufficiency of reasons for forming this belief is not for the court to judge but it is open to an assessee to establish that there in fact existed no belief or that the belief was not at all a bona fide one or was based on vague, irrelevant and non-specific information. To that limited extent, the court may look into the conclusion arrived at by the Income-tax Officer and examine whether there was any material available on the record from which the requisite belief could be formed by the Income-tax Officer and further whether that material had any rational connection or a live link for the formation of the requisite belief." See also Income Tax Officer Vs. Lakshmani Mewal Das [(1976) 103 ITR 437] .In Assistant Commissioner of Income Tax v. Rajesh Jhaveri Stock Brokers Pvt. Ltd. [2007 (8) SCALE 396 ], interpreting the term ‘reason to believe as used under Section 247 (a) of the Income Tax Act, 1961, it was opined: "To confer jurisdiction under Section 247(a) two conditions were required to be satisfied firstly the AO must have reason to believe that income profits or gains chargeable to income tax have escaped assessment, and secondly he must also have reason to believe that such escapement has occurred by reason of either (i) omission or failure on the part of the assessee to disclose fully or truly all material facts necessary for his assessment of that year. Both these conditions were conditions precedent to be satisfied before the AO could have jurisdiction to issue notice under Section 148 read with Section 147(a). But under the substituted Section 147 existence of only the first condition suffices. In other words, if the assessing officer for whatever reason has reason to believe that income has escaped assessment, it confers jurisdiction to reopen the assessment." NON APPLICATION OF MINDApplying these tests, it is evident that the statutory requirements have not been fulfilled in the present case.39. Non-application of mind on the part of the competent officer would also be evident from the fact that a property named ‘Rose Villa which was the subject matter of the decision of this Court in Fatima Amin (supra), was also included herein. Once the show cause notice is found to be illegal, the same would vitiate all subsequent proceedings.40. In Dilip N. Shroff Vs. Joint Commissioner of Income Tax, Mumbai and Another [(2007) 6 SCC 329] , this Court held: "86. It is of some significance that in the standard pro forma used by the assessing officer in issuing a notice despite the fact that the same postulates that inappropriate words and paragraphs were to be deleted, but the same had not been done. Thus, the assessing officer himself was not sure as to whether he had proceeded on the basis that the assessee had concealed his income or he had furnished inaccurate particulars. Even before us, the learned Additional Solicitor General while placing the order of assessment laid emphasis that he had dealt with both the situations. The impugned order, therefore, suffers from non-application of mind. It was also bound to comply with the principles of natural justice. (See Malabar Industrial Co. Ltd. Vs. CIT)"; RECORDING OF REASONS41. Submission of Mr. Singh that the appellants have not been able to discharge the burden of proof which was on them from the impugned orders, it would appear that they have utterly failed to prove their own independent income; they being close relative of the detune as in terms of the statutory requirements , it was for them to show that they had sufficient income from those properties.42. Had the show cause notice been valid, Mr. B.B. Singh, might have been right, but if the proceedings themselves were not initiated validly, the competent authority did not derive any jurisdiction to enter into the merit of the matter. Legality and/or validity of the notice had been questioned at several stages of the proceedings. Despite their asking, no reason was disclosed by the authority to the appellants. They had asked for additional reasons, if any, which were not reflected in the show cause notices. None was disclosed.43. It is also relevant to notice that the High Court opined that there had been a proper application of mind on the part of the Competent Authority and Appellate Tribunal as they had released some items of properties. Application of mind on the part of the Competent Authority and the Appellate Tribunal at the subsequent stage was not in question; what was in question was non application of mind on the part of the authority prior to issuance of the notice.CONCLUSION44. We are not unmindful of the purport and object of the Act. Dealing in narcotics is a social evil that must be curtailed or prohibited at any cost. Chapter VA seeks to achieve a salutary purpose. But, it must also be borne in mind that right to hold property although no longer a fundamental right is still a constitutional right. It is a human right. The provisions of the Act must be interpreted in a manner so that its constitutionality is upheld. The validity of the provisions might have received constitutional protection, but when stringent laws become applicable as a result whereof some persons are to be deprived of his/her right in a property, scrupulous compliance of the statutory requirements is imperative.

1[ds]41. Submission of Mr. Singh that the appellants have not been able to discharge the burden of proof which was on them from the impugned orders, it would appear that they have utterly failed to prove their own independent income; they being close relative of the detune as in terms of the statutory requirements , it was for them to show that they had sufficient income from those properties.Had the show cause notice been valid, Mr. B.B. Singh, might have been right, but if the proceedings themselves were not initiated validly, the competent authority did not derive any jurisdiction to enter into the merit of the matter. Legality and/or validity of the notice had been questioned at several stages of the proceedings. Despite their asking, no reason was disclosed by the authority to the appellants. They had asked for additional reasons, if any, which were not reflected in the show cause notices. None was disclosed.It is also relevant to notice that the High Court opined that there had been a proper application of mind on the part of the Competent Authority and Appellate Tribunal as they had released some items of properties. Application of mind on the part of the Competent Authority and the Appellate Tribunal at the subsequent stage was not in question; what was in question was non application of mind on the part of the authority prior to issuance of the

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: facts necessary for his assessment during the concluded assessment proceedings, any part of his income, profits or gains chargeable to income-tax has escaped assessment. He may start reassessment proceedings either because some fresh facts had come to light which were not previously disclosed or some information with regard to the facts previously disclosed comes into his possession which tends to expose the untruthfulness of those facts. In such situations, it is not a case of mere change of opinion or the drawing of a different inference from the same facts as were earlier available but acting on fresh information. Since the belief is that of the Income-tax Officer, the sufficiency of reasons for forming this belief is not for the court to judge but it is open to an assessee to establish that there in fact existed no belief or that the belief was not at all a bona fide one or was based on vague, irrelevant and non-specific information. To that limited extent, the court may look into the conclusion arrived at by the Income-tax Officer and examine whether there was any material available on the record from which the requisite belief could be formed by the Income-tax Officer and further whether that material had any rational connection or a live link for the formation of the requisite belief." See also Income Tax Officer Vs. Lakshmani Mewal Das [(1976) 103 ITR 437] .In Assistant Commissioner of Income Tax v. Rajesh Jhaveri Stock Brokers Pvt. Ltd. [2007 (8) SCALE 396 ], interpreting the term ‘reason to believe as used under Section 247 (a) of the Income Tax Act, 1961, it was opined: "To confer jurisdiction under Section 247(a) two conditions were required to be satisfied firstly the AO must have reason to believe that income profits or gains chargeable to income tax have escaped assessment, and secondly he must also have reason to believe that such escapement has occurred by reason of either (i) omission or failure on the part of the assessee to disclose fully or truly all material facts necessary for his assessment of that year. Both these conditions were conditions precedent to be satisfied before the AO could have jurisdiction to issue notice under Section 148 read with Section 147(a). But under the substituted Section 147 existence of only the first condition suffices. In other words, if the assessing officer for whatever reason has reason to believe that income has escaped assessment, it confers jurisdiction to reopen the assessment." NON APPLICATION OF MINDApplying these tests, it is evident that the statutory requirements have not been fulfilled in the present case.39. Non-application of mind on the part of the competent officer would also be evident from the fact that a property named ‘Rose Villa which was the subject matter of the decision of this Court in Fatima Amin (supra), was also included herein. Once the show cause notice is found to be illegal, the same would vitiate all subsequent proceedings.40. In Dilip N. Shroff Vs. Joint Commissioner of Income Tax, Mumbai and Another [(2007) 6 SCC 329] , this Court held: "86. It is of some significance that in the standard pro forma used by the assessing officer in issuing a notice despite the fact that the same postulates that inappropriate words and paragraphs were to be deleted, but the same had not been done. Thus, the assessing officer himself was not sure as to whether he had proceeded on the basis that the assessee had concealed his income or he had furnished inaccurate particulars. Even before us, the learned Additional Solicitor General while placing the order of assessment laid emphasis that he had dealt with both the situations. The impugned order, therefore, suffers from non-application of mind. It was also bound to comply with the principles of natural justice. (See Malabar Industrial Co. Ltd. Vs. CIT)"; RECORDING OF REASONS41. Submission of Mr. Singh that the appellants have not been able to discharge the burden of proof which was on them from the impugned orders, it would appear that they have utterly failed to prove their own independent income; they being close relative of the detune as in terms of the statutory requirements , it was for them to show that they had sufficient income from those properties.42. Had the show cause notice been valid, Mr. B.B. Singh, might have been right, but if the proceedings themselves were not initiated validly, the competent authority did not derive any jurisdiction to enter into the merit of the matter. Legality and/or validity of the notice had been questioned at several stages of the proceedings. Despite their asking, no reason was disclosed by the authority to the appellants. They had asked for additional reasons, if any, which were not reflected in the show cause notices. None was disclosed.43. It is also relevant to notice that the High Court opined that there had been a proper application of mind on the part of the Competent Authority and Appellate Tribunal as they had released some items of properties. Application of mind on the part of the Competent Authority and the Appellate Tribunal at the subsequent stage was not in question; what was in question was non application of mind on the part of the authority prior to issuance of the notice.CONCLUSION44. We are not unmindful of the purport and object of the Act. Dealing in narcotics is a social evil that must be curtailed or prohibited at any cost. Chapter VA seeks to achieve a salutary purpose. But, it must also be borne in mind that right to hold property although no longer a fundamental right is still a constitutional right. It is a human right. The provisions of the Act must be interpreted in a manner so that its constitutionality is upheld. The validity of the provisions might have received constitutional protection, but when stringent laws become applicable as a result whereof some persons are to be deprived of his/her right in a property, scrupulous compliance of the statutory requirements is imperative. ### Response: 1

Unikat Sankunni Menon Vs. The State Of Rajasthan

against them in the matter of pay-scales, as compared with Income-tax Officers recruited directly to the Class I service. The Court, rejecting this argument, held:"The only other contention raised is that there is discrimination between Class I and Class II Officers inasmuch as, though they do the same kind of work, their pay scales are different. This it is said, violates Article 14 of the Constitution. If this contention had any validity, there could be no incremental scales of pay fixed dependent on the duration of an officers service. The abstract doctrine of equal pay for equal work has nothing to do with Article 14.The contention that Article 14 of the Constitution has been violated, therefore, fails." The claim of the appellant in the present case that, on appointment as Deputy Secretary he must be held entitled to receive special pay on the ground of being placed on parity, with the members of the R.A.S., has therefore, to be rejected. 7. The second ground, which shows that the claim made on behalf of the appellant has no basis, is that, under the various Service Rules themselves, a member of the R.S.S., on appointment as Deputy Secretary, is given pay in a grade specially and separately fixed for the posts of Deputy Secretaries, while a member of the R.A.S., is not placed in that grade at all. Thus, under the latest Rules, a member of the R.S.S. on appointment as Deputy Secretary, draws salary in the grade of Rs. 900-50-1500. On the other hand, a member of the R.A.S., appointed as Deputy Secretary, is not granted pay in this scale. In this case, he continues to draw his salary in the scale applicable to him in the R.A.S., and is allowed a special pay of Rs. 150. This special pay allowed to a member of the R.A.S., is therefore, not in addition to the pay in the grade specially prescribed for the posts of Deputy Secretaries. That grade is much higher than the grade applicable to the member of the R. A. S. which continues to apply to him on his appointment as Deputy Secretary, and it is only in addition to that lower timescale that a member of the R.A.S. is allowed the special pay of Rs. 150.It is thus clear that the method of fixation of salary for members of the two Services, on appointment as Deputy Secretaries, is quite different. A member of the R.S.S. is allowed a special higher grade, while a member of the R.A.S. continues on his old scale and only gets an extra salary of Rs.150 per month. In such a case, no question can arise of holding that a member of the R.S.S. must also be granted a special pay in addition to being placed in the higher grade of pay prescribed for the post of Deputy Secretaries when that post is held by the member of the R.S.S. 8. In this connection, learned counsel for the appellant drew our attention to Rule 7(31) of the Rajasthan Civil Services Rules, 1951, framed under Article 309 of the Constitution, defining special pay. The definition given in the Rule is that "Special Pay" means an addition of the nature of pay, to the emoluments of a post or of a government servant, granted in consideration of -(a) the specially arduous nature of the duties; (b) a specific addition to the work or responsibility; or (c) the unhealthiness of the locality in which the work is performed. 9. It was urged by learned counsel that, if the post of Deputy Secretary was considered as involving specially arduous nature of duties for members of the R.A.S., there is no reason to hold that that post is not equally arduous for members of the R.S.S. and, consequently, there would be no justification for denying special pay to members of the R.S.S. holding such a post, when special pay is granted to members of the R.A.S. It appears to us that this submission is made on a misconception of the scope of this Rule. The Rule, in defining special pay, envisages an addition of the nature of pay to the emoluments of either a post or of a government servant and, consequently it is clear that a special pay is to be granted, if a person is appointed to a post which is specially arduous in nature as compared with the earlier post held by him. Similarly, it may be granted to a government servant who is appointed to a post involving specially arduous duties as compared with the posts to be held by him ordinarily, while continuing in the Service in which he holds his permanent appointment. Special pay does not arise out of any inherent quality of being arduous in nature in the post itself.Thus, when special pay is granted to a member of the R.A.S. on appointment as Deputy Secretary, the reason may be that the post is considered more arduous in nature than the post which would be held by him, if he had continued on a regular post borne on the cadre of his Service. In the case of a member of the R.S.S., the post of a Deputy Secretary is already designated as a selection post for him and in view of this difference between the post to which he is appointed, as compared with the post of an Assistant Secretary earlier held by him, he is granted a special and higher grade, so that there is no question of his being granted a special pay on the basis that the post of Deputy Secretary is more arduous in nature than the post of Assistant Secretary. The Rules, as framed, are thus, based on well-recognised principles for granting salary to members of different services even when they are appointed to the same post. 10. In these circumstances, no question arises of any discrimination under Article 14 of the Constitution, or of any denial of equality of opportunity under Article 16 of the Constitution.

0[ds]It is true that, on such appointment under these Rules, he was not entitled to any special pay but the principle for fixation of pay given in the remark column ensured that the pay admissible to the Officer would certainly be higher than the pay which would have been admissible if the earlier Rules had continued in forceThe Rules thus applicable to the member of the R.S.S on appointment to the post of Deputy Secretary, against which the appellant made his grievance in the High Court, cannot be held to be vitiated in any manner, if considered by themselves in the light of rights which the members of the R.S.S. possessed from time to time6. There are two reasons why this grievance put forward on behalf of the appellant has to be rejected. The first is that the appellant comes to the post of a Deputy Secretary from the R.S.S., which is a service distinct and separate from the R.A.S.The methods of recruitment, qualifications, etc., of the two Services are not identical. In their ordinary time-scale, the two Services do not carry the same grades. Even the posts, for which recruitment in the two Services is made, are to a major extent, different. The members of the R.S.S., are meant to be employed in the Secretariat only, while members of the R.A.S. are mostly meant for posts which are outside the Secretariat though some posts in the Secretariat can be filled by members of the R.A.S. In such a case, where appointment is made to the posts of Deputy Secretaries of government servants belonging to two different and separate Services, there can arise no question of a claim that all of them, when working as Deputy Secretaries, must receive identical salaries, or must necessarily both be given special pay. It is entirely wrong to think that every one, appointed to the same post, is entitled to claim that he must be paid identical emoluments as any other person appointed to the same post, disregarding the method of recruitment, or the source from which the Officer is drawn for appointment to that post. No such equality is required either by Article 14 or Article 16 of the ConstitutionIn our opinion, the answer must be in the negative. The concept of equality can have no existence except with reference to matters which are common as between individuals, between whom equality is predicated. Equality of opportunity in matters of employment can be predicated only as between persons, who are either seeking the same employment, or have obtained the same employmentThe claim of the appellant in the present case that, on appointment as Deputy Secretary he must be held entitled to receive special pay on the ground of being placed on parity, with the members of the R.A.S., has therefore, to be rejected7. The second ground, which shows that the claim made on behalf of the appellant has no basis, is that, under the various Service Rules themselves, a member of the R.S.S., on appointment as Deputy Secretary, is given pay in a grade specially and separately fixed for the posts of Deputy Secretaries, while a member of the R.A.S., is not placed in that grade at all. Thus, under the latest Rules, a member of the R.S.S. on appointment as Deputy Secretary, draws salary in the grade of Rs. 900-50-1500. On the other hand, a member of the R.A.S., appointed as Deputy Secretary, is not granted pay in this scale. In this case, he continues to draw his salary in the scale applicable to him in the R.A.S., and is allowed a special pay of Rs. 150. This special pay allowed to a member of the R.A.S., is therefore, not in addition to the pay in the grade specially prescribed for the posts of Deputy Secretaries. That grade is much higher than the grade applicable to the member of the R. A. S. which continues to apply to him on his appointment as Deputy Secretary, and it is only in addition to that lower timescale that a member of the R.A.S. is allowed the special pay of Rs. 150.It is thus clear that the method of fixation of salary for members of the two Services, on appointment as Deputy Secretaries, is quite different. A member of the R.S.S. is allowed a special higher grade, while a member of the R.A.S. continues on his old scale and only gets an extra salary of Rs.150 per month. In such a case, no question can arise of holding that a member of the R.S.S. must also be granted a special pay in addition to being placed in the higher grade of pay prescribed for the post of Deputy Secretaries when that post is held by the member of the R.S.SIt appears to us that this submission is made on a misconception of the scope of this Rule. The Rule, in defining special pay, envisages an addition of the nature of pay to the emoluments of either a post or of a government servant and, consequently it is clear that a special pay is to be granted, if a person is appointed to a post which is specially arduous in nature as compared with the earlier post held by him. Similarly, it may be granted to a government servant who is appointed to a post involving specially arduous duties as compared with the posts to be held by him ordinarily, while continuing in the Service in which he holds his permanent appointment. Special pay does not arise out of any inherent quality of being arduous in nature in the post itself.Thus, when special pay is granted to a member of the R.A.S. on appointment as Deputy Secretary, the reason may be that the post is considered more arduous in nature than the post which would be held by him, if he had continued on a regular post borne on the cadre of his Service. In the case of a member of the R.S.S., the post of a Deputy Secretary is already designated as a selection post for him and in view of this difference between the post to which he is appointed, as compared with the post of an Assistant Secretary earlier held by him, he is granted a special and higher grade, so that there is no question of his being granted a special pay on the basis that the post of Deputy Secretary is more arduous in nature than the post of Assistant Secretary. The Rules, as framed, are thus, based on well-recognised principles for granting salary to members of different services even when they are appointed to the same post.In these circumstances, no question arises of any discrimination under Article 14 of the Constitution, or of any denial of equality of opportunity under Article 16 of the Constitution

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: against them in the matter of pay-scales, as compared with Income-tax Officers recruited directly to the Class I service. The Court, rejecting this argument, held:"The only other contention raised is that there is discrimination between Class I and Class II Officers inasmuch as, though they do the same kind of work, their pay scales are different. This it is said, violates Article 14 of the Constitution. If this contention had any validity, there could be no incremental scales of pay fixed dependent on the duration of an officers service. The abstract doctrine of equal pay for equal work has nothing to do with Article 14.The contention that Article 14 of the Constitution has been violated, therefore, fails." The claim of the appellant in the present case that, on appointment as Deputy Secretary he must be held entitled to receive special pay on the ground of being placed on parity, with the members of the R.A.S., has therefore, to be rejected. 7. The second ground, which shows that the claim made on behalf of the appellant has no basis, is that, under the various Service Rules themselves, a member of the R.S.S., on appointment as Deputy Secretary, is given pay in a grade specially and separately fixed for the posts of Deputy Secretaries, while a member of the R.A.S., is not placed in that grade at all. Thus, under the latest Rules, a member of the R.S.S. on appointment as Deputy Secretary, draws salary in the grade of Rs. 900-50-1500. On the other hand, a member of the R.A.S., appointed as Deputy Secretary, is not granted pay in this scale. In this case, he continues to draw his salary in the scale applicable to him in the R.A.S., and is allowed a special pay of Rs. 150. This special pay allowed to a member of the R.A.S., is therefore, not in addition to the pay in the grade specially prescribed for the posts of Deputy Secretaries. That grade is much higher than the grade applicable to the member of the R. A. S. which continues to apply to him on his appointment as Deputy Secretary, and it is only in addition to that lower timescale that a member of the R.A.S. is allowed the special pay of Rs. 150.It is thus clear that the method of fixation of salary for members of the two Services, on appointment as Deputy Secretaries, is quite different. A member of the R.S.S. is allowed a special higher grade, while a member of the R.A.S. continues on his old scale and only gets an extra salary of Rs.150 per month. In such a case, no question can arise of holding that a member of the R.S.S. must also be granted a special pay in addition to being placed in the higher grade of pay prescribed for the post of Deputy Secretaries when that post is held by the member of the R.S.S. 8. In this connection, learned counsel for the appellant drew our attention to Rule 7(31) of the Rajasthan Civil Services Rules, 1951, framed under Article 309 of the Constitution, defining special pay. The definition given in the Rule is that "Special Pay" means an addition of the nature of pay, to the emoluments of a post or of a government servant, granted in consideration of -(a) the specially arduous nature of the duties; (b) a specific addition to the work or responsibility; or (c) the unhealthiness of the locality in which the work is performed. 9. It was urged by learned counsel that, if the post of Deputy Secretary was considered as involving specially arduous nature of duties for members of the R.A.S., there is no reason to hold that that post is not equally arduous for members of the R.S.S. and, consequently, there would be no justification for denying special pay to members of the R.S.S. holding such a post, when special pay is granted to members of the R.A.S. It appears to us that this submission is made on a misconception of the scope of this Rule. The Rule, in defining special pay, envisages an addition of the nature of pay to the emoluments of either a post or of a government servant and, consequently it is clear that a special pay is to be granted, if a person is appointed to a post which is specially arduous in nature as compared with the earlier post held by him. Similarly, it may be granted to a government servant who is appointed to a post involving specially arduous duties as compared with the posts to be held by him ordinarily, while continuing in the Service in which he holds his permanent appointment. Special pay does not arise out of any inherent quality of being arduous in nature in the post itself.Thus, when special pay is granted to a member of the R.A.S. on appointment as Deputy Secretary, the reason may be that the post is considered more arduous in nature than the post which would be held by him, if he had continued on a regular post borne on the cadre of his Service. In the case of a member of the R.S.S., the post of a Deputy Secretary is already designated as a selection post for him and in view of this difference between the post to which he is appointed, as compared with the post of an Assistant Secretary earlier held by him, he is granted a special and higher grade, so that there is no question of his being granted a special pay on the basis that the post of Deputy Secretary is more arduous in nature than the post of Assistant Secretary. The Rules, as framed, are thus, based on well-recognised principles for granting salary to members of different services even when they are appointed to the same post. 10. In these circumstances, no question arises of any discrimination under Article 14 of the Constitution, or of any denial of equality of opportunity under Article 16 of the Constitution. ### Response: 0

State of Gujarat and Another Vs. Vaghela Dayabhai Chaturbhai and Others

Code was enacted and this becomes obvious from the following observation of the High Court:-"As we have already pointed out, the object sought to be achieved is completely a collateral object and the criteria which are adopted for the alleged classification viz. the membership of the co-operative society and the persons being Harijans, Adivasis or backward class people have no rational nexus whatever to the object of augmenting land revenue, which would be the implicit object underlying the entire Code, including this statutory power of disposal of the said lands for the benefit of the public. The Code never contemplated any exclusion of persons when such statutory power was sought to be exercised by the State by any statutory order. Therefore, this statutory order clearly violates Article 14 of the Constitution and even on that ground it must be struck down."8. For the purpose of determining the question whether the impugned Resolution is violative of Article 14 of the Constitution or not, it is necessary to examine whether the classification adopted by the State Government is based upon some intelligible differentia which distinguishes individuals and co-operative societies in whose favour grants of lease-hold rights in bhatha lands are required to be made by the Collector from others and whether the said classification bears any reasonable relation to the object underlying the Code. The High Court has proceeded on the basis that the classification made by the Resolution does not have any rational relation to the object of the Code which according to it was realization of revenue and nothing more than that. We have explained earlier that the object of the Code is to make provision for an equitable distribution of available land amongst persons who are in need of it. As mentioned earlier, the State Government is under an obligation to ensure that the ownership and the control of material resources of the community are so distributed as best to subserve the common good and the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment. In India which is predominantly an agricultural country, land forms the most important means of production. It is well known that unemployment among the masses is on the increase because employment opportunities are not increasing at the same rate at which the population is increasing. Consequently we find in India to day a large number of landless persons and persons with uneconomic holdings in villages who are either unemployed or under-employed. It is also equally well-known that persons belonging to Scheduled Castes and Scheduled Tribes form the bulk of such landless persons or owners of uneconomic holdings who are in need of special care. It is also the settled policy of the State Governments to encourage co-operative movement, which is embarked upon with a view to preventing exploitation of economically weaker sections of society by others. The State Government in the instant case appears to have passed the impugned Resolution in order to grant leases in respect of bhatha lands in favour of landless persons or persons having very small extents of land or persons belonging to Scheduled Castes, Scheduled Tribes and backward classes and members of co-operative societies at a reasonable rent without being put to the necessity of offering bids at a public auction where it is well known that only moneyed persons can become successful bidders. The impugned Resolution lays down the procedure to be followed in the disposal of lease-h old rights in respect of bhatha lands. It does not relate to all unoccupied lands available in the State of Gujarat. The total extent of bhatha lands available in the State of Gujarat when compared with other available unoccupied lands may be a very small extent. The writ petitioners on whom the burden of proving that the impugned Resolution is discriminatory have not furnished any information about the extent of Bhatha lands available for disposal. Clauses (1) and (2) of the Resolution provide that the existing leases held by cooperative societies should be renewed on their expiry only in favour of the members of such co-operative societies subject to certain conditions for a further period of ten years on payment of revised rent which should be fixed on the basis of the factors referred to therein. Clause (3) of the Resolution provides that leases of bhatha lands granted in favour of individuals should not be renewed on their expiry but they should be disposed of in favour of bonafide agriculturists who belong to the weaker sections of society and co-operative farming societies on the basis of priority set out in clause (5) thereof. The rent payable by them should again be determined in accordance with the instructions given in the Resolution. The Resolution is designed to bring about distribution of agricultural lands as best to subserve the common good thus eliminating concentration of wealth and means of production to the common detriment. It helps persons, who are in need of lands for their bare maintenance and who have otherwise no chance of getting them, to acquire lands at a low rate of rent.The classification made in the impugned Resolution of persons or co-operative societies who are eligible to secure grants of lease hold rights, according to us, bears a reasonable relation to the object with which the Code is enacted. It cannot be characterised as arbitrary. We do not find that there is any infirmity in the above classification. The Resolution aims at bringing about social and economic justice and assists people who are not strong enough to secure lease-hold rights of a public auction for purposes of cultivation. The leases to be granted are not for any unlimited period. At the end of the period prescribed in the leases, it will be open to the Collector to dispose them of afresh. In the above circumstances, we hold that the High Court was in error in holding that the Resolution was violative of Article 14 of the Constitution.9.

1[ds]From a reading of the above observations of the High Court, it becomes obvious that the High Court felt that the Resolution which had been passed with a view to showing preference to members belonging to Scheduled Castes, Scheduled Tribes and backward classes, landless persons who belonged to the weaker sections of society and members of co-operative farming societies did not subserve the object of the Code i .e. realization of maximum revenue. The High Court also felt that there was no scope for the passing of any order or resolution in the nature of a welfare measure while administering the provisions of theit is felt that it is necessary to acquire excessive lands in the hands of private individuals for distribution amongst the landless and other deserving persons, it is equally necessary to observe the same rule while distributing the land which belongs to the State Government. In view o f the foregoing, we are of the view that the conclusion reached by the High Court that the basic scheme of the Code was the realization of land revenue by disposing of unoccupied lands by public auction alone appears to be baseless. We, there fore, find it difficult to agree that the impugned Resolution which provides for the disposal of bhatha lands amongst bonafide agriculturists, harijans, adivasis and backward class people and other persons mentioned therein without resorting to public auction but by having recourse to the procedure set out in it is contrary to the letter and the spirit of the code. We, therefore, set aside the finding of the High Court on the abovethe purpose of determining the question whether the impugned Resolution is violative of Article 14 of the Constitution or not, it is necessary to examine whether the classification adopted by the State Government is based upon some intelligible differentia which distinguishes individuals and co-operative societies in whose favour grants of lease-hold rights in bhatha lands are required to be made by the Collector from others and whether the said classification bears any reasonable relation to the object underlying the Code. The High Court has proceeded on the basis that the classification made by the Resolution does not have any rational relation to the object of the Code which according to it was realization of revenue and nothing more than that. We have explained earlier that the object of the Code is to make provision for an equitable distribution of available land amongst persons who are in need of it. As mentioned earlier, the State Government is under an obligation to ensure that the ownership and the control of material resources of the community are so distributed as best to subserve the common good and the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment. In India which is predominantly an agricultural country, land forms the most important means of production. It is well known that unemployment among the masses is on the increase because employment opportunities are not increasing at the same rate at which the population is increasing. Consequently we find in India to day a large number of landless persons and persons with uneconomic holdings in villages who are either unemployed or under-employed. It is also equally well-known that persons belonging to Scheduled Castes and Scheduled Tribes form the bulk of such landless persons or owners of uneconomic holdings who are in need of special care. It is also the settled policy of the State Governments to encourage co-operative movement, which is embarked upon with a view to preventing exploitation of economically weaker sections of society by others. The State Government in the instant case appears to have passed the impugned Resolution in order to grant leases in respect of bhatha lands in favour of landless persons or persons having very small extents of land or persons belonging to Scheduled Castes, Scheduled Tribes and backward classes and members of co-operative societies at a reasonable rent without being put to the necessity of offering bids at a public auction where it is well known that only moneyed persons can become successful bidders. The impugned Resolution lays down the procedure to be followed in the disposal of lease-h old rights in respect of bhatha lands. It does not relate to all unoccupied lands available in the State of Gujarat. The total extent of bhatha lands available in the State of Gujarat when compared with other available unoccupied lands may be a very small extent. The writ petitioners on whom the burden of proving that the impugned Resolution is discriminatory have not furnished any information about the extent of Bhatha lands available for disposal. Clauses (1) and (2) of the Resolution provide that the existing leases held by cooperative societies should be renewed on their expiry only in favour of the members of such co-operative societies subject to certain conditions for a further period of ten years on payment of revised rent which should be fixed on the basis of the factors referred to therein. Clause (3) of the Resolution provides that leases of bhatha lands granted in favour of individuals should not be renewed on their expiry but they should be disposed of in favour of bonafide agriculturists who belong to the weaker sections of society and co-operative farming societies on the basis of priority set out in clause (5) thereof. The rent payable by them should again be determined in accordance with the instructions given in the Resolution. The Resolution is designed to bring about distribution of agricultural lands as best to subserve the common good thus eliminating concentration of wealth and means of production to the common detriment. It helps persons, who are in need of lands for their bare maintenance and who have otherwise no chance of getting them, to acquire lands at a low rate of rent.The classification made in the impugned Resolution of persons or co-operative societies who are eligible to secure grants of lease hold rights, according to us, bears a reasonable relation to the object with which the Code is enacted. It cannot be characterised as arbitrary. We do not find that there is any infirmity in the above classification. The Resolution aims at bringing about social and economic justice and assists people who are not strong enough to secure lease-hold rights of a public auction for purposes of cultivation. The leases to be granted are not for any unlimited period. At the end of the period prescribed in the leases, it will be open to the Collector to dispose them of afresh. In the above circumstances, we hold that the High Court was in error in holding that the Resolution was violative of Article 14 of thea reading of the above observations of the High Court, it becomes obvious that the High Court felt that the Resolution which had been passed with a view to showing preference to members belonging to Scheduled Castes, Scheduled Tribes and backward classes, landless persons who belonged to the weaker sections of society and members offarming societies did not subserve the object of the Code i .e. realization of maximum revenue. The High Court also felt that there was no scope for the passing of any order or resolution in the nature of a welfare measure while administering the provisions of thecode. In order to examine the correctness of the above view of the High Court, it is necessary to refer to some of the relevant provisions of the Code. The Preamble of the Code provides that it had been passed as it was found expedient to consolidate and amend the law relating to Revenue officers and to the assessment and recovery of Land Revenue and to other matters connected with the Land Revenue Administration. Chapters II and III of the Code deal with constitution powers officers provision relating to the security to be furnished by certain Revenue officers and the liability of principals and sureties. Chapter V of the Code is entitled Of Lands and Land Revenue and contains sections 37 to 59. Section 37 of the Code declares that all public roads, loans and paths, the bridges, ditches, dikes, and fences, on, or beside, the same, the bed of the sea and of harbours and creeks below high watermark, and of rivers, streams, nallas, lakes, and tanks, and all canals, andand all standing and flowing water, and all lands wherever situated, which are not the property of individuals, or of aggregates of persons legally capable of holding property, and except in so far as any right of such persons may be established, in or over the same, and except as may be otherwise provided in any law for the time being in force are and are hereby declared to be, with all rights, in or over the same, or appertaining thereto, the property of the Government and it sh all be lawful for the Collector subject to the order of the State Government, to dispose of them in such manner as he may deem fit, or as may be authorised by general rules sanctioned by the Government concerned, subject always to the rights of way, and all other rights of the public or of individual legally subsisting. The aforesaid section 37 of the Code vests the rights in all properties referred to therein the State Government and provides that it is lawful for the Collector subject to the orders of the State Government to dispose of them in such manner as he may deem fit or as may be authorised by the general rules sanctioned by the Government. The State Government is thus constituted the proprietor of the several items referred to therein. While the Collector has been given the power of disposal of the land belonging to the Government, he can do so only in accordance with the other provisions of the Code and the Rules made thereunder and subject to any order or resolution passed by the State Government. The power of the State Government to make orders under section 37(1) of the Code is not in the nature of appellate or revisional powers which are dealt with separately under sections 203 and 211 o f the Code but is in the nature of an administrative power enabling the State Government to regulate the power of the Collector. Section 38 of the Code authorises the survey officers whilst survey operations are proceeding under Chapter VIII of the Code and at any other time the Collector to set apart lands which belonged to the State Government and not in the lawful occupation of any person or aggregate of persons, in unalienated villages or unalienated portions of villages, for free pasturage for the village cattle, for forest reserves, or for any other public or municipal purpose; and lands assigned specially for any such purpose shall not be otherwise used without the sanction of the Collector. Section 39 of the C ode restricts the right of grazzing on freeto the cattle of the village or villages to which such lands belong or have been assigned. Section 44 of the Code recognizes the existence of certain privileges of villagers or of certain classes of persons to cutor timber for domestic or other purposes even in the case of villages or lands in which the rights of the Government to the trees have been reserved under section 40 of the Code. Section 48 of the Code sets out the manner of assessment and alteration of assessment of any land. It provides that the land revenue leviable on any land shall be assessed with reference to the use of thefor the purpose of agriculture, (b) for the purpose of building and (c) for a purpose other than agriculture or building. Subsection (3) of section 48 of the Code empowers the Collector or a survey officer, subject to any rules made in this behalf, to prohibit the use for certain purposes of any land liable t o the payment of land revenue and to summarily evict any holder who uses or attempts to use the same for any such prohibited purpose. Chapter VIII lays down the procedure to be followed in the course of survey and settlement proceedings thus ensuring that there is an equitable classification of lands for purposes of levy of just assessment in the light of the relevant economic factors. The principles underlying the said procedure prohibit the levy of oppressive or excessive revenue. There is no scope for levy of extortionate revenue which may be termed as rackrent.Chapter VI of the Code deals with the provisions relating to the grant, use and relinquishment of land. Section 62 of the Code which lays down the conditions subject to which unoccupied land may be granted provides that the Collector may, subject to such rules as may from time to time be made by the State Government, require the payment of a price for unalienated land or to sell the same by auction or to annex such conditions as he may deem fit. Rule 37 of the Bombay Land Revenue Rules, 1921 (hereinafter referred to as the Rules) which are promulgated by the State Government in exercise of its powers under sections 213 and 214 of the Code provides that any unoccupied survey number not assigned for any special purpose may, at the Collectors discretion, be granted for agricultural purposes to such person as the Collectors deems fit, either upon payment of a p rice fixed by the Collector, or without charge, or may be put up to public auction. When land is granted under section 62 read with Rule 37, the grantee acquires a heritable and transferable occupancy right over the land granted, subject to the lawful conditions imposed under the grant. The proviso to section 68 of the Code, however, provides that notwithstanding any provision in the Code, it shall not be unlawful for the Collector at any time to grant permission to any person to occupy any unalienated unoccupied land for such period and on such conditions as he may, subject to rules made by the State Government in that behalf prescribe and in any such case the occupancy shall be held only for the period and subject to the conditions so prescribed. Rule 32 of the Rules provides that land may be given free of price and free of revenue, whether in perpetuity or for a term, for any of the purposes specified in column 1 referred to in the table given below that rule viz. for sites for the construction at the cost of a municipality, a panchayat or other local bodies of schools or colleges etc., for sites used or to be used in connection with any scheme under the Community Development Programme, for sites used or to be used as market yards under the management of market committees established under the Gujarat Agricultural Produce Markets Act, 1963 etc. Rule 35 of the Rules empowers the Collector to exempt from payment of land revenue without any limit lands used for sites of hospitals, dispensaries, schools etc. Under Rule 41 of the Rules, land situated in the bed of a river and not included in a survey number can, save as otherwise provided in sections 46 and 64, ordinarily be leased annually by auction to the highest bidder for the term of one year or such further period as the Collector may think fit and the accepted bid should be deemed to be the land revenue chargeable on such land. The language of this rule also enables the State Government to dispose of such lands in any other equitable way. This Rule, however, does not apply to a land which is situated in the bed of a river and which is included in a survey number. Rule 42 of the Rules empowers the Collector to dispose of unoccupied land required or suitable for building sites or other nonagricultural purpose either by public auction or in his discretion by private arrangement either upon payment of a price fixed by him, or without charge, as he deems fit.These and the other provisions of the Code and the Rules made thereunder show that it is open to the Collector to dispose of unoccupied lands belonging to the Government either for cultivation or for any other purpose in favour of individuals or aggregate of individuals either free of charge or at an upset price to be fixed by him or by public auction.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: Code was enacted and this becomes obvious from the following observation of the High Court:-"As we have already pointed out, the object sought to be achieved is completely a collateral object and the criteria which are adopted for the alleged classification viz. the membership of the co-operative society and the persons being Harijans, Adivasis or backward class people have no rational nexus whatever to the object of augmenting land revenue, which would be the implicit object underlying the entire Code, including this statutory power of disposal of the said lands for the benefit of the public. The Code never contemplated any exclusion of persons when such statutory power was sought to be exercised by the State by any statutory order. Therefore, this statutory order clearly violates Article 14 of the Constitution and even on that ground it must be struck down."8. For the purpose of determining the question whether the impugned Resolution is violative of Article 14 of the Constitution or not, it is necessary to examine whether the classification adopted by the State Government is based upon some intelligible differentia which distinguishes individuals and co-operative societies in whose favour grants of lease-hold rights in bhatha lands are required to be made by the Collector from others and whether the said classification bears any reasonable relation to the object underlying the Code. The High Court has proceeded on the basis that the classification made by the Resolution does not have any rational relation to the object of the Code which according to it was realization of revenue and nothing more than that. We have explained earlier that the object of the Code is to make provision for an equitable distribution of available land amongst persons who are in need of it. As mentioned earlier, the State Government is under an obligation to ensure that the ownership and the control of material resources of the community are so distributed as best to subserve the common good and the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment. In India which is predominantly an agricultural country, land forms the most important means of production. It is well known that unemployment among the masses is on the increase because employment opportunities are not increasing at the same rate at which the population is increasing. Consequently we find in India to day a large number of landless persons and persons with uneconomic holdings in villages who are either unemployed or under-employed. It is also equally well-known that persons belonging to Scheduled Castes and Scheduled Tribes form the bulk of such landless persons or owners of uneconomic holdings who are in need of special care. It is also the settled policy of the State Governments to encourage co-operative movement, which is embarked upon with a view to preventing exploitation of economically weaker sections of society by others. The State Government in the instant case appears to have passed the impugned Resolution in order to grant leases in respect of bhatha lands in favour of landless persons or persons having very small extents of land or persons belonging to Scheduled Castes, Scheduled Tribes and backward classes and members of co-operative societies at a reasonable rent without being put to the necessity of offering bids at a public auction where it is well known that only moneyed persons can become successful bidders. The impugned Resolution lays down the procedure to be followed in the disposal of lease-h old rights in respect of bhatha lands. It does not relate to all unoccupied lands available in the State of Gujarat. The total extent of bhatha lands available in the State of Gujarat when compared with other available unoccupied lands may be a very small extent. The writ petitioners on whom the burden of proving that the impugned Resolution is discriminatory have not furnished any information about the extent of Bhatha lands available for disposal. Clauses (1) and (2) of the Resolution provide that the existing leases held by cooperative societies should be renewed on their expiry only in favour of the members of such co-operative societies subject to certain conditions for a further period of ten years on payment of revised rent which should be fixed on the basis of the factors referred to therein. Clause (3) of the Resolution provides that leases of bhatha lands granted in favour of individuals should not be renewed on their expiry but they should be disposed of in favour of bonafide agriculturists who belong to the weaker sections of society and co-operative farming societies on the basis of priority set out in clause (5) thereof. The rent payable by them should again be determined in accordance with the instructions given in the Resolution. The Resolution is designed to bring about distribution of agricultural lands as best to subserve the common good thus eliminating concentration of wealth and means of production to the common detriment. It helps persons, who are in need of lands for their bare maintenance and who have otherwise no chance of getting them, to acquire lands at a low rate of rent.The classification made in the impugned Resolution of persons or co-operative societies who are eligible to secure grants of lease hold rights, according to us, bears a reasonable relation to the object with which the Code is enacted. It cannot be characterised as arbitrary. We do not find that there is any infirmity in the above classification. The Resolution aims at bringing about social and economic justice and assists people who are not strong enough to secure lease-hold rights of a public auction for purposes of cultivation. The leases to be granted are not for any unlimited period. At the end of the period prescribed in the leases, it will be open to the Collector to dispose them of afresh. In the above circumstances, we hold that the High Court was in error in holding that the Resolution was violative of Article 14 of the Constitution.9. ### Response: 1

The State Trading Corporation of India Ltd. & Others Vs. State of Mysore & Another

only concerned with the sales hi which goods were moved from outside into Mysore.2. The assessment year is 1956-57. We are, therefore, concerned with sales which took place between April 1, 1956 and March 31, 1957. The tax was imposed under the Mysore Sales Tax Act. 1948 which was in force during the whole of this period.3. There are six petitioners, the first three being the State Trading Corporation Ltd., the Associated Cement Company Ltd. and the Cement Marketing Co. Ltd. The other three petitioners are shareholders or directors in one or other of these companies. The respondents are the State of Mysore and one of its Taxing Officers.4. In this case also we arc concerned with sales of cement. Here also as in the other case, the sales were made under permits issued by the Government and the procedure of the sales in both the cases was the same.5. The Associated Cement Company Ltd. was the owner of various factories from which the supplies had to be made under the permits. From April 1, 1956 to June 30, 1956 the Marketing Company is said to have acted as the selling agent of the Associated Cement Company. Under the Cement Control Order, 1956 which came into force on July l, 1956 the entire stock of cement produced in the country in any factory became vested in the State Trading Corporation. That Corporation appointed the Marketing Company its selling agent on July 1, 1956. The sales in this case are said to have been made by the Marketing Company as the agent of the Associated Cement Company during the period between April 1, 1956 to June 30, 1956 and as the Agent of the State Trading Corporation between July 1, 1956, and March 31, 1957. Nothing really turns on whether the Marketing Company had sold as agent or principal for the reason stated in the other judgment.6. The procedure of sale in this case being exactly the same as in the previous case it has to be held that the goods were moved from a place outside Mysore into the State of Mysore as a result of the contracts of sale that is to say the contracts of sale contained a covenant that the goods would be so moved. We have stated in our judgment in Writ Petns. Nos. 65 and 66 of 1960 (Reported in AIR 1963 SC 548 ), that such sales are inter-State sales within S. 3 (a) of the Central Sales Tax Act. Now that Act came into force on January 5, 1957. Therefore so far as sales between that date and the end of the assessment year, that is to say, March 31, 1957, are concerned they have to be regarded as inter-State sales which the State legislature could not tax for the reasons mentioned in the aforesaid judgment.7. The remaining part of the assessment year has to be considered in two periods. The first is between April 1, 1956 and September 10, 1956. During this period Art. 286 (2) of the Constitution before it was amended by the Constitution (Sixth Amendment) Act, 1956, was in force. That provision forbade a State legislature from taxing an inter-State sale. What an inter-State sale was within the meaning of Art. 286 (2) had been decided by judgments of this Court mentioned in the judgment delivered earlier today by Kapur, J. in Cement Marketing Co. Ltd. v. State of Mysore, Civil Appeal No. 255 of 1961 (reported in AIR 1963 SC 980 ). As stated in that judgment it is well settled that inter-State sales contemplated by Art. 286 (2) were the same as those defined in S. 3 (a) of the Central Sales Tax Act. The sales between April 1, 1956 and .September 10, 1956 in which the goods moved from outside Mysore into Mysore must, therefore, be held to be inter-State sales which the respondents had no jurisdiction or power to tax.8. It remains now to deal with the period between September 11, 1956 to January 4. 1957. During this period Art. 286 (2) did not exist in the Constitution and the Parliament had not formulated principles defining an inter-State sale which it was given power to do by Art. 269 (3) of the Constitution introduced into the Constitution by the Constitution (Sixth Amendment) Act. During this period, however, under Art. 269 (1) (g) and Item 92A of List I and Item 54 of List II of Sch. 7 to the Constitution the State legislature had no power to tax an inter-State sale. The question is how was an inter-State sale to be understood during this period. We think it has to be understood in its ordinary natural sense, that is to say, a sense which it conveys unaided by any other statutory provision. That is the sense in which this Court understood it in the cases mentioned in the judgment of Kapur, J. referred to in the preceding paragraph. Now applying the definition of inter-State sale mentioned in those cases, we have to hold that the sales in which goods moved from outside the State of Mysore into it under the procedure which prevailed in the present case were all inter-State sales. therefore, the State of Mysore had no power to tax these sales either.9. For these reasons this petition is allowed. The assessment order mentioned in the petition is quashed and we direct the issue of necessary writs restraining the respondents from levying any tax on the sales mentioned in the petition in which the goods moved from outside Mysore into Mysore. In this case also the petitioners had omitted to disclose the permits under which the sales had been made and to state expressly that the sales had been made under the permits and on the terms contained in them with the result that under the contract of sale goods had to be moved from outside Mysore into Mysore. Hence, as in the previous case, here also there will be no order for costs.

1[ds]7. The remaining part of the assessment year has to be considered in two periods. The first is between April 1, 1956 and September 10, 1956. During this period Art. 286 (2) of the Constitution before it was amended by the Constitution (Sixth Amendment) Act, 1956, was in force. That provision forbade a State legislature from taxing an. What ane was within the meaning of Art. 286 (2) had been decided by judgments of this Court mentioned in the judgment delivered earlier today by Kapur, J. in Cement Marketing Co. Ltd. v. State of Mysore, Civil Appeal No. 255 of 1961 (reported in AIR 1963 SC 980 ). As stated in that judgment it is well settled thats contemplated by Art. 286 (2) were the same as those defined in S. 3 (a) of the Central Sales Tax Act. The sales between April 1, 1956 and .September 10, 1956 in which the goods moved from outside Mysore into Mysore must, therefore, be held to besales which the respondents had no jurisdiction or power to tax.It remains now to deal with the period between September 11, 1956 to January 4. 1957. During this period Art. 286 (2) did not exist in the Constitution and the Parliament had not formulated principles defining ansale which it was given power to do by Art. 269 (3) of the Constitution introduced into the Constitution by the Constitution (Sixth Amendment) Act. During this period, however, under Art. 269 (1) (g) and Item 92A of List I and Item 54 of List II of Sch. 7 to the Constitution the State legislature had no power to tax ansale. The question is how was ansale to be understood during this period. We think it has to be understood in its ordinary natural sense, that is to say, a sense which it conveys unaided by any other statutory provision. That is the sense in which this Court understood it in the cases mentioned in the judgment of Kapur, J. referred to in the preceding paragraph. Now applying the definition ofsale mentioned in those cases, we have to hold that the sales in which goods moved from outside the State of Mysore into it under the procedure which prevailed in the present case were allsales. therefore, the State of Mysore had no power to tax these sales either.9. For these reasons this petition is allowed. The assessment order mentioned in the petition is quashed and we direct the issue of necessary writs restraining the respondents from levying any tax on the sales mentioned in the petition in which the goods moved from outside Mysore into Mysore. In this case also the petitioners had omitted to disclose the permits under which the sales had been made and to state expressly that the sales had been made under the permits and on the terms contained in them with the result that under the contract of sale goods had to be moved from outside Mysore into Mysore. Hence, as in the previous case, here also there will be no order for costs.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: only concerned with the sales hi which goods were moved from outside into Mysore.2. The assessment year is 1956-57. We are, therefore, concerned with sales which took place between April 1, 1956 and March 31, 1957. The tax was imposed under the Mysore Sales Tax Act. 1948 which was in force during the whole of this period.3. There are six petitioners, the first three being the State Trading Corporation Ltd., the Associated Cement Company Ltd. and the Cement Marketing Co. Ltd. The other three petitioners are shareholders or directors in one or other of these companies. The respondents are the State of Mysore and one of its Taxing Officers.4. In this case also we arc concerned with sales of cement. Here also as in the other case, the sales were made under permits issued by the Government and the procedure of the sales in both the cases was the same.5. The Associated Cement Company Ltd. was the owner of various factories from which the supplies had to be made under the permits. From April 1, 1956 to June 30, 1956 the Marketing Company is said to have acted as the selling agent of the Associated Cement Company. Under the Cement Control Order, 1956 which came into force on July l, 1956 the entire stock of cement produced in the country in any factory became vested in the State Trading Corporation. That Corporation appointed the Marketing Company its selling agent on July 1, 1956. The sales in this case are said to have been made by the Marketing Company as the agent of the Associated Cement Company during the period between April 1, 1956 to June 30, 1956 and as the Agent of the State Trading Corporation between July 1, 1956, and March 31, 1957. Nothing really turns on whether the Marketing Company had sold as agent or principal for the reason stated in the other judgment.6. The procedure of sale in this case being exactly the same as in the previous case it has to be held that the goods were moved from a place outside Mysore into the State of Mysore as a result of the contracts of sale that is to say the contracts of sale contained a covenant that the goods would be so moved. We have stated in our judgment in Writ Petns. Nos. 65 and 66 of 1960 (Reported in AIR 1963 SC 548 ), that such sales are inter-State sales within S. 3 (a) of the Central Sales Tax Act. Now that Act came into force on January 5, 1957. Therefore so far as sales between that date and the end of the assessment year, that is to say, March 31, 1957, are concerned they have to be regarded as inter-State sales which the State legislature could not tax for the reasons mentioned in the aforesaid judgment.7. The remaining part of the assessment year has to be considered in two periods. The first is between April 1, 1956 and September 10, 1956. During this period Art. 286 (2) of the Constitution before it was amended by the Constitution (Sixth Amendment) Act, 1956, was in force. That provision forbade a State legislature from taxing an inter-State sale. What an inter-State sale was within the meaning of Art. 286 (2) had been decided by judgments of this Court mentioned in the judgment delivered earlier today by Kapur, J. in Cement Marketing Co. Ltd. v. State of Mysore, Civil Appeal No. 255 of 1961 (reported in AIR 1963 SC 980 ). As stated in that judgment it is well settled that inter-State sales contemplated by Art. 286 (2) were the same as those defined in S. 3 (a) of the Central Sales Tax Act. The sales between April 1, 1956 and .September 10, 1956 in which the goods moved from outside Mysore into Mysore must, therefore, be held to be inter-State sales which the respondents had no jurisdiction or power to tax.8. It remains now to deal with the period between September 11, 1956 to January 4. 1957. During this period Art. 286 (2) did not exist in the Constitution and the Parliament had not formulated principles defining an inter-State sale which it was given power to do by Art. 269 (3) of the Constitution introduced into the Constitution by the Constitution (Sixth Amendment) Act. During this period, however, under Art. 269 (1) (g) and Item 92A of List I and Item 54 of List II of Sch. 7 to the Constitution the State legislature had no power to tax an inter-State sale. The question is how was an inter-State sale to be understood during this period. We think it has to be understood in its ordinary natural sense, that is to say, a sense which it conveys unaided by any other statutory provision. That is the sense in which this Court understood it in the cases mentioned in the judgment of Kapur, J. referred to in the preceding paragraph. Now applying the definition of inter-State sale mentioned in those cases, we have to hold that the sales in which goods moved from outside the State of Mysore into it under the procedure which prevailed in the present case were all inter-State sales. therefore, the State of Mysore had no power to tax these sales either.9. For these reasons this petition is allowed. The assessment order mentioned in the petition is quashed and we direct the issue of necessary writs restraining the respondents from levying any tax on the sales mentioned in the petition in which the goods moved from outside Mysore into Mysore. In this case also the petitioners had omitted to disclose the permits under which the sales had been made and to state expressly that the sales had been made under the permits and on the terms contained in them with the result that under the contract of sale goods had to be moved from outside Mysore into Mysore. Hence, as in the previous case, here also there will be no order for costs. ### Response: 1

Wazid Ali Abid Ali v. Commissioner of Income Tax, Lucknow. Additional Commissioner of Income Tax, Gujarat Vs. United Commercial Company

attention was, however, drawn to a decision of the Calcutta High Court in the case of Joshi and Co. v. CIT [1986] 162 ITR 268. The court held in that case that on the construction of the relevant sections and the rules framed under the Act of 1961, it appears that under the Income-tax Act, 1961, all that as assessee-firm was required to submit is an instrument of partnership as a documentary evidence of the partnership. It was not stated in the Act that evidence must be contemporaneous nor was it laid down that the instrument of partnership must be executed within the accounting year. On the other hand, it had been left open to the Income-tax Officer to accept an application after the end of the accounting year and a duty was case on the assessee to submit to the Income-tax Officer all subsequent instruments, if any, which may be in existence, right up to the date of the application showing the changes in the constitution of the firm. Under rule 23, all changes in the constitution, even after the date of the application, are required to be intimated to the Income- tax Officer. The duty cast on the Income-tax Officer under the Act of 1961 is to ascertain the genuineness of the firm and its constitution as specified in the instrument. The Income-tax Officer may entertain an application made even after the end of the accounting year if he is satisfied that the firm was prevented by sufficient cause from making the application before the end of such period. In commercial practice, the terms of a partnership constituted initially under an oral agreement are often subsequently recorded in writing in an instrument. It was held that this was not prohibited in law. The instrument showed that the partnership had come into existence from a date other than that of the execution of the instrument and also on the terms and conditions on which the partnership had been and was being carried on. The Indian Income-tax Act, 1922, required the Income-tax Officer to certify and register the deed itself and the registration of the firm would follow. That is not so under the Income-tax Act, 1961. The High Court referred to the proviso to section 187(2) and observed that it could not be interpreted to mean that in every case where one of the partners died, the firm was and must be held to be dissolved for the purpose of registration under the Income-tax Act. The language of the proviso was clear and it stated that nothing in clause (a) of section 187(2) of the Act should apply to a case where a firm was dissolved on the death of any of its partners. In the facts of this case, before the High Court, it was held by the High Court that the assessee-firm was not dissolved on the death of B, one of its partners. Under the terms of the deed, one of the heirs of the deceased partner was inducted as a partner in the firm in respect, and to the extent, of the share and interest of the deceased partner. Hence, there had been a change in the constitution of the firm. It was held that the assessee was entitled to registration for the assessment year 1976-77 on the strength of its application made in Forms Nos. 11 and 11A and on the strength of the new deed of partnership executed after the end of the accounting year. We are in agreement with the views expressed in the said decision. It may, however, be mentioned that so far as the High Court had held that the assessee-firm was not dissolved on the death of one of the partners in view of the terms of the partnership deed, but there is a change in the constitution of the firm, the High Court was right. Whether the assessee was entitled to registration in the facts of that case on the strength of its application Forms Nos. 11 and 11A would, however, require closer examination when the facts of that case are re-examinedIn the aforesaid view of the matter, we are of the opinion, as indicated earlier, that the High Court of Allahabad in Civil Appeal No. 1792 of 1974 was in error in the view it took. The appeal must be allowed and the judgment and order of the High Court must be set aside. The view of the Tribunal must be upheld. 14. So far as Civil Appeal No. 609 of 1975 is concerned, the question is whether, on the facts and circumstances of the case, there was any dissolution of the partnership on the date of the death of Shri Sarabhai Chimanlal and there should be two separate assessments or whether, on the facts and circumstances of the case, the provisions of section 187(2) apply to the facts of this case. There, the High Court found examination of the facts of that case, that the assessees contention was right that the firm as found by the Tribunal was dissolved and the transactions were carried on with the remaining parties in the course of the winding up and for realisation of its dues. The High Court accordingly answered rightly in the affirmative and in favour of the assessee. There was, in fact, a dissolution as found by the Tribunal and on the facts and circumstances of that case and after the dissolution, the firm ceased to exist and there should be two separate assessments. The High Court was right in answering the question as it did. It appears to us that the High Court was also right in answering the second question, in view of the fact that there was a death and as such dissolution of the firm by the manner in which the parties acted, that there is no question of the same firm being continued and the provisions of section 187(2) could not be said to apply in the light of the facts. 15.

0[ds]There was a contract to the contrary, in our opinion, in the Allahabad High Courts decision, where the deed provided, inter alia, that where the deed is silent, it shall be governed by the Indian Partnership Act save and except that, on the death or demise of any partner, the firm shall not be dissolved but shall be carried on with the remaining partners and that heir and representative of the deceased partner who resides in India on such terms and conditions to which they mutually agree. Therefore, on the death of the partner, there is no dissolution by the express terms of the contract between the parties but the partnership is deemed to be carried on with the remaining partners and that heir and representative of the deceased partner. The terms and conditions, however, of such carrying on had to be mutually agreed upon. In that case, as mentioned hereinbefore, Qamaruddin, one of the partners, died on June 4, 1964, within the relevant time, and his son, Fariduddin, joined the firm as a partner. Before the expiry of November 4, 1964, that is to say, the previous year which expired on November 4, 1964, the assessee had filed a declaration in Form No. 12 for the relevant assessment year 1965-66 under section 184(7) of the Act. We are of the opinion that in this case, on the death of Qamaruddin and the inclusion of Fariduddin, there was a change in the constitution of the firm. It did not dissolve the firm but brought about a change in the constitution of the firm. Fresh deed had to be executed under sub-section (8) of section 184. This follows from an analysis of the different sections of the Act. The application was not filed for the whole of the assessment year and so, for part of the assessment year, the firm was registered and for the rest, the firm was not registered. The Tribunal held that the assessee would be entitled to the benefit of registration up to June 4, 1964, that is to say, a part of the previous year. The Tribunal further held that the total income be apportioned between the partners who were entitled to receive the profits accordingly as they were entitled to share the profits, the firm being assessed as a registered firm in respect of the profits ending of June 4, 1964, and as an unregistered firm in respect of the profits for the remaining part of the previous year. In our opinion, this conclusion is correct. The High Court has held that there is no warrant for this view. We are unable to agree. As a matter of fact, an analysis of the different sections of the Act leads to that conclusion and there is no contrary provision in the Act. Such a conclusion is logical and equitable and would do justice to both the Revenue as well as to the assessee. Our attention was not drawn to any decision of this court which is against that view though there is a certain amount of divergence of views amongst the High courts on this aspect. According to the High Court, by virtue of section 42(c) of the Indian Partnership Act, a firm was dissolved by the death of the partner but as the section provided, that was subject to the contract between the parties. The High Court was right in the view that clause (7) of the partnership deed dated March 17, 1959, specifically stipulated that the firm would not be dissolved on the death of a partner but it would be carried on with the remaining partners and such heir of the deceased partner who resides in India on the terms and conditions to which they mutually agreed. The High Court was of the view, in our opinion, rightly, that if there was an heir to the deceased partner who resides in India and agrees with the surviving partners on the terms and conditions on which he could be admitted of the partnership, the firm would not be dissolved. The High Court was further to the view that the inclusion of such partner depended upon the mutual agreement between the surviving partners and was not an automatic one, on the death of the deceased partner. In the background of the facts of this case, we are of the opinion that the High Court was right that in such circumstances, the course open was to seek registration to execute a new deed of partnership and to apply for the registration of that deed. But that does not make the registration up to the date of the death of the deceased partner invalid and, in our opinion, subject to any express prohibition indicating the same, the firm is entitled to the benefit of registration. We have found no such express prohibition, as the analysis of the various sections indicates. On the other hand, it would be just and equitable that the assessee should have that limited benefit. We are of the opinion that the Tribunal took the correct view in the first caseIn the aforesaid view of the matter, it must be held that the Allahabad High Court was in error in the view it took. The Tribunal was right. The appeal must be allowed and the judgment and order of the High Court must bethe High Court found examination of the facts of that case, that the assessees contention was right that the firm as found by the Tribunal was dissolved and the transactions were carried on with the remaining parties in the course of the winding up and for realisation of its dues. The High Court accordingly answered rightly in the affirmative and in favour of the assessee. There was, in fact, a dissolution as found by the Tribunal and on the facts and circumstances of that case and after the dissolution, the firm ceased to exist and there should be two separate assessments. The High Court was right in answering the question as it did. It appears to us that the High Court was also right in answering the second question, in view of the fact that there was a death and as such dissolution of the firm by the manner in which the parties acted, that there is no question of the same firm being continued and the provisions of section 187(2) could not be said to apply in the light of the facts

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: attention was, however, drawn to a decision of the Calcutta High Court in the case of Joshi and Co. v. CIT [1986] 162 ITR 268. The court held in that case that on the construction of the relevant sections and the rules framed under the Act of 1961, it appears that under the Income-tax Act, 1961, all that as assessee-firm was required to submit is an instrument of partnership as a documentary evidence of the partnership. It was not stated in the Act that evidence must be contemporaneous nor was it laid down that the instrument of partnership must be executed within the accounting year. On the other hand, it had been left open to the Income-tax Officer to accept an application after the end of the accounting year and a duty was case on the assessee to submit to the Income-tax Officer all subsequent instruments, if any, which may be in existence, right up to the date of the application showing the changes in the constitution of the firm. Under rule 23, all changes in the constitution, even after the date of the application, are required to be intimated to the Income- tax Officer. The duty cast on the Income-tax Officer under the Act of 1961 is to ascertain the genuineness of the firm and its constitution as specified in the instrument. The Income-tax Officer may entertain an application made even after the end of the accounting year if he is satisfied that the firm was prevented by sufficient cause from making the application before the end of such period. In commercial practice, the terms of a partnership constituted initially under an oral agreement are often subsequently recorded in writing in an instrument. It was held that this was not prohibited in law. The instrument showed that the partnership had come into existence from a date other than that of the execution of the instrument and also on the terms and conditions on which the partnership had been and was being carried on. The Indian Income-tax Act, 1922, required the Income-tax Officer to certify and register the deed itself and the registration of the firm would follow. That is not so under the Income-tax Act, 1961. The High Court referred to the proviso to section 187(2) and observed that it could not be interpreted to mean that in every case where one of the partners died, the firm was and must be held to be dissolved for the purpose of registration under the Income-tax Act. The language of the proviso was clear and it stated that nothing in clause (a) of section 187(2) of the Act should apply to a case where a firm was dissolved on the death of any of its partners. In the facts of this case, before the High Court, it was held by the High Court that the assessee-firm was not dissolved on the death of B, one of its partners. Under the terms of the deed, one of the heirs of the deceased partner was inducted as a partner in the firm in respect, and to the extent, of the share and interest of the deceased partner. Hence, there had been a change in the constitution of the firm. It was held that the assessee was entitled to registration for the assessment year 1976-77 on the strength of its application made in Forms Nos. 11 and 11A and on the strength of the new deed of partnership executed after the end of the accounting year. We are in agreement with the views expressed in the said decision. It may, however, be mentioned that so far as the High Court had held that the assessee-firm was not dissolved on the death of one of the partners in view of the terms of the partnership deed, but there is a change in the constitution of the firm, the High Court was right. Whether the assessee was entitled to registration in the facts of that case on the strength of its application Forms Nos. 11 and 11A would, however, require closer examination when the facts of that case are re-examinedIn the aforesaid view of the matter, we are of the opinion, as indicated earlier, that the High Court of Allahabad in Civil Appeal No. 1792 of 1974 was in error in the view it took. The appeal must be allowed and the judgment and order of the High Court must be set aside. The view of the Tribunal must be upheld. 14. So far as Civil Appeal No. 609 of 1975 is concerned, the question is whether, on the facts and circumstances of the case, there was any dissolution of the partnership on the date of the death of Shri Sarabhai Chimanlal and there should be two separate assessments or whether, on the facts and circumstances of the case, the provisions of section 187(2) apply to the facts of this case. There, the High Court found examination of the facts of that case, that the assessees contention was right that the firm as found by the Tribunal was dissolved and the transactions were carried on with the remaining parties in the course of the winding up and for realisation of its dues. The High Court accordingly answered rightly in the affirmative and in favour of the assessee. There was, in fact, a dissolution as found by the Tribunal and on the facts and circumstances of that case and after the dissolution, the firm ceased to exist and there should be two separate assessments. The High Court was right in answering the question as it did. It appears to us that the High Court was also right in answering the second question, in view of the fact that there was a death and as such dissolution of the firm by the manner in which the parties acted, that there is no question of the same firm being continued and the provisions of section 187(2) could not be said to apply in the light of the facts. 15. ### Response: 0

Scindia Steam Navigation Co. Ltd Vs. Union of India

claim was being considered by them. We have, for instance, a letter addressed to the Stores Accounts Officer, E. P. Railway, Delhi, by the Head-quarters Office at Delhi in which the appellants claim is indicated at serial numbers 4 and 5, and the Stores Accounts Officer is asked to deal with it. The Administrative Officer, E. P. Railway, Delhi, wrote to appellant 1 to say that its claim had been registered and that further action would be taken when orders of the Railway Board had been received. The appellants then reminded the railway officers from time to time and on August 5, 1950, their attorneys were told that the claim was still under verification by the N. W. Railway and until it is verified by the F. A. and C. A. O., N. W. Railway, Lahore, it could not be finalised. The attorneys of the appellants then enquired as to how much time the process of verification would take, but since no satisfactory answer was given the appellants filed the present suit. It is, however, clear that some attempts were made by the railway authorities in India for getting the appellants claim verified but the said attempts did not succeed. Indeed, the learned Attorney-General, for the respondent, has filed an affidavit by Mr. R. L. Takyar, Legal Assistant, Northern Railway, Baroda House, New Delhi, which shows that in pursuance to the assurance given by the learned Advocate-General before the Bombay High Court attempts were made by the respondent to have the appellants claim verified but the said attempts failed, and it adds that "in the absence of the verification of the claim and the authorisation by the Pakistan Government, the Union of India was not in a position to make any payment ex gratia to the appellants". We sympathise with the grievance made by the appellants that they have been driven from pillar to post and have yet received no satisfaction to their claim either from the Pakistan Government or from the respondent; but the difficulty in the way of the appellants is that the statements in the correspondence to which we have been referred do not at all justify the appellants claim that the Communique represents an agreement between the two Dominions. First of all the appellants should have taken proper steps to prove the said Communique and should have called upon the respondent to produce all relevant documents in respect of the alleged agreement on which the appellants relied. Besides, the terms of the Communique themselves negative the theory that the Communique represents an agreement between the two Dominions. The Communique expressly refers to the discontinuance of payment by the Pakistan Government from about the middle of December owing to difference of opinion between the two Governments about the liability of these payments, and it proceeds to state the decision of the respondent that in order to avoid hardships to suppliers and contractors the respondent had decided that it should undertake initial liability for these payments and recover Pakistans share through Debt Settlement. That sometimes in the course of the correspondence the Pakistan authorities referred to the Press Communique as a joint Communique can hardly assist the appellants in showing that the Communique was the result of an agreement between the two Dominions. It is not unlikely that there may have been some agreement between the two Dominions because the conduct of the railway authorities in India can be satisfactorlly explained only on the basis of some agreement or other; but unfortunately the appellants have not produced sufficient or satisfactory material to prove their case that there was a specific agreement between the two Dominions which brought into play the provisions of Art. 3 (1) of the Order. On the material produced by the appellants the Courts below have made a concurrent finding that no such agreement had been proved. Having gone through the correspondence to which our attention was drawn we are satisfied that the appellants cannot successfully attack the validity or correctness of the said concurrent conclusion. Therefore, if the theory of an agreement between the two Dominions fails the Press Communique cannot help to sustain the appellants claim against the respondent. It is not suggested by the appellants that the unilateral statement which is contained in the Press Communique can itself without anything more help to sustain the appellants claim.17. Then Mr. Purshottam wanted to contend that the respondent was estopped from disputing its liability under the contract, and he also wanted to urge the ground of novatio. His contention was that the facts necessary for the purpose of pleading estoppel and novatio were available on the record in the interest of justice he should not be precluded from urging those points on the ground that the appellants had not taken the said points in the trial Court. We are not impressed by this argument.There can be no doubt that both the pleas are pleas which can be effectively raised only after pleading the relevant and material fact; had been averred in the plaint on which either of the two pleas can be raised and no issue was asked for in the trial Court in respect of either of the said pleas the Appeal Court was justified in refusing leave to the appellants to raise the said pleas for the first time in appeal. In our opinion. Mr. Purshottam is not right in contending that the Appeal Court was unduly technical when it refused leave to the appellants to raise the said pleas.We have already seen that on the pleadings as many as eleven issues were framed by the learned trial Judge. The plaint itself is an elaborately drawn document, and so the appellants cannot be heard to complain if for their failure to make adequate and proper pleadings they are not allowed to raise the plea of estoppel or novatio at the appellate stage. In our opinion, therefore, the Appeal Court was right in not permitting the said pleas to be raised in appeal.

0[ds]It would thus be seen that in considering the nature of the contract in the present appeal either of the two artificial tests approved by this Court must be applied.It is clear that the fact that the contract in question was made by the Conservator of Forests, Kanara, is immaterial in determining its character under Art. 8 (1), nor is it relevant to consider the fact that the contract had been made on behalf of theRailway. It is obvious that all contracts prior to the appointed day were made by the officers of the Government of India or by or on behalf of the said Government; and so both the Courts below are rightly agreed that in determining the character of the contract who initially made the contract with the appellants is of no relevance. Similarly the respondent cannot rely on the fact that the contract was made on behalf of the NorthWestern Railway and the originalRailway has now been split up into two sections, the Pakistan section being known by the name ofRailway and the Indian section being known by the name of Eastern Punjab Railway. It may be that theRailway on whose behalf the contract was made now runs in Pakistan alone, but that is hardly relevant for determining the character of the contract. In dealing with this question we must look at the substance of the contract and not its form.13. It is true that the timber which was carried to Karachi under the contract was for the purposes of theRailway as a whole and there is no evidence on the record to show that it was intended to be used for that section of the said railway which ran either through Sind or Western Punjab which subsequently formed part of Pakistan. On the other hand, the Appeal Court has found that the goods were lying in Karachi from August 15, 1947, to December 1947, and that it can be taken to be established that these goods were in the Dominion of Pakistan on the relevant date, and had been in fact used for the purposes of theRailway which was in the Dominion of Pakistan. We have already seen that the purpose of the contract is not to be confused with the ultimate user or disposal of the goods, but it appears that the learned trial Judge was somewhat influenced by the fact that the goods under the contract were originally intended for the use of theRailway as a whole and since the use of the said railway as a whole could not be said to be limited to the use of Pakistan alone the contract was not exclusively for the purposes of Pakistan. It is only in that context that we have referred to the finding of the Appeal Court that in the circumstances of this case there can be no doubt that the goods which lay in Karachi from August 15,, 1947, to December 1947, have in fact been used by theRailway which fell to the share of the Dominion ofhave seen the nature of the contract. It was a contract for the carriage of logs of teakwood timber from the Kanara forests to Karachi for the purpose of the railway. The destination of the delivery of goods was Karachi, and the object of securing the goods was to use them for the railway. In such a case it is difficult to resist the conclusion that if this contract had been made on August 15, 1947, it would not (sic) have been exclusively for the purposes of Dominion of Pakistan. It is inconceivable that on the appointed day a contract could have been made for the shipment of goods to Karachi unless the contract was for the purposes of the Dominion of Pakistan. If the contract had been even partially for the purposes of India shipment of all the goods to Karachi would not have been the term of the contract. The same result follows if we apply the alternative test. If Pakistan had existed on the date of the contract, in our opinion, the contract as made would obviously and clearly be for the purposes of Pakistan. That is the view taken by the Appeal Court, and we see no reason to differ from it.15. In this connection the Appeal Court has taken into account the fact that the goods had become the property of Pakistan by virtue of Art. 6 of the Order so that on the appointed day the goods the shipment of which was the subjectmatter of the contract were the property of Pakistan. If that be so, we do not see how we can escape the conclusion that the application of either or the two artificial tests prescribed by Art. 8 (1) will inevitably lead to the conclusion that the contract had been made exclusively for the purposes of Pakistan. We have already seen that the tests enunciated by the Bombay High Court in the case of Chinubhai Jeshingbhai, 54 Bom LR 561: (AIR 1953 Bom 13 ), have been expressly approved by this Court in the case of Chaman Lal Loona, 1957 SCR 1039 : ( (S) AIR 1957 SC 652 ). It is true that in terms the significance of the vesting of the title in the goods by the operation of Art. 6 of the Order to which the Bombay High Court attached considerable importance in the case of Chinubhai Jeshingbhai, 54 Bom LR 561: (AIR 1953 Bom 13 ), has not been noticed by this Court, and so in that sense it may be permissible to urge that that part of the judgment had not been expressly approved. However, such a contention, in our opinion is purely technical. We are inclined to hold that the alternative tests which have been expressly approved by this Court are wholly consistent with the consideration of ownership to which the Bombay High Court attached importance and is both relevant and material in the application of the said tests.If the goods which are theof the contract have become the goods of Pakistan that would be a relevant and material fact in considering whether the contract in question if made on the appointed day would have been made by Pakistan, or whether Pakistan would have made the said contract if it had been in existence on the actual date of the contract. Therefore, in our opinion, the Appeal Court was right in coming to the conclusion that the suit contract fell within the scope of Art. 8 (1) (a) and the assumption made by the appellants that Art. (1) (b) could be invoked against the respondent is not wellmay briefly indicate the broad features of the said correspondence. It appears that on July 10,1948, theRailway Department, Government of Pakistan, Karachi, wrote to the General Manager, N. W. Railway, Lahore, in regard to the question about the disposal of preparation claims outstanding against the undivided Government of India. In this letter he set out the contents of the Press Communique on which the appellants rely. The Collector of Stores, Karachi, drew attention of the appellants to the said Communique by his letter dated July 19, 1948. In their correspondence with the railway authorities the appellants have sometimes described this Communique as joint press notification. Similarly, in their letters written to appellant 1 the railway authorities in Pakistan also have described the said Communique as joint notification "said to have been issued by the Dominions of India and Pakistan". Then we have some letters from the railway authorities in India which would show that the appellants claim was being considered by them. We have, for instance, a letter addressed to the Stores Accounts Officer, E. P. Railway, Delhi, by theOffice at Delhi in which the appellants claim is indicated at serial numbers 4 and 5, and the Stores Accounts Officer is asked to deal with it. The Administrative Officer, E. P. Railway, Delhi, wrote to appellant 1 to say that its claim had been registered and that further action would be taken when orders of the Railway Board had been received. The appellants then reminded the railway officers from time to time and on August 5, 1950, their attorneys were told that the claim was still under verification by the N. W. Railway and until it is verified by the F. A. and C. A. O., N. W. Railway, Lahore, it could not be finalised. The attorneys of the appellants then enquired as to how much time the process of verification would take, but since no satisfactory answer was given the appellants filed the present suit. It is, however, clear that some attempts were made by the railway authorities in India for getting the appellants claim verified but the said attempts did not succeed. Indeed, the learnedfor the respondent, has filed an affidavit by Mr. R. L. Takyar, Legal Assistant, Northern Railway, Baroda House, New Delhi, which shows that in pursuance to the assurance given by the learnedbefore the Bombay High Court attempts were made by the respondent to have the appellants claim verified but the said attempts failed, and it adds that "in the absence of the verification of the claim and the authorisation by the Pakistan Government, the Union of India was not in a position to make any payment ex gratia to the appellants". We sympathise with the grievance made by the appellants that they have been driven from pillar to post and have yet received no satisfaction to their claim either from the Pakistan Government or from the respondent; but the difficulty in the way of the appellants is that the statements in the correspondence to which we have been referred do not at all justify the appellants claim that the Communique represents an agreement between the two Dominions. First of all the appellants should have taken proper steps to prove the said Communique and should have called upon the respondent to produce all relevant documents in respect of the alleged agreement on which the appellants relied. Besides, the terms of the Communique themselves negative the theory that the Communique represents an agreement between the two Dominions. The Communique expressly refers to the discontinuance of payment by the Pakistan Government from about the middle of December owing to difference of opinion between the two Governments about the liability of these payments, and it proceeds to state the decision of the respondent that in order to avoid hardships to suppliers and contractors the respondent had decided that it should undertake initial liability for these payments and recover Pakistans share through Debt Settlement. That sometimes in the course of the correspondence the Pakistan authorities referred to the Press Communique as a joint Communique can hardly assist the appellants in showing that the Communique was the result of an agreement between the two Dominions. It is not unlikely that there may have been some agreement between the two Dominions because the conduct of the railway authorities in India can be satisfactorlly explained only on the basis of some agreement or other; but unfortunately the appellants have not produced sufficient or satisfactory material to prove their case that there was a specific agreement between the two Dominions which brought into play the provisions of Art. 3 (1) of the Order. On the material produced by the appellants the Courts below have made a concurrent finding that no such agreement had been proved. Having gone through the correspondence to which our attention was drawn we are satisfied that the appellants cannot successfully attack the validity or correctness of the said concurrent conclusion. Therefore, if the theory of an agreement between the two Dominions fails the Press Communique cannot help to sustain the appellants claim against the respondent. It is not suggested by the appellants that the unilateral statement which is contained in the Press Communique can itself without anything more help to sustain the appellantsare not impressed by this argument.There can be no doubt that both the pleas are pleas which can be effectively raised only after pleading the relevant and material fact; had been averred in the plaint on which either of the two pleas can be raised and no issue was asked for in the trial Court in respect of either of the said pleas the Appeal Court was justified in refusing leave to the appellants to raise the said pleas for the first time in appeal. In our opinion. Mr. Purshottam is not right in contending that the Appeal Court was unduly technical when it refused leave to the appellants to raise the said pleas.We have already seen that on the pleadings as many as eleven issues were framed by the learned trial Judge. The plaint itself is an elaborately drawn document, and so the appellants cannot be heard to complain if for their failure to make adequate and proper pleadings they are not allowed to raise the plea of estoppel or novatio at the appellate stage. In our opinion, therefore, the Appeal Court was right in not permitting the said pleas to be raised in appeal.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: claim was being considered by them. We have, for instance, a letter addressed to the Stores Accounts Officer, E. P. Railway, Delhi, by the Head-quarters Office at Delhi in which the appellants claim is indicated at serial numbers 4 and 5, and the Stores Accounts Officer is asked to deal with it. The Administrative Officer, E. P. Railway, Delhi, wrote to appellant 1 to say that its claim had been registered and that further action would be taken when orders of the Railway Board had been received. The appellants then reminded the railway officers from time to time and on August 5, 1950, their attorneys were told that the claim was still under verification by the N. W. Railway and until it is verified by the F. A. and C. A. O., N. W. Railway, Lahore, it could not be finalised. The attorneys of the appellants then enquired as to how much time the process of verification would take, but since no satisfactory answer was given the appellants filed the present suit. It is, however, clear that some attempts were made by the railway authorities in India for getting the appellants claim verified but the said attempts did not succeed. Indeed, the learned Attorney-General, for the respondent, has filed an affidavit by Mr. R. L. Takyar, Legal Assistant, Northern Railway, Baroda House, New Delhi, which shows that in pursuance to the assurance given by the learned Advocate-General before the Bombay High Court attempts were made by the respondent to have the appellants claim verified but the said attempts failed, and it adds that "in the absence of the verification of the claim and the authorisation by the Pakistan Government, the Union of India was not in a position to make any payment ex gratia to the appellants". We sympathise with the grievance made by the appellants that they have been driven from pillar to post and have yet received no satisfaction to their claim either from the Pakistan Government or from the respondent; but the difficulty in the way of the appellants is that the statements in the correspondence to which we have been referred do not at all justify the appellants claim that the Communique represents an agreement between the two Dominions. First of all the appellants should have taken proper steps to prove the said Communique and should have called upon the respondent to produce all relevant documents in respect of the alleged agreement on which the appellants relied. Besides, the terms of the Communique themselves negative the theory that the Communique represents an agreement between the two Dominions. The Communique expressly refers to the discontinuance of payment by the Pakistan Government from about the middle of December owing to difference of opinion between the two Governments about the liability of these payments, and it proceeds to state the decision of the respondent that in order to avoid hardships to suppliers and contractors the respondent had decided that it should undertake initial liability for these payments and recover Pakistans share through Debt Settlement. That sometimes in the course of the correspondence the Pakistan authorities referred to the Press Communique as a joint Communique can hardly assist the appellants in showing that the Communique was the result of an agreement between the two Dominions. It is not unlikely that there may have been some agreement between the two Dominions because the conduct of the railway authorities in India can be satisfactorlly explained only on the basis of some agreement or other; but unfortunately the appellants have not produced sufficient or satisfactory material to prove their case that there was a specific agreement between the two Dominions which brought into play the provisions of Art. 3 (1) of the Order. On the material produced by the appellants the Courts below have made a concurrent finding that no such agreement had been proved. Having gone through the correspondence to which our attention was drawn we are satisfied that the appellants cannot successfully attack the validity or correctness of the said concurrent conclusion. Therefore, if the theory of an agreement between the two Dominions fails the Press Communique cannot help to sustain the appellants claim against the respondent. It is not suggested by the appellants that the unilateral statement which is contained in the Press Communique can itself without anything more help to sustain the appellants claim.17. Then Mr. Purshottam wanted to contend that the respondent was estopped from disputing its liability under the contract, and he also wanted to urge the ground of novatio. His contention was that the facts necessary for the purpose of pleading estoppel and novatio were available on the record in the interest of justice he should not be precluded from urging those points on the ground that the appellants had not taken the said points in the trial Court. We are not impressed by this argument.There can be no doubt that both the pleas are pleas which can be effectively raised only after pleading the relevant and material fact; had been averred in the plaint on which either of the two pleas can be raised and no issue was asked for in the trial Court in respect of either of the said pleas the Appeal Court was justified in refusing leave to the appellants to raise the said pleas for the first time in appeal. In our opinion. Mr. Purshottam is not right in contending that the Appeal Court was unduly technical when it refused leave to the appellants to raise the said pleas.We have already seen that on the pleadings as many as eleven issues were framed by the learned trial Judge. The plaint itself is an elaborately drawn document, and so the appellants cannot be heard to complain if for their failure to make adequate and proper pleadings they are not allowed to raise the plea of estoppel or novatio at the appellate stage. In our opinion, therefore, the Appeal Court was right in not permitting the said pleas to be raised in appeal. ### Response: 0

Mahadeo Vs. State of Bombay

of it. They rely on the definition of proprietor in the Act, and refer under the authority of S. 2(b) of the Act to the Central Provinces Land Revenue Act, 1917.22. The definition in the Act is not exhaustive. It only tells us who, besides the proprietor, is included in the term proprietor. Further, the definitions in the Act are subordinate to the requirements of the context and the subject-matter of any particular enactment. From the Act, we know that the proprietors interest in forest, trees, shrub, grass and the like passes to the State. The question thus resolves into two short ones-did the former proprietors own proprietary interest in these trees, and did they part with that proprietary interest and convey it to the petitioners? 23. There is but little doubt that in so far as the Act is concerned, it does contemplate cesser of all proprietary rights in land, grass land, scrub jungle, forest and trees, whether owned by the proprietor or through him by some other person. The contention of the petitioners is that by the term "proprietor" is meant what that term conveys in the Central Provinces Land Revenue Act, and reference is made for this purpose to various sections therein. The term "proprietor" is defined in the Central Provinces Land Revenue Act thus:"Proprietor except in sections 68, 93 and 94, includes a gaontia of a Government village in Sambalpur Territory." This definition does not advance the matter any further. In several sections, special explanations are added to define "proprietors". In all those explanations, the term is not defined, but is said to include thekedars or headmen with protected status, mortgagee with possession, lessees holding under leases from year to year and the like. In addition, there is invariably the inclusion of a transferee of proprietary rights in possession, which again leaves the matter at large. See Ss. 2(5), 2(21), 53 and 68. 24. Counsel faced with this difficulty rely upon the scheme of settlement in Ch. VI of the Central Provinces Land Revenue Act, and the record of rights which consists of Khewat, a statement of persons possessing proprietary rights in the mahal including inferior proprietors or lessees or mortgagees in possession, specifying the nature and extent of the interest of each; and Khasra or field book and Jamabandi or list of persons cultivating or occupying land in the village. These documents are prepared separately. The petitioners contend that by proprietary right is meant that right which can find a place or be entered in the Khewat, and the rights enjoyed by the petitioners are not and cannot be entered in the Khewat because they are not proprietary rights. They also refer to the schemes of settlement under which proprietors, sub-proprietors etc., are determined and offered assessment. 25. In our opinion, these arguments, though attractive, do not represent the whole of the matter. What these documents record and what the settlement operations determine are the kinds of proprietors among whom the entire bundle of rights is shared. Every proprietor or sub-proprietor enjoys proprietary rights over land, forests etc., falling within his interest. The right to forest trees etc., is the consequence of proprietorship, and indeed, under S. 47(3) the State Government can declare which rights and interest must be regarded as proprietary rights. That sub-section provides:"The State Government may declare the rights and interests which shall be deemed to be proprietary rights and interests within the meaning of sub-section (2)." The second sub-section provides: "The Deputy Commissioner shall cause to be recorded, in accordance with rules made under S. 227, all changes that have taken place in respect of, and all transactions that have affected, any of the proprietary rights and interests in any land." 26. The matter is made clear if one refers to the provisions of S. 202 of the Land Revenue Act. That section confers on Government the power to regulate the control and management of the forest-growth on the lands of any estate or mahal. A reading of sub-ss. (4) to (8) of that section clearly shows that forests belong to the proprietors from whom under those sub-sections they can be taken over for management, the profits of the management less expenses being paid to the proprietors or to superior and inferior proprietors as the case may be. Sub-sections (9) and (10) provide: "(9) No lease, lien, encumbrance or contract with respect to the forest land held under direct management shall be binding upon the Government. (10) On the expiration of the period fixed for the direct management, the forest land shall be restored to the proprietor thereof." Even here, the term proprietor is explained by the usual explanation showing the same category of persons as included in the section. 27. From this, it is quite clear that forests and trees belonged to the proprietors, and they were items of proprietary rights. The first of the two questions posed by us, therefore, admits of none but an affirmative answer. 28. If then the forest and the trees belonged to the proprietors as items in their proprietary rights it is quite clear that these items of proprietary rights have been transferred to the petitioners. The answer to the second question is also in the affirmative. Being a proprietary right it vests in the State under Ss. 3 an 4 of the Act. The decision in Chhotabhais case, 1958 SCR 476: (AIR 1953 SC 108 ) treated these rights as bare licenses, and it was apparently given per incuriam, and cannot therefore be followed. 29. Even assuming that the documents in question do not amount to grant of any proprietary right by the proprietors to the petitioners, the latter can have only the benefit of their respective contracts or licenses. In either case, the State has not, by the Act, acquired or taken possession of such contracts or licenses and consequently, there has been no infringement of the petitioners fundamental right which alone can support a petition under Art. 32 of the Constitution.

0[ds]10. It is clear from the foregoing analysis of the decision in Chhotabhais case, 1953 SCR 476 : (AIR 1953 SC 108 ), that on a construction of the documents there under consideration and adopting a principle enuncited by the Privy Council in ILR (1949) Nag 892: (AIR 1949 PC 311 ) and relying upon a passage each in Benjamin on Sale and the well-known treatise of Baden-Powell, the Bench came to the conclusion that the documents there under consideration did not create any interest in land and did not constitute any grant of any proprietary interest in the estate but were merely contracts or licences given to the petitioners "to cut, gather and carry away the produce in the shape of tendu leaves, or lac, or timber or wood." But then, it necessarily followed that the Act did not purport to affect the petitioners rights under the contracts or licenses. But what was the nature of those rights of the petitioners? It is plain, that if they were merely contractual rights, then as pointed out in the two later decisions, in Ananda Behera v. The State of Orissa, 1955 2 SCR 919 : ((S) AIR 1956 SC 17 ), Shantabais case, AIR 1958 SC 532 , the State has not acquired or taken possession of those rights but has only declined to be bound by the agreements to which they were not a party. If, on the other hand, the petitioners were mere licensees, then also, as pointed out in the second of the two cases cited, the licenses came to an end on the extinction of the title of the licensers. In either ease there was no question of the breach of any fundamental right of the petitioner which could support the petitions which were presented under Art. 32 of the Constitution. It is this aspect of the matter which was not brought to the notice of the Court, and the resulting omission to advert to it has seriously impaired, if not completely nullified, the effect and weight of the decision in Chhotabhais case, 1953 SCR 476 : (AIR 1953 SC 108 ), is a precedent18.It has already been pointed out that the agreements conveyed more than the tendu leaves to the petitioners. They conveyed other forest produce like timber, bamboos etc., the soil for making bricks, the right to prune, coppice and burn tendu trees and the right to build on and occupy land for the purpose of their business. These rights were spread over many years, and were not so simple as buying leaves so to speak, in a shop. The expression "growing crop" might appropriately comprehead tendu leaves, but would not include Adjat timber, bamboos, nor even tendu plants. The petitioners were not to get leaves from the extant trees but also such trees as might grow in the future. They could even burn the old trees, presumably, so that others might grow in their place. In these circumstances, the agreements cannot be said to be contracts of sale of goods simpliciter22. The definition in the Act is not exhaustive. It only tells us who, besides the proprietor, is included in the term proprietor. Further, the definitions in the Act are subordinate to the requirements of the context and the subject-matter of any particular enactment. From the Act, we know that the proprietors interest in forest, trees, shrub, grass and the like passes to the StateIn our opinion, these arguments, though attractive, do not represent the whole of the matter. What these documents record and what the settlement operations determine are the kinds of proprietors among whom the entire bundle of rights is shared. Every proprietor or sub-proprietor enjoys proprietary rights over land, forests etc., falling within his interest. The right to forest trees etc., is the consequence of proprietorship, and indeed, under S. 47(3) the State Government can declare which rights and interest must be regarded as proprietary rights9. Even assuming that the documents in question do not amount to grant of any proprietary right by the proprietors to the petitioners, the latter can have only the benefit of their respective contracts or licenses. In either case, the State has not, by the Act, acquired or taken possession of such contracts or licenses and consequently, there has been no infringement of the petitioners fundamental right which alone can support a petition under Art. 32 of the Constitution.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: of it. They rely on the definition of proprietor in the Act, and refer under the authority of S. 2(b) of the Act to the Central Provinces Land Revenue Act, 1917.22. The definition in the Act is not exhaustive. It only tells us who, besides the proprietor, is included in the term proprietor. Further, the definitions in the Act are subordinate to the requirements of the context and the subject-matter of any particular enactment. From the Act, we know that the proprietors interest in forest, trees, shrub, grass and the like passes to the State. The question thus resolves into two short ones-did the former proprietors own proprietary interest in these trees, and did they part with that proprietary interest and convey it to the petitioners? 23. There is but little doubt that in so far as the Act is concerned, it does contemplate cesser of all proprietary rights in land, grass land, scrub jungle, forest and trees, whether owned by the proprietor or through him by some other person. The contention of the petitioners is that by the term "proprietor" is meant what that term conveys in the Central Provinces Land Revenue Act, and reference is made for this purpose to various sections therein. The term "proprietor" is defined in the Central Provinces Land Revenue Act thus:"Proprietor except in sections 68, 93 and 94, includes a gaontia of a Government village in Sambalpur Territory." This definition does not advance the matter any further. In several sections, special explanations are added to define "proprietors". In all those explanations, the term is not defined, but is said to include thekedars or headmen with protected status, mortgagee with possession, lessees holding under leases from year to year and the like. In addition, there is invariably the inclusion of a transferee of proprietary rights in possession, which again leaves the matter at large. See Ss. 2(5), 2(21), 53 and 68. 24. Counsel faced with this difficulty rely upon the scheme of settlement in Ch. VI of the Central Provinces Land Revenue Act, and the record of rights which consists of Khewat, a statement of persons possessing proprietary rights in the mahal including inferior proprietors or lessees or mortgagees in possession, specifying the nature and extent of the interest of each; and Khasra or field book and Jamabandi or list of persons cultivating or occupying land in the village. These documents are prepared separately. The petitioners contend that by proprietary right is meant that right which can find a place or be entered in the Khewat, and the rights enjoyed by the petitioners are not and cannot be entered in the Khewat because they are not proprietary rights. They also refer to the schemes of settlement under which proprietors, sub-proprietors etc., are determined and offered assessment. 25. In our opinion, these arguments, though attractive, do not represent the whole of the matter. What these documents record and what the settlement operations determine are the kinds of proprietors among whom the entire bundle of rights is shared. Every proprietor or sub-proprietor enjoys proprietary rights over land, forests etc., falling within his interest. The right to forest trees etc., is the consequence of proprietorship, and indeed, under S. 47(3) the State Government can declare which rights and interest must be regarded as proprietary rights. That sub-section provides:"The State Government may declare the rights and interests which shall be deemed to be proprietary rights and interests within the meaning of sub-section (2)." The second sub-section provides: "The Deputy Commissioner shall cause to be recorded, in accordance with rules made under S. 227, all changes that have taken place in respect of, and all transactions that have affected, any of the proprietary rights and interests in any land." 26. The matter is made clear if one refers to the provisions of S. 202 of the Land Revenue Act. That section confers on Government the power to regulate the control and management of the forest-growth on the lands of any estate or mahal. A reading of sub-ss. (4) to (8) of that section clearly shows that forests belong to the proprietors from whom under those sub-sections they can be taken over for management, the profits of the management less expenses being paid to the proprietors or to superior and inferior proprietors as the case may be. Sub-sections (9) and (10) provide: "(9) No lease, lien, encumbrance or contract with respect to the forest land held under direct management shall be binding upon the Government. (10) On the expiration of the period fixed for the direct management, the forest land shall be restored to the proprietor thereof." Even here, the term proprietor is explained by the usual explanation showing the same category of persons as included in the section. 27. From this, it is quite clear that forests and trees belonged to the proprietors, and they were items of proprietary rights. The first of the two questions posed by us, therefore, admits of none but an affirmative answer. 28. If then the forest and the trees belonged to the proprietors as items in their proprietary rights it is quite clear that these items of proprietary rights have been transferred to the petitioners. The answer to the second question is also in the affirmative. Being a proprietary right it vests in the State under Ss. 3 an 4 of the Act. The decision in Chhotabhais case, 1958 SCR 476: (AIR 1953 SC 108 ) treated these rights as bare licenses, and it was apparently given per incuriam, and cannot therefore be followed. 29. Even assuming that the documents in question do not amount to grant of any proprietary right by the proprietors to the petitioners, the latter can have only the benefit of their respective contracts or licenses. In either case, the State has not, by the Act, acquired or taken possession of such contracts or licenses and consequently, there has been no infringement of the petitioners fundamental right which alone can support a petition under Art. 32 of the Constitution. ### Response: 0

T.V.V. Narasimham & Others Vs. State of Orissa

of Jeypore zamindari as originally settled in 1803. It appears that the Inam Commission appointed by the Government in 1862 called for and obtained from the zamindar a statement of pre-settlement and post-settlement inams within the geographical limits of the zamindari; but it did not make any inquiry in regard thereto. But in the year 1907 the Government of Madras directed an inquiry of the inams in the Jeypore zamindari by a Special Deputy Collector by name Meenakshisundaram Pillai. In the inquiry held by him the zamindar did not put forward his claim. His report was not full or complete as it should be and it was simply recorded by the Government in its order dated February 25, 1910. The Government again by its order dated November 16, 1910 directed another officer named Burkitt to make a further or detailed inquiry into the inams of Jeypur zamindari and he submitted his report to the Government which was recorded by it in its order dated May 19, 1914. On the basis of the said report the Government gave notice to the Maharaja of Jeypore to show cause why the said villages found to be pre-settlement inams by Burkitt should not be enfranchised. The Maharaja submitted his objections claiming that all the said villages formed part of his zamindari and the Government had no right of reversion therein. On November 1, 1919 the Government issued the following order No. 2489."The Board of Revenue is informed that the Government have on reconsideration decided to take no further action in connection with the question of the settlement of pre-settlement inams in the Jeypore Zamindary."In this context the relevant records, namely the reports of Meenalcshisundaram Pillai and Burkitt and the objections filed by the Maharaja were not filed in the High Court. If they had been produced as they should have been, the High Court and this Court would have been in a better position to appreciate the situation. But the aforesaid facts were given in the counter-affidavit filed on behalf of the State in O.J.C. No. 68 of 1954 and the correctness of those facts is not disputed before us. From the foregoing narration, the factual and legal position was this:The inamdars were holding the said inams under grant made by the Jeypore Maharaja prior to 1803. The Government claimed reversionary rights therein on the basis that these were pre-settlement inams not included in the assets of the zamindari at the time of the. permanent settlement. The Maharaja claimed that the said villages were part of his zamindari i.e. they were included in the assets of the zamindari at the time of the permanent settlement. The Government presumably accepted that claim by deciding not to take further action in connection with the settlement of the pre-settlement inams of the Jeypore zamindari. It is not possible to accept the contention that there was only inaction on the part of the Government in the aforesaid circumstances. As there were conflicting claims between the Maharaja and the Government, and by withdrawing further action the Government accepted the claim of the Maharaja namely, that the Inamdars were holding the inams as under-tenure holders under the zamindar. This was a clear recognition of the Inamdars title to hold under the zamindar. We agree with the High Court that the Government "recognized " the said grants within the meaning of S. 3 (2) of the Madras Act.16. As regards the second and the third groups of villages there is nothing on the record which discloses any recognition by the Government of the grants of the said inam villages. It does not appear that the Government had directed any inquiry into the titles of the said inams or did any act de hors the inquiry to recognize the said title. We find it very difficult to agree with the High Court that mere inaction on the part of the Government amounts to recognition of the grants in favour of the Inamdars. But the learned Additional Solicitor-General contends that the Inam Rules framed by the Government providing for an inquiry, and particularly the rule directing the confirmation of title on the basis of possession would amount to recognition within the meaning of S. 3(2)(d) of the Madras Act. We cannot accept this contention. Inam Rules were framed by the Government in 1859 for investigating into the titles of various inamdars and for enfranchising inams. These rules proprio vigore did not confer title on, or recognize title of any inamdar. They lay down only a procedure for ascertaining the titles in those areas where an inquiry was held for the purposes of investigation of titles and confirmation thereof. In this case no such inquiry appears to have been held in respect of korpad Paragana. These rules do not therefore help the State. In our view the High Court went wrong in holding that the British Government recongnized the said inams.17. Lastly the learned Additional Solicitor General contended that a grant of pre-settlement inam villages which did not fall within the definition of an estate in S. 3 (2) (d) of the Madras Act would be an estate within the definition of that expression in S. 2 (g) of the Orissa Act and therefore the Government validity issued the notifications under S. 3(1) of the Orissa Act abolishing the aforesaid villages not recognised by the Government. This contention has been raised or the first time before us. The contention raised is not a pure question of law, but depends upon the proof of the conditions laid down in the said cl. (g) of S. 2 of the Orissa Act. We do not think we are justified in allowing the respondent to raise a plea of mixed question of fact and law for the first time before us. There must have been very good reasons for the State not raising the extreme contention in the High Court. We should not be understood to have expressed our opinion one way or the other on this question.

0[ds]14. The foregoing discussion leads us to the following conclusion: recognition signifies an admission or an acknowledgment of something existing before. To recognise is to take cognizance of a fact. It implies an overt act on the part of the person taking such cognizance. "Recognition" is, therefore, an acknowledgment by the Government of the title of a grantee expressly or by some unequivocal act on its part. Acquiescence in the context of certain surrounding circumstances may amount to recognition, but it must be such as to lead to that inevitable conclusion. Mere inaction de hors such compelling circumstances cannot amount to recognition within the meaning of the section.15. Now coming to the merits of the case we shall first deal with the group of villages admittedly lying within the geographical limits of Jeypore zamindari as originally settled in 1803. It appears that the Inam Commission appointed by the Government in 1862 called for and obtained from the zamindar a statement of pre-settlement and post-settlement inams within the geographical limits of the zamindari; but it did not make any inquiry in regard thereto. But in the year 1907 the Government of Madras directed an inquiry of the inams in the Jeypore zamindari by a Special Deputy Collector by name Meenakshisundaram Pillai. In the inquiry held by him the zamindar did not put forward his claim. His report was not full or complete as it should be and it was simply recorded by the Government in its order dated February 25, 1910. The Government again by its order dated November 16, 1910 directed another officer named Burkitt to make a further or detailed inquiry into the inams of Jeypur zamindari and he submitted his report to the Government which was recorded by it in its order dated May 19, 1914. On the basis of the said report the Government gave notice to the Maharaja of Jeypore to show cause why the said villages found to be pre-settlement inams by Burkitt should not be enfranchised. The Maharaja submitted his objections claiming that all the said villages formed part of his zamindari and the Government had no right of reversion therein. On November 1, 1919 the Government issued the following order No.Board of Revenue is informed that the Government have on reconsideration decided to take no further action in connection with the question of the settlement of pre-settlement inams in the Jeyporethis context the relevant records, namely the reports of Meenalcshisundaram Pillai and Burkitt and the objections filed by the Maharaja were not filed in the High Court. If they had been produced as they should have been, the High Court and this Court would have been in a better position to appreciate the situation. But the aforesaid facts were given in the counter-affidavit filed on behalf of the State in O.J.C. No. 68 of 1954 and the correctness of those facts is not disputed before us. From the foregoing narration, the factual and legal position was this:The inamdars were holding the said inams under grant made by the Jeypore Maharaja prior to 1803. The Government claimed reversionary rights therein on the basis that these were pre-settlement inams not included in the assets of the zamindari at the time of the. permanent settlement. The Maharaja claimed that the said villages were part of his zamindari i.e. they were included in the assets of the zamindari at the time of the permanent settlement. The Government presumably accepted that claim by deciding not to take further action in connection with the settlement of the pre-settlement inams of the Jeypore zamindari. It is not possible to accept the contention that there was only inaction on the part of the Government in the aforesaid circumstances. As there were conflicting claims between the Maharaja and the Government, and by withdrawing further action the Government accepted the claim of the Maharaja namely, that the Inamdars were holding the inams as under-tenure holders under the zamindar. This was a clear recognition of the Inamdars title to hold under the zamindar. We agree with the High Court that the Government "recognized " the said grants within the meaning of S. 3 (2) of the Madras Act.16. As regards the second and the third groups of villages there is nothing on the record which discloses any recognition by the Government of the grants of the said inam villages. It does not appear that the Government had directed any inquiry into the titles of the said inams or did any act de hors the inquiry to recognize the said title. We find it very difficult to agree with the High Court that mere inaction on the part of the Government amounts to recognition of the grants in favour of the Inamdars. Butthe learned Additional Solicitor-General contends that the Inam Rules framed by the Government providing for an inquiry, and particularly the rule directing the confirmation of title on the basis of possession would amount to recognition within the meaning of S. 3(2)(d) of the Madras Act.We cannot accept this contention. Inam Rules were framed by the Government in 1859 for investigating into the titles of various inamdars and for enfranchising inams. These rules proprio vigore did not confer title on, or recognize title of any inamdar. They lay down only a procedure for ascertaining the titles in those areas where an inquiry was held for the purposes of investigation of titles and confirmation thereof. In this case no such inquiry appears to have been held in respect of korpad Paragana. These rules do not therefore help the State. In our view the High Court went wrong in holding that the British Government recongnized the said inams.17.Lastly the learned Additional Solicitor General contended that a grant of pre-settlement inam villages which did not fall within the definition of an estate in S. 3 (2) (d) of the Madras Act would be an estate within the definition of that expression in S. 2 (g) of the Orissa Act and therefore the Government validity issued the notifications under S. 3(1) of the Orissa Act abolishing the aforesaid villages not recognised by the Government.This contention has been raised or the first time before us. The contention raised is not a pure question of law, but depends upon the proof of the conditions laid down in the said cl. (g) of S. 2 of the Orissa Act. We do not think we are justified in allowing the respondent to raise a plea of mixed question of fact and law for the first time before us. There must have been very good reasons for the State not raising the extreme contention in the High Court. We should not be understood to have expressed our opinion one way or the other on this question.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: of Jeypore zamindari as originally settled in 1803. It appears that the Inam Commission appointed by the Government in 1862 called for and obtained from the zamindar a statement of pre-settlement and post-settlement inams within the geographical limits of the zamindari; but it did not make any inquiry in regard thereto. But in the year 1907 the Government of Madras directed an inquiry of the inams in the Jeypore zamindari by a Special Deputy Collector by name Meenakshisundaram Pillai. In the inquiry held by him the zamindar did not put forward his claim. His report was not full or complete as it should be and it was simply recorded by the Government in its order dated February 25, 1910. The Government again by its order dated November 16, 1910 directed another officer named Burkitt to make a further or detailed inquiry into the inams of Jeypur zamindari and he submitted his report to the Government which was recorded by it in its order dated May 19, 1914. On the basis of the said report the Government gave notice to the Maharaja of Jeypore to show cause why the said villages found to be pre-settlement inams by Burkitt should not be enfranchised. The Maharaja submitted his objections claiming that all the said villages formed part of his zamindari and the Government had no right of reversion therein. On November 1, 1919 the Government issued the following order No. 2489."The Board of Revenue is informed that the Government have on reconsideration decided to take no further action in connection with the question of the settlement of pre-settlement inams in the Jeypore Zamindary."In this context the relevant records, namely the reports of Meenalcshisundaram Pillai and Burkitt and the objections filed by the Maharaja were not filed in the High Court. If they had been produced as they should have been, the High Court and this Court would have been in a better position to appreciate the situation. But the aforesaid facts were given in the counter-affidavit filed on behalf of the State in O.J.C. No. 68 of 1954 and the correctness of those facts is not disputed before us. From the foregoing narration, the factual and legal position was this:The inamdars were holding the said inams under grant made by the Jeypore Maharaja prior to 1803. The Government claimed reversionary rights therein on the basis that these were pre-settlement inams not included in the assets of the zamindari at the time of the. permanent settlement. The Maharaja claimed that the said villages were part of his zamindari i.e. they were included in the assets of the zamindari at the time of the permanent settlement. The Government presumably accepted that claim by deciding not to take further action in connection with the settlement of the pre-settlement inams of the Jeypore zamindari. It is not possible to accept the contention that there was only inaction on the part of the Government in the aforesaid circumstances. As there were conflicting claims between the Maharaja and the Government, and by withdrawing further action the Government accepted the claim of the Maharaja namely, that the Inamdars were holding the inams as under-tenure holders under the zamindar. This was a clear recognition of the Inamdars title to hold under the zamindar. We agree with the High Court that the Government "recognized " the said grants within the meaning of S. 3 (2) of the Madras Act.16. As regards the second and the third groups of villages there is nothing on the record which discloses any recognition by the Government of the grants of the said inam villages. It does not appear that the Government had directed any inquiry into the titles of the said inams or did any act de hors the inquiry to recognize the said title. We find it very difficult to agree with the High Court that mere inaction on the part of the Government amounts to recognition of the grants in favour of the Inamdars. But the learned Additional Solicitor-General contends that the Inam Rules framed by the Government providing for an inquiry, and particularly the rule directing the confirmation of title on the basis of possession would amount to recognition within the meaning of S. 3(2)(d) of the Madras Act. We cannot accept this contention. Inam Rules were framed by the Government in 1859 for investigating into the titles of various inamdars and for enfranchising inams. These rules proprio vigore did not confer title on, or recognize title of any inamdar. They lay down only a procedure for ascertaining the titles in those areas where an inquiry was held for the purposes of investigation of titles and confirmation thereof. In this case no such inquiry appears to have been held in respect of korpad Paragana. These rules do not therefore help the State. In our view the High Court went wrong in holding that the British Government recongnized the said inams.17. Lastly the learned Additional Solicitor General contended that a grant of pre-settlement inam villages which did not fall within the definition of an estate in S. 3 (2) (d) of the Madras Act would be an estate within the definition of that expression in S. 2 (g) of the Orissa Act and therefore the Government validity issued the notifications under S. 3(1) of the Orissa Act abolishing the aforesaid villages not recognised by the Government. This contention has been raised or the first time before us. The contention raised is not a pure question of law, but depends upon the proof of the conditions laid down in the said cl. (g) of S. 2 of the Orissa Act. We do not think we are justified in allowing the respondent to raise a plea of mixed question of fact and law for the first time before us. There must have been very good reasons for the State not raising the extreme contention in the High Court. We should not be understood to have expressed our opinion one way or the other on this question. ### Response: 0

Punjab Engineering College Etc Vs. Sanjay Gulati and Others

the time the decision of the High Court is pronounced. A further appeal to this Court consumes still more time, which creates further difficulties in adjusting equites between students who are wrongly admitted and those who are unjustly excluded. Inevitably, the Court has to rest content with an academic pronouncement of the true legal position. Students who are wrongly admitted do not suffer the consequences of the manipulations, if any, made on their behalf by interested persons. This has virtually come to mean that one must get into an educational institution by means, fair or foul: once you are in, no one will put you out. Laws delays work their wonders in such diverse fashions.We find that this situation has emboldened the erring authorities of educational institutions of various States to indulge in violating the norms of admission with impunity They seem to feel that the Court will leave the admissions in fact, even if the admissions are granted contrary to the rules and regulations, This is a most unsatisfactory state of affairs. Laws are meant to be obeyed, not flouted. Some day, not distant, if admissions are quashed for the reason that they were made wrongly, it will have to be directed that the names of students who are wrongly admitted should be removed from the roll of the institution. We might have been justified in adopting this course in this case itself, but we thought that we may utter a cl ear warning before taking that precipitate step. We have decided, regretfully, to allow the aforesaid sixteen students to continue their studies, despite the careful and weighty finding of the High Court that at least eight of them, namely, t he seven wards of employees and Ashok Kumar Kaushik, were admitted to the Engineering Course in violation of the relevant rules and regulations.5. It is strange that in all such cases, the authorities who make admissions by ignoring the rules of admission contend that the seats cannot correspondingly be increased, since the State Government cannot meet the additional expenditure which will be caused be increasing the number of seats or that the institution will not be able to cope up with the additional influx of students. An additional plea available in regard to Medical Colleges is that the Indian Medical Council will not sanction additional seats. We cannot entertain this submission. Those who infringe the rules must pay for their lapse and the wrong done to the deserving students who ought to have been admitted has to be rectified. The best solution under the circumstances is to ensure that the strength of seats is increased in proportion to the wrong ad missions made.Since in this case eight students, and perhaps sixteen were wrongly admitted, we direct that over and above sanctioned strength for the next academic year commencing in July 1983, sixteen additional seats shall be created, to which sixteen students shall be admitted to the Punjab Engineering College from the lists which were prepared for the 1982-83 academic year. These sixteen seats shall be apportioned in an equal measure between the local students belonging to Chandigarh and the general group of students belonging to areas outside Chandigarh. That is to say, eight students will be admitted from the Chandigarh List of students and eight from the General List of students, which were prepared for the last academic year, viz, 1982-83.6. The only question which survives is whether the sixteen writ petitioners should be admitted to those sixteen seats or whether admission to those seats should be strictly in accordance with merit. We are unable to accept the submission made by the petitioners that they should be preferred for admission irrespective of merit. The circumstance that they filed writ petitions in the High Court but others similarly aggrieved did no t, will not, justify the granting of admission to them by ignoring those others who were higher up in the merit list.7. When a similar question arose before this Court in State of Kerala v. Kumari T.P. Roshana, (1) the Court directed the State Government to admit thirty more students. Krishna Iyer, J. observed:"The selection of these 30 students will not be confined to those who have moved this Court or the High Court by way of writ proceedings or appeal. The measure is academic excellence, not litigative persistence. It will be thrown open to the first 30, strictly according to merit measured by marks secured."In Ajay Hasia etc. v. Khalid Mujib Sehravardi, (2) the State Government the College , and the Society which was running the College, all agreed before this Court that the best fifty students out of those who had applied for admission for the academic year 1979-80 and who had failed to secure admission, would be granted admission for the academic year 1981-82 and that the seats allocated to them would be in addition to the normal intake of students in the College. In Arti Sapru v. State of Jammu and Kashmir &Others, (3) after allowing the writ petitions of candidates who were wrongly denied admission to the Medical Colleges, it was observed by one of us Pathak, J., that:"The candidates who will be displaced in consequence have already completed a few months of study and in order to avoid serious prejudice and detriment to their careers it is hoped that the State Government will deal sympathetically with their cases so that while effect is given to the judgment of this Court the rules may be suitably relaxed, if possible by a temporary increase in the number of seats, in order to accommodate the displaced candidates."The authorities were directed by this Court to fill up the additional vacancies "on the basis of open merit."8. Following these decisions, we direct that admission to the 16 additional vacancies for the academic year 1983-84 shall be made in accordance with merit on the basis of the lists which were prepared for the academic year 1982-83 for the Chandigarh group of students and the general group of students.9.

1[ds]We are unable to accept the submission made by the petitioners that they should be preferred for admission irrespective of merit. The circumstance that they filed writ petitions in the High Court but others similarly aggrieved did no t, will not, justify the granting of admission to them by ignoring those others who were higher up in the merita similar question arose before this Court in State of Kerala v. Kumari T.P. Roshana, (1) the Court directed the State Government to admit thirty more students. Krishna Iyer, J.selection of these 30 students will not be confined to those who have moved this Court or the High Court by way of writ proceedings or appeal. The measure is academic excellence, not litigative persistence. It will be thrown open to the first 30, strictly according to merit measured by marksAjay Hasia etc. v. Khalid Mujib Sehravardi, (2) the State Government the College , and the Society which was running the College, all agreed before this Court that the best fifty students out of those who had applied for admission for the academic year 1979-80 and who had failed to secure admission, would be granted admission for the academic year 1981-82 and that the seats allocated to them would be in addition to the normal intake of students in the College. In Arti Sapru v. State of Jammu and Kashmir &Others, (3) after allowing the writ petitions of candidates who were wrongly denied admission to the Medical Colleges, it was observed by one of us Pathak, J.,candidates who will be displaced in consequence have already completed a few months of study and in order to avoid serious prejudice and detriment to their careers it is hoped that the State Government will deal sympathetically with their cases so that while effect is given to the judgment of this Court the rules may be suitably relaxed, if possible by a temporary increase in the number of seats, in order to accommodate the displacedauthorities were directed by this Court to fill up the additional vacancies "on the basis of openthese decisions, we direct that admission to the 16 additional vacancies for the academic year 1983-84 shall be made in accordance with merit on the basis of the lists which were prepared for the academic year 1982-83 for the Chandigarh group of students and the general group of students.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: the time the decision of the High Court is pronounced. A further appeal to this Court consumes still more time, which creates further difficulties in adjusting equites between students who are wrongly admitted and those who are unjustly excluded. Inevitably, the Court has to rest content with an academic pronouncement of the true legal position. Students who are wrongly admitted do not suffer the consequences of the manipulations, if any, made on their behalf by interested persons. This has virtually come to mean that one must get into an educational institution by means, fair or foul: once you are in, no one will put you out. Laws delays work their wonders in such diverse fashions.We find that this situation has emboldened the erring authorities of educational institutions of various States to indulge in violating the norms of admission with impunity They seem to feel that the Court will leave the admissions in fact, even if the admissions are granted contrary to the rules and regulations, This is a most unsatisfactory state of affairs. Laws are meant to be obeyed, not flouted. Some day, not distant, if admissions are quashed for the reason that they were made wrongly, it will have to be directed that the names of students who are wrongly admitted should be removed from the roll of the institution. We might have been justified in adopting this course in this case itself, but we thought that we may utter a cl ear warning before taking that precipitate step. We have decided, regretfully, to allow the aforesaid sixteen students to continue their studies, despite the careful and weighty finding of the High Court that at least eight of them, namely, t he seven wards of employees and Ashok Kumar Kaushik, were admitted to the Engineering Course in violation of the relevant rules and regulations.5. It is strange that in all such cases, the authorities who make admissions by ignoring the rules of admission contend that the seats cannot correspondingly be increased, since the State Government cannot meet the additional expenditure which will be caused be increasing the number of seats or that the institution will not be able to cope up with the additional influx of students. An additional plea available in regard to Medical Colleges is that the Indian Medical Council will not sanction additional seats. We cannot entertain this submission. Those who infringe the rules must pay for their lapse and the wrong done to the deserving students who ought to have been admitted has to be rectified. The best solution under the circumstances is to ensure that the strength of seats is increased in proportion to the wrong ad missions made.Since in this case eight students, and perhaps sixteen were wrongly admitted, we direct that over and above sanctioned strength for the next academic year commencing in July 1983, sixteen additional seats shall be created, to which sixteen students shall be admitted to the Punjab Engineering College from the lists which were prepared for the 1982-83 academic year. These sixteen seats shall be apportioned in an equal measure between the local students belonging to Chandigarh and the general group of students belonging to areas outside Chandigarh. That is to say, eight students will be admitted from the Chandigarh List of students and eight from the General List of students, which were prepared for the last academic year, viz, 1982-83.6. The only question which survives is whether the sixteen writ petitioners should be admitted to those sixteen seats or whether admission to those seats should be strictly in accordance with merit. We are unable to accept the submission made by the petitioners that they should be preferred for admission irrespective of merit. The circumstance that they filed writ petitions in the High Court but others similarly aggrieved did no t, will not, justify the granting of admission to them by ignoring those others who were higher up in the merit list.7. When a similar question arose before this Court in State of Kerala v. Kumari T.P. Roshana, (1) the Court directed the State Government to admit thirty more students. Krishna Iyer, J. observed:"The selection of these 30 students will not be confined to those who have moved this Court or the High Court by way of writ proceedings or appeal. The measure is academic excellence, not litigative persistence. It will be thrown open to the first 30, strictly according to merit measured by marks secured."In Ajay Hasia etc. v. Khalid Mujib Sehravardi, (2) the State Government the College , and the Society which was running the College, all agreed before this Court that the best fifty students out of those who had applied for admission for the academic year 1979-80 and who had failed to secure admission, would be granted admission for the academic year 1981-82 and that the seats allocated to them would be in addition to the normal intake of students in the College. In Arti Sapru v. State of Jammu and Kashmir &Others, (3) after allowing the writ petitions of candidates who were wrongly denied admission to the Medical Colleges, it was observed by one of us Pathak, J., that:"The candidates who will be displaced in consequence have already completed a few months of study and in order to avoid serious prejudice and detriment to their careers it is hoped that the State Government will deal sympathetically with their cases so that while effect is given to the judgment of this Court the rules may be suitably relaxed, if possible by a temporary increase in the number of seats, in order to accommodate the displaced candidates."The authorities were directed by this Court to fill up the additional vacancies "on the basis of open merit."8. Following these decisions, we direct that admission to the 16 additional vacancies for the academic year 1983-84 shall be made in accordance with merit on the basis of the lists which were prepared for the academic year 1982-83 for the Chandigarh group of students and the general group of students.9. ### Response: 1

Hiralal Agrawal, Etc Vs. Rampadarath Singh & Others

by the municipal board on the found that the tax had not been imposed according to law inasmuch as the proposals and the draft rules had been published by the Board in an Urdu paper whereas according to S. 131 ( 3) read with S. 94 (3) of the U. P. Municipalities Act, 1918 they should have been published in a Hindi paper. The Court held that S. 131 (3) fell into two parts, the first providing that the proposal and draft rules for an intended tax should be published for inviting objections of the public and the second, laying down that such publication must be in the manner laid down in S. 94 (3). It held that considering the object of the provisions for publication, the first part was mandatory while the second was merely directory. What that part required was that the publication should be in Hindi in a local paper and if that was done there was sufficient compliance of S. 94 (3). The publication was made in Hindi in a local paper which had good circulation in Rampur; there was no regularly published local Hindi newspaper. There was in the circumstances substantial compliance with the provisions of S. 94 (3).At p. 975 (of SCR) = (at p. 899 of AIR) this Court observed that the question whether a particular provision of a statute which on the face of it appears mandatory inasmuch as it used the word shall is merely directory cannot be resolved by laying down any general rule and depends upon the acts of each case and for that purpose the object of the statute in making the provision is the determining factor. 15. The object of R. 19 in prescribing that the application under S. 16 (3) must be accompanied by a copy of the registered deed is clearly to enable the Collector before he exercises his power thereunder to ascertain the purchase price, the terms and conditions of the sale, the readiness of the applicant to have the land in question reconveyed to him on the same terms and conditions as in the sale deed and the fact of the applicant having deposited the relevant amount in the treasury. The purpose of prescribing that a copy of the registered deed should accompany the application is that if such a copy is before the Collector there would be no scope for any controversy that the land is transferred to the purchaser, about its area and location, and the terms and conditions of the sale including the sale price. If this information is before the Collector and he is satisfied about it, does it still mean that it would be fatal to the application if the formality of annexing a copy of the registered deed is not complied with. Section 16 lays down that such an application must be made within three months from the date of the registration and if it is not done within that period, it would be time barred. Suppose for a while that an applicant does not know when registration under Ss. 60 and 61 of the Registration Act is completed and annexes to his application a certified copy of the sale deed furnished at his instance by the registering authority or where the registering authority is not able to furnish a copy of the registered deed of sale within time. Does it mean that an applicant is to be deprived of the right of reconveyance conferred by the statute? To hold that if the formality prescribed by R. 19 is not satisfied the application would be bad would be to nullify the object of the statute. That surely cannot be the intention of the draftsmen who framed R. 19 and Form L. C. 13. 16. Rule 19 (3) requires that a copy of the application be sent to the transferee and the transferor by registered post with acknowledgment due, Form L. C. 13 requires, the applicant to state that the is made by a registered deed on the date specified therein. If a copy of the application is delivered to the transferor or the transferee by hand delivery or by registered post but without acknowledgment due or if the applicant is not able to state the date of registration because he does not know it, does it mean that merely because Cl. (3) of R. 19 and the form use the word "shall" the omission to comply with the aforesaid requirements is fatal to the application? Surely these are directory instructions and if there is sufficient compliance thereof the application can be validly entertained by the Collector. 17. In our view, whereas the deposit in the relevant treasury, the applicant being either a co-sharer or a raiyat of the adjoining land, his readiness and willingness to have the land in question reconveyed to him on the same terms and conditions as in the sale deed and the transfer of the land to the transferee are conditions precedent to his acquiring the right of reconveyance and to the Collectors jurisdiction to try such an application, the prescription as to annexing a copy of the registered deed is only directory and is laid down to furnish necessary information to the Collector to enable him to proceed with it. Annexing a certified copy of the sale deed where a copy of the registered deed is not yet available on account of the process of registration not having been completed would, in our view, be sufficient compliance of the directory prescription so long as it furnishes information necessary for the Collector to proceed with the application.The fact that a copy of the registered deed was not furnished along with the application was, therefore, not fatal to the application nor did such omission deprive the Collector of his jurisdiction to entertain it nor did it vitiate the proceedings before him or the order thereon made y him. The Board of Revenue and the High Court were not right in dismissing the appellants application.

1[ds]8. From the contents of Rr. 18 and 19 and Forms L.C. 12 and 13, it is clear that the object of these rules, firstly, is to enable the registering authority to see that the transferee does not by the transfer acquire land in excess of the ceiling area and, secondly, to enable the Collector to know that a transfer of the land has been made and that such transfer is completed by registration, the price paid for it and that the deposit made by the applicant is of a sum equivalent to the purchase price and 10 per cent thereof. It is manifest that the purpose for requiring the applicant to file a copy of the challan and of the registered deed is to enable the Collector to ascertain therefrom the aforesaid facts and to proceed further on being satisfied about themIt is true that the Board of Revenue has stated at one place that the Collector "admitted" the application on November 28, 1964 and at another place that he "took cognizance of it on that date. If by the words "admitted" and took cognizance of" the Board meant that the Collector took cognizance of the application in its technical sense, the Board would appear to be factually incorrect. The record of the case shows that some one in the Collectors office received the application on November 28, 1964 and made an endorsement thereon that it should be put up before the Collector on November 30, 1964. As already stated, on the said application having been placed before him on November 30, 1964, the Collector passed his interim order under S. 16 (3) (ii) directing the transferee to deliver possession of the land in question to the appellant. Admittedly, registration was also completed on that dateA mere presentation of the application in the sense of the appellant having handed it over to some subordinate in the Collectors office cannot mean its having been entertained by the Collector on that date.There is, therefore, no merit in the contention that the Collector had entertained the application either on the 26th when it was taken by the appellant to the Collectors office or on the 28th when some subordinate in the office made an endorsement on it that it should be placed before the Collector.The endorsement on the contrary shows that the Collector had not even seen it on that day, much less accepted it. The Collector took cognizance of it on November 30, 1964 only when it was placed before him and when on being satisfied that the conditions of S. 16 were satisfied he passed his order under sub-s. (3) (ii) for handing over possession from the transferee to the appellant. On these facts, Mr. Nambiars first contention must failour view, whereas the deposit in the relevant treasury, the applicant being either a co-sharer or a raiyat of the adjoining land, his readiness and willingness to have the land in question reconveyed to him on the same terms and conditions as in the sale deed and the transfer of the land to the transferee are conditions precedent to his acquiring the right of reconveyance and to the Collectors jurisdiction to try such an application, the prescription as to annexing a copy of the registered deed is only directory and is laid down to furnish necessary information to the Collector to enable him to proceed with it. Annexing a certified copy of the sale deed where a copy of the registered deed is not yet available on account of the process of registration not having been completed would, in our view, be sufficient compliance of the directory prescription so long as it furnishes information necessary for the Collector to proceed with the application.The fact that a copy of the registered deed was not furnished along with the application was, therefore, not fatal to the application nor did such omission deprive the Collector of his jurisdiction to entertain it nor did it vitiate the proceedings before him or the order thereon made y him. The Board of Revenue and the High Court were not right in dismissing the appellants application.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: by the municipal board on the found that the tax had not been imposed according to law inasmuch as the proposals and the draft rules had been published by the Board in an Urdu paper whereas according to S. 131 ( 3) read with S. 94 (3) of the U. P. Municipalities Act, 1918 they should have been published in a Hindi paper. The Court held that S. 131 (3) fell into two parts, the first providing that the proposal and draft rules for an intended tax should be published for inviting objections of the public and the second, laying down that such publication must be in the manner laid down in S. 94 (3). It held that considering the object of the provisions for publication, the first part was mandatory while the second was merely directory. What that part required was that the publication should be in Hindi in a local paper and if that was done there was sufficient compliance of S. 94 (3). The publication was made in Hindi in a local paper which had good circulation in Rampur; there was no regularly published local Hindi newspaper. There was in the circumstances substantial compliance with the provisions of S. 94 (3).At p. 975 (of SCR) = (at p. 899 of AIR) this Court observed that the question whether a particular provision of a statute which on the face of it appears mandatory inasmuch as it used the word shall is merely directory cannot be resolved by laying down any general rule and depends upon the acts of each case and for that purpose the object of the statute in making the provision is the determining factor. 15. The object of R. 19 in prescribing that the application under S. 16 (3) must be accompanied by a copy of the registered deed is clearly to enable the Collector before he exercises his power thereunder to ascertain the purchase price, the terms and conditions of the sale, the readiness of the applicant to have the land in question reconveyed to him on the same terms and conditions as in the sale deed and the fact of the applicant having deposited the relevant amount in the treasury. The purpose of prescribing that a copy of the registered deed should accompany the application is that if such a copy is before the Collector there would be no scope for any controversy that the land is transferred to the purchaser, about its area and location, and the terms and conditions of the sale including the sale price. If this information is before the Collector and he is satisfied about it, does it still mean that it would be fatal to the application if the formality of annexing a copy of the registered deed is not complied with. Section 16 lays down that such an application must be made within three months from the date of the registration and if it is not done within that period, it would be time barred. Suppose for a while that an applicant does not know when registration under Ss. 60 and 61 of the Registration Act is completed and annexes to his application a certified copy of the sale deed furnished at his instance by the registering authority or where the registering authority is not able to furnish a copy of the registered deed of sale within time. Does it mean that an applicant is to be deprived of the right of reconveyance conferred by the statute? To hold that if the formality prescribed by R. 19 is not satisfied the application would be bad would be to nullify the object of the statute. That surely cannot be the intention of the draftsmen who framed R. 19 and Form L. C. 13. 16. Rule 19 (3) requires that a copy of the application be sent to the transferee and the transferor by registered post with acknowledgment due, Form L. C. 13 requires, the applicant to state that the is made by a registered deed on the date specified therein. If a copy of the application is delivered to the transferor or the transferee by hand delivery or by registered post but without acknowledgment due or if the applicant is not able to state the date of registration because he does not know it, does it mean that merely because Cl. (3) of R. 19 and the form use the word "shall" the omission to comply with the aforesaid requirements is fatal to the application? Surely these are directory instructions and if there is sufficient compliance thereof the application can be validly entertained by the Collector. 17. In our view, whereas the deposit in the relevant treasury, the applicant being either a co-sharer or a raiyat of the adjoining land, his readiness and willingness to have the land in question reconveyed to him on the same terms and conditions as in the sale deed and the transfer of the land to the transferee are conditions precedent to his acquiring the right of reconveyance and to the Collectors jurisdiction to try such an application, the prescription as to annexing a copy of the registered deed is only directory and is laid down to furnish necessary information to the Collector to enable him to proceed with it. Annexing a certified copy of the sale deed where a copy of the registered deed is not yet available on account of the process of registration not having been completed would, in our view, be sufficient compliance of the directory prescription so long as it furnishes information necessary for the Collector to proceed with the application.The fact that a copy of the registered deed was not furnished along with the application was, therefore, not fatal to the application nor did such omission deprive the Collector of his jurisdiction to entertain it nor did it vitiate the proceedings before him or the order thereon made y him. The Board of Revenue and the High Court were not right in dismissing the appellants application. ### Response: 1

Mcleod and Company Vs. Collector of Customs, Calcutta

J. C. Shah, J.1. The Collector of Customs, purporting to act under Section 167(8) of the Sea Customs Act, imposed a penalty of Rs. 5, 00, 000/- on goods covered by Shipping Bills Nos. 8072, 2082, 2083, 2084, 2127 and 2085, and imposed a personal penalty on M/s. McLeod & Co. Ltd. of Rs. 7, 00, 000/-. In respect of goods covered by Shipping Bill No. 788, the Collector imposed a personal penalty of Rs. 5, 00, 000/- under Section 167(8) of the Sea Customs Act. He imposed another penalty of Rs. 1, 000/- under Section 167(37)(c) on M/s. McLeod & Co. Ltd. and a personal penalty of Rs. 500/- under Section 167(3). The Central Board of Excise & Customs reduced the penalty in respect of Shipping Bills Nos. 8072, 2084, 2127 and 2085 from Rs. 5, 00, 000/- to Rs. 4, 00, 000/- and reduced the personal penalty from Rs. 7, 00, 000/- to Rs. 3, 50, 000/-, and in respect of Shipping Bill No. 788 it reduced the personal penalty from Rs. 5, 00, 000/- to Rs. 50, 000/-. It confirmed the penalty under Section 167(37)(c) and vacated the order imposing personal penalty of Rs. 500/- under Section 167(3).2. Mr. Daphtary, appearing on behalf of the appellant, contends that the penalty of Rs. 7, 50, 000/- in respect of Shipping Bills Nos. 8072, 2084, 2127 and 2085 imposed by the Central Board of Excise and Customs and of Rs. 50, 000/- in respect of Shipping Bill No. 788 is illegal in view of the judgment of this Court in Union of India and Ors. v. Rai Bahadur Shreeram Durga Prasad (P) Ltd. and Ors. (Civil Appeals Nos. 45-49 of 1968 decided on 19-11-1968). Mr. Mohan Kumaramangalam, for the Union of India, and Mr. Bindra, for the Collector of Customs, contend that the principle of the judgment in Union of India and Ors. v. R. B. Shreeram Durga Prasad (P) Ltd. and Ors. (supra) applies to the facts of the present case but they ask us to send the case to a larger Bench for reconsideration of that decision. It is urged that the decision of this Court in the case cited above is likely to affect several other cases which are pending before the Customs Authorities.3. We do not see any reason to accede to this request. This Court has considered the matter in some detail. It is true that there was difference of opinion and the judgment was by a majority of the Court but we will not be justified in lightly ignoring the judgment of this Court which has been given after full consideration of the merits of the dispute.

1[ds]3. We do not see any reason to accede to this request. This Court has considered the matter in some detail. It is true that there was difference of opinion and the judgment was by a majority of the Court but we will not be justified in lightly ignoring the judgment of this Court which has been given after full consideration of the merits of the dispute.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: J. C. Shah, J.1. The Collector of Customs, purporting to act under Section 167(8) of the Sea Customs Act, imposed a penalty of Rs. 5, 00, 000/- on goods covered by Shipping Bills Nos. 8072, 2082, 2083, 2084, 2127 and 2085, and imposed a personal penalty on M/s. McLeod & Co. Ltd. of Rs. 7, 00, 000/-. In respect of goods covered by Shipping Bill No. 788, the Collector imposed a personal penalty of Rs. 5, 00, 000/- under Section 167(8) of the Sea Customs Act. He imposed another penalty of Rs. 1, 000/- under Section 167(37)(c) on M/s. McLeod & Co. Ltd. and a personal penalty of Rs. 500/- under Section 167(3). The Central Board of Excise & Customs reduced the penalty in respect of Shipping Bills Nos. 8072, 2084, 2127 and 2085 from Rs. 5, 00, 000/- to Rs. 4, 00, 000/- and reduced the personal penalty from Rs. 7, 00, 000/- to Rs. 3, 50, 000/-, and in respect of Shipping Bill No. 788 it reduced the personal penalty from Rs. 5, 00, 000/- to Rs. 50, 000/-. It confirmed the penalty under Section 167(37)(c) and vacated the order imposing personal penalty of Rs. 500/- under Section 167(3).2. Mr. Daphtary, appearing on behalf of the appellant, contends that the penalty of Rs. 7, 50, 000/- in respect of Shipping Bills Nos. 8072, 2084, 2127 and 2085 imposed by the Central Board of Excise and Customs and of Rs. 50, 000/- in respect of Shipping Bill No. 788 is illegal in view of the judgment of this Court in Union of India and Ors. v. Rai Bahadur Shreeram Durga Prasad (P) Ltd. and Ors. (Civil Appeals Nos. 45-49 of 1968 decided on 19-11-1968). Mr. Mohan Kumaramangalam, for the Union of India, and Mr. Bindra, for the Collector of Customs, contend that the principle of the judgment in Union of India and Ors. v. R. B. Shreeram Durga Prasad (P) Ltd. and Ors. (supra) applies to the facts of the present case but they ask us to send the case to a larger Bench for reconsideration of that decision. It is urged that the decision of this Court in the case cited above is likely to affect several other cases which are pending before the Customs Authorities.3. We do not see any reason to accede to this request. This Court has considered the matter in some detail. It is true that there was difference of opinion and the judgment was by a majority of the Court but we will not be justified in lightly ignoring the judgment of this Court which has been given after full consideration of the merits of the dispute. ### Response: 1

Tata Davy Ltd Vs. State Of Orissa

Works (SC). Vallabh Glass Works had been declared a sick industrial company within the meaning of section3(1) (o) of the Central Act. The appellant-Gram Panchayat initiated coercive proceedings under section129 of the Bombay Village Panchayat Act against Vallabh Glass Works to recover arrears of property tax. Vallabh Glass Works filed a writ petition in the High Court at Bombay claiming the protection of section22 of the Central Act. The writ petition was allowed, and the Gram Panchayat appealed to this Court. This Court noted that the said Board had been satisfied by its order dated August 27, 1987, that Vallabh Glass Works had become a sick industrial company and, consequently, steps had been taken under sections 16 and 17 of the Central Act. As soon as the enquiry under section 16 was ordered by the said Board, this Court said, the various proceedings set out under section22(1) of the Central Act were deemed to have been suspended. Creditors could then approach the said Board for permission to proceed against the sick company for recovery of their dues and the said Board, at its discretion, could accord such approval. If approval was not granted, the creditors remedy was not extinguished. It was only postponed. The section provided for exclusion of the period during which the remedy was suspended while computing the period of limitation for recovery of the dues.7. Learned counsel for the appellants submitted that in the case of Vallabh Glass Works, this Court had dealt with proceedings for recovery of dues under a State Act and had come to the conclusion that section22(1) of the Central Act applied thereto. The case of the appellants was, therefore, squarely covered by Vallabh Glass Works case (SC); (SC).8. Learned counsel for the respondents submitted that section22(1) of the Central Act should be so read as not to interfere with the exclusive power of the States to legislate under entry 54 of List II of the Seventh Schedule to the Constitution in respect of sales tax. In his submission, the words "any other law" in section22(1) of the Central Act must be so read as to exclude all laws on List II subjects, for Parliament must be assumed to know its limitations. Learned counsel cited the judgment of this Court in Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals (SC); [1997] 2 Scale 640 , as supporting his case.9. Vallabh Glass Works (SC); (SC) judgment covers these appeals. Arrears of taxes and the like due from sick industrial companies that satisfy the conditions set out in section22(1) of the Central Act cannot be recovered by coercive process unless the said Board gives its consent thereto.10. The Central Act is enacted under entry 52 of List I of the Seventh Schedule. The said entry 52 empowers Parliament to legislate in respect of "industries" the control of which by the Union is declared by Parliament by law to be in the "public interest". The Central Act declares that it is "for giving effect to the policy of the State towards securing the principles specified in clauses (b) and (c) of article 39 of the Constitution", namely "that the ownership and control of the material resources of the community are so distributed as best to serve the common good" and "that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment". The Central Act does not impair or interfere with the rights of the States to legislate with respect to sales tax under entry 54 of List II of the Seventh Schedule. In the larger interest of the industrial health of the nation, section22 of the Central Act requires all creditors seeking to recover their dues from the sick industrial companies in respect of whom an inquiry under section 16 is pending or a scheme is under preparation or consideration or has been sanctioned, to obtain the consent of the said Board to such recovery. If such consent is not secured and the recovery is deferred, the creditors remedy is protected for the period of deferment is, by reason of sub-section (5) of section 22, excluded in the computation of the period of limitation. The words "any other law" in section 22 cannot, therefore, be read in the manner suggested by learned counsel for the respondents.11. Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals (SC);, 11 (SC) judgment dealt with a sick industrial company which was enabled to collect amounts like sales tax after the date of the sanctioned scheme. This Court said, "such amounts like sales tax, etc., which the sick industrial company is enabled to collect after the date of the sanctioned scheme, legitimately belonging to the Revenue, cannot be and could not have been intended to be covered within section22 of the Act". It added that the issue that had arisen before it had not arisen in the case of Vallabh Glass Works (SC); (SC). It did not appear therefrom or from any other decision of this Court or of the High Courts "that in any one of them, the liability of the sick company dealt with therein itself arose, for the first time after the date of the sanctioned scheme. At any rate, in none of those cases a situation arose whereby the sick industrial unit was enabled to collect tax due to the Revenue from the customers after the sanctioned scheme but the sick unit simply folded its hands and declined to pay it over to the Revenue, for which proceedings for recovery had to be taken". Clearly, the facts in Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals (SC); (SC) differ from the facts of Vallabh Glass Works case (SC); (SC) and those before us. The reference to Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals (SC); (SC) is, therefore, inapposite.12. We hold, in the premises, that the respondents cannot recover the aforementioned arrears of sales tax from the appellants without first seeking the consent of the said Board in this behalf.

1[ds]9. Vallabh Glass Works (SC); (SC) judgment covers these appeals. Arrears of taxes and the like due from sick industrial companies that satisfy the conditions set out in section22(1) of the Central Act cannot be recovered by coercive process unless the said Board gives its consent thereto.10. The Central Act is enacted under entry 52 of List I of the Seventh Schedule. The said entry 52 empowers Parliament to legislate in respect of "industries" the control of which by the Union is declared by Parliament by law to be in the "public interest". The Central Act declares that it is "for giving effect to the policy of the State towards securing the principles specified in clauses (b) and (c) of article 39 of the Constitution", namely "that the ownership and control of the material resources of the community are so distributed as best to serve the common good" and "that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment". The Central Act does not impair or interfere with the rights of the States to legislate with respect to sales tax under entry 54 of List II of the Seventh Schedule. In the larger interest of the industrial health of the nation, section22 of the Central Act requires all creditors seeking to recover their dues from the sick industrial companies in respect of whom an inquiry under section 16 is pending or a scheme is under preparation or consideration or has been sanctioned, to obtain the consent of the said Board to such recovery. If such consent is not secured and the recovery is deferred, the creditors remedy is protected for the period of deferment is, by reason of sub-section (5) of section 22, excluded in the computation of the period of limitation. The words "any other law" in section 22 cannot, therefore, be read in the manner suggested by learned counsel for the respondents.11. Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals (SC);, 11 (SC) judgment dealt with a sick industrial company which was enabled to collect amounts like sales tax after the date of the sanctioned scheme. This Court said, "such amounts like sales tax, etc., which the sick industrial company is enabled to collect after the date of the sanctioned scheme, legitimately belonging to the Revenue, cannot be and could not have been intended to be covered within section22 of the Act". It added that the issue that had arisen before it had not arisen in the case of Vallabh Glass Works (SC); (SC). It did not appear therefrom or from any other decision of this Court or of the High Courts "that in any one of them, the liability of the sick company dealt with therein itself arose, for the first time after the date of the sanctioned scheme. At any rate, in none of those cases a situation arose whereby the sick industrial unit was enabled to collect tax due to the Revenue from the customers after the sanctioned scheme but the sick unit simply folded its hands and declined to pay it over to the Revenue, for which proceedings for recovery had to be taken". Clearly, the facts in Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals (SC); (SC) differ from the facts of Vallabh Glass Works case (SC); (SC) and those before us. The reference to Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals (SC); (SC) is, therefore, inapposite.12. We hold, in the premises, that the respondents cannot recover the aforementioned arrears of sales tax from the appellants without first seeking the consent of the said Board in this behalf.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: Works (SC). Vallabh Glass Works had been declared a sick industrial company within the meaning of section3(1) (o) of the Central Act. The appellant-Gram Panchayat initiated coercive proceedings under section129 of the Bombay Village Panchayat Act against Vallabh Glass Works to recover arrears of property tax. Vallabh Glass Works filed a writ petition in the High Court at Bombay claiming the protection of section22 of the Central Act. The writ petition was allowed, and the Gram Panchayat appealed to this Court. This Court noted that the said Board had been satisfied by its order dated August 27, 1987, that Vallabh Glass Works had become a sick industrial company and, consequently, steps had been taken under sections 16 and 17 of the Central Act. As soon as the enquiry under section 16 was ordered by the said Board, this Court said, the various proceedings set out under section22(1) of the Central Act were deemed to have been suspended. Creditors could then approach the said Board for permission to proceed against the sick company for recovery of their dues and the said Board, at its discretion, could accord such approval. If approval was not granted, the creditors remedy was not extinguished. It was only postponed. The section provided for exclusion of the period during which the remedy was suspended while computing the period of limitation for recovery of the dues.7. Learned counsel for the appellants submitted that in the case of Vallabh Glass Works, this Court had dealt with proceedings for recovery of dues under a State Act and had come to the conclusion that section22(1) of the Central Act applied thereto. The case of the appellants was, therefore, squarely covered by Vallabh Glass Works case (SC); (SC).8. Learned counsel for the respondents submitted that section22(1) of the Central Act should be so read as not to interfere with the exclusive power of the States to legislate under entry 54 of List II of the Seventh Schedule to the Constitution in respect of sales tax. In his submission, the words "any other law" in section22(1) of the Central Act must be so read as to exclude all laws on List II subjects, for Parliament must be assumed to know its limitations. Learned counsel cited the judgment of this Court in Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals (SC); [1997] 2 Scale 640 , as supporting his case.9. Vallabh Glass Works (SC); (SC) judgment covers these appeals. Arrears of taxes and the like due from sick industrial companies that satisfy the conditions set out in section22(1) of the Central Act cannot be recovered by coercive process unless the said Board gives its consent thereto.10. The Central Act is enacted under entry 52 of List I of the Seventh Schedule. The said entry 52 empowers Parliament to legislate in respect of "industries" the control of which by the Union is declared by Parliament by law to be in the "public interest". The Central Act declares that it is "for giving effect to the policy of the State towards securing the principles specified in clauses (b) and (c) of article 39 of the Constitution", namely "that the ownership and control of the material resources of the community are so distributed as best to serve the common good" and "that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment". The Central Act does not impair or interfere with the rights of the States to legislate with respect to sales tax under entry 54 of List II of the Seventh Schedule. In the larger interest of the industrial health of the nation, section22 of the Central Act requires all creditors seeking to recover their dues from the sick industrial companies in respect of whom an inquiry under section 16 is pending or a scheme is under preparation or consideration or has been sanctioned, to obtain the consent of the said Board to such recovery. If such consent is not secured and the recovery is deferred, the creditors remedy is protected for the period of deferment is, by reason of sub-section (5) of section 22, excluded in the computation of the period of limitation. The words "any other law" in section 22 cannot, therefore, be read in the manner suggested by learned counsel for the respondents.11. Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals (SC);, 11 (SC) judgment dealt with a sick industrial company which was enabled to collect amounts like sales tax after the date of the sanctioned scheme. This Court said, "such amounts like sales tax, etc., which the sick industrial company is enabled to collect after the date of the sanctioned scheme, legitimately belonging to the Revenue, cannot be and could not have been intended to be covered within section22 of the Act". It added that the issue that had arisen before it had not arisen in the case of Vallabh Glass Works (SC); (SC). It did not appear therefrom or from any other decision of this Court or of the High Courts "that in any one of them, the liability of the sick company dealt with therein itself arose, for the first time after the date of the sanctioned scheme. At any rate, in none of those cases a situation arose whereby the sick industrial unit was enabled to collect tax due to the Revenue from the customers after the sanctioned scheme but the sick unit simply folded its hands and declined to pay it over to the Revenue, for which proceedings for recovery had to be taken". Clearly, the facts in Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals (SC); (SC) differ from the facts of Vallabh Glass Works case (SC); (SC) and those before us. The reference to Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals (SC); (SC) is, therefore, inapposite.12. We hold, in the premises, that the respondents cannot recover the aforementioned arrears of sales tax from the appellants without first seeking the consent of the said Board in this behalf. ### Response: 1

STATE OF RAJASTHAN Vs. SHIV DAYAL

Having heard the learned counsel for the parties and on perusal of the record of the case, we are constrained to allow the appeals, set aside the impugned order and remand the case to the High Court for deciding the second appeals afresh on merits in accordance with law. 13. In our opinion, the need to remand the case to the High Court has arisen because we find that the second appeals did involve several substantial questions of law for being answered on merits in accordance with law. The High Court was, therefore, not right in so holding. 14. Indeed, we find that the High Court dismissed the second appeals essentially on the ground that since the two Courts have decreed the suit, no substantial question of law arises in the appeals. In other words, the High Court was mostly swayed away with the consideration that since two Courts have decreed the suit, resulting in passing of the decree against the State, there arises no substantial question of law in the appeals. It is clear from the last paragraph of the impugned order, which reads as under: Under these circumstances, when both the Ld. Courts have arrived at the conclusion that the disputed area is outside the forest area. Therefore, the principles laid down in T.N. GODAWARAN vs. U.O.I. (above-quoted) cannot be enforced in this appeal. (Emphasis supplied) 15. We do not agree with the aforementioned reasoning and the conclusion arrived at by the High Court. 16. It is not the principle of law that where the High Court finds that there is a concurrent finding of two Courts (whether of dismissal or decreeing of the suit), such finding becomes unassailable in the second appeal. 17. True it is as has been laid down by this Court in several decisions that concurrent finding of fact is usually binding on the High Court while hearing the second appeal under Section 100 of the Code of Civil Procedure, 1908(hereinafter referred to as the Code). However, this rule of law is subject to certain well known exceptions mentioned infra. 18. It is a trite law that in order to record any finding on the facts, the Trial Court is required to appreciate the entire evidence (oral and documentary) in the light of the pleadings of the parties. 19. Similarly, it is also a trite law that the Appellate Court also has the jurisdiction to appreciate the evidence de novo while hearing the first appeal and either affirm the finding of the Trial Court or reverse it. 20. If the Appellate Court affirms the finding, it is called concurrent finding of fact whereas if the finding is reversed, it is called reversing finding. These expressions are well known in the legal parlance. 21. When any concurrent finding of fact is assailed in second appeal, the appellant is entitled to point out that it is bad in law because it was recorded de hors the pleadings or it was based on no evidence or it was based on misreading of material documentary evidence or it was recorded against any provision of law and lastly, the decision is one which no Judge acting judicially could reasonably have reached. (see observation made by learned Judge -Vivian Bose,J.- as His Lordship then was a Judge of the Nagpur High Court in Rajeshwar Vishwanath Mamidwar & Ors. vs. Dashrath Narayan Chilwelkar & Ors., AIR 1943 Nagpur 117 - Para 43). 22. In our opinion, if any one or more ground, as mentioned above, is made out in an appropriate case on the basis of the pleading and evidence, such ground will constitute substantial question of law within the meaning of Section 100 of the Code. 23. Coming to the facts of the case, we are of the view that the following are the questions which do arise for consideration in the suit/appeal for proper adjudication of the rights of the parties to the suit and are in the nature of substantial questions within the meaning of Section 100 of the Code. 24. First, whether the suit land was a part of a protected Forest area, i.e., Forest land and, if so, whether the parties satisfied all the statutory provisions of the Forest Laws enacted by the Center and the State? 25. Second, whether the suit land was a part of a Revenue land and, if so, whether the parties to the suit satisfied all the statutory provisions of the State Revenue Laws. 26. Third, whether a mining lease of the suit land could be granted by the State to the plaintiff for carrying out the mining operation in accordance with the provisions of the MMRD Act and, if so, whether it satisfied all the statutory provisions of the MMRD Act read with relevant Forest and Revenue Laws. 27. Fourth, whether a suit is hit by any provision of Forest Laws or MMRD Act or/and Revenue Laws expressly or by implication. 28. Lastly, whether the plaintiff on facts/evidence has proved that the suit land is a part of Revenue land and, therefore, it does not fall in the protected forest area and, if so, whether any prima facie case, balance of convenience and irreparable loss is made out for grant of permanent injunction in plaintiffs favour? 29. In our opinion, all the five questions enumerated above did arise in the case. As a matter of fact, the suit could not have been tried properly without deciding these questions in the light of the pleadings, evidence and the applicable laws mentioned above. 30. In our view, the High Court, therefore, should have admitted the second appeal by framing appropriate substantial question(s) of law arising in the case and answered them on their respective merits rather than to dismiss the appeals without considering any of the aforementioned questions. 31. It is for this reason, we are of the view that the interference in the impugned order is called for to enable the High Court to decide the controversy in its proper perspective.

1[ds]12. Having heard the learned counsel for the parties and on perusal of the record of the case, we are constrained to allow the appeals, set aside the impugned order and remand the case to the High Court for deciding the second appeals afresh on merits in accordance with law13. In our opinion, the need to remand the case to the High Court has arisen because we find that the second appeals did involve several substantial questions of law for being answered on merits in accordance with law. The High Court was, therefore, not right in so holding14. Indeed, we find that the High Court dismissed the second appeals essentially on the ground that since the two Courts have decreed the suit, no substantial question of law arises in the appeals. In other words, the High Court was mostly swayed away with the consideration that since two Courts have decreed the suit, resulting in passing of the decree against the State, there arises no substantial question of law in the appeals. It is clear from the last paragraph of the impugned order, which reads as under:Under these circumstances, when both the Ld. Courts have arrived at the conclusion that the disputed area is outside the forest area. Therefore, the principles laid down in T.N. GODAWARAN vs. U.O.I. (above-quoted) cannot be enforced in this appeal15. We do not agree with the aforementioned reasoning and the conclusion arrived at by the High Court16. It is not the principle of law that where the High Court finds that there is a concurrent finding of two Courts (whether of dismissal or decreeing of the suit), such finding becomes unassailable in the second appeal17. True it is as has been laid down by this Court in several decisions that concurrent finding of fact is usually binding on the High Court while hearing the second appeal under Section 100 of the Code of Civil Procedure, 1908(hereinafter referred to as the Code). However, this rule of law is subject to certain well known exceptions mentioned infra18. It is a trite law that in order to record any finding on the facts, the Trial Court is required to appreciate the entire evidence (oral and documentary) in the light of the pleadings of the parties19. Similarly, it is also a trite law that the Appellate Court also has the jurisdiction to appreciate the evidence de novo while hearing the first appeal and either affirm the finding of the Trial Court or reverse it20. If the Appellate Court affirms the finding, it is called concurrent finding of fact whereas if the finding is reversed, it is called reversing finding. These expressions are well known in the legal parlance21. When any concurrent finding of fact is assailed in second appeal, the appellant is entitled to point out that it is bad in law because it was recorded de hors the pleadings or it was based on no evidence or it was based on misreading of material documentary evidence or it was recorded against any provision of law and lastly, the decision is one which no Judge acting judicially could reasonably have reached. (see observation made by learned Judge -Vivian Bose,J.- as His Lordship then was a Judge of the Nagpur High Court in Rajeshwar Vishwanath Mamidwar & Ors. vs. Dashrath Narayan Chilwelkar & Ors., AIR 1943 Nagpur 117 - Para 43)22. In our opinion, if any one or more ground, as mentioned above, is made out in an appropriate case on the basis of the pleading and evidence, such ground will constitute substantial question of law within the meaning of Section 100 of the Code23. Coming to the facts of the case, we are of the view that the following are the questions which do arise for consideration in the suit/appeal for proper adjudication of the rights of the parties to the suit and are in the nature of substantial questions within the meaning of Section 100 of the Code24. First, whether the suit land was a part of a protected Forest area, i.e., Forest land and, if so, whether the parties satisfied all the statutory provisions of the Forest Laws enacted by the Center and the State?25. Second, whether the suit land was a part of a Revenue land and, if so, whether the parties to the suit satisfied all the statutory provisions of the State Revenue Laws26. Third, whether a mining lease of the suit land could be granted by the State to the plaintiff for carrying out the mining operation in accordance with the provisions of the MMRD Act and, if so, whether it satisfied all the statutory provisions of the MMRD Act read with relevant Forest and Revenue Laws27. Fourth, whether a suit is hit by any provision of Forest Laws or MMRD Act or/and Revenue Laws expressly or by implication28. Lastly, whether the plaintiff on facts/evidence has proved that the suit land is a part of Revenue land and, therefore, it does not fall in the protected forest area and, if so, whether any prima facie case, balance of convenience and irreparable loss is made out for grant of permanent injunction in plaintiffs favour?29. In our opinion, all the five questions enumerated above did arise in the case. As a matter of fact, the suit could not have been tried properly without deciding these questions in the light of the pleadings, evidence and the applicable laws mentioned above30. In our view, the High Court, therefore, should have admitted the second appeal by framing appropriate substantial question(s) of law arising in the case and answered them on their respective merits rather than to dismiss the appeals without considering any of the aforementioned questions31. It is for this reason, we are of the view that the interference in the impugned order is called for to enable the High Court to decide the controversy in its proper perspective35. It was, however, brought to our notice that during pendency of the appeals Shiv Dayal- plaintiff/respondent No.1 in civil suit has expired. We, however, find that his wife – Smt. Kasturi Devi is already on record in two connected appeals/civil suits; Second, all the three suits/appeals, i.e., the one filed by Shiv Dayal and two filed by his wife Kasturi Devi) were clubbed together for their analogues disposal; Third, when one legal representative of the deceased is already on record, the appeal would not abate; and lastly, when the remand of the case is directed, consequential steps to bring remaining legal representative of the deceased on record, if there are, can always be taken before the High Court in pending appeals.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: Having heard the learned counsel for the parties and on perusal of the record of the case, we are constrained to allow the appeals, set aside the impugned order and remand the case to the High Court for deciding the second appeals afresh on merits in accordance with law. 13. In our opinion, the need to remand the case to the High Court has arisen because we find that the second appeals did involve several substantial questions of law for being answered on merits in accordance with law. The High Court was, therefore, not right in so holding. 14. Indeed, we find that the High Court dismissed the second appeals essentially on the ground that since the two Courts have decreed the suit, no substantial question of law arises in the appeals. In other words, the High Court was mostly swayed away with the consideration that since two Courts have decreed the suit, resulting in passing of the decree against the State, there arises no substantial question of law in the appeals. It is clear from the last paragraph of the impugned order, which reads as under: Under these circumstances, when both the Ld. Courts have arrived at the conclusion that the disputed area is outside the forest area. Therefore, the principles laid down in T.N. GODAWARAN vs. U.O.I. (above-quoted) cannot be enforced in this appeal. (Emphasis supplied) 15. We do not agree with the aforementioned reasoning and the conclusion arrived at by the High Court. 16. It is not the principle of law that where the High Court finds that there is a concurrent finding of two Courts (whether of dismissal or decreeing of the suit), such finding becomes unassailable in the second appeal. 17. True it is as has been laid down by this Court in several decisions that concurrent finding of fact is usually binding on the High Court while hearing the second appeal under Section 100 of the Code of Civil Procedure, 1908(hereinafter referred to as the Code). However, this rule of law is subject to certain well known exceptions mentioned infra. 18. It is a trite law that in order to record any finding on the facts, the Trial Court is required to appreciate the entire evidence (oral and documentary) in the light of the pleadings of the parties. 19. Similarly, it is also a trite law that the Appellate Court also has the jurisdiction to appreciate the evidence de novo while hearing the first appeal and either affirm the finding of the Trial Court or reverse it. 20. If the Appellate Court affirms the finding, it is called concurrent finding of fact whereas if the finding is reversed, it is called reversing finding. These expressions are well known in the legal parlance. 21. When any concurrent finding of fact is assailed in second appeal, the appellant is entitled to point out that it is bad in law because it was recorded de hors the pleadings or it was based on no evidence or it was based on misreading of material documentary evidence or it was recorded against any provision of law and lastly, the decision is one which no Judge acting judicially could reasonably have reached. (see observation made by learned Judge -Vivian Bose,J.- as His Lordship then was a Judge of the Nagpur High Court in Rajeshwar Vishwanath Mamidwar & Ors. vs. Dashrath Narayan Chilwelkar & Ors., AIR 1943 Nagpur 117 - Para 43). 22. In our opinion, if any one or more ground, as mentioned above, is made out in an appropriate case on the basis of the pleading and evidence, such ground will constitute substantial question of law within the meaning of Section 100 of the Code. 23. Coming to the facts of the case, we are of the view that the following are the questions which do arise for consideration in the suit/appeal for proper adjudication of the rights of the parties to the suit and are in the nature of substantial questions within the meaning of Section 100 of the Code. 24. First, whether the suit land was a part of a protected Forest area, i.e., Forest land and, if so, whether the parties satisfied all the statutory provisions of the Forest Laws enacted by the Center and the State? 25. Second, whether the suit land was a part of a Revenue land and, if so, whether the parties to the suit satisfied all the statutory provisions of the State Revenue Laws. 26. Third, whether a mining lease of the suit land could be granted by the State to the plaintiff for carrying out the mining operation in accordance with the provisions of the MMRD Act and, if so, whether it satisfied all the statutory provisions of the MMRD Act read with relevant Forest and Revenue Laws. 27. Fourth, whether a suit is hit by any provision of Forest Laws or MMRD Act or/and Revenue Laws expressly or by implication. 28. Lastly, whether the plaintiff on facts/evidence has proved that the suit land is a part of Revenue land and, therefore, it does not fall in the protected forest area and, if so, whether any prima facie case, balance of convenience and irreparable loss is made out for grant of permanent injunction in plaintiffs favour? 29. In our opinion, all the five questions enumerated above did arise in the case. As a matter of fact, the suit could not have been tried properly without deciding these questions in the light of the pleadings, evidence and the applicable laws mentioned above. 30. In our view, the High Court, therefore, should have admitted the second appeal by framing appropriate substantial question(s) of law arising in the case and answered them on their respective merits rather than to dismiss the appeals without considering any of the aforementioned questions. 31. It is for this reason, we are of the view that the interference in the impugned order is called for to enable the High Court to decide the controversy in its proper perspective. ### Response: 1

Ram Kripal Singh Vs. State Of U.P

Dr. Arijit Pasayat, J. 1. Leave granted. 2. Challenge in this appeal is to the order passed by a Division Bench of the Allahabad High Court dismissing the writ petition filed by the appellant. Challenge in the writ petition was to the recovery proceedings initiated against him under Uttar Pradesh Public Moneys recovery of Dues Act, 1972 (in short the Act). Prayer was to quash the citation issued by the Tehsildar principally on the ground that the proceedings are without jurisdiction as the respondent cannot proceed against the appellant as a guarantor unless and until the property of the principal debtor is sold. Since the recovery proceedings were initiated in the year 1993, recovery citation during the pendency of the earlier writ petition was illegal and therefore the appellant was entitled to get protection in view of what has been stated by this Court in Pawan Kumar Jain v. Pradeshiya Industrial and Investment Corporation of U.P. [2004 (6) SCC 758 ].3. Respondents on the other hand supported the action taken relying on a decision of this Court in Kailash Nath Agrawal v. Pradeshiya Industrial and Investment Corporation of U.P. [2003 (4) SCC 305 ]. It was also pointed out that the decision in Pawan Kumars case (supra) is not applicable as the company had been wound up and the official liquidator has been appointed.4. Accordingly the High Court dismissed the writ petition holding that since that the company has been wound up and the proceedings against the guarantor i.e. appellant were perfectly in order. 5. Stands taken before the High Court were reiterated by the parties in this appeal. At first glance the appellants stand appears to be in terra firma because of what has been stated by this court in Pawan Kumars case (supra). 6. On a closure scrutiny the finding of the High Court appears to be in order. Though it was urged that the recovery citation was issued after 24.1.2004 i.e. on 18th September, 2004, it is to be noted that the first recovery citation was issued on 3.9.1993. It is true that the same was under challenge in another writ petition. But the basic features are distinguishable. The present case is different from that of Pawan Kumars case (supra) as principal debtors Company has already been wound up and official liquidator has been appointed. The company was declared as sick industry on 17.11.1994 by the Board for Industrial and Financial Reconstruction (in short the BIFR) where after the company has undergone winding up proceedings before the High Court. The BIFR submitted its recommendation for winding up and against the order of BIFR appellant had preferred an appeal before the appellate authority which was rejected on 9.1.1997. The company had filed a writ petition questioning orders of the BIFR and the appellate authority. By order dated 26.2.2003 the Writ Petition No. 14172 of 1997 was dismissed and in the winding up proceedings, Company Court has permitted official liquidator to proceed with the winding up. 7. It appears that proposal for one time settlement was made and nothing concrete has been done by the appellant. In International Coach Builders Ltd. v. Karnataka State Financial Corporation [2003(10) SCC 482] it has been held that the position would be different in the company is under liquidation. 8. It appears to be a classic case where the efforts for recovery of the amounts have been frustrated on some pretext or other. In Orissa State Financial Corporation and Anr. v. Hotel Jogendra [1996(5) SCC 357] it was held that a recalcitrant defaulters case deserves to be dealt with sternly. 9. The right of State Financial Corporation (in short SFC) unilaterally exercisable under Section 29 of the State Financial Corporation Act, 1951 (in short SFC Act) is available against a debtor, if a company, only so long as there is no order of winding up.10. SFCs cannot unilaterally act to realize the mortgaged properties without the consent of the official liquidator.11. If the official liquidator does not consent, SFCs have to move the Company Court for appropriate directions to the official liquidator. In any event, the official liquidator cannot act without seeking directions from the Company Court and under its supervision.

0[ds]6. On a closure scrutiny the finding of the High Court appears to be in order. Though it was urged that the recovery citation was issued after 24.1.2004 i.e. on 18th September, 2004, it is to be noted that the first recovery citation was issued on 3.9.1993. It is true that the same was under challenge in another writ petition. But the basic features are distinguishable. The present case is different from that of Pawan Kumars case (supra) as principal debtors Company has already been wound up and official liquidator has been appointed. The company was declared as sick industry on 17.11.1994 by the Board for Industrial and Financial Reconstruction (in short the BIFR) where after the company has undergone winding up proceedings before the High Court. The BIFR submitted its recommendation for winding up and against the order of BIFR appellant had preferred an appeal before the appellate authority which was rejected on 9.1.1997. The company had filed a writ petition questioning orders of the BIFR and the appellate authority. By order dated 26.2.2003 the Writ Petition No. 14172 of 1997 was dismissed and in the winding up proceedings, Company Court has permitted official liquidator to proceed with the winding up.The right of State Financial Corporation (in short SFC) unilaterally exercisable under Section 29 of the State Financial Corporation Act, 1951 (in short SFC Act) is available against a debtor, if a company, only so long as there is no order of winding up.10. SFCs cannot unilaterally act to realize the mortgaged properties without the consent of the official liquidator.11. If the official liquidator does not consent, SFCs have to move the Company Court for appropriate directions to the official liquidator. In any event, the official liquidator cannot act without seeking directions from the Company Court and under its supervision.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: Dr. Arijit Pasayat, J. 1. Leave granted. 2. Challenge in this appeal is to the order passed by a Division Bench of the Allahabad High Court dismissing the writ petition filed by the appellant. Challenge in the writ petition was to the recovery proceedings initiated against him under Uttar Pradesh Public Moneys recovery of Dues Act, 1972 (in short the Act). Prayer was to quash the citation issued by the Tehsildar principally on the ground that the proceedings are without jurisdiction as the respondent cannot proceed against the appellant as a guarantor unless and until the property of the principal debtor is sold. Since the recovery proceedings were initiated in the year 1993, recovery citation during the pendency of the earlier writ petition was illegal and therefore the appellant was entitled to get protection in view of what has been stated by this Court in Pawan Kumar Jain v. Pradeshiya Industrial and Investment Corporation of U.P. [2004 (6) SCC 758 ].3. Respondents on the other hand supported the action taken relying on a decision of this Court in Kailash Nath Agrawal v. Pradeshiya Industrial and Investment Corporation of U.P. [2003 (4) SCC 305 ]. It was also pointed out that the decision in Pawan Kumars case (supra) is not applicable as the company had been wound up and the official liquidator has been appointed.4. Accordingly the High Court dismissed the writ petition holding that since that the company has been wound up and the proceedings against the guarantor i.e. appellant were perfectly in order. 5. Stands taken before the High Court were reiterated by the parties in this appeal. At first glance the appellants stand appears to be in terra firma because of what has been stated by this court in Pawan Kumars case (supra). 6. On a closure scrutiny the finding of the High Court appears to be in order. Though it was urged that the recovery citation was issued after 24.1.2004 i.e. on 18th September, 2004, it is to be noted that the first recovery citation was issued on 3.9.1993. It is true that the same was under challenge in another writ petition. But the basic features are distinguishable. The present case is different from that of Pawan Kumars case (supra) as principal debtors Company has already been wound up and official liquidator has been appointed. The company was declared as sick industry on 17.11.1994 by the Board for Industrial and Financial Reconstruction (in short the BIFR) where after the company has undergone winding up proceedings before the High Court. The BIFR submitted its recommendation for winding up and against the order of BIFR appellant had preferred an appeal before the appellate authority which was rejected on 9.1.1997. The company had filed a writ petition questioning orders of the BIFR and the appellate authority. By order dated 26.2.2003 the Writ Petition No. 14172 of 1997 was dismissed and in the winding up proceedings, Company Court has permitted official liquidator to proceed with the winding up. 7. It appears that proposal for one time settlement was made and nothing concrete has been done by the appellant. In International Coach Builders Ltd. v. Karnataka State Financial Corporation [2003(10) SCC 482] it has been held that the position would be different in the company is under liquidation. 8. It appears to be a classic case where the efforts for recovery of the amounts have been frustrated on some pretext or other. In Orissa State Financial Corporation and Anr. v. Hotel Jogendra [1996(5) SCC 357] it was held that a recalcitrant defaulters case deserves to be dealt with sternly. 9. The right of State Financial Corporation (in short SFC) unilaterally exercisable under Section 29 of the State Financial Corporation Act, 1951 (in short SFC Act) is available against a debtor, if a company, only so long as there is no order of winding up.10. SFCs cannot unilaterally act to realize the mortgaged properties without the consent of the official liquidator.11. If the official liquidator does not consent, SFCs have to move the Company Court for appropriate directions to the official liquidator. In any event, the official liquidator cannot act without seeking directions from the Company Court and under its supervision. ### Response: 0

Seth Hiralal Patni Vs. Sri Kali Nath

in an objection under Ss. 47 and l51 of the Code of Civil Procedure, objecting to the execution of the decree on a number of grounds, of which it is only necessary to notice the one challenging the jurisdiction of the High Court to entertain the suit and to make the award a decree of Court. It was contended that the Bombay High Court had no jurisdiction to entertain the suit as no part of the cause of action even arose within the territorial jurisdiction of that Court, that, therefore, all the proceedings following thereupon were wholly without jurisdiction. The learned Execution Judge, by his judgment and order dated April 3, 1954 dismissed the objection petition with costs. The appellant then preferred an appeal to the High Court of Judicature at Allahabad against the aforesaid judgment and order of the Executing Court. The appeal, being Execution First Appeal No. 137 of 1954, was ultimately dismissed by a Division Bench of the Allahabad High Court, by its judgment dated January 27, 1955. The judgment debtor-appellant moved the High Court and obtained the necessary certificate that the case was a fit one for appeal to this Court; and that is how the matter is before us.4. The only ground on which the decision of the High Court is challenged is that the suit instituted on the original side of the Bombay High Court was wholly incompetent for want of territorial jurisdiction and that therefore, the award that followed on the reference between the parties and the decree of Court, under execution, were all null and void. Strong reliance was placed upon the decision of the Privy Council in the case of Ledgard v. Bull, 13 Ind. App. l34 (P. C.). In our opinion, there is no substance in this contention. There was no inherent lack of jurisdiction in the Bombay High Court where the suit was instituted by the plaintiff-decree-holder. The plaint had been filed after obtaining the necessary leave of the High Court under Cl. 12 of the Letters Patent. Whether the leave obtained had been rightly obtained or wrongly obtained is not a matter which can be agitated at the execution stage. The validity of a decree can be challenged in execution proceedings only on the ground that the court which passed the decree was lacking in inherent jurisdiction in the sense that it could not have seizin of the case because subject matter was wholly foreign to its jurisdiction or that the defendant was dead at the time the suit had been instituted or decree passed, or some such other ground which could have the effect of rendering the court entirely lacking in jurisdiction in respect of the subject matter of the suit in over the parties to it. But in the instant case there was no such inherent lack of jurisdiction.The decision of the Privy Council in the case of 13 Ind. App. 134 (P. C.) is an authority for the proposition that consent or waiver can cure defect of jurisdiction but cannot cure inherent lack of jurisdiction. In that case, the suit had been instituted in the court of the subordinate Judge, who was incompetent to try it. By consent of the parties, the case was transferred to the Court of the District Judge for convenience of trial. It was laid down by the Privy Council that as the Court in which the suit had been originally instituted was entirely lacking in jurisdiction, in the sense that it was incompetent to try it, whatever happened subsequently was null and void because consent of parties could not operate to confer jurisdiction on a court which was incompetent to try the suit. That decision has no relevance to a case like the present where there could he no question of inherent lack of jurisdiction in the sense that the Bombay High Court was incompetent to try a suit of that kind. The objection to its territorial jurisdiction is one which does not go to the competence of the Court and can, therefore, be waived. In the instant case, when the plaintiff obtained the leave of the Bombay High Court on the original side, under Cl. 12 of the Letters Patent, the correctness of the procedure or of the order granting the leave could be questioned by the defendant or the objection could be waived by him. When he agreed to refer the matter to arbitration through Court, he would be deemed to have waived his objection to the territorial jurisdiction of the Court, raised by him in his written statement. It is well settled that the objection as to local jurisdiction of a court does not stand on the same footing as an objection to the competence of a court to try case. Competence of a court to try a case goes to the very root of the jurisdiction, and where it is lacking, it is a case of inherent lack of jurisdiction. On the other hand an objection as to the local jurisdiction of a court can be waived and this principle has been given a statutory recognition by enactments like S. 21 of the Code of Civil Procedure. Having consented to have the controversy between the parties resolved by reference to arbitration through court, the defendant deprived himself of the right to question the authority of the Court to refer the matter to arbitration or of the arbitrator to render the award. It is clear, therefore, that the defendant is estopped from challenging the jurisdiction of the Bombay High Court to entertain the suit and to make the reference to the arbitrator. He is equally estopped from challenging the authority of the arbitrator to render the award. In our opinion, this conclusion is sufficient to dispose of the appeal. It is not, therefore, necessary to determine the other points in controversy, including the question whether the Decrees and Orders Validating Act, 1936 (Act V of 1936) had the effect of validating what otherwise may have been invalid.

0[ds]In our opinion, there is no substance in this contention. There was no inherent lack of jurisdiction in the Bombay High Court where the suit was instituted by the plaintiff-decree-holder. The plaint had been filed after obtaining the necessary leave of the High Court under Cl. 12 of the Letters Patent. Whether the leave obtained had been rightly obtained or wrongly obtained is not a matter which can be agitated at the execution stage. The validity of a decree can be challenged in execution proceedings only on the ground that the court which passed the decree was lacking in inherent jurisdiction in the sense that it could not have seizin of the case because subject matter was wholly foreign to its jurisdiction or that the defendant was dead at the time the suit had been instituted or decree passed, or some such other ground which could have the effect of rendering the court entirely lacking in jurisdiction in respect of the subject matter of the suit in over the parties to it. But in the instant case there was no such inherent lack ofdecision has no relevance to a case like the present where there could he no question of inherent lack of jurisdiction in the sense that the Bombay High Court was incompetent to try a suit of that kind. The objection to its territorial jurisdiction is one which does not go to the competence of the Court and can, therefore, be waived. In the instant case, when the plaintiff obtained the leave of the Bombay High Court on the original side, under Cl. 12 of the Letters Patent, the correctness of the procedure or of the order granting the leave could be questioned by the defendant or the objection could be waived by him. When he agreed to refer the matter to arbitration through Court, he would be deemed to have waived his objection to the territorial jurisdiction of the Court, raised by him in his written statement. It is well settled that the objection as to local jurisdiction of a court does not stand on the same footing as an objection to the competence of a court to try case. Competence of a court to try a case goes to the very root of the jurisdiction, and where it is lacking, it is a case of inherent lack of jurisdiction. On the other hand an objection as to the local jurisdiction of a court can be waived and this principle has been given a statutory recognition by enactments like S. 21 of the Code of Civil Procedure. Having consented to have the controversy between the parties resolved by reference to arbitration through court, the defendant deprived himself of the right to question the authority of the Court to refer the matter to arbitration or of the arbitrator to render the award. It is clear, therefore, that the defendant is estopped from challenging the jurisdiction of the Bombay High Court to entertain the suit and to make the reference to the arbitrator. He is equally estopped from challenging the authority of the arbitrator to render the award. In our opinion, this conclusion is sufficient to dispose of the appeal. It is not, therefore, necessary to determine the other points in controversy, including the question whether the Decrees and Orders Validating Act, 1936 (Act V of 1936) had the effect of validating what otherwise may have been invalid.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: in an objection under Ss. 47 and l51 of the Code of Civil Procedure, objecting to the execution of the decree on a number of grounds, of which it is only necessary to notice the one challenging the jurisdiction of the High Court to entertain the suit and to make the award a decree of Court. It was contended that the Bombay High Court had no jurisdiction to entertain the suit as no part of the cause of action even arose within the territorial jurisdiction of that Court, that, therefore, all the proceedings following thereupon were wholly without jurisdiction. The learned Execution Judge, by his judgment and order dated April 3, 1954 dismissed the objection petition with costs. The appellant then preferred an appeal to the High Court of Judicature at Allahabad against the aforesaid judgment and order of the Executing Court. The appeal, being Execution First Appeal No. 137 of 1954, was ultimately dismissed by a Division Bench of the Allahabad High Court, by its judgment dated January 27, 1955. The judgment debtor-appellant moved the High Court and obtained the necessary certificate that the case was a fit one for appeal to this Court; and that is how the matter is before us.4. The only ground on which the decision of the High Court is challenged is that the suit instituted on the original side of the Bombay High Court was wholly incompetent for want of territorial jurisdiction and that therefore, the award that followed on the reference between the parties and the decree of Court, under execution, were all null and void. Strong reliance was placed upon the decision of the Privy Council in the case of Ledgard v. Bull, 13 Ind. App. l34 (P. C.). In our opinion, there is no substance in this contention. There was no inherent lack of jurisdiction in the Bombay High Court where the suit was instituted by the plaintiff-decree-holder. The plaint had been filed after obtaining the necessary leave of the High Court under Cl. 12 of the Letters Patent. Whether the leave obtained had been rightly obtained or wrongly obtained is not a matter which can be agitated at the execution stage. The validity of a decree can be challenged in execution proceedings only on the ground that the court which passed the decree was lacking in inherent jurisdiction in the sense that it could not have seizin of the case because subject matter was wholly foreign to its jurisdiction or that the defendant was dead at the time the suit had been instituted or decree passed, or some such other ground which could have the effect of rendering the court entirely lacking in jurisdiction in respect of the subject matter of the suit in over the parties to it. But in the instant case there was no such inherent lack of jurisdiction.The decision of the Privy Council in the case of 13 Ind. App. 134 (P. C.) is an authority for the proposition that consent or waiver can cure defect of jurisdiction but cannot cure inherent lack of jurisdiction. In that case, the suit had been instituted in the court of the subordinate Judge, who was incompetent to try it. By consent of the parties, the case was transferred to the Court of the District Judge for convenience of trial. It was laid down by the Privy Council that as the Court in which the suit had been originally instituted was entirely lacking in jurisdiction, in the sense that it was incompetent to try it, whatever happened subsequently was null and void because consent of parties could not operate to confer jurisdiction on a court which was incompetent to try the suit. That decision has no relevance to a case like the present where there could he no question of inherent lack of jurisdiction in the sense that the Bombay High Court was incompetent to try a suit of that kind. The objection to its territorial jurisdiction is one which does not go to the competence of the Court and can, therefore, be waived. In the instant case, when the plaintiff obtained the leave of the Bombay High Court on the original side, under Cl. 12 of the Letters Patent, the correctness of the procedure or of the order granting the leave could be questioned by the defendant or the objection could be waived by him. When he agreed to refer the matter to arbitration through Court, he would be deemed to have waived his objection to the territorial jurisdiction of the Court, raised by him in his written statement. It is well settled that the objection as to local jurisdiction of a court does not stand on the same footing as an objection to the competence of a court to try case. Competence of a court to try a case goes to the very root of the jurisdiction, and where it is lacking, it is a case of inherent lack of jurisdiction. On the other hand an objection as to the local jurisdiction of a court can be waived and this principle has been given a statutory recognition by enactments like S. 21 of the Code of Civil Procedure. Having consented to have the controversy between the parties resolved by reference to arbitration through court, the defendant deprived himself of the right to question the authority of the Court to refer the matter to arbitration or of the arbitrator to render the award. It is clear, therefore, that the defendant is estopped from challenging the jurisdiction of the Bombay High Court to entertain the suit and to make the reference to the arbitrator. He is equally estopped from challenging the authority of the arbitrator to render the award. In our opinion, this conclusion is sufficient to dispose of the appeal. It is not, therefore, necessary to determine the other points in controversy, including the question whether the Decrees and Orders Validating Act, 1936 (Act V of 1936) had the effect of validating what otherwise may have been invalid. ### Response: 0

THE STATE OF TAMIL NADU Vs. THE STATE OF KARNATAKA

from paragraphs 1, 2, 47, 49, 50, 51, 52 and 53 of the decision of Kabir, J. (as the learned Chief Justice then was), with whom Katju, J. concurred:-"1. The State of Orissa has filed this writ petition under Article 32 of the Constitution of India, wherein the Government of India has been made Respondent 1 and the State of Andhra Pradesh has been made Respondent 2, inter alia, for the following reliefs:?(a) direct the Government of India to constitute an appropriate Tribunal under Section 4 of the Inter-State Water Disputes Act, 1956 and thereafter, refer to it the dispute relating to the construction of Side Channel Weir and Flood Flow Canal Project at Katragada on River Vansadhara by the State of Andhra Pradesh;(b) issue a writ of mandamus commanding the State of Andhra Pradesh to forbear from carrying on any works of the proposed project;?2. As indicated in the very opening paragraph, the writ petition was filed by the State of Orissa for a direction to the Central Government to constitute a Water Disputes Tribunal under the Inter-State Water Disputes Act, 1956 and to refer to the Tribunal the dispute contained in the complaint made by the State of Orissa on 13-2-2006, as to whether the State of Andhra Pradesh was justified in constructing a Side Channel Weir and Flood Flow Canal Project on River Vansadhara at Katragada, which would adversely affect the supply of water from the river to the State of Orissa and adversely affect the livelihood of thousands of people of Orissa in glaring violation of Article 21 of the Constitution of India.…47. It is now almost three years since the complaint was made by the State of Orissa but the Central Government has not taken any action in the matter. In this scenario, the prayer made by the State of Orissa does not appear to be unreasonable since the dispute between the two States does not confine itself to the construction of the side channel weir and the flood flow canal, but primarily it involves the unilateral decision taken by the State of Andhra Pradesh to divert the river waters to the State of Andhra Pradesh, which could possibly disturb the agreement to share the waters of the river equally.…49. Coming to the question of grant of interim order during the interregnum, I am satisfied that unless some interim protection is given till the constitution of the Water Disputes Tribunal by the Central Government, the objection raised by the State of Orissa will be rendered infructuous, which certainly is not the intention of the 1956 Act.50. Notwithstanding the powers vested by Section 9 of the Act in the Water Disputes Tribunal to be constituted by the Central Government under Section 4, which includes the power to grant the interim order, this Court under Article 32 of the Constitution has ample jurisdiction to pass interim orders preserving the status quo till a Tribunal is constituted which can then exercise its powers under Section 9.51. The bar under Section 11 of the Act will come into play once the Tribunal is constituted and the water dispute is referred to the said Tribunal. Till then, the bar of Section 11 cannot operate, as that would leave a party without any remedy till such time as the Tribunal is formed, which may be delayed.52. I, accordingly, allow the writ petition and direct the Central Government to constitute a Water Disputes Tribunal within a period of six months from the date and to refer to it the dispute relating to the construction of the Side Channel Weir and Flood Flow Canal Project at Katragada on River Vansadhara by the State of Andhra Pradesh for diversion of the waters of the said river which could adversely affect the supply of water from the said river to the State of Orissa.53. I also direct that pending constitution of the Water Disputes Tribunal and reference of the above dispute to it, the State of Andhra Pradesh will maintain status quo as of date with regard to the construction of the side channel weir and the flood flow canal at Katragada. Once the Tribunal is constituted the parties will be free to apply for further interim orders before the Tribunal.?The second case dealt with the maintainability of a Writ Petition by the concerned Writ Petitioners.16. In the present case neither in the plaint, nor in the interim application any relief in the nature of directions to constitute a Tribunal under the Act is claimed.17. We repeatedly asked Mr. Naphade, learned Senior Advocate to show any communication where the plaintiff had invoked the power of the Central Government and sought constitution of an Inter State River Water Disputes Tribunal to consider the present controversy. Mr. Naphade accepted that there was no such express communication but submitted that the request ought to be inferred from various communications addressed by the plaintiff to the Central Government.18. It must be stated that Section 3 of the Act postulates that a request be made in such form and manner as may be prescribed, whereafter the requisite power can be exercised by the Central Government. The rules framed pursuant to rule making power conferred upon the Central Government under Section 13 of the Act also prescribe a particular form. It is not as if that there was lack of proper legal opinion in the matter. The State would normally be guided by expert legal advice in such matters. It is also possible to say that in a given case, a State may not be inclined to have any Inter State River Water Disputes Tribunal to be constituted and would therefore consciously avoid any direct request asking for such constitution of the Tribunal. There could be variety of reasons. It will not therefore be correct on our part to infer such an idea from the communications addressed by the plaintiff to the second defendant and then find second defendant to be at fault for not constituting a Tribunal under the Act.

0[ds]13. The rival contentions advanced by the parties touching upon merits of the matter including maintainability of the suit will certainly be gone into after the parties are allowed opportunity to lead evidence in accordance with law and to make appropriate submissions.From the record it is prima facie evident that the project in question was undertaken after receiving all requisite sanctions and permissions. The issue was engaging the attention of the authorities for a while; the construction work began few years back; and as of now 75% work is complete. Therefore, in our prima facie view, no case is made out for granting any interim relief.In the present case neither in the plaint, nor in the interim application any relief in the nature of directions to constitute a Tribunal under the Act is claimed.It must be stated that Section 3 of the Act postulates that a request be made in such form and manner as may be prescribed, whereafter the requisite power can be exercised by the Central Government. The rules framed pursuant to rule making power conferred upon the Central Government under Section 13 of the Act also prescribe a particular form. It is not as if that there was lack of proper legal opinion in the matter. The State would normally be guided by expert legal advice in such matters. It is also possible to say that in a given case, a State may not be inclined to have any Inter State River Water Disputes Tribunal to be constituted and would therefore consciously avoid any direct request asking for such constitution of the Tribunal. There could be variety of reasons. It will not therefore be correct on our part to infer such an idea from the communications addressed by the plaintiff to the second defendant and then find second defendant to be at fault for not constituting a Tribunal under the Act.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: from paragraphs 1, 2, 47, 49, 50, 51, 52 and 53 of the decision of Kabir, J. (as the learned Chief Justice then was), with whom Katju, J. concurred:-"1. The State of Orissa has filed this writ petition under Article 32 of the Constitution of India, wherein the Government of India has been made Respondent 1 and the State of Andhra Pradesh has been made Respondent 2, inter alia, for the following reliefs:?(a) direct the Government of India to constitute an appropriate Tribunal under Section 4 of the Inter-State Water Disputes Act, 1956 and thereafter, refer to it the dispute relating to the construction of Side Channel Weir and Flood Flow Canal Project at Katragada on River Vansadhara by the State of Andhra Pradesh;(b) issue a writ of mandamus commanding the State of Andhra Pradesh to forbear from carrying on any works of the proposed project;?2. As indicated in the very opening paragraph, the writ petition was filed by the State of Orissa for a direction to the Central Government to constitute a Water Disputes Tribunal under the Inter-State Water Disputes Act, 1956 and to refer to the Tribunal the dispute contained in the complaint made by the State of Orissa on 13-2-2006, as to whether the State of Andhra Pradesh was justified in constructing a Side Channel Weir and Flood Flow Canal Project on River Vansadhara at Katragada, which would adversely affect the supply of water from the river to the State of Orissa and adversely affect the livelihood of thousands of people of Orissa in glaring violation of Article 21 of the Constitution of India.…47. It is now almost three years since the complaint was made by the State of Orissa but the Central Government has not taken any action in the matter. In this scenario, the prayer made by the State of Orissa does not appear to be unreasonable since the dispute between the two States does not confine itself to the construction of the side channel weir and the flood flow canal, but primarily it involves the unilateral decision taken by the State of Andhra Pradesh to divert the river waters to the State of Andhra Pradesh, which could possibly disturb the agreement to share the waters of the river equally.…49. Coming to the question of grant of interim order during the interregnum, I am satisfied that unless some interim protection is given till the constitution of the Water Disputes Tribunal by the Central Government, the objection raised by the State of Orissa will be rendered infructuous, which certainly is not the intention of the 1956 Act.50. Notwithstanding the powers vested by Section 9 of the Act in the Water Disputes Tribunal to be constituted by the Central Government under Section 4, which includes the power to grant the interim order, this Court under Article 32 of the Constitution has ample jurisdiction to pass interim orders preserving the status quo till a Tribunal is constituted which can then exercise its powers under Section 9.51. The bar under Section 11 of the Act will come into play once the Tribunal is constituted and the water dispute is referred to the said Tribunal. Till then, the bar of Section 11 cannot operate, as that would leave a party without any remedy till such time as the Tribunal is formed, which may be delayed.52. I, accordingly, allow the writ petition and direct the Central Government to constitute a Water Disputes Tribunal within a period of six months from the date and to refer to it the dispute relating to the construction of the Side Channel Weir and Flood Flow Canal Project at Katragada on River Vansadhara by the State of Andhra Pradesh for diversion of the waters of the said river which could adversely affect the supply of water from the said river to the State of Orissa.53. I also direct that pending constitution of the Water Disputes Tribunal and reference of the above dispute to it, the State of Andhra Pradesh will maintain status quo as of date with regard to the construction of the side channel weir and the flood flow canal at Katragada. Once the Tribunal is constituted the parties will be free to apply for further interim orders before the Tribunal.?The second case dealt with the maintainability of a Writ Petition by the concerned Writ Petitioners.16. In the present case neither in the plaint, nor in the interim application any relief in the nature of directions to constitute a Tribunal under the Act is claimed.17. We repeatedly asked Mr. Naphade, learned Senior Advocate to show any communication where the plaintiff had invoked the power of the Central Government and sought constitution of an Inter State River Water Disputes Tribunal to consider the present controversy. Mr. Naphade accepted that there was no such express communication but submitted that the request ought to be inferred from various communications addressed by the plaintiff to the Central Government.18. It must be stated that Section 3 of the Act postulates that a request be made in such form and manner as may be prescribed, whereafter the requisite power can be exercised by the Central Government. The rules framed pursuant to rule making power conferred upon the Central Government under Section 13 of the Act also prescribe a particular form. It is not as if that there was lack of proper legal opinion in the matter. The State would normally be guided by expert legal advice in such matters. It is also possible to say that in a given case, a State may not be inclined to have any Inter State River Water Disputes Tribunal to be constituted and would therefore consciously avoid any direct request asking for such constitution of the Tribunal. There could be variety of reasons. It will not therefore be correct on our part to infer such an idea from the communications addressed by the plaintiff to the second defendant and then find second defendant to be at fault for not constituting a Tribunal under the Act. ### Response: 0

M/s. Road Transport Company Vs. Bhan Singh

contained in section. II.I(c) but subject otherwise to the terms, exceptions, conditions and limitations of this Policy the company will indemnify the insured against liability at law for compensation (including law costs of any claimant) for death of or bodily injury to any person other than a person excluded under section II-I(b) being carried in or upon or entering or mounting or alighting from the Motor Vehicle but such indemnity is limited to the sum of Rs. 5,000/- in respect of any one person and subject to the aforesaid limit in respect of any one person to Rs. 75,000 in respect of any number of claims in connection with the Motor Vehicle arising out of one cause." Section 95(1)(b)(i) provides for compulsory insurance against any liability which may be incurred by the insured in respect of the death of or bodily injury to any person. Section 95(1)(b)(ii) provides for compulsory insurance against the death or bodily injury to any passenger of a public service vehicle cause by or arising out of the use of the vehicle in a public place. Section 95(1)(b)(ii) being a specific provision made in respect of passengers of a public service vehicle, obviously that provision becomes applicable and not the general provision contained in Section 95(1)(b)(i), when the insured incurs liability in respect of the passengers travelling into his public service vehicle. Before the Tribunal and the High Court also the appellant had claimed the protection of Section 95(1)(b)(ii). Therefore, Mr. Ranjit Kumar, learned counsel for the appellant, cannot now be permitted to bring the appellants case under Section 95(1)(b)(i) on the ground that it is wide enough to include a passenger as the word used therein is `any person. Even otherwise also this contention has no substance. Therefore, the liability of the insurance company will have to be determined in terms of Section 95(2)(ii). It is not in dispute that at the relevant time Section 95(2)(b)(ii) limited the liability of the insurance company to Rs. 5,000/- each passenger and Rs. 75,000/- in all, where the vehicle was registered to carry more than 30 but not more than 60 passengers. 6. The next submission was that the appellant had paid additional premium of Rs. 300/- to cover liability higher than the limited liability fixed by Section 95(2). It was submitted by Mr. Ranjit Kumar that the policy being a comprehensive policy it covered all the statutory liabilities and the additional premium of Rs. 300/- was paid for covering liability higher than the statutory liability in respect of passengers. The insurance policy, relevant part of which has been set out above, shows that it covered the following risks : (1) comprehensive risk, (2) S&R risk, (3) passenger risk, and (4) legal liability in respect of paid driver, cleaner and conductor under Workmens Compensation Act. For the comprehensive risk the appellant had paid Rs. 626/- as basic premium. Ordinarily the insurance policy does not cover strike and riot risk and, therefore, to cover that risk also the insured had paid additional premium of Rs. 100/-. To cover 50 passengers risk the insured had paid Rs. 300/- as premium and for covering the risk in respect of driver etc. he had paid Rs. 721.20 as additional premium. If the comprehensive risk covered all other risks as contended by the appellant then the policy would not have mentioned separately the S&R risk and passenger risk. Not only that they have been separately mentioned but separate amounts were paid by way of premium for covering those risks. Thus the basic premium of Rs. 626 paid for the comprehensive risk was obviously in respect of the bus and not in respect of other risks as contended by the learned counsel for the respondent insurance company. A fair reading of the insurance policy discloses that the basic premium of Rs. 626/- though paid for comprehensive risk was not intended to cover all the statutory liabilities but it was really intended to cover the entire loss or damage to the vehicle. As observed by this Court in Jugal Kishores case "even though it not permissible to use a vehicle unless it is covered at least under an `Act only policy it is not obligatory for the owner of a vehicle to get it comprehensively insured. In case, however, it is not comprehensively insured a higher premium that for an `Act only policy is payable depending on the estimated value of the vehicle. Such insurance entitles the owner to claim reimbursement of the entire amount of loss or damage suffered upto the estimated value of the vehicle calculated according to the rules and regulations framed in this behalf."7. The insurance company had charged a premium of Rs. 300/- towards passengers risk. It works out at Rs. 6/- per passenger. As per the Indian Motor Tariff applicable on the date of accident by charging a premium of Rs. 6/- per passenger the liability of the company per passenger was Rs. 5,000/- only. The Indian Motor Tariff which regulates a premium and liability of insurance company is framed by the Tariff Advisory Committee, a statutory body set up under the Insurance Act. The additional premium of Rs. 300/- was thus paid to cover the statutory liability for 50 passengers as the vehicle insured was a passenger bus having registered capacity of carrying 50 passengers. Endorsement No. 13 which was attached to and formed part of the policy and which we have set out above also makes it clear that it was in consideration of an additional premium of Rs. 300/- that the insurance company had undertaken to idemnify the insured against his liability in respect of passengers to the extent of Rs. 5,000/- for each passenger and Rs. 75,000/- in all. It is, therefore, not possible to accept the contention raised on behalf of the appellant that the additional premium of Rs. 300/- was paid for covering higher than the statutory liability. There was no special contract to cover unlimited liability in respect of the passengers. 8.

0[ds]Thus the basic premium of Rs. 626 paid for the comprehensive risk was obviously in respect of the bus and not in respect of other risks as contended by the learned counsel for the respondent insurance company. A fair reading of the insurance policy discloses that the basic premium of Rs. 626/- though paid for comprehensive risk was not intended to cover all the statutory liabilities but it was really intended to cover the entire loss or damage to the vehicle. As observed by this Court in Jugal Kishores case "even though it not permissible to use a vehicle unless it is covered at least under an `Act only policy it is not obligatory for the owner of a vehicle to get it comprehensively insured. In case, however, it is not comprehensively insured a higher premium that for an `Act only policy is payable depending on the estimated value of the vehicle. Such insurance entitles the owner to claim reimbursement of the entire amount of loss or damage suffered upto the estimated value of the vehicle calculated according to the rules and regulations framed in this behalf."7. The insurance company had charged a premium of Rs. 300/- towards passengers risk. It works out at Rs. 6/- per passenger. As per the Indian Motor Tariff applicable on the date of accident by charging a premium of Rs. 6/- per passenger the liability of the company per passenger was Rs. 5,000/- only. The Indian Motor Tariff which regulates a premium and liability of insurance company is framed by the Tariff Advisory Committee, a statutory body set up under the Insurance Act. The additional premium of Rs. 300/- was thus paid to cover the statutory liability for 50 passengers as the vehicle insured was a passenger bus having registered capacity of carrying 50 passengers. Endorsement No. 13 which was attached to and formed part of the policy and which we have set out above also makes it clear that it was in consideration of an additional premium of Rs. 300/- that the insurance company had undertaken to idemnify the insured against his liability in respect of passengers to the extent of Rs. 5,000/- for each passenger and Rs. 75,000/- in all. It is, therefore, not possible to accept the contention raised on behalf of the appellant that the additional premium of Rs. 300/- was paid for covering higher than the statutory liability. There was no special contract to cover unlimited liability in respect of the passengers.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: contained in section. II.I(c) but subject otherwise to the terms, exceptions, conditions and limitations of this Policy the company will indemnify the insured against liability at law for compensation (including law costs of any claimant) for death of or bodily injury to any person other than a person excluded under section II-I(b) being carried in or upon or entering or mounting or alighting from the Motor Vehicle but such indemnity is limited to the sum of Rs. 5,000/- in respect of any one person and subject to the aforesaid limit in respect of any one person to Rs. 75,000 in respect of any number of claims in connection with the Motor Vehicle arising out of one cause." Section 95(1)(b)(i) provides for compulsory insurance against any liability which may be incurred by the insured in respect of the death of or bodily injury to any person. Section 95(1)(b)(ii) provides for compulsory insurance against the death or bodily injury to any passenger of a public service vehicle cause by or arising out of the use of the vehicle in a public place. Section 95(1)(b)(ii) being a specific provision made in respect of passengers of a public service vehicle, obviously that provision becomes applicable and not the general provision contained in Section 95(1)(b)(i), when the insured incurs liability in respect of the passengers travelling into his public service vehicle. Before the Tribunal and the High Court also the appellant had claimed the protection of Section 95(1)(b)(ii). Therefore, Mr. Ranjit Kumar, learned counsel for the appellant, cannot now be permitted to bring the appellants case under Section 95(1)(b)(i) on the ground that it is wide enough to include a passenger as the word used therein is `any person. Even otherwise also this contention has no substance. Therefore, the liability of the insurance company will have to be determined in terms of Section 95(2)(ii). It is not in dispute that at the relevant time Section 95(2)(b)(ii) limited the liability of the insurance company to Rs. 5,000/- each passenger and Rs. 75,000/- in all, where the vehicle was registered to carry more than 30 but not more than 60 passengers. 6. The next submission was that the appellant had paid additional premium of Rs. 300/- to cover liability higher than the limited liability fixed by Section 95(2). It was submitted by Mr. Ranjit Kumar that the policy being a comprehensive policy it covered all the statutory liabilities and the additional premium of Rs. 300/- was paid for covering liability higher than the statutory liability in respect of passengers. The insurance policy, relevant part of which has been set out above, shows that it covered the following risks : (1) comprehensive risk, (2) S&R risk, (3) passenger risk, and (4) legal liability in respect of paid driver, cleaner and conductor under Workmens Compensation Act. For the comprehensive risk the appellant had paid Rs. 626/- as basic premium. Ordinarily the insurance policy does not cover strike and riot risk and, therefore, to cover that risk also the insured had paid additional premium of Rs. 100/-. To cover 50 passengers risk the insured had paid Rs. 300/- as premium and for covering the risk in respect of driver etc. he had paid Rs. 721.20 as additional premium. If the comprehensive risk covered all other risks as contended by the appellant then the policy would not have mentioned separately the S&R risk and passenger risk. Not only that they have been separately mentioned but separate amounts were paid by way of premium for covering those risks. Thus the basic premium of Rs. 626 paid for the comprehensive risk was obviously in respect of the bus and not in respect of other risks as contended by the learned counsel for the respondent insurance company. A fair reading of the insurance policy discloses that the basic premium of Rs. 626/- though paid for comprehensive risk was not intended to cover all the statutory liabilities but it was really intended to cover the entire loss or damage to the vehicle. As observed by this Court in Jugal Kishores case "even though it not permissible to use a vehicle unless it is covered at least under an `Act only policy it is not obligatory for the owner of a vehicle to get it comprehensively insured. In case, however, it is not comprehensively insured a higher premium that for an `Act only policy is payable depending on the estimated value of the vehicle. Such insurance entitles the owner to claim reimbursement of the entire amount of loss or damage suffered upto the estimated value of the vehicle calculated according to the rules and regulations framed in this behalf."7. The insurance company had charged a premium of Rs. 300/- towards passengers risk. It works out at Rs. 6/- per passenger. As per the Indian Motor Tariff applicable on the date of accident by charging a premium of Rs. 6/- per passenger the liability of the company per passenger was Rs. 5,000/- only. The Indian Motor Tariff which regulates a premium and liability of insurance company is framed by the Tariff Advisory Committee, a statutory body set up under the Insurance Act. The additional premium of Rs. 300/- was thus paid to cover the statutory liability for 50 passengers as the vehicle insured was a passenger bus having registered capacity of carrying 50 passengers. Endorsement No. 13 which was attached to and formed part of the policy and which we have set out above also makes it clear that it was in consideration of an additional premium of Rs. 300/- that the insurance company had undertaken to idemnify the insured against his liability in respect of passengers to the extent of Rs. 5,000/- for each passenger and Rs. 75,000/- in all. It is, therefore, not possible to accept the contention raised on behalf of the appellant that the additional premium of Rs. 300/- was paid for covering higher than the statutory liability. There was no special contract to cover unlimited liability in respect of the passengers. 8. ### Response: 0

Trustees of The Port of Bombay Vs. Premier Automobiles Limited

that of any of its employees, But we are constrained to say that in Gulam Hussains case(1) also, the High Court referred only to the "employees of the Board and the torts committed by them in the course of their employment, but failed to notice that even though a duty was cast on the Board under section 61B for the loss, destruction or deterioration of goods of which it had taken charge, that responsibility was "subject to the other provisions of the Act", namely, section 87, paragraph 2 to which reference has been made by us at some length, and which expressly absolved the Board from responsibility for any misfeasance, malfeasance or non- feasance of any employee appointed under the Act. Gulam Hussains case (supra) was therefore not decided correctly and as the High Court, in the impugned judgment, took the view that the conclusion reached in Gulam Hussains case (supra) was binding on it, it naturally arrived at a decision with which we are unable to agree.The High Court failed to notice that paragraph 2 of section 87 related essentially to acts of misfeasance, malfeasance and non-feasance of only those employees who had been appointed under the Act, and as such employees were very few, the restriction on the Boards liability was limited and confined quite substantially. The High Court went further, and brought in the question and concept of the Boards "agents" eve n though it was quite foreign to paragraph 2 of section 87 and no evidence was relied upon to establish that it were the Boards "agents" who were responsible for the damage to the consignment. In fact, in Gulam Hussains case (supra) the High Court presumed that if the Board was responsible for the loss, destruction or deterioration of the goods, the cause of action must be the failure of the Board to take the requisite degree of care by itself or through its agents, and not merely a tort committed by an employee for which the Board was sought to be held vicariously liable. With respect, we are unable to find any justification for such a view. Gulam Hussains case (supra) was therefore not decided on a proper appreciation of the provisions of section 61B and paragraph 2 of section 87 of the Act. One of the Judges who decided that case was the Judge who tried the present case, and he naturally followed his own earlier judgment in Gulam Hussains case (supra). As the Division Bench, which gave the present judgment (under appeal before us) in that very case held that the conclusion reached in Gulam Hussains case (supra) was binding upon it, it fell into the error which had crept in the initial decision in Gulam Hussains case (supra). Gulam Hussains case (supra) is therefore no authority or basis for upholding the impugned judgment.It has to be appreciated and remembered all through. that section 61B which imposes the responsibility on the Board for loss. destruction or deterioration of goods of which it has taken charge, and states that that responsibility shall be that of a bailee under the three sections of the Contract Act, states further that the responsibility shall be "subject to the other provisions of (the) Act". So the so-called statutory duty is not unequivocal, and even if it were assumed that it took the case outside the purview of the law of torts and made it what Salmond has classified a s an "innominate obligation", that would not take the case out of the exception provided by paragraph 2 of section 87. Sections 61B and 87 are both parts of the same statute, and must be read together-particularly when that is the clear direct ion of section 61B. By virtue of that section, the liability of the Board is no more than that of a bailee under sections 151, 152 and 161 of the Contract Act. As we have pointed out, bailment is a concept correlated to possession, and w hen that is admittedly not contradicted in this case, it is really a liability in tort and the so- called liability under section 61B of the Act means no more and no less than this.23. The High Court has observed that any other view would "virtually render the provisions of section 61B largely nugatory". But the very next sentence gives out the reason for that view, for the High Court has gone on to observe that that would be so if paragraph 2 of section 87 is construed otherwise, namely, that "for any and every misfeasance, malfeasance or non-feasance of its employee, the Board is given complete immunity." That, however, is not what section 61B and paragraph 2 of section 87 provide for, as we have pointed out earlier, only a very few of the Boards employees are appointed under the Act and all that the paragraph provides is that the Board shall not be responsible for any misfeasance, malfeasance or non-feasance on the part of only those employees. They m ay, for aught one knows, be responsible personally for what they do, but it is not a correct proposition of law to say that the view which has found favour with us would virtually render the provisions of section 61B "largely nugatory".24. In the view we have taken, it is not necessary for so to examine the validity of the bye-laws to which reference has been made by the High Court. They were produced before us towards the close of the hearing, for the arguments proceeded and were based on the true meaning and construction of sections 61B and 87 (paragraph 2) and it was agreed that our decision thereon would govern the fate of this case. We should not therefore be taken to have expressed any opinion about the validity of the bye-laws in question. It will be sufficient for us to say that the decision here or below will not be conclusive of their validity or invalidity for purposes of the present case or like controversy.25.

1[ds]In reaching that conclusion the High Court noticed the obvious facts that in paragraph II(b) of the consent terms the trial court was required to assume that there was some misfeasance, malfeasance or non-feasance of the persons handling case No. 249. The High Court also noticed the two further facts (i) that there were three clear heads under which torts could be classified, and by using them in paragraph 2 of section 87 of the Act, "the Legislature provided for immunity of the Port Trust from torts committed by its employees", and (ii) that in so far as the plaintiffs claim in tort was concerned there could be no doubt that "it would fall within the ambit of paragraph 2 of section 87 because misfeasance, malfeasance or nonfeasance (was) specificallysection thus makes it clear that, for purposes of the present case, the responsibility of the Board was that of a bailee under the three sections of the Contract Act, and noeven though there was no contractual bailment either according to the pleadings of the parties. or on the wordings of section 61B, the responsibility of the Board was of the nature aforesaid, as the bailee of the consignment by virtue of that section. In other words, in so far as the "responsibility" of the Board for the loss, destruction or deterioration of the goods of which it had taken charge was concerned, it was clearly that of a bailee, subject of course to the reservations provided by themay be mentioned that we have gone through the pleadings and there is no justification for the view that the plaintiffs based their claim on the breach of a mere statutory duty of the Board under sectionfollows, therefore, that as the claim in the present case was not based upon a mere breach of statutory duty under section 61B of the Act, and was based on the Boards liability as bailee, it was no other than by way of an action inmay be that, as in the present case, certain obligations were fastened on the Board under section 61B of the Act which were not in truth contractual in as much as they did not rest on agreement, but which, by virtue of the same section, were to be treated as if the y were so, and were made the subject-matter of liability under three sections (sections 151, 152 and 162) of the Contract Act. Such a relationship may well be called as one arising out of an implied contract. But that does not justify the view of the High Court that an altogether new cause of action arose merely because a duty to take charge of the landed goods was cast on the Board under section 61A(1) and the Boards responsibility for them was defined in section 61B. By the very nature of that relationship, which admittedly did not arise out of agreement between the parties, it was essentially a delictalwould thus appear that it was not the case of the plaintiffs in their pleadings that their claim was founded merely upon the breach of the statutory duty under section 61B of the Act, apart from tort. O n the other hand. in their notice before the suit, the plaintiffs case was based on negligence, malfeasance and non-feasance on the part of the Boards administration at the docks and/or the acts of misconduct on the part of its employees. As ha s been pointed out, in the plaint the claim was based on careless handling by the defendants when the case slipped and fell while it was being removed by them as baileesSo when the action was by way of tort, and was, at any rate, rested on sect ion 61B, it was necessary for the High Court to give full meaning to what that section provided and to give effect to paragraph 2 of section 87 if it had a bearing on that section as was canvassed at length all through theHigh Court went on to hold that in its opinion one and the same act may give rise to two liabilities, one for breach of statutory duties and the other for the commission of a civil wrong or a tort and that while section 61B provides for the former, paragraph 2 of section 87 pro vides for the latter and the two provisions do not overlap. No justifiable reason has been given for this view and, if we may say with respect, we find that it runs counter to the clear provisions of the two sections if they are read together, and is wholly unsustainable. It is section 61B which deals with and prescribes the responsibility of the Board for goods of which it has taken possession under the statutory duty under section 61A, and it is that section, namely, section 61B, which makes that responsibility "subject to the other provisions of (that) Act". There is no occasion or justification for reading the clause regarding the subjection to the other provisions of the Act so as to exclude section 87 as if it were outside theif it could be shown that the acts of misfeasance, malfeasance and non-feasance compendiously used at the trial and in the consent terms, were committed by any employee appointed under the Act, there is n o reason why the Board should not invoke paragraph 2 of section 87 and successfully claim that it was not responsible forthe High Court clearly reached that conclusion, it was a short and inevitable step for it to hold, further, that the Board was therefore entitled to be absolved of its liability for the acts of these employees by virtue of paragraph 2 of section 87. So here again the High Court fell into an error for which its judgment cannot berespect, we are unable to find any justification for such a view. Gulam Hussains case (supra) was therefore not decided on a proper appreciation of the provisions of section 61B and paragraph 2 of section 87 of the Act. One of the Judges who decided that case was the Judge who tried the present case, and he naturally followed his own earlier judgment in Gulam Hussains case (supra). As the Division Bench, which gave the present judgment (under appeal before us) in that very case held that the conclusion reached in Gulam Hussains case (supra) was binding upon it, it fell into the error which had crept in the initial decision in Gulam Hussains case (supra). Gulam Hussains case (supra) is therefore no authority or basis for upholding the impugned judgment.It has to be appreciated and remembered all through. that section 61B which imposes the responsibility on the Board foror deterioration of goods of which it has taken charge, and states that that responsibility shall be that of a bailee under the three sections of the Contract Act, states further that the responsibility shall be "subject to the other provisions of (the) Act". So the so-called statutory duty is not unequivocal, and even if it were assumed that it took the case outside the purview of the law of torts and made it what Salmond has classified a s an "innominate obligation", that would not take the case out of the exception provided by paragraph 2 of section 87. Sections 61B and 87 are both parts of the same statute, and must be read together-particularly when that is the clear direct ion of section 61B. By virtue of that section, the liability of the Board is no more than that of a bailee under sections 151, 152 and 161 of the Contract Act. As we have pointed out, bailment is a concept correlated to possession, and w hen that is admittedly not contradicted in this case, it is really a liability in tort and the so- called liability under section 61B of the Act means no more and no less thanHigh Court has observed that any other view would "virtually render the provisions of section 61B largely nugatory". But the very next sentence gives out the reason for that view, for the High Court has gone on to observe that that would be so if paragraph 2 of section 87 is construed otherwise, namely, that "for any and every misfeasance, malfeasance or non-feasance of its employee, the Board is given complete immunity." That, however, is not what section 61B and paragraph 2 of section 87 provide for, as we have pointed out earlier, only a very few of the Boards employees are appointed under the Act and all that the paragraph provides is that the Board shall not be responsible for any misfeasance, malfeasance or non-feasance on the part of only those employees. They m ay, for aught one knows, be responsible personally for what they do, but it is not a correct proposition of law to say that the view which has found favour with us would virtually render the provisions of section 61B "largelythe view we have taken, it is not necessary for so to examine the validity of the bye-laws to which reference has been made by the High Court. They were produced before us towards the close of the hearing, for the arguments proceeded and were based on the true meaning and construction of sections 61B and 87 (paragraph 2) and it was agreed that our decision thereon would govern the fate of this case. We should not therefore be taken to have expressed any opinion about the validity of the bye-laws in question. It will be sufficient for us to say that the decision here or below will not be conclusive of their validity or invalidity for purposes of the present case or like controversy.

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: that of any of its employees, But we are constrained to say that in Gulam Hussains case(1) also, the High Court referred only to the "employees of the Board and the torts committed by them in the course of their employment, but failed to notice that even though a duty was cast on the Board under section 61B for the loss, destruction or deterioration of goods of which it had taken charge, that responsibility was "subject to the other provisions of the Act", namely, section 87, paragraph 2 to which reference has been made by us at some length, and which expressly absolved the Board from responsibility for any misfeasance, malfeasance or non- feasance of any employee appointed under the Act. Gulam Hussains case (supra) was therefore not decided correctly and as the High Court, in the impugned judgment, took the view that the conclusion reached in Gulam Hussains case (supra) was binding on it, it naturally arrived at a decision with which we are unable to agree.The High Court failed to notice that paragraph 2 of section 87 related essentially to acts of misfeasance, malfeasance and non-feasance of only those employees who had been appointed under the Act, and as such employees were very few, the restriction on the Boards liability was limited and confined quite substantially. The High Court went further, and brought in the question and concept of the Boards "agents" eve n though it was quite foreign to paragraph 2 of section 87 and no evidence was relied upon to establish that it were the Boards "agents" who were responsible for the damage to the consignment. In fact, in Gulam Hussains case (supra) the High Court presumed that if the Board was responsible for the loss, destruction or deterioration of the goods, the cause of action must be the failure of the Board to take the requisite degree of care by itself or through its agents, and not merely a tort committed by an employee for which the Board was sought to be held vicariously liable. With respect, we are unable to find any justification for such a view. Gulam Hussains case (supra) was therefore not decided on a proper appreciation of the provisions of section 61B and paragraph 2 of section 87 of the Act. One of the Judges who decided that case was the Judge who tried the present case, and he naturally followed his own earlier judgment in Gulam Hussains case (supra). As the Division Bench, which gave the present judgment (under appeal before us) in that very case held that the conclusion reached in Gulam Hussains case (supra) was binding upon it, it fell into the error which had crept in the initial decision in Gulam Hussains case (supra). Gulam Hussains case (supra) is therefore no authority or basis for upholding the impugned judgment.It has to be appreciated and remembered all through. that section 61B which imposes the responsibility on the Board for loss. destruction or deterioration of goods of which it has taken charge, and states that that responsibility shall be that of a bailee under the three sections of the Contract Act, states further that the responsibility shall be "subject to the other provisions of (the) Act". So the so-called statutory duty is not unequivocal, and even if it were assumed that it took the case outside the purview of the law of torts and made it what Salmond has classified a s an "innominate obligation", that would not take the case out of the exception provided by paragraph 2 of section 87. Sections 61B and 87 are both parts of the same statute, and must be read together-particularly when that is the clear direct ion of section 61B. By virtue of that section, the liability of the Board is no more than that of a bailee under sections 151, 152 and 161 of the Contract Act. As we have pointed out, bailment is a concept correlated to possession, and w hen that is admittedly not contradicted in this case, it is really a liability in tort and the so- called liability under section 61B of the Act means no more and no less than this.23. The High Court has observed that any other view would "virtually render the provisions of section 61B largely nugatory". But the very next sentence gives out the reason for that view, for the High Court has gone on to observe that that would be so if paragraph 2 of section 87 is construed otherwise, namely, that "for any and every misfeasance, malfeasance or non-feasance of its employee, the Board is given complete immunity." That, however, is not what section 61B and paragraph 2 of section 87 provide for, as we have pointed out earlier, only a very few of the Boards employees are appointed under the Act and all that the paragraph provides is that the Board shall not be responsible for any misfeasance, malfeasance or non-feasance on the part of only those employees. They m ay, for aught one knows, be responsible personally for what they do, but it is not a correct proposition of law to say that the view which has found favour with us would virtually render the provisions of section 61B "largely nugatory".24. In the view we have taken, it is not necessary for so to examine the validity of the bye-laws to which reference has been made by the High Court. They were produced before us towards the close of the hearing, for the arguments proceeded and were based on the true meaning and construction of sections 61B and 87 (paragraph 2) and it was agreed that our decision thereon would govern the fate of this case. We should not therefore be taken to have expressed any opinion about the validity of the bye-laws in question. It will be sufficient for us to say that the decision here or below will not be conclusive of their validity or invalidity for purposes of the present case or like controversy.25. ### Response: 1

RAJINDER TIWARI Vs. KEDAR NATH (DECEASED) THROUGH LRS

Abhay Manohar Sapre, J. 1. Leave granted. 2. These appeals are directed against the final judgment and order dated 03.11.2016 passed by the High Court of Delhi at New Delhi in R.S.A. No.188 of 2010 whereby the High Court allowed the RSA filed by the respondents herein and order dated 26.04.2017 in CM(Application) No.46865 of 2016 by which the High Court dismissed the application for re¬hearing of the second appeal filed by the appellant herein. 3. A few facts need mention hereinbelow for the disposal of the appeals, which involve a short point. 4. The appellant is the plaintiff and the original respondent (now represented by his legal representatives) is the defendant in the civil suit out of which these appeals arise. 5. The appellant(plaintiff) filed Civil Suit No. 147 of 2007 against the original respondent(defendant) in the Court of Senior Civil Judge¬cum¬Rent Controller(North East Dist.), Karkardooma Courts, Delhi for permanent injunction in relation to the suit property. 6. It is not in dispute that the defendant?s right to file the written statement was closed by the Senior Civil Judge with the result, the defendant could not file his written statement and nor could file any documentary evidence. 7. The plaintiff then adduced his evidence. The defendant, however, could only cross¬examine the plaintiffs witnesses without his defence for want of written statement. 8. By judgment/decree dated 01.02.2010, the Senior Civil Judge decreed the plaintiffs suit by passing a decree for permanent injunction as prayed by him. The defendant felt aggrieved and filed first appeal before the Additional District Judge. 9. By judgment dated 26.07.2010, the first Appellate Court dismissed the appeal and upheld the judgment and decree passed by the Senior Civil Judge. 10. The defendant felt aggrieved and filed second appeal in the High Court of Delhi. By order dated 03.11.2016, the High Court allowed the second appeal, set aside the judgment of the first Appellate Court and dismissed the plaintiffs (appellant?s herein) suit. Thereafter the plaintiff filed application for re-hearing of the second appeal but the same was dismissed by order dated 26.04.2017. Against both the orders, the appellant(plaintiff) has filed the present appeals by way of special leave in this Court. 11. So, the short question, which arises for consideration in these appeals, is whether the High Court was justified in allowing the defendants second appeal and was, therefore, justified in dismissing the plaintiffs (appellant?s herein) suit. 12. Having heard the learned counsel for the parties and on perusal of the record of the case, we are inclined to allow these appeals and while setting aside the impugned orders, remand the case to the Trial Court (Senior Civil Judge) for trying the civil suit afresh on merits in accordance with law. 13. In our considered opinion, the need to remand the case to the Senior Civil Judge for trying the civil suit afresh on merits has occasioned for more than one reason. 14. First, we find that the trial in the suit has not been done satisfactorily inasmuch as the defendant was not afforded an adequate opportunity to file his written statement. 15. Second, in the absence of any written statement, the defendant could neither adduce proper evidence nor file any documentary evidence in support of his case. 16. Third, the rights of the parties were, therefore, decided by the two Courts (Trial Court and First Appellate Court) by decreeing the suit and the High Court by dismissing the suit on the basis of insufficient evidence. In our view, it caused prejudice to both the parties. 17. Fourth, we do not find any justifiable reason to deny the defendant of his right to file the written statement. He was entitled to file the written statement and to adduce oral and documentary evidence for contesting the suit on merits. 18. It is a settled law that all the contesting parties to the suit must get fair opportunity to contest the suit on merits in accordance with law. A decision rendered by the Courts in an unsatisfactory conducting of the trial of the suit is not legally sustainable. It is regardless of the fact that in whose favour the decision in the trial may go. 19. It is for these reasons, we are of the view that these appeals deserve to be allowed and matter is remitted to the Trial Court for deciding the civil suit afresh on merits in accordance with law.

1[ds]13. In our considered opinion, the need to remand the case to the Senior Civil Judge for trying the civil suit afresh on merits has occasioned for more than one reason.First, we find that the trial in the suit has not been done satisfactorily inasmuch as the defendant was not afforded an adequate opportunity to file his written statement.Second, in the absence of any written statement, the defendant could neither adduce proper evidence nor file any documentary evidence in support of his case.Third, the rights of the parties were, therefore, decided by the two Courts (Trial Court and First Appellate Court) by decreeing the suit and the High Court by dismissing the suit on the basis of insufficient evidence. In our view, it caused prejudice to both the parties.Fourth, we do not find any justifiable reason to deny the defendant of his right to file the written statement. He was entitled to file the written statement and to adduce oral and documentary evidence for contesting the suit on merits.It is a settled law that all the contesting parties to the suit must get fair opportunity to contest the suit on merits in accordance with law. A decision rendered by the Courts in an unsatisfactory conducting of the trial of the suit is not legally sustainable. It is regardless of the fact that in whose favour the decision in the trial may go.It is for these reasons, we are of the view that these appeals deserve to be allowed and matter is remitted to the Trial Court for deciding the civil suit afresh on merits in accordance with law.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: Abhay Manohar Sapre, J. 1. Leave granted. 2. These appeals are directed against the final judgment and order dated 03.11.2016 passed by the High Court of Delhi at New Delhi in R.S.A. No.188 of 2010 whereby the High Court allowed the RSA filed by the respondents herein and order dated 26.04.2017 in CM(Application) No.46865 of 2016 by which the High Court dismissed the application for re¬hearing of the second appeal filed by the appellant herein. 3. A few facts need mention hereinbelow for the disposal of the appeals, which involve a short point. 4. The appellant is the plaintiff and the original respondent (now represented by his legal representatives) is the defendant in the civil suit out of which these appeals arise. 5. The appellant(plaintiff) filed Civil Suit No. 147 of 2007 against the original respondent(defendant) in the Court of Senior Civil Judge¬cum¬Rent Controller(North East Dist.), Karkardooma Courts, Delhi for permanent injunction in relation to the suit property. 6. It is not in dispute that the defendant?s right to file the written statement was closed by the Senior Civil Judge with the result, the defendant could not file his written statement and nor could file any documentary evidence. 7. The plaintiff then adduced his evidence. The defendant, however, could only cross¬examine the plaintiffs witnesses without his defence for want of written statement. 8. By judgment/decree dated 01.02.2010, the Senior Civil Judge decreed the plaintiffs suit by passing a decree for permanent injunction as prayed by him. The defendant felt aggrieved and filed first appeal before the Additional District Judge. 9. By judgment dated 26.07.2010, the first Appellate Court dismissed the appeal and upheld the judgment and decree passed by the Senior Civil Judge. 10. The defendant felt aggrieved and filed second appeal in the High Court of Delhi. By order dated 03.11.2016, the High Court allowed the second appeal, set aside the judgment of the first Appellate Court and dismissed the plaintiffs (appellant?s herein) suit. Thereafter the plaintiff filed application for re-hearing of the second appeal but the same was dismissed by order dated 26.04.2017. Against both the orders, the appellant(plaintiff) has filed the present appeals by way of special leave in this Court. 11. So, the short question, which arises for consideration in these appeals, is whether the High Court was justified in allowing the defendants second appeal and was, therefore, justified in dismissing the plaintiffs (appellant?s herein) suit. 12. Having heard the learned counsel for the parties and on perusal of the record of the case, we are inclined to allow these appeals and while setting aside the impugned orders, remand the case to the Trial Court (Senior Civil Judge) for trying the civil suit afresh on merits in accordance with law. 13. In our considered opinion, the need to remand the case to the Senior Civil Judge for trying the civil suit afresh on merits has occasioned for more than one reason. 14. First, we find that the trial in the suit has not been done satisfactorily inasmuch as the defendant was not afforded an adequate opportunity to file his written statement. 15. Second, in the absence of any written statement, the defendant could neither adduce proper evidence nor file any documentary evidence in support of his case. 16. Third, the rights of the parties were, therefore, decided by the two Courts (Trial Court and First Appellate Court) by decreeing the suit and the High Court by dismissing the suit on the basis of insufficient evidence. In our view, it caused prejudice to both the parties. 17. Fourth, we do not find any justifiable reason to deny the defendant of his right to file the written statement. He was entitled to file the written statement and to adduce oral and documentary evidence for contesting the suit on merits. 18. It is a settled law that all the contesting parties to the suit must get fair opportunity to contest the suit on merits in accordance with law. A decision rendered by the Courts in an unsatisfactory conducting of the trial of the suit is not legally sustainable. It is regardless of the fact that in whose favour the decision in the trial may go. 19. It is for these reasons, we are of the view that these appeals deserve to be allowed and matter is remitted to the Trial Court for deciding the civil suit afresh on merits in accordance with law. ### Response: 1

Trai Foods Ltd Vs. National Insurance Co. & Others

1. The Appellant Had Filed A Claim Before The National Commission Against The Respondent Insurance Company For Damages Under Four Heads:(I) Earthquake Damage(Ii) Machinery Breakdown (Do Set)(Iii) Deterioration Of Stock(Iv) Consequential Losses2. The Claim Before The Commission Was That The Earthquake Which Is Alleged To Have Taken Place On 28-3-1999 Had Been Insured Against And That The Damages Suffered By The Appellant Were The Direct Consequences Of The Earthquake And Within The Insurance Policies Issued To The Appellant.3. The Claim Before The Commission Was Filed On 26-12-2001 After The Respondents Ultimately Rejected The Appellants Claim In Respect Of Three Of The Heads Noted Above And Partially Allowed Only One, Namely, For The Machinery Breakdown. The Commission By Its Order Dated 18-7-2002 Refused To Entertain The Application On The Ground That The Controversy Could Not Be Resolved In A Summary Manner Without Recording Elaborate Evidence. The Appellants Case Before Us Was That The National Commission Was Fully Empowered To Decide Matters Which Required Elaborate Evidence And Has Relied Upon A Decision Of This Court In J.J. Merchant (Dr.) V. Shrinath Chaturvedi1 In Support Of His Submission. It Is Further Stated That The Case Of The Appellant Did Not In Fact Require Elaborate Evidence As The Claim Could Be Decided On The Documents On Record.4. Learned Counsel Appearing For The Respondent Insurance Company Has Stated That The Decision In J.J. Merchant1 Did Not Deviate From The Principles Enunciated By This Court In Synco Industries V. State Bank Of Bikaner And Jaipur2 Where This Court Has Said That Where Detailed Evidence Would Have To Be Led To Prove The Claim And Thereafter To Prove The Damages, It Was Not Appropriate For Such Cases To Be Heard And Disposed Of In The Summary Jurisdiction Of The National Commission And That The More Appropriate Forum Was The Civil Court. 5. Having Heard The Submissions, We Are Of The View That The Learned Counsel For The Respondents Is Correct. In J.J. Merchant1 This Court Has Not Denied The Discretion Of The Commission To Refer The Complainant To The Civil Court For Appropriate Relief, In Case The Complaint Involves Complicated Issues Requiring Recording Of Evidence Of Experts Which May Delay The Proceedings (Para 11 Of The Report).6. The Only Question To Be Decided Is, When Should This Jurisdiction Be Exercised By The Commission. In Our View The Commission Should Address Itself To The Quantity Of The Claim, The Nature Of The Claim, The Nature Of The Evidence Which Would Be Required To Be Submitted Both In Respect Of The Claim And The Damages Suffered And The Nature Of The Legal Issues Before Deciding That The Matter Ought To Be Decided By The Civil Courts In The Regular Course. It Is Not Disputed That The Consumer Forum Has Been Set Up To Grant Speedy Remedy. The Consumer Forums Have Been Given The Responsibility Of Achieving This Object. They Were Not Meant To Duplicate The Civil Courts, And Subject The Litigants To Delays Which Have Become Endemic In The Civil Courts.7. Although The Reason Given In The Impugned Order Of The Commission For Referring The Present Matter To The Civil Court Is Cryptic, We Have Been Through The Records Filed Before Us And Are Satisfied That The Commissions Decision Was Correct. There Is No Doubt Having Regard To The Nature Of The Claim, The Large Amount Of Damages Claimed, And The Extensive Enquiry Into The Evidence Which Would Be Necessary In Order To Resolve The Disputes Between The Parties That This Is Not A Matter To Be Decided Summarily At All.

0[ds]In Our View The Commission Should Address Itself To The Quantity Of The Claim, The Nature Of The Claim, The Nature Of The Evidence Which Would Be Required To Be Submitted Both In Respect Of The Claim And The Damages Suffered And The Nature Of The Legal Issues Before Deciding That The Matter Ought To Be Decided By The Civil Courts In The Regular Course. It Is Not Disputed That The Consumer Forum Has Been Set Up To Grant Speedy Remedy. The Consumer Forums Have Been Given The Responsibility Of Achieving This Object. They Were Not Meant To Duplicate The Civil Courts, And Subject The Litigants To Delays Which Have Become Endemic In The Civil Courts.7. Although The Reason Given In The Impugned Order Of The Commission For Referring The Present Matter To The Civil Court Is Cryptic, We Have Been Through The Records Filed Before Us And Are Satisfied That The Commissions Decision Was Correct. There Is No Doubt Having Regard To The Nature Of The Claim, The Large Amount Of Damages Claimed, And The Extensive Enquiry Into The Evidence Which Would Be Necessary In Order To Resolve The Disputes Between The Parties That This Is Not A Matter To Be Decided Summarily At All.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: 1. The Appellant Had Filed A Claim Before The National Commission Against The Respondent Insurance Company For Damages Under Four Heads:(I) Earthquake Damage(Ii) Machinery Breakdown (Do Set)(Iii) Deterioration Of Stock(Iv) Consequential Losses2. The Claim Before The Commission Was That The Earthquake Which Is Alleged To Have Taken Place On 28-3-1999 Had Been Insured Against And That The Damages Suffered By The Appellant Were The Direct Consequences Of The Earthquake And Within The Insurance Policies Issued To The Appellant.3. The Claim Before The Commission Was Filed On 26-12-2001 After The Respondents Ultimately Rejected The Appellants Claim In Respect Of Three Of The Heads Noted Above And Partially Allowed Only One, Namely, For The Machinery Breakdown. The Commission By Its Order Dated 18-7-2002 Refused To Entertain The Application On The Ground That The Controversy Could Not Be Resolved In A Summary Manner Without Recording Elaborate Evidence. The Appellants Case Before Us Was That The National Commission Was Fully Empowered To Decide Matters Which Required Elaborate Evidence And Has Relied Upon A Decision Of This Court In J.J. Merchant (Dr.) V. Shrinath Chaturvedi1 In Support Of His Submission. It Is Further Stated That The Case Of The Appellant Did Not In Fact Require Elaborate Evidence As The Claim Could Be Decided On The Documents On Record.4. Learned Counsel Appearing For The Respondent Insurance Company Has Stated That The Decision In J.J. Merchant1 Did Not Deviate From The Principles Enunciated By This Court In Synco Industries V. State Bank Of Bikaner And Jaipur2 Where This Court Has Said That Where Detailed Evidence Would Have To Be Led To Prove The Claim And Thereafter To Prove The Damages, It Was Not Appropriate For Such Cases To Be Heard And Disposed Of In The Summary Jurisdiction Of The National Commission And That The More Appropriate Forum Was The Civil Court. 5. Having Heard The Submissions, We Are Of The View That The Learned Counsel For The Respondents Is Correct. In J.J. Merchant1 This Court Has Not Denied The Discretion Of The Commission To Refer The Complainant To The Civil Court For Appropriate Relief, In Case The Complaint Involves Complicated Issues Requiring Recording Of Evidence Of Experts Which May Delay The Proceedings (Para 11 Of The Report).6. The Only Question To Be Decided Is, When Should This Jurisdiction Be Exercised By The Commission. In Our View The Commission Should Address Itself To The Quantity Of The Claim, The Nature Of The Claim, The Nature Of The Evidence Which Would Be Required To Be Submitted Both In Respect Of The Claim And The Damages Suffered And The Nature Of The Legal Issues Before Deciding That The Matter Ought To Be Decided By The Civil Courts In The Regular Course. It Is Not Disputed That The Consumer Forum Has Been Set Up To Grant Speedy Remedy. The Consumer Forums Have Been Given The Responsibility Of Achieving This Object. They Were Not Meant To Duplicate The Civil Courts, And Subject The Litigants To Delays Which Have Become Endemic In The Civil Courts.7. Although The Reason Given In The Impugned Order Of The Commission For Referring The Present Matter To The Civil Court Is Cryptic, We Have Been Through The Records Filed Before Us And Are Satisfied That The Commissions Decision Was Correct. There Is No Doubt Having Regard To The Nature Of The Claim, The Large Amount Of Damages Claimed, And The Extensive Enquiry Into The Evidence Which Would Be Necessary In Order To Resolve The Disputes Between The Parties That This Is Not A Matter To Be Decided Summarily At All. ### Response: 0

BHARAT WATCH COMPANY THROUGH ITS PARTNER Vs. NATIONAL INSURANCE CO. LTD. THROUGH ITS REGIONAL MANAGER

for business. 4. A First Information Report was lodged with the Police and a claim under the insurance policy was made. The surveyor submitted a preliminary report on 4 September 2001 indicating a loss of approximately Rs 3,86,395. The surveyor recorded that they were informed by the partner of the firm that the theft may have taken place by utilising duplicate keys. The surveyor, however, found empty watch stands on which the strips of the model numbers were lying behind the counters. There was no sign of forcible entry. This was followed by a surveyor?s report dated 30 November 2001. 5. After the claim was repudiated by the insurer, the appellant filed a consumer complaint. By an order dated 26 April 2007, the District Forum allowed the claim in the amount of Rs. 3,04,000. The decision of the District Forum was affirmed, in appeal, by the SCDRC on 19 April 2010. 6. The NCDRC reversed the above decisions in its revisional order dated 16 April 2015, relying upon a decision of this Court in United India Insurance Co. Ltd. vs. Harchand Rai Chandan Lal (2004) 8 SCC 644 . Construing the terms of the exclusion in a policy of insurance against burglary and/or house breaking, this Court had held that where the loss or damage was caused without forcible and violent entry to and/or exit from the premises, the claim could not be maintained. The terms of the policy in the above decision of this Court read as follows:??Burglary and/or housebreaking? shall mean theft involving entry to or exit from the premises stated therein by forcible and violent means or following assault or violence or threat thereof to the insured or to his employees or to the members of his family.?7. Construing the above condition, this Court held:?15….we are of the opinion that theft should have been preceded with force or violence as per the terms of insurance policy. In order to substantiate a claim an insurer has to establish that theft or burglary took place preceding with force or violence and if it is not, then the insurance company will be well within their right to repudiate the claim of the insurer.?8. In the present case, the NCDRC in the course of its decision adverted to ?clause 8? of the insurance policy which was in the following terms:-?Loss of money and / or other property abstracted from safe following the use of the key to said safe or any duplicate thereof belonging to the insured unless such key has been obtained by assault or any threat?9. This was in any event not applicable, since the loss was not from a safe. Clause (a) of the policy as extracted in the above judgment reads thus:?Any loss of or damage to the property or any part thereof whilst contained in the premises described in the schedule hereto due to Burglary or Housebreaking (theft following upon an actual forcible and violent entry to and / or exit from the premises and hold-up?10. Since clause (a) was pari materia with the clause which was construed by this Court in the above decision of this Court in United India Insurance (supra), the NCDRC reversed the decisions of the District Forum and the SCDRC. 11. The basic issue which has been canvassed on behalf of the appellant before this Court is that the conditions of exclusion under the policy document were not handed over to the appellant by the insurer and in the absence of the appellant being made aware of the terms of the exclusion, it is not open to the insurer to rely upon the exclusionary clauses. Hence, it was urged that the decision in Harchand Rai (supra) will have no application since there was no dispute in that case that the policy document was issued to the insured. 12. This submission is sought to be answered by the learned counsel appearing on behalf of the insurer by adverting to the fact that the SCDRC construed the terms of the exclusion. The SCDRC, however, did not notice the decision of this Court, and hence, the NCDRC was (it was urged) justified in correcting the error having regard to the law laid down by this Court. Learned counsel urged that the appellant has been insuring its goods for nearly ten years and it is improbable that the appellant was not aware of the exclusion. 13. We find from the judgment of the District Forum that it was the specific contention of the appellant that the exclusionary conditions in the policy document had not been communicated by the insurer as a result of which the terms and conditions of the exclusion were never communicated. The fact that there was a contract of insurance is not in dispute and has never been in dispute. The only issue is whether the exclusionary conditions were communicated to the appellant. The District Forum came to a specific finding of fact that the insurer did not furnish the terms and conditions of the exclusion and special conditions to the appellant and hence, they were not binding. When the case travelled to the SCDRC, there was a finding of fact again that the conditions of exclusion were not supplied to the complainant. 14. Having held this, the SCDRC also came to the conclusion that the exclusion would in any event not be attracted. The finding of the SCDRC in regard to the interpretation of such an exclusionary clause is evidently contrary to the law laid down by this Court in Harchand Rai (supra). However, the relevance of that interpretation would have arisen provided the conditions of exclusion were provided to the insured. The NCDRC missed the concurrent findings of both the District Forum and the SCDRC that the terms of exclusion were not made known to the insured. If those conditions were not made known to the insured, as is the concurrent finding, there was no occasion for the NCDRC to render a decision on the effect of such an exclusion.

1[ds]13. We find from the judgment of the District Forum that it was the specific contention of the appellant that the exclusionary conditions in the policy document had not been communicated by the insurer as a result of which the terms and conditions of the exclusion were never communicated. The fact that there was a contract of insurance is not in dispute and has never been in dispute. The only issue is whether the exclusionary conditions were communicated to the appellant. The District Forum came to a specific finding of fact that the insurer did not furnish the terms and conditions of the exclusion and special conditions to the appellant and hence, they were not binding. When the case travelled to the SCDRC, there was a finding of fact again that the conditions of exclusion were not supplied to the complainant.Having held this, the SCDRC also came to the conclusion that the exclusion would in any event not be attracted. The finding of the SCDRC in regard to the interpretation of such an exclusionary clause is evidently contrary to the law laid down by this Court in Harchand Rai (supra). However, the relevance of that interpretation would have arisen provided the conditions of exclusion were provided to the insured. The NCDRC missed the concurrent findings of both the District Forum and the SCDRC that the terms of exclusion were not made known to the insured. If those conditions were not made known to the insured, as is the concurrent finding, there was no occasion for the NCDRC to render a decision on the effect of such an exclusion.

### Instruction: Delve into the case proceeding and predict the outcome: is the judgment expected to be in support (1) or in denial (0) of the appeal? ### Input: for business. 4. A First Information Report was lodged with the Police and a claim under the insurance policy was made. The surveyor submitted a preliminary report on 4 September 2001 indicating a loss of approximately Rs 3,86,395. The surveyor recorded that they were informed by the partner of the firm that the theft may have taken place by utilising duplicate keys. The surveyor, however, found empty watch stands on which the strips of the model numbers were lying behind the counters. There was no sign of forcible entry. This was followed by a surveyor?s report dated 30 November 2001. 5. After the claim was repudiated by the insurer, the appellant filed a consumer complaint. By an order dated 26 April 2007, the District Forum allowed the claim in the amount of Rs. 3,04,000. The decision of the District Forum was affirmed, in appeal, by the SCDRC on 19 April 2010. 6. The NCDRC reversed the above decisions in its revisional order dated 16 April 2015, relying upon a decision of this Court in United India Insurance Co. Ltd. vs. Harchand Rai Chandan Lal (2004) 8 SCC 644 . Construing the terms of the exclusion in a policy of insurance against burglary and/or house breaking, this Court had held that where the loss or damage was caused without forcible and violent entry to and/or exit from the premises, the claim could not be maintained. The terms of the policy in the above decision of this Court read as follows:??Burglary and/or housebreaking? shall mean theft involving entry to or exit from the premises stated therein by forcible and violent means or following assault or violence or threat thereof to the insured or to his employees or to the members of his family.?7. Construing the above condition, this Court held:?15….we are of the opinion that theft should have been preceded with force or violence as per the terms of insurance policy. In order to substantiate a claim an insurer has to establish that theft or burglary took place preceding with force or violence and if it is not, then the insurance company will be well within their right to repudiate the claim of the insurer.?8. In the present case, the NCDRC in the course of its decision adverted to ?clause 8? of the insurance policy which was in the following terms:-?Loss of money and / or other property abstracted from safe following the use of the key to said safe or any duplicate thereof belonging to the insured unless such key has been obtained by assault or any threat?9. This was in any event not applicable, since the loss was not from a safe. Clause (a) of the policy as extracted in the above judgment reads thus:?Any loss of or damage to the property or any part thereof whilst contained in the premises described in the schedule hereto due to Burglary or Housebreaking (theft following upon an actual forcible and violent entry to and / or exit from the premises and hold-up?10. Since clause (a) was pari materia with the clause which was construed by this Court in the above decision of this Court in United India Insurance (supra), the NCDRC reversed the decisions of the District Forum and the SCDRC. 11. The basic issue which has been canvassed on behalf of the appellant before this Court is that the conditions of exclusion under the policy document were not handed over to the appellant by the insurer and in the absence of the appellant being made aware of the terms of the exclusion, it is not open to the insurer to rely upon the exclusionary clauses. Hence, it was urged that the decision in Harchand Rai (supra) will have no application since there was no dispute in that case that the policy document was issued to the insured. 12. This submission is sought to be answered by the learned counsel appearing on behalf of the insurer by adverting to the fact that the SCDRC construed the terms of the exclusion. The SCDRC, however, did not notice the decision of this Court, and hence, the NCDRC was (it was urged) justified in correcting the error having regard to the law laid down by this Court. Learned counsel urged that the appellant has been insuring its goods for nearly ten years and it is improbable that the appellant was not aware of the exclusion. 13. We find from the judgment of the District Forum that it was the specific contention of the appellant that the exclusionary conditions in the policy document had not been communicated by the insurer as a result of which the terms and conditions of the exclusion were never communicated. The fact that there was a contract of insurance is not in dispute and has never been in dispute. The only issue is whether the exclusionary conditions were communicated to the appellant. The District Forum came to a specific finding of fact that the insurer did not furnish the terms and conditions of the exclusion and special conditions to the appellant and hence, they were not binding. When the case travelled to the SCDRC, there was a finding of fact again that the conditions of exclusion were not supplied to the complainant. 14. Having held this, the SCDRC also came to the conclusion that the exclusion would in any event not be attracted. The finding of the SCDRC in regard to the interpretation of such an exclusionary clause is evidently contrary to the law laid down by this Court in Harchand Rai (supra). However, the relevance of that interpretation would have arisen provided the conditions of exclusion were provided to the insured. The NCDRC missed the concurrent findings of both the District Forum and the SCDRC that the terms of exclusion were not made known to the insured. If those conditions were not made known to the insured, as is the concurrent finding, there was no occasion for the NCDRC to render a decision on the effect of such an exclusion. ### Response: 1

National Insurance Co. Ltd Vs. Keshav Bahadur

to Section 166 of the new Act can derive direct guidance from Section 34 of the Code of Civil Procedure, 1908 (in short the CPC). In fact, the provisions require payment of interest in addition to compensation already determined. Even though the expression may is used, a duty is laid on the Tribunal to consider the question of interest separately with due regard to the facts and circumstances of the case. The provision is discretionary and is not and cannot be bound by rules. In the words of Lord Cairns, L.C. in Julius v. Bishop of Oxford (1880 (5) AC 214), "But there may be something in the nature of the thing empowered to be done, something in the object for which it is to be done, something in the conditions under which it is to be done, something in the title of person or persons for whose benefit the power is to be exercised, which may couple the power with a duty, and make it the duty of the person in whom the power is reposed to exercise that power when called upon to do so". This classic observation has been quoted with approval by this Court in several cases. (See Commissioner of Police v. Gordhandas Bhanji (AIR 1952 SC 16 and S.P. Gupta and Ors. v. President of India and Ors. (AIR 1982 SC 149 ). In Halsburys Laws of England, 4th Edn., Vol.I, it has been observed:- Para 28: Duty and discretion. xxx xxx xxx "A statutory discretion is not, however, necessarily or, indeed, usually absolute; it may be qualified by express and implied legal duties to comply with substantive and procedural requirements before a decision is taken whether to act and how to act. Moreover, there may be a discretion whether to exercise a power, but no discretion as to the mode of its exercise; or a duty to act when certain conditions are present, but a discretion how to act. Discretion may thus be coupled with duties". 8. Discretion, in general, is the discernment of what is right and proper. It denotes knowledge and prudence, that discernment which enables a person to judge critically of what is correct and proper united with caution; nice discernment, and judgment directed by circumspection; deliberate judgment; soundness of judgment; a science or understanding to discern between falsity and truth, between wrong and right, between shadow and substance, between equity and colorable glosses and pretences, and not to do according to the will and private affections of persons. When it is said that something is to be done within the discretion of the authorities, that something is to be done according to the rules of reason and justice, not according to private opinion; according to law and not humour. It is to be not arbitrary, vague, and fanciful, but legal and regular. And it must be exercised within the limit, to which an honest man, competent to the discharge of his office ought to confine himself (Per Lord Halsbury, L.C., in Sharp v. Wakefield, (1891) Appeal Cases 173). Also (See S.G. Jaisinghani v. Union of India and Ors. (AIR 1967 SC 1427 ). 9. The word "discretion" standing single and unsupported by circumstances signifies exercise of judgment, skill or wisdom as distinguished from folly, unthinking or haste; evidently therefore a discretion cannot be arbitrary but must be a result of judicial thinking. The word in itself implies vigilant circumspection and care; therefore where the legislature concedes discretion it also imposes a heavy responsibility. "The discretion of a Judge is the law of tyrants; it is always unknown. It is different in different men. It is casual, and depends upon constitution, temper, passion. In the best it is often times caprice; in the worst it is every vice, folly, and passion to which human nature is liable," said (Lord Camden, L.C.J., in Hindson and Kersey (1680) 8 How, St. Tr.57.) 10. If a certain latitude or liberty accorded by statute or rules to a judge as distinguished from a ministerial or administrative official, in adjudicating on matters brought before him, it is judicial discretion. It limits and regulates the exercise of the discretion, and prevents it from being wholly absolute, capricious, or exempt from review. 11. Such discretion is usually given on matters of procedure or punishment, or costs of administration rather than with reference to vested substantive rights. The matters which should regulate the exercise of discretion have been stated by eminent judges in somewhat different forms of words but with substantial identity. When a statute gives a judge a discretion, what is meant is a judicial discretion, regulated according to the known rules of law, and not the mere whim or caprice of the person to whom it is given on the assumption that he is discreet (Per Willes J. in Lee v Budge Railway Co., (1871) LR 6 CP 576, and in Morgan v. Morgan, 1869, LR 1 P & M 644). 12. Though Section 110CC of the Act (corresponding to Section 171 of the New Act) confers a discretion on the Tribunal to award interest, the same is meant to be exercised in cases where the claimant can claim the same as a matter of right. In the above background, it is to be judged whether a stipulation for higher rate of interest in case of default can be imposed by the Tribunal. Once the discretion has been exercised by the Tribunal to award simple interest on the amount of compensation to be awarded at a particular rate and from a particular date, there is no scope for retrospective enhancement for default in payment of compensation. No express or implied power in this regard can be culled out from Section 110CC of the Act or Section 171 of the new Act. Such a direction in the award for retrospective enhancement of interest for default in payment of the compensation together with interest payable thereon virtually amounts to imposition of penalty which is not statutorily envisaged and prescribed.

1[ds]12. Though Section 110CC of the Act (corresponding to Section 171 of the New Act) confers a discretion on the Tribunal to award interest, the same is meant to be exercised in cases where the claimant can claim the same as a matter of right. In the above background, it is to be judged whether a stipulation for higher rate of interest in case of default can be imposed by the Tribunal. Once the discretion has been exercised by the Tribunal to award simple interest on the amount of compensation to be awarded at a particular rate and from a particular date, there is no scope for retrospective enhancement for default in payment of compensation. No express or implied power in this regard can be culled out from Section 110CC of the Act or Section 171 of the new Act. Such a direction in the award for retrospective enhancement of interest for default in payment of the compensation together with interest payable thereon virtually amounts to imposition of penalty which is not statutorily envisaged and prescribed.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: to Section 166 of the new Act can derive direct guidance from Section 34 of the Code of Civil Procedure, 1908 (in short the CPC). In fact, the provisions require payment of interest in addition to compensation already determined. Even though the expression may is used, a duty is laid on the Tribunal to consider the question of interest separately with due regard to the facts and circumstances of the case. The provision is discretionary and is not and cannot be bound by rules. In the words of Lord Cairns, L.C. in Julius v. Bishop of Oxford (1880 (5) AC 214), "But there may be something in the nature of the thing empowered to be done, something in the object for which it is to be done, something in the conditions under which it is to be done, something in the title of person or persons for whose benefit the power is to be exercised, which may couple the power with a duty, and make it the duty of the person in whom the power is reposed to exercise that power when called upon to do so". This classic observation has been quoted with approval by this Court in several cases. (See Commissioner of Police v. Gordhandas Bhanji (AIR 1952 SC 16 and S.P. Gupta and Ors. v. President of India and Ors. (AIR 1982 SC 149 ). In Halsburys Laws of England, 4th Edn., Vol.I, it has been observed:- Para 28: Duty and discretion. xxx xxx xxx "A statutory discretion is not, however, necessarily or, indeed, usually absolute; it may be qualified by express and implied legal duties to comply with substantive and procedural requirements before a decision is taken whether to act and how to act. Moreover, there may be a discretion whether to exercise a power, but no discretion as to the mode of its exercise; or a duty to act when certain conditions are present, but a discretion how to act. Discretion may thus be coupled with duties". 8. Discretion, in general, is the discernment of what is right and proper. It denotes knowledge and prudence, that discernment which enables a person to judge critically of what is correct and proper united with caution; nice discernment, and judgment directed by circumspection; deliberate judgment; soundness of judgment; a science or understanding to discern between falsity and truth, between wrong and right, between shadow and substance, between equity and colorable glosses and pretences, and not to do according to the will and private affections of persons. When it is said that something is to be done within the discretion of the authorities, that something is to be done according to the rules of reason and justice, not according to private opinion; according to law and not humour. It is to be not arbitrary, vague, and fanciful, but legal and regular. And it must be exercised within the limit, to which an honest man, competent to the discharge of his office ought to confine himself (Per Lord Halsbury, L.C., in Sharp v. Wakefield, (1891) Appeal Cases 173). Also (See S.G. Jaisinghani v. Union of India and Ors. (AIR 1967 SC 1427 ). 9. The word "discretion" standing single and unsupported by circumstances signifies exercise of judgment, skill or wisdom as distinguished from folly, unthinking or haste; evidently therefore a discretion cannot be arbitrary but must be a result of judicial thinking. The word in itself implies vigilant circumspection and care; therefore where the legislature concedes discretion it also imposes a heavy responsibility. "The discretion of a Judge is the law of tyrants; it is always unknown. It is different in different men. It is casual, and depends upon constitution, temper, passion. In the best it is often times caprice; in the worst it is every vice, folly, and passion to which human nature is liable," said (Lord Camden, L.C.J., in Hindson and Kersey (1680) 8 How, St. Tr.57.) 10. If a certain latitude or liberty accorded by statute or rules to a judge as distinguished from a ministerial or administrative official, in adjudicating on matters brought before him, it is judicial discretion. It limits and regulates the exercise of the discretion, and prevents it from being wholly absolute, capricious, or exempt from review. 11. Such discretion is usually given on matters of procedure or punishment, or costs of administration rather than with reference to vested substantive rights. The matters which should regulate the exercise of discretion have been stated by eminent judges in somewhat different forms of words but with substantial identity. When a statute gives a judge a discretion, what is meant is a judicial discretion, regulated according to the known rules of law, and not the mere whim or caprice of the person to whom it is given on the assumption that he is discreet (Per Willes J. in Lee v Budge Railway Co., (1871) LR 6 CP 576, and in Morgan v. Morgan, 1869, LR 1 P & M 644). 12. Though Section 110CC of the Act (corresponding to Section 171 of the New Act) confers a discretion on the Tribunal to award interest, the same is meant to be exercised in cases where the claimant can claim the same as a matter of right. In the above background, it is to be judged whether a stipulation for higher rate of interest in case of default can be imposed by the Tribunal. Once the discretion has been exercised by the Tribunal to award simple interest on the amount of compensation to be awarded at a particular rate and from a particular date, there is no scope for retrospective enhancement for default in payment of compensation. No express or implied power in this regard can be culled out from Section 110CC of the Act or Section 171 of the new Act. Such a direction in the award for retrospective enhancement of interest for default in payment of the compensation together with interest payable thereon virtually amounts to imposition of penalty which is not statutorily envisaged and prescribed. ### Response: 1

DAMODAR VALLEY CORPORATION Vs. CENTRAL ELEC. REGULATORY COMM. AND ORS

found to be in two forms, namely, either as return on equity in respect of the equity portion and as interest on the loan component. 23. There remains only one area of doubt. In paragraph A-15, the Appellate Tribunal noted that the interest due from DVC on the capital employed by the participating Governments have been allowed to be retained by the appellant and it has been ploughed back into the capital. To this portion also, the Appellate Tribunal directed to apply under Section 38 of the DVC Act. However, firstly, it is after so providing that the Appellate Tribunal has later in paragraph E-13 given its direction under Section 38 of the DVC Act. Secondly, even in the written submission made this aspect has not been taken up as such and at any rate, the particulars are not given. Also in paragraph 73 of the impugned order which refers to the complaint of the appellant relating to cumulative depreciation being employed to reduce the loan component being illegal and reference is made to the retained interest being ploughed back as capital to the creation of capital assets resulting in the appellant enjoying perpetual moratorium as it has never repaid the loan and the question of adjustment of the depreciation for the loan did not arise. There is no complaint raised about interest under Section 38 of the Act not being given in respect of interest which is ploughed back as capital. 24. The next question relates to the legality of taking into consideration the cumulative depreciation for reducing the loan component. The complaint of the appellant is that both the Commission and the Tribunal have calculated interest on the basis that cumulative depreciation will result in a reduction of loan which is unsustainable. The answer to the same which is raised by the respondents is that it is not open to the appellant to raise this contention as this contention was not raised before the appellate Tribunal in the first round of litigation which culminated in the order dated 23.11.2007 being passed by the Appellate Tribunal. The appellant no doubt seeks support from the order of the Appellate Tribunal passed in the case of NTPC. It is no doubt true that in the order of the Appellate Tribunal in the case of NTPC, the Tribunal discountenanced adjusting cumulative depreciation reducing the loan. As far as the judgment of this Court in 2007 (3) SCC 33 , there the question which really arose was related to the rate of depreciation. This Court took the view for power companies keeping in view the need to replace the assets, a higher rate of depreciation was necessary as it would reduce the number of years required for replacing the assets. The observation made therein incidentally may not have the effect which the appellant seeks to persuade us to accept. But the question would be whether the appellant would be entitled to raise the complaint in this appeal. In the original order passed on 3.10.2006 by the Central Commission, the Commission held as follows:- 57. Majority of the loans raised by the petitioner Corporation are not project specific. The normative loan outstanding for individual station, as on 31.3.2004, has been computed by applying the normative debt-equity structure of 70:30 (as mentioned above) to the capital cost with weighted average rate of interest of the loan for the petitioner Corporation as a whole. The cumulative depreciation as on 31.3.2004 or notional loan amount, whichever is lower, has been deemed as loan repayment and balance amount, if any, has been allowed to be serviced till it is fully repaid. Annual depreciation amount has been treated as normative loan repayment. The weighted average rate of interest as claimed by the petitioner Corporation and as adopted for the tariff calculations is as follows: chart 25. Being dissatisfied by the same, the appellant approached the Appellate Tribunal. Apparently, 10 issues were agitated by the Appellate Tribunal at the instance of the appellant. Since the matter has attained finality by the decision of this Court in 2018 (8) SCC 281, it is but apposite that we have set out paragraph 11 of the said judgment. Paragraph 11 of the said judgment is extracted below: 11. Accordingly, the learned Appellate Tribunal while rejecting the following five claims and upholding the order of CERC on the aforesaid counts thought it proper to remand the matter, for a de novo consideration of the remaining five issues by CERC in the light of the findings recorded by it. The tabular chart, extracted below, would indicate the five issues that have been finalised by the learned Appellate Tribunal by upholding the order of CERC dated 3-10-2006 and the other five issues which have been remanded for redetermination by CERC: Issues finalised by the learned Appellate Tribunal by upholding the order of CERC dated 3-10-2006 Issues remanded for redetermination by CERC (i) Higher return on equity; chart 26. A perusal of the same would appear to suggest the substantive question of law sought to be raised as part of the second contention, does not remain open for adjudication. 27. When the matter went back pursuant to the remand order in the first round of litigation which has become final in view of the dismissal of appeal by this Court, the Central Commission has only reiterated the procedure in the matter of calculating interest on loan by reducing the loan amount by the cumulative depreciation. This is a procedure to which exception was not taken in the first round when the appellant could have taken exception to the same. This is also for the period prior to 31.3.2006. Having regard to what is stated in paragraph 57 in the earlier round of litigation, therefore, on a point which has become final in the earlier round, we are not persuaded to hold that it will be open for the appellant to raise the same issue in the second round in respect of a matter which has attained finality.

0[ds]19. It is in the light of these orders that we must consider the contention of the appellant that despite appellant being entitled to the benefit of interest on capital it was not given the benefit despite the final pronouncement of this Court in 2018(8) SCC 281 upholding the view of the Appellate Tribunal itself that Section 38 of the DVC Act will continue to apply for the benefit of the. On the other hand, the contention of the contesting respondents is that the benefit under Section 38 of the DVC Act as claimed by the appellant would result in appellant getting a benefit which would be a duplication of claims insofar as on the total capital, applying the normative debt equity ratio, appellant has been given the benefit of return on capital on the normative equity portion and it has also been allowed interest on the loan portion. The case of the appellant on the other hand, is that even after interest has been given on the loan portion and the return on equity has also been ensured on the normative equity portion by the impugned order, over and above the same, the appellant is entitled to the benefit of interest on capital on the whole amount as that is so provided under Section 38 of the DVC Act20. In the order of the Appellate Tribunal dated 23.11.2007 the matter came to be dealt with under the heading debt equity ratio. The Tribunal went on to accept the case of the appellant in respect of all old projects of DVC and normative debt equity of 50:50 was assigned, commissioned prior to 1992. In respect of recent projects such as Mejina, it was assigned debt equity ratio of 70:30 on capital structure as specified in the Regulations. This finding has become final. It was contended on behalf of the appellant that equity has been the primary source of capital. Thereafter, in paragraph, it was found by the Appellate Tribunal that owners take upon themselves business related risk and are entitled to interest on capital investment, but the return is to be governed by the scheme of determination of tariff for the supply of electricity as mandated by the law in place. The Appellate Tribunal further proceeds to hold that the scheme provides for assured Return on Equity (ROE) which is at the rate of 14% on the equity employed for the purpose of supplying electricity. The scheme does not permit return on investment made on projects other than for supply of electricity to be recovered from supply of electricity. The Tribunal went on to hold that the DVC Act does not recognise capital as borrowings and there is no reference about repayment of such capital to the participating Governments. The Appellate Tribunal proceeds to hold that the capital infused by participating Governments is in the nature of equity capital and for the determination of tariff, the same would be eligible for return on equity but the Appellate Tribunal does not end there. It clearly provides that the return on equity is as may be permitted by the tariff Regulation of 2004. It is thereafter that the Appellate Tribunal in para 15 proceeded to hold that the DVC Act provides for interest on capital which is contributed by the participating Governments. The accrued interest due to the Governments apparently has been allowed to be retained by the appellant. The same however came to be ploughed back into the capital with the tacit consent of the participating Governments. Thereafter, it is stated that this has to be provided to the DVC as per the provisions of Section 38 of the DVC Act. It is thereafter paragraph6 which we have already extracted, the Tribunal proceeded to observe that under the DVC Act if there is any deficit in the capital contributed by the participating Governments, it is to be made good by taking loan on behalf of the participating Governments. The said debt would attract interest. The average interest rate of the repayment payable is to be applied on a 50:50 normative debt capital. This means that out of the aggregate equity including reserves, equity considering the normative debt ratio of 50:50 would be eligible for return on equity as specified in the Regulations and the excess of equity, if any, over the equity earning ratio of 14% is to be considered as interest bearing debt. In the example which has been given it is shown that if the debt equity ratio is 40:60, return on equity at 14% will be available on 50% equity whereas interest would be available at 10% portion of equity and 40% loan which were reduced by repayments21. On the basis of the remand, the Commission has worked out the debt equity ratio as directed by the Appellate Tribunal. It has further provided return on equity at the rate of 14% on the equity portion, namely 50%. In respect of the debt portion, interest has been calculated no doubt after deducting depreciation, the legality of which is the subject matter of the other contention which we will deal with separately. It is quite clear to us that appellant has already been given return on equity in terms of the tariff Regulation in respect of capital on the basis of debt equity ratio which has been fixed by the Appellate Tribunal on a ratio which has become final between the parties22. Though a perusal of para9 of order dated 23.11.2007 may appear to show that equity has been found to be the main source of capital, a perusal of paragraph3 would show that capital under Section 38 of the DVC Act has been understood as the value of the operating assets when they were first put to commercial use. Capital is also understood not as equity alone but it has been understood both as loan and equity. The ratio between loan and equity is also fixed in respect of the old projects at 50:50 and under the new projects it is at 70:30. It is further clear from paragraph3 of the order of the Appellate Tribunal dated 23.11.2007 that the appellate Tribunal contemplated that the equity component would remain static and it would earn the rate of return as provided in the tariff Regulation. As far as the loan component is concerned, it would get reduced on account of repayments. Therefore, the recovery as contemplated under the Regulations was found to be in two forms, namely, either as return on equity in respect of the equity portion and as interest on the loan component23. There remains only one area of doubt. In paragraph, the Appellate Tribunal noted that the interest due from DVC on the capital employed by the participating Governments have been allowed to be retained by the appellant and it has been ploughed back into the capital. To this portion also, the Appellate Tribunal directed to apply under Section 38 of the DVC Act. However, firstly, it is after so providing that the Appellate Tribunal has later in paragraph3 given its direction under Section 38 of the DVC Act. Secondly, even in the written submission made this aspect has not been taken up as such and at any rate, the particulars are not given. Also in paragraph 73 of the impugned order which refers to the complaint of the appellant relating to cumulative depreciation being employed to reduce the loan component being illegal and reference is made to the retained interest being ploughed back as capital to the creation of capital assets resulting in the appellant enjoying perpetual moratorium as it has never repaid the loan and the question of adjustment of the depreciation for the loan did not arise. There is no complaint raised about interest under Section 38 of the Act not being given in respect of interest which is ploughed back as capital26. A perusal of the same would appear to suggest the substantive question of law sought to be raised as part of the second contention, does not remain open for adjudication27. When the matter went back pursuant to the remand order in the first round of litigation which has become final in view of the dismissal of appeal by this Court, the Central Commission has only reiterated the procedure in the matter of calculating interest on loan by reducing the loan amount by the cumulative depreciation. This is a procedure to which exception was not taken in the first round when the appellant could have taken exception to the same. This is also for the period prior to 31.3.2006. Having regard to what is stated in paragraph 57 in the earlier round of litigation, therefore, on a point which has become final in the earlier round, we are not persuaded to hold that it will be open for the appellant to raise the same issue in the second round in respect of a matter which has attained finality.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: found to be in two forms, namely, either as return on equity in respect of the equity portion and as interest on the loan component. 23. There remains only one area of doubt. In paragraph A-15, the Appellate Tribunal noted that the interest due from DVC on the capital employed by the participating Governments have been allowed to be retained by the appellant and it has been ploughed back into the capital. To this portion also, the Appellate Tribunal directed to apply under Section 38 of the DVC Act. However, firstly, it is after so providing that the Appellate Tribunal has later in paragraph E-13 given its direction under Section 38 of the DVC Act. Secondly, even in the written submission made this aspect has not been taken up as such and at any rate, the particulars are not given. Also in paragraph 73 of the impugned order which refers to the complaint of the appellant relating to cumulative depreciation being employed to reduce the loan component being illegal and reference is made to the retained interest being ploughed back as capital to the creation of capital assets resulting in the appellant enjoying perpetual moratorium as it has never repaid the loan and the question of adjustment of the depreciation for the loan did not arise. There is no complaint raised about interest under Section 38 of the Act not being given in respect of interest which is ploughed back as capital. 24. The next question relates to the legality of taking into consideration the cumulative depreciation for reducing the loan component. The complaint of the appellant is that both the Commission and the Tribunal have calculated interest on the basis that cumulative depreciation will result in a reduction of loan which is unsustainable. The answer to the same which is raised by the respondents is that it is not open to the appellant to raise this contention as this contention was not raised before the appellate Tribunal in the first round of litigation which culminated in the order dated 23.11.2007 being passed by the Appellate Tribunal. The appellant no doubt seeks support from the order of the Appellate Tribunal passed in the case of NTPC. It is no doubt true that in the order of the Appellate Tribunal in the case of NTPC, the Tribunal discountenanced adjusting cumulative depreciation reducing the loan. As far as the judgment of this Court in 2007 (3) SCC 33 , there the question which really arose was related to the rate of depreciation. This Court took the view for power companies keeping in view the need to replace the assets, a higher rate of depreciation was necessary as it would reduce the number of years required for replacing the assets. The observation made therein incidentally may not have the effect which the appellant seeks to persuade us to accept. But the question would be whether the appellant would be entitled to raise the complaint in this appeal. In the original order passed on 3.10.2006 by the Central Commission, the Commission held as follows:- 57. Majority of the loans raised by the petitioner Corporation are not project specific. The normative loan outstanding for individual station, as on 31.3.2004, has been computed by applying the normative debt-equity structure of 70:30 (as mentioned above) to the capital cost with weighted average rate of interest of the loan for the petitioner Corporation as a whole. The cumulative depreciation as on 31.3.2004 or notional loan amount, whichever is lower, has been deemed as loan repayment and balance amount, if any, has been allowed to be serviced till it is fully repaid. Annual depreciation amount has been treated as normative loan repayment. The weighted average rate of interest as claimed by the petitioner Corporation and as adopted for the tariff calculations is as follows: chart 25. Being dissatisfied by the same, the appellant approached the Appellate Tribunal. Apparently, 10 issues were agitated by the Appellate Tribunal at the instance of the appellant. Since the matter has attained finality by the decision of this Court in 2018 (8) SCC 281, it is but apposite that we have set out paragraph 11 of the said judgment. Paragraph 11 of the said judgment is extracted below: 11. Accordingly, the learned Appellate Tribunal while rejecting the following five claims and upholding the order of CERC on the aforesaid counts thought it proper to remand the matter, for a de novo consideration of the remaining five issues by CERC in the light of the findings recorded by it. The tabular chart, extracted below, would indicate the five issues that have been finalised by the learned Appellate Tribunal by upholding the order of CERC dated 3-10-2006 and the other five issues which have been remanded for redetermination by CERC: Issues finalised by the learned Appellate Tribunal by upholding the order of CERC dated 3-10-2006 Issues remanded for redetermination by CERC (i) Higher return on equity; chart 26. A perusal of the same would appear to suggest the substantive question of law sought to be raised as part of the second contention, does not remain open for adjudication. 27. When the matter went back pursuant to the remand order in the first round of litigation which has become final in view of the dismissal of appeal by this Court, the Central Commission has only reiterated the procedure in the matter of calculating interest on loan by reducing the loan amount by the cumulative depreciation. This is a procedure to which exception was not taken in the first round when the appellant could have taken exception to the same. This is also for the period prior to 31.3.2006. Having regard to what is stated in paragraph 57 in the earlier round of litigation, therefore, on a point which has become final in the earlier round, we are not persuaded to hold that it will be open for the appellant to raise the same issue in the second round in respect of a matter which has attained finality. ### Response: 0

Commissioner Of Income-Tax, Madras Vs. K. R. M. T. T. Thiagaraja Chetty & Co

connote the idea of something "coming in". Lord Wrenbury who delivered the judgment of the Privy Council construed the word "income and or accruing" as money arising or accruing by way of income and not "debts arising or accruing". The learned Law Lord observed A debt has accrued to him (tax-payer) but income has not. It is clear that the case related to the meaning of the word "Income" as used in the Ordinance and can be no authority on the question of the assessment of profits and gains under the Indian Income-tax Act.13. The next case relied upon is - Dewar v. Commr. of Inland Revenue, 1935-2 KB 351 (C). In that case one of the executors became entitled to a legacy which carried interest for such time as it remained unpaid. The testators estate, was sufficient at all material times to enable interest to be paid on the legacy but the legatee acting on the advice of his Accountant did not demand the legacy or interest thereon. It was held that as the legatee had not received interest, there was no income in respect of which he could be charged to sur-tax. The decision turned upon the language of Schedule D, cl. 1, sub-cl. (b), English Income-tax Act of 1918, as distinguished from cl 1 (a). Clause 1 (a) deals with annual profits or gains arising or accruing from any kind of property whatever . . . . . . . . but clause (b) imposes a tax in respect of "all interest of money, annuities and other annual profits."Lord Hanworth, M. R. drew the distinction between the two clauses and observed that the case was one of interest of money and fell under cl. (b) and not under cl. (a). Under that clause the tax was limited to any interest of money whether the same is received and payable half-yearly or any shorter or more distant period. The learned Master of the Rolls observed :"If the interest on the legacy in this case has not arisen to the respondent, it he had not become the dominus of this sum, if it does not lie to his order in the hands of his agent, can it be said that it has arisen to him? I think the answer definitely upon the facts must be; No, it has not."14. Lord Maugham, L. J. put the partition thus : " I think in the present case two circumstances may be accurately stated in regard to the sum of ?40,000 which it is said can be brought into charge. The first is that the sum of ?40,000 was not during the year of assessment a debt due by the executors to Mr. Dewar, and secondly, that the sum in question may never be paid or received at all".15. The case of - Commr. of Taxes v. Melbourne Trust Ltd., AIR 1914 PC 230 (D), turned on the construction of the charging section in the Income-tax Act, 1903 of Victoria, whereby a company was liable to pay tax upon the profits earned in or derived in or from Victoria ....In this case the surplus realised by the assesses over the purchase price for the assets sold after making all just deductions was taxed as profit but it was held that they were entitled to hold in suspense part of the surplus realised to meet possible losses on other assets and that under the circumstances the profit was earned for the purposes of the Act. only when distributed to the shareholders.16. Having considered all these cases, we are of opinion that neither of them has any bearing upon the facts and circumstances of the present case.17. Lastly it was urged that the commission could not be said to have accrued, as the profit of the business could be computed only after the 31st March, and therefore the commission could not be subjected to tax when it is no more than a mere right to receive. This argument involves the fallacy that profits do not accrue unless and until they are actually computed. The computation of the profits whenever it may take place cannot possibly be allowed to suspend their accrual. In the case of income where there is a condition that the commission will not be payable until the expiry of a definite period or the making up of the account, it might be said with some justification, though we do not decide it, that the income has not accrued, but there is no such condition in the present case.Clauses 7 and 8 of the agreement which relate to the payment of the commission and the calculation of the profits mean no more than this that the commission will be quantified only after certain deductions had been made and not that the commission will not accrue until the profits have been ascertained. The quantification of the commission is not a condition precedent to its accrual. If the profits of the company are said to have accrued on the 31st of March upon a parity of reasoning, it must be conceded that the commission also accrued on the same date. The date has as much to do with the accrual of the commission as it has to do with the accrual of the profits.18. It was faintly suggested that the managing agency was not a business but this is immaterial for Income-tax purposes because S. 13 will apply to cases both under S. 10 and 12, so we refrain from deciding the point. We may, however, point out in passing that in two cases -Tata Hydro Electric Agencies Ltd. Bombay v. Commr. of I. T. Bombay Presidency and Aden, AIR 1937 PC 139 (E) and - Commr. of Income Tax, Bombay v. Tata Sons, Ltd., AIR 1939 Bom 283 (P), it was assume that the managing agency is business but the point was directly decided in - Inderchand Hari Ram V. Commr. of Income Tax, AIR 1952 All 706 (G), that it is so.

1[ds]The sum of Rs. 2,26,850-5-0 was debited as a revenue expenditure of the company as having been paid to the firm in the books of accounts of the company kept by the firm and was also allowed as a deduction in computing the profits and gains of the company for the purposes of income-tax for 1941-1942.The fact that certain moneys were drawn in cash by the firm from time to time does not necessarily lead to the inference that the firm kept its accounts on a cash basis. Anyone familiar with commercial transactions knows that even in accounts kept on a mercantile basis there can be entries of cash credits and debits. We see no flaw in the conclusion reached by the High Court on the firstundisputed facts are that the amount in question was the commission earned by the firm as managing agents of the Company. In the books of the company maintained by the firm the aforesaid sum was debited as an item of revenue expenditure and the profits were computed after deducting that sum. The amount was simultaneously credited to the managing agents commission account. Under these circumstances, it is idle to contend that the aforesaid sum had not accrued. There can be no doubt under the circumstances that the aforesaid sum was income which had accrued to the firm.It is true that the sum was not drawn by the firm but that can hardly affect the question of its liability to tax, once it is established that the income had accrued or arisen to the firm. The mere fact that the company was withholding payment account of a pending dispute cannot be told to mean that the amount did not accrue to the firmThis argument involves the fallacy that profits do not accrue unless and until they are actually computed. The computation of the profits whenever it may take place cannot possibly be allowed to suspend their accrual. In the case of income where there is a condition that the commission will not be payable until the expiry of a definite period or the making up of the account, it might be said with some justification, though we do not decide it, that the income has not accrued, but there is no such condition in the present7 and 8 of the agreement which relate to the payment of the commission and the calculation of the profits mean no more than this that the commission will be quantified only after certain deductions had been made and not that the commission will not accrue until the profits have been ascertained. The quantification of the commission is not a condition precedent to its accrual. If the profits of the company are said to have accrued on the 31st of March upon a parity of reasoning, it must be conceded that the commission also accrued on the same date. The date has as much to do with the accrual of the commission as it has to do with the accrual of the profits.It was faintly suggested that the managing agency was not a business but this is immaterial for Income-tax purposes because S. 13 will apply to cases both under10 and 12, so we refrain from deciding the point. We may, however, point out in passing that in two cases -Tata Hydro Electric Agencies Ltd. Bombay v. Commr. of I. T. Bombay Presidency and Aden, AIR 1937 PC 139 (E) and - Commr. of Income Tax, Bombay v. Tata Sons, Ltd., AIR 1939 Bom 283 (P), it was assume that the managing agency is business but the point was directly decided in - Inderchand Hari Ram V. Commr. of Income Tax, AIR 1952 All 706 (G), that it is

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: connote the idea of something "coming in". Lord Wrenbury who delivered the judgment of the Privy Council construed the word "income and or accruing" as money arising or accruing by way of income and not "debts arising or accruing". The learned Law Lord observed A debt has accrued to him (tax-payer) but income has not. It is clear that the case related to the meaning of the word "Income" as used in the Ordinance and can be no authority on the question of the assessment of profits and gains under the Indian Income-tax Act.13. The next case relied upon is - Dewar v. Commr. of Inland Revenue, 1935-2 KB 351 (C). In that case one of the executors became entitled to a legacy which carried interest for such time as it remained unpaid. The testators estate, was sufficient at all material times to enable interest to be paid on the legacy but the legatee acting on the advice of his Accountant did not demand the legacy or interest thereon. It was held that as the legatee had not received interest, there was no income in respect of which he could be charged to sur-tax. The decision turned upon the language of Schedule D, cl. 1, sub-cl. (b), English Income-tax Act of 1918, as distinguished from cl 1 (a). Clause 1 (a) deals with annual profits or gains arising or accruing from any kind of property whatever . . . . . . . . but clause (b) imposes a tax in respect of "all interest of money, annuities and other annual profits."Lord Hanworth, M. R. drew the distinction between the two clauses and observed that the case was one of interest of money and fell under cl. (b) and not under cl. (a). Under that clause the tax was limited to any interest of money whether the same is received and payable half-yearly or any shorter or more distant period. The learned Master of the Rolls observed :"If the interest on the legacy in this case has not arisen to the respondent, it he had not become the dominus of this sum, if it does not lie to his order in the hands of his agent, can it be said that it has arisen to him? I think the answer definitely upon the facts must be; No, it has not."14. Lord Maugham, L. J. put the partition thus : " I think in the present case two circumstances may be accurately stated in regard to the sum of ?40,000 which it is said can be brought into charge. The first is that the sum of ?40,000 was not during the year of assessment a debt due by the executors to Mr. Dewar, and secondly, that the sum in question may never be paid or received at all".15. The case of - Commr. of Taxes v. Melbourne Trust Ltd., AIR 1914 PC 230 (D), turned on the construction of the charging section in the Income-tax Act, 1903 of Victoria, whereby a company was liable to pay tax upon the profits earned in or derived in or from Victoria ....In this case the surplus realised by the assesses over the purchase price for the assets sold after making all just deductions was taxed as profit but it was held that they were entitled to hold in suspense part of the surplus realised to meet possible losses on other assets and that under the circumstances the profit was earned for the purposes of the Act. only when distributed to the shareholders.16. Having considered all these cases, we are of opinion that neither of them has any bearing upon the facts and circumstances of the present case.17. Lastly it was urged that the commission could not be said to have accrued, as the profit of the business could be computed only after the 31st March, and therefore the commission could not be subjected to tax when it is no more than a mere right to receive. This argument involves the fallacy that profits do not accrue unless and until they are actually computed. The computation of the profits whenever it may take place cannot possibly be allowed to suspend their accrual. In the case of income where there is a condition that the commission will not be payable until the expiry of a definite period or the making up of the account, it might be said with some justification, though we do not decide it, that the income has not accrued, but there is no such condition in the present case.Clauses 7 and 8 of the agreement which relate to the payment of the commission and the calculation of the profits mean no more than this that the commission will be quantified only after certain deductions had been made and not that the commission will not accrue until the profits have been ascertained. The quantification of the commission is not a condition precedent to its accrual. If the profits of the company are said to have accrued on the 31st of March upon a parity of reasoning, it must be conceded that the commission also accrued on the same date. The date has as much to do with the accrual of the commission as it has to do with the accrual of the profits.18. It was faintly suggested that the managing agency was not a business but this is immaterial for Income-tax purposes because S. 13 will apply to cases both under S. 10 and 12, so we refrain from deciding the point. We may, however, point out in passing that in two cases -Tata Hydro Electric Agencies Ltd. Bombay v. Commr. of I. T. Bombay Presidency and Aden, AIR 1937 PC 139 (E) and - Commr. of Income Tax, Bombay v. Tata Sons, Ltd., AIR 1939 Bom 283 (P), it was assume that the managing agency is business but the point was directly decided in - Inderchand Hari Ram V. Commr. of Income Tax, AIR 1952 All 706 (G), that it is so. ### Response: 1

National Insurance Company Limited Vs. Mrs.Jyoti Niranjan Vaswani & Others

by the strict rules of evidence. We find that apart from the said certificate at Exh.27 which is on the letterhead of the company, there are large number of certificates filed on record on the letterhead of Mobil Shipping Company Limited showing the salary/income of the deceased right from 1986-1987. Therefore, it is not possible to accept the submission that the certificate at Exh.27 is not a genuine document. We find no fault with the Tribunal for placing reliance on the said certificate to arrive at conclusion that income of the deceased was US $23,544/- at the time of his death. Exchange rate of Rs.42/- per US $ has been taken by the Tribunal on which there is no specific challenge.8. As far as age of the deceased is concerned, in the examination-in-chief, the first respondent deposed that age of her husband was 36 years. Age of the first respondent in the affidavit filed in October 2009 is disclosed as 46 years. So her age at the time of accident was above 35 years. It is true that only a photo copy of the passport of the deceased was produced and not the original. The passport discloses that the date of birth of the deceased was 28th February 1962. A suggestion was given in the cross examination of the first respondent that the age of the deceased was more than 40 years. Considering the factual aspects, it can be safely said that the age of the deceased at the time of accident was above 36 years and not more than 40 years. Therefore, going by the decision of the Apex Court in case of Sarla Verma (supra), the appropriate multiplier will be 15. The Tribunal has committed an error by taking the multiplier at 16.9. As far as number of dependants are concerned, in the affidavit in lieu of examination-in-chief, the first respondent has stated that she herself being the widow, the second respondent being the minor daughter of the deceased and the third and fourth respondents being the parents of the deceased, were dependent on the deceased. The respective ages of the third and fourth respondents as disclosed from the claim application filed in the year 1999 were 72 and 61 respectively. There is absolutely no cross examination on this aspect set out in the affidavit. Had there been even a suggestion given that the father of the deceased was not dependent on the deceased, there would have been substance in the grievance made by the learned counsel for the appellant regarding non examination of the father of the deceased. The version in the affidavit in lieu of examination in chief that all four claimants were depending on the deceased has gone unchallenged. Therefore, in view of what is held in the case of Sarla Verma (supra) by the Apex Court, 1/4th amount will have to be deducted on account of personal expenditure for the purpose of calculating multiplicand. Therefore, the yearly dependency taken by the Tribunal cannot be faulted with.10. Now as regards interest, there cannot be any dispute about rate of interest at 7.5% p.a considering the fact that the claim petition is of 1999. Perusal of the Roznama shows that notices were issued to the opponents in the claim petition on 24th June 1999. At the stage of hearing of the application under section 140 of the said Act, the 5th respondent (owner of the vehicle) did not enter appearance and only the appellant insurer entered appearance. Issues were framed in April 2006. Thereafter, the petition remained pending for service of notice to the insured-owner of the vehicle. It is not the case that the respondent Nos.1 to 4 had not paid process fees. Notices were issued from time to time which were not served. We find that only on 12th November 2008, an application for adjournment was moved by the claimants to enable them to take steps. Thereafter, an application at Exh.13 was filed by the appellant on 18th June 2010 seeking leave under section 170(b) of the said Act. The application was allowed by order dated 5th October 2010. Therefore, the claimants cannot be blamed for delay up to the said date. Perusal of the Roznama shows that thereafter only on one or two occasions, an application for adjournment was made on behalf of the claimants. Another grievance made by the learned counsel for the appellant was that after the evidence was closed, an application was made by the claimants seeking permission to examine one more witness. We find that the application was made by the claimants seeking permission to examine Captain Lavji Mistry. At the stage when the case was at the stage of argument, an objection was raised by the Appellant regarding the proof of income of the deceased. The Tribunal accordingly allowed the application and that is how the said witness was examined by the claimants. We must note here that though leave under section 170 of the said Act was granted as aforesaid by order dated 5th October 2010, no additional or further written statement was filed by the appellant.11. Considering the aforesaid circumstances, it is obvious that the claimants cannot be blamed for delay in disposal of the claim petition. Therefore, objection regarding grant of interest from the date of claim application will have to be rejected.12. We have already found that the yearly dependency arrived at by the Tribunal at Rs.4,96,896/- on the basis of the yearly income of the deceased at US $ 23,544/- is appropriate. We may note that 33% deduction has been made on account of income tax, education cess and professional tax. If multiplier of 15 is applied, the compensation comes to Rs.74,53,440/-. By affidavit dated 27th August 2012 filed in the application for condonation of delay, the first to fourth respondents have confined their claim to a sum of Rs.67,25,290/- with interest thereon. Therefore, we will have to reduce the compensation to the said amount and to that extent, the appeal must succeed.

1[ds]6. We have carefully considered the submissions. As far as first submission about contributory negligence is concerned, we may note here that the appellant obtained a leave under section 170 of the said Act to contest the claim application on all grounds which are available to the insured. Written statement of the appellant contains mere denial. The Tribunal has relied upon the evidence of eye witness Deepak Agarwal who was examined in companion claim application. The learned Member of the Tribunal observed that the evidence of the said eye witness on the aspect of negligence of the driver of the truck has not been controverted in the cross examination. The Tribunal was dealing with the three claim petitions arising out of the same accident. Therefore, the Tribunal was relying upon the evidence of the eye witness who was examined in companion claim petition. It is well settled that the Tribunal is not bound by the strict rules of evidence. The Tribunal accepted the evidence of the said witness Deepak Agarwal. On the other hand, there was no effort made by the appellant to examine the driver of the offending truck or any other eye witness. Therefore, there is no reason to disturb the finding of the Tribunal that the accident occurred on account of negligence of the driver of the truck which was insured with theperusal of the cross examination it appears that the Advocate for the appellant did not dispute that Captain Mistry was employed with the said company. Only suggestion given to the witness was that he was not the General Manager of the said company during the relevant period. He stated that he was not present when Mr.Kennady signed the said certificate. However, he identified the said signature of Mr.Kennady on the letter at Exhibit 27. Therefore, we find that no fault can be found with the learned Chairman of the Motor Accident Claim Tribunal, Mumbai when he marked the certificate as exhibit. We must note here that the Tribunal constituted under the said Act is not bound by the strict rules of evidence. We find that apart from the said certificate at Exh.27 which is on the letterhead of the company, there are large number of certificates filed on record on the letterhead of Mobil Shipping Company Limited showing the salary/income of the deceased right fromTherefore, it is not possible to accept the submission that the certificate at Exh.27 is not a genuine document. We find no fault with the Tribunal for placing reliance on the said certificate to arrive at conclusion that income of the deceased was US $23,544/at the time of his death. Exchange rate of Rs.42/per US $ has been taken by the Tribunal on which there is no specific challenge.8. As far as age of the deceased is concerned, in thethe first respondent deposed that age of her husband was 36 years. Age of the first respondent in the affidavit filed in October 2009 is disclosed as 46 years. So her age at the time of accident was above 35 years. It is true that only a photo copy of the passport of the deceased was produced and not the original. The passport discloses that the date of birth of the deceased was 28th February 1962. A suggestion was given in the cross examination of the first respondent that the age of the deceased was more than 40 years. Considering the factual aspects, it can be safely said that the age of the deceased at the time of accident was above 36 years and not more than 40 years. Therefore, going by the decision of the Apex Court in case of Sarla Verma (supra), the appropriate multiplier will be 15. The Tribunal has committed an error by taking the multiplier at 16.9. As far as number of dependants are concerned, in the affidavit in lieu ofthe first respondent has stated that she herself being the widow, the second respondent being the minor daughter of the deceased and the third and fourth respondents being the parents of the deceased, were dependent on the deceased. The respective ages of the third and fourth respondents as disclosed from the claim application filed in the year 1999 were 72 and 61 respectively. There is absolutely no cross examination on this aspect set out in the affidavit. Had there been even a suggestion given that the father of the deceased was not dependent on the deceased, there would have been substance in the grievance made by the learned counsel for the appellant regarding non examination of the father of the deceased. The version in the affidavit in lieu of examination in chief that all four claimants were depending on the deceased has gone unchallenged. Therefore, in view of what is held in the case of Sarla Verma (supra) by the Apex Court, 1/4th amount will have to be deducted on account of personal expenditure for the purpose of calculating multiplicand. Therefore, the yearly dependency taken by the Tribunal cannot be faulted with.10. Now as regards interest, there cannot be any dispute about rate of interest at 7.5% p.a considering the fact that the claim petition is of 1999. Perusal of the Roznama shows that notices were issued to the opponents in the claim petition on 24th June 1999. At the stage of hearing of the application under section 140 of the said Act, the 5th respondent (owner of the vehicle) did not enter appearance and only the appellant insurer entered appearance. Issues were framed in April 2006. Thereafter, the petition remained pending for service of notice to theof the vehicle. It is not the case that the respondent Nos.1 to 4 had not paid process fees. Notices were issued from time to time which were not served. We find that only on 12th November 2008, an application for adjournment was moved by the claimants to enable them to take steps. Thereafter, an application at Exh.13 was filed by the appellant on 18th June 2010 seeking leave under section 170(b) of the said Act. The application was allowed by order dated 5th October 2010. Therefore, the claimants cannot be blamed for delay up to the said date. Perusal of the Roznama shows that thereafter only on one or two occasions, an application for adjournment was made on behalf of the claimants. Another grievance made by the learned counsel for the appellant was that after the evidence was closed, an application was made by the claimants seeking permission to examine one more witness. We find that the application was made by the claimants seeking permission to examine Captain Lavji Mistry. At the stage when the case was at the stage of argument, an objection was raised by the Appellant regarding the proof of income of the deceased. The Tribunal accordingly allowed the application and that is how the said witness was examined by the claimants. We must note here that though leave under section 170 of the said Act was granted as aforesaid by order dated 5th October 2010, no additional or further written statement was filed by the appellant.11. Considering the aforesaid circumstances, it is obvious that the claimants cannot be blamed for delay in disposal of the claim petition. Therefore, objection regarding grant of interest from the date of claim application will have to be rejected.12. We have already found that the yearly dependency arrived at by the Tribunal at Rs.4,96,896/on the basis of the yearly income of the deceased at US $ 23,544/is appropriate. We may note that 33% deduction has been made on account of income tax, education cess and professional tax. If multiplier of 15 is applied, the compensation comes to Rs.By affidavit dated 27th August 2012 filed in the application for condonation of delay, the first to fourth respondents have confined their claim to a sum of Rs.67,25,290/with interest thereon. Therefore, we will have to reduce the compensation to the said amount and to that extent, the appeal must succeed.

### Instruction: From the information provided in the case proceeding, infer whether the court's decision will be positive (1) or negative (0) for the appellant. ### Input: by the strict rules of evidence. We find that apart from the said certificate at Exh.27 which is on the letterhead of the company, there are large number of certificates filed on record on the letterhead of Mobil Shipping Company Limited showing the salary/income of the deceased right from 1986-1987. Therefore, it is not possible to accept the submission that the certificate at Exh.27 is not a genuine document. We find no fault with the Tribunal for placing reliance on the said certificate to arrive at conclusion that income of the deceased was US $23,544/- at the time of his death. Exchange rate of Rs.42/- per US $ has been taken by the Tribunal on which there is no specific challenge.8. As far as age of the deceased is concerned, in the examination-in-chief, the first respondent deposed that age of her husband was 36 years. Age of the first respondent in the affidavit filed in October 2009 is disclosed as 46 years. So her age at the time of accident was above 35 years. It is true that only a photo copy of the passport of the deceased was produced and not the original. The passport discloses that the date of birth of the deceased was 28th February 1962. A suggestion was given in the cross examination of the first respondent that the age of the deceased was more than 40 years. Considering the factual aspects, it can be safely said that the age of the deceased at the time of accident was above 36 years and not more than 40 years. Therefore, going by the decision of the Apex Court in case of Sarla Verma (supra), the appropriate multiplier will be 15. The Tribunal has committed an error by taking the multiplier at 16.9. As far as number of dependants are concerned, in the affidavit in lieu of examination-in-chief, the first respondent has stated that she herself being the widow, the second respondent being the minor daughter of the deceased and the third and fourth respondents being the parents of the deceased, were dependent on the deceased. The respective ages of the third and fourth respondents as disclosed from the claim application filed in the year 1999 were 72 and 61 respectively. There is absolutely no cross examination on this aspect set out in the affidavit. Had there been even a suggestion given that the father of the deceased was not dependent on the deceased, there would have been substance in the grievance made by the learned counsel for the appellant regarding non examination of the father of the deceased. The version in the affidavit in lieu of examination in chief that all four claimants were depending on the deceased has gone unchallenged. Therefore, in view of what is held in the case of Sarla Verma (supra) by the Apex Court, 1/4th amount will have to be deducted on account of personal expenditure for the purpose of calculating multiplicand. Therefore, the yearly dependency taken by the Tribunal cannot be faulted with.10. Now as regards interest, there cannot be any dispute about rate of interest at 7.5% p.a considering the fact that the claim petition is of 1999. Perusal of the Roznama shows that notices were issued to the opponents in the claim petition on 24th June 1999. At the stage of hearing of the application under section 140 of the said Act, the 5th respondent (owner of the vehicle) did not enter appearance and only the appellant insurer entered appearance. Issues were framed in April 2006. Thereafter, the petition remained pending for service of notice to the insured-owner of the vehicle. It is not the case that the respondent Nos.1 to 4 had not paid process fees. Notices were issued from time to time which were not served. We find that only on 12th November 2008, an application for adjournment was moved by the claimants to enable them to take steps. Thereafter, an application at Exh.13 was filed by the appellant on 18th June 2010 seeking leave under section 170(b) of the said Act. The application was allowed by order dated 5th October 2010. Therefore, the claimants cannot be blamed for delay up to the said date. Perusal of the Roznama shows that thereafter only on one or two occasions, an application for adjournment was made on behalf of the claimants. Another grievance made by the learned counsel for the appellant was that after the evidence was closed, an application was made by the claimants seeking permission to examine one more witness. We find that the application was made by the claimants seeking permission to examine Captain Lavji Mistry. At the stage when the case was at the stage of argument, an objection was raised by the Appellant regarding the proof of income of the deceased. The Tribunal accordingly allowed the application and that is how the said witness was examined by the claimants. We must note here that though leave under section 170 of the said Act was granted as aforesaid by order dated 5th October 2010, no additional or further written statement was filed by the appellant.11. Considering the aforesaid circumstances, it is obvious that the claimants cannot be blamed for delay in disposal of the claim petition. Therefore, objection regarding grant of interest from the date of claim application will have to be rejected.12. We have already found that the yearly dependency arrived at by the Tribunal at Rs.4,96,896/- on the basis of the yearly income of the deceased at US $ 23,544/- is appropriate. We may note that 33% deduction has been made on account of income tax, education cess and professional tax. If multiplier of 15 is applied, the compensation comes to Rs.74,53,440/-. By affidavit dated 27th August 2012 filed in the application for condonation of delay, the first to fourth respondents have confined their claim to a sum of Rs.67,25,290/- with interest thereon. Therefore, we will have to reduce the compensation to the said amount and to that extent, the appeal must succeed. ### Response: 1

Ashalata Debi & Others Vs. Jadu Nath Roy & Others

of the Appellant.Paragraph 4(2) provided for appeals or applications for revision in respect of proceedings which were pending in the Courts after the 15th August 1947 and laid down that these proceedings by way of appeal or applications for revision could lie in the Court which would have appellate or revisional jurisdiction over that Court if the proceedings were instituted in that Court after the 15th August 1947.It was contended that for the purpose of this provision the words "if the proceedings were instituted in that Court should be read as meaning "if the proceedings could have been instituted in that Court".This certainly could not be the meaning, because by reason of the transfer of the territories no proceedings in respect of the properties which had gone to Pakistan could ever have been maintained after the 15th August 1947 in the Courts concerned. The only construction which could be put upon this provision was that the Court having appellate or revisional jurisdiction over that Court would have such jurisdiction as if the proceedings had been instituted in that Court after the 15th August 1947.For the purpose of the appellate or the revisional jurisdiction that Court had to be treated as the court in which the proceedings could and should have been instituted and it goes without saying that if the proceedings could be treated as having been properly instituted in that Court the only Court to which we appeal or the application for revision could lie was the Court which then had appellate or revisional jurisdiction over that Court. In the case before us no proceedings could have been instituted in the Third Subordinate Judges Court at Alipore in respect of the properties which had gone to East Pakistan after the 15th August 1947.But by reason of the fact that these proceedings were pending in that Court on the 15th August 1947 the High Court of Calcutta which had appellate or revisional jurisdiction over that Court was prescribed to be the court in which the appeal or the application for revision in respect of such proceedings would lie, because that Court that is the Third Subordinate Judges Court at Alipore was treated as the Court in which such proceeding could and should have been instituted after the 15th August 1947.8. Learned counsel for the Respondents drew our attention to the Case of - Tirlok Nath v. Moti Ram, AIR 1950 EP 149 (A). In that case a suit for possession of land at place A was filed in Court at B in 1943. On the 15th August 1947 the suit was pending before the Court at B which dismissed the suit in 1948. An appeal from the decision was filed in the East Punjab High Court as the place B was included in the East Punjab.On objection regarding jurisdiction of the High Court being taken on the ground that the land in suit was at A, now included in Pakistan, the High Court held that the suit being pending at place B on 15th August 1947, appeal from the decision of that Court lay to the East Punjab High Court and not to Lahore High Court under Para 4(2) of the Indian Independence (Legal Proceedings), Order, 1947.This decision is on all fours with the case before us and we are of the opinion that the contention urged on behalf of the Appellants in untenable.9. The next contention of the Appellants is equally untenable. The Calcutta High Court Considered these applications as applications in the suit for a special remedy given under a special law and held that the rules of the Code of Civil Procedure applied and an appeal lay against the orders because they were decrees within the definition of S. 2(2) of the Civil Procedure Code. We cannot accept this reasoning. These applications were in truth and in substance applications for execution of the new decree which had been passed in favour of the mortgagors by the High Court on the 29th June 1944.The only thing competent to the mortgagees under the terms of the new decree was to apply for executions of the decree on default committed by the mortgagors and the applications made by mortgagees in the Court of the Third Subordinate Judge at Alipore were really applications for execution of the decree though not couched in the proper form and could be treated as such. If they were treated as such it is clear that the orders passed on such applications for execution were appealable and no objections could be sustained on the ground that no appeals lay against these orders. Treating these applications therefore as applications for execution we see no substance in this contention of the Appellants.10. If the matter is approached in this way no objection could be urged by the Appellants against the decision of the High Court. The executing Court could not go behind the decree and it is clear on the facts that default was committed by the mortgagors both in regard to the payment of the revenue and the cess as also the second instalment under the new decree.11. The contention which was therefore urged on behalf of the Appellants that there was no default committed by the mortgagors also could not be sustained.12. The High Court of Judicature at Calcutta was therefore rightly seized of the appeal and it had jurisdiction go decide whether the mortgagors had committed default in carrying out the terms of the new decree. The appeal being a mere rehearing the appellate Court was entitled to review the judgment of the trial Judge and declare that it was wrong and that the decree-holder was entitled to re-restoration. The question whether he would be able to obtain possession of the immovable properties in fact was foreign to such an enquiry. By appropriate proceedings in another jurisdiction be may be able to do so: but this difficulty could not be a deterrent to the High Court passing the necessary orders for re-restoration of the properties.

0[ds]9. The next contention of the Appellants is equally untenable. The Calcutta High Court Considered these applications as applications in the suit for a special remedy given under a special law and held that the rules of the Code of Civil Procedure applied and an appeal lay against the orders because they were decrees within the definition of S. 2(2) of the Civil Procedure Code. We cannot accept this reasoning. These applications were in truth and in substance applications for execution of the new decree which had been passed in favour of the mortgagors by the High Court on the 29th June 1944.The only thing competent to the mortgagees under the terms of the new decree was to apply for executions of the decree on default committed by the mortgagors and the applications made by mortgagees in the Court of the Third Subordinate Judge at Alipore were really applications for execution of the decree though not couched in the proper form and could be treated as such. If they were treated as such it is clear that the orders passed on such applications for execution were appealable and no objections could be sustained on the ground that no appeals lay against these orders. Treating these applications therefore as applications for execution we see no substance in this contention of the Appellants.10. If the matter is approached in this way no objection could be urged by the Appellants against the decision of the High Court. The executing Court could not go behind the decree and it is clear on the facts that default was committed by the mortgagors both in regard to the payment of the revenue and the cess as also the second instalment under the new decree.11. The contention which was therefore urged on behalf of the Appellants that there was no default committed by the mortgagors also could not be sustained.12. The High Court of Judicature at Calcutta was therefore rightly seized of the appeal and it had jurisdiction go decide whether the mortgagors had committed default in carrying out the terms of the new decree. The appeal being a mere rehearing the appellate Court was entitled to review the judgment of the trial Judge and declare that it was wrong and that the decree-holder was entitled to re-restoration. The question whether he would be able to obtain possession of the immovable properties in fact was foreign to such an enquiry. By appropriate proceedings in another jurisdiction be may be able to do so: but this difficulty could not be a deterrent to the High Court passing the necessary orders for re-restoration of the properties.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: of the Appellant.Paragraph 4(2) provided for appeals or applications for revision in respect of proceedings which were pending in the Courts after the 15th August 1947 and laid down that these proceedings by way of appeal or applications for revision could lie in the Court which would have appellate or revisional jurisdiction over that Court if the proceedings were instituted in that Court after the 15th August 1947.It was contended that for the purpose of this provision the words "if the proceedings were instituted in that Court should be read as meaning "if the proceedings could have been instituted in that Court".This certainly could not be the meaning, because by reason of the transfer of the territories no proceedings in respect of the properties which had gone to Pakistan could ever have been maintained after the 15th August 1947 in the Courts concerned. The only construction which could be put upon this provision was that the Court having appellate or revisional jurisdiction over that Court would have such jurisdiction as if the proceedings had been instituted in that Court after the 15th August 1947.For the purpose of the appellate or the revisional jurisdiction that Court had to be treated as the court in which the proceedings could and should have been instituted and it goes without saying that if the proceedings could be treated as having been properly instituted in that Court the only Court to which we appeal or the application for revision could lie was the Court which then had appellate or revisional jurisdiction over that Court. In the case before us no proceedings could have been instituted in the Third Subordinate Judges Court at Alipore in respect of the properties which had gone to East Pakistan after the 15th August 1947.But by reason of the fact that these proceedings were pending in that Court on the 15th August 1947 the High Court of Calcutta which had appellate or revisional jurisdiction over that Court was prescribed to be the court in which the appeal or the application for revision in respect of such proceedings would lie, because that Court that is the Third Subordinate Judges Court at Alipore was treated as the Court in which such proceeding could and should have been instituted after the 15th August 1947.8. Learned counsel for the Respondents drew our attention to the Case of - Tirlok Nath v. Moti Ram, AIR 1950 EP 149 (A). In that case a suit for possession of land at place A was filed in Court at B in 1943. On the 15th August 1947 the suit was pending before the Court at B which dismissed the suit in 1948. An appeal from the decision was filed in the East Punjab High Court as the place B was included in the East Punjab.On objection regarding jurisdiction of the High Court being taken on the ground that the land in suit was at A, now included in Pakistan, the High Court held that the suit being pending at place B on 15th August 1947, appeal from the decision of that Court lay to the East Punjab High Court and not to Lahore High Court under Para 4(2) of the Indian Independence (Legal Proceedings), Order, 1947.This decision is on all fours with the case before us and we are of the opinion that the contention urged on behalf of the Appellants in untenable.9. The next contention of the Appellants is equally untenable. The Calcutta High Court Considered these applications as applications in the suit for a special remedy given under a special law and held that the rules of the Code of Civil Procedure applied and an appeal lay against the orders because they were decrees within the definition of S. 2(2) of the Civil Procedure Code. We cannot accept this reasoning. These applications were in truth and in substance applications for execution of the new decree which had been passed in favour of the mortgagors by the High Court on the 29th June 1944.The only thing competent to the mortgagees under the terms of the new decree was to apply for executions of the decree on default committed by the mortgagors and the applications made by mortgagees in the Court of the Third Subordinate Judge at Alipore were really applications for execution of the decree though not couched in the proper form and could be treated as such. If they were treated as such it is clear that the orders passed on such applications for execution were appealable and no objections could be sustained on the ground that no appeals lay against these orders. Treating these applications therefore as applications for execution we see no substance in this contention of the Appellants.10. If the matter is approached in this way no objection could be urged by the Appellants against the decision of the High Court. The executing Court could not go behind the decree and it is clear on the facts that default was committed by the mortgagors both in regard to the payment of the revenue and the cess as also the second instalment under the new decree.11. The contention which was therefore urged on behalf of the Appellants that there was no default committed by the mortgagors also could not be sustained.12. The High Court of Judicature at Calcutta was therefore rightly seized of the appeal and it had jurisdiction go decide whether the mortgagors had committed default in carrying out the terms of the new decree. The appeal being a mere rehearing the appellate Court was entitled to review the judgment of the trial Judge and declare that it was wrong and that the decree-holder was entitled to re-restoration. The question whether he would be able to obtain possession of the immovable properties in fact was foreign to such an enquiry. By appropriate proceedings in another jurisdiction be may be able to do so: but this difficulty could not be a deterrent to the High Court passing the necessary orders for re-restoration of the properties. ### Response: 0

V. Ramakrishna Rao Vs. The Singareni Collieries Company Ltd. & Another

been able to move the Collector for making reference under Section 18 of the Act to get higher compensation if market value is revised by the Reference Court at the instance of other land owners, whose land is acquired under the same notification. Of course, this opportunity can be availed by filing application within the prescribed period. In Union of India v. Pradeep Kumari (supra), a three-Judge Bench of this Court held that Section 28A is in the nature of a beneficent provision intended to remove inequality and to give relief to the inarticulate and poor land owners, who are not able to take advantage of the right of reference to the Civil Court under Section 18 of the Act and such a provision should be interpreted in a manner which advances the policy of legislation. 10. In Union of India v. Munshi Ram (supra), a two-Judge Bench considered the meaning of the word ‘re-determination’ appearing in Section 28A and held that compensation payable to the applicant under Section 28A should be at par with what is finally payable to those who sought reference under Section 18 of the Act and if the compensation payable to the latter category is reduced by the superior Court, the one who gets higher compensation under Section 28A may be directed to refund the excess amount. What was emphasized by the two-Judge Bench was that re-determination of the amount of compensation under Section 28A must be commensurate with the compensation payable to those who had sought reference under Section 18 and if the higher Court reduces the amount of compensation payable in terms of the order of the Reference Court, then those making application under Section 28A must be asked to refund the excess amount. A somewhat similar view was expressed in Kendriya Karamchari Sehkari Grah Nirman Samiti Limited v. State of Uttar Pradesh (supra) in the following words: “It is true that once the Reference Court decides the matter and enhances the compensation, a person who is otherwise eligible to similar relief and who has not sought reference, may apply under Section 28A of the Act. If the conditions for application of the said provision have been complied with, such person would be entitled to the same relief which has been granted to other persons seeking reference and getting enhanced compensation. But, it is equally true that if the Reference Court decides the matter and the State or acquiring body challenges such enhanced amount of compensation and the matter is pending either before the High Court or before this Court (the Supreme Court), the Collector would be within his power or authority to keep the application under Section 28A of the Act pending till the matter is finally decided by the High Court or the Supreme Court as the case may be. The reason being that the decision rendered by the Reference Court enhancing compensation has not attained ‘finality’ and is sub judice before a superior Court.” 11. If Sub-section (3) of Section 28A is interpreted keeping in view the object sought to be achieved by enacting the provision for removing inequality in the matter of payment of compensation, it must be held that a person who is not satisfied with an award made under Section 28A(2) can make an application to the Collector under Section 28A(3) for making a reference to the Court as defined in Section 3(d) of the Act and this right cannot be frustrated merely because as a result of re-determination made under Section 28A(2) read with Section 28A(1) the applicant becomes entitled to receive compensation at par with other land owners. There is nothing in the plain language of Section 28A(3) from which it can be inferred that a person who has not accepted the award made under Section 28A(2) is precluded from making an application to the Collector with the request to refer the matter to the Court. Of course, the Court to which reference is made under Section 28A(3) will have to bear in mind that a person who has not sought reference under Section 18 cannot get compensation higher than the one payable to those who had sought reference under that section.12. Reverting to the facts of this case, we find that on the date of making an award by the Land Acquisition Officer under Section 28A, Appeal Suit No. 978/1990 filed by other land owners against the order of the Reference Court was pending before the High Court. The same was finally disposed of on 10.3.2000 and the matter was remanded to the Reference Court for fresh determination of market value of the acquired land. After reconsidering the matter, the Reference Court passed order dated 17.7.2000 and fixed market value of the acquired land, which was substantially higher than the one determined by earlier order dated 30.10.1989. Therefore, the appellant cannot be denied right to seek determination of fair market value which has to be at least at par with market value fixed by the Reference Courtvide order dated 17.7.2000. The mere fact that the application filed by the appellant under Section 28A(3) remained pending for more than 9 years and it was only on 10.5.2000 that the Collector accorded permission for making reference to the Court, cannot be made a ground to deprive the appellant of his legitimate right to seek further enhancement in the amount of compensation. If the High Court enhances the compensation payable to the other land owners, the appellant will also become entitled to higher compensation. If the High Court dismisses both the appeals, then too the appellant will be entitled to compensation at the rate of Rs. 30,000/- per acre for the land falling in category I and Rs. 15,000/- per acre for the land falling in category II. If, on the other hand, the amount of compensation payable in terms of order dated 17.7.2000 passed by the Reference Court is reduced by the High Court then the amount payable to the appellant will have to adjusted accordingly.

1[ds]9. The above reproduced provision represents thedetermination to ensure that the goal of equality enshrined in the Preamble of the Constitution and Articles 38, 39 and 46 thereof is translated into reality, at least in the matter of payment of compensation to those who are deprived of their land for the benefit of the State, its instrumentalities/agencies and even private persons. Section 28A also represents statutory embodiment of the doctrine of equality in matters relating to the acquisition of land. The Act which was enacted in 1894 and was amended after 90 years has the potential of depriving a large segment of the society i.e. theof their only source of livelihood. The scheme of Section 28A provide some solace to this segment of the society by ensuring that such of the land owners whose land was acquired under the same notification but who could not, on account of poverty, ignorance and other disabilities join others in seeking reference under Section 18 get an opportunity to claim compensation at par with others. This section is aimed at removing inequality in the payment of compensation in lieu of acquisition of land under the same notification. To put it differently, this section gives a chance to the land owner, who may not have applied under Section 18 for determination of market value by the Court to seekof the amount of compensation, if any other similarly situated land owner succeeds in persuading the Reference Court to fix higher market value of the acquired land. Therefore, Section 28A has to be interpreted in a manner which would advance the policy of legislation to give an opportunity to the land owner who may have, due to variety of reasons not been able to move the Collector for making reference under Section 18 of the Act to get higher compensation if market value is revised by the Reference Court at the instance of other land owners, whose land is acquired under the same notification. Of course, this opportunity can be availed by filing application within the prescribed period. In Union of India v. Pradeep Kumari (supra), aBench of this Court held that Section 28A is in the nature of a beneficent provision intended to remove inequality and to give relief to the inarticulate and poor land owners, who are not able to take advantage of the right of reference to the Civil Court under Section 18 of the Act and such a provision should be interpreted in a manner which advances the policy of legislation.on (3) of Section 28A is interpreted keeping in view the object sought to be achieved by enacting the provision for removing inequality in the matter of payment of compensation, it must be held that a person who is not satisfied with an award made under Section 28A(2) can make an application to the Collector under Section 28A(3) for making a reference to the Court as defined in Section 3(d) of the Act and this right cannot be frustrated merely because as a result ofmade under Section 28A(2) read with Section 28A(1) the applicant becomes entitled to receive compensation at par with other land owners. There is nothing in the plain language of Section 28A(3) from which it can be inferred that a person who has not accepted the award made under Section 28A(2) is precluded from making an application to the Collector with the request to refer the matter to the Court. Of course, the Court to which reference is made under Section 28A(3) will have to bear in mind that a person who has not sought reference under Section 18 cannot get compensation higher than the one payable to those who had sought reference under that section.12. Reverting to the facts of this case, we find that on the date of making an award by the Land Acquisition Officer under Section 28A, Appeal Suit No. 978/1990 filed by other land owners against the order of the Reference Court was pending before the High Court. The same was finally disposed of on 10.3.2000 and the matter was remanded to the Reference Court for fresh determination of market value of the acquired land. After reconsidering the matter, the Reference Court passed order dated 17.7.2000 and fixed market value of the acquired land, which was substantially higher than the one determined by earlier order dated 30.10.1989. Therefore, the appellant cannot be denied right to seek determination of fair market value which has to be at least at par with market value fixed by the Reference Courtvide order dated 17.7.2000. The mere fact that the application filed by the appellant under Section 28A(3) remained pending for more than 9 years and it was only on 10.5.2000 that the Collector accorded permission for making reference to the Court, cannot be made a ground to deprive the appellant of his legitimate right to seek further enhancement in the amount of compensation. If the High Court enhances the compensation payable to the other land owners, the appellant will also become entitled to higher compensation. If the High Court dismisses both the appeals, then too the appellant will be entitled to compensation at the rate of Rs. 30,000/per acre for the land falling in category I and Rs. 15,000/per acre for the land falling in category II. If, on the other hand, the amount of compensation payable in terms of order dated 17.7.2000 passed by the Reference Court is reduced by the High Court then the amount payable to the appellant will have to adjusted accordingly.

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: been able to move the Collector for making reference under Section 18 of the Act to get higher compensation if market value is revised by the Reference Court at the instance of other land owners, whose land is acquired under the same notification. Of course, this opportunity can be availed by filing application within the prescribed period. In Union of India v. Pradeep Kumari (supra), a three-Judge Bench of this Court held that Section 28A is in the nature of a beneficent provision intended to remove inequality and to give relief to the inarticulate and poor land owners, who are not able to take advantage of the right of reference to the Civil Court under Section 18 of the Act and such a provision should be interpreted in a manner which advances the policy of legislation. 10. In Union of India v. Munshi Ram (supra), a two-Judge Bench considered the meaning of the word ‘re-determination’ appearing in Section 28A and held that compensation payable to the applicant under Section 28A should be at par with what is finally payable to those who sought reference under Section 18 of the Act and if the compensation payable to the latter category is reduced by the superior Court, the one who gets higher compensation under Section 28A may be directed to refund the excess amount. What was emphasized by the two-Judge Bench was that re-determination of the amount of compensation under Section 28A must be commensurate with the compensation payable to those who had sought reference under Section 18 and if the higher Court reduces the amount of compensation payable in terms of the order of the Reference Court, then those making application under Section 28A must be asked to refund the excess amount. A somewhat similar view was expressed in Kendriya Karamchari Sehkari Grah Nirman Samiti Limited v. State of Uttar Pradesh (supra) in the following words: “It is true that once the Reference Court decides the matter and enhances the compensation, a person who is otherwise eligible to similar relief and who has not sought reference, may apply under Section 28A of the Act. If the conditions for application of the said provision have been complied with, such person would be entitled to the same relief which has been granted to other persons seeking reference and getting enhanced compensation. But, it is equally true that if the Reference Court decides the matter and the State or acquiring body challenges such enhanced amount of compensation and the matter is pending either before the High Court or before this Court (the Supreme Court), the Collector would be within his power or authority to keep the application under Section 28A of the Act pending till the matter is finally decided by the High Court or the Supreme Court as the case may be. The reason being that the decision rendered by the Reference Court enhancing compensation has not attained ‘finality’ and is sub judice before a superior Court.” 11. If Sub-section (3) of Section 28A is interpreted keeping in view the object sought to be achieved by enacting the provision for removing inequality in the matter of payment of compensation, it must be held that a person who is not satisfied with an award made under Section 28A(2) can make an application to the Collector under Section 28A(3) for making a reference to the Court as defined in Section 3(d) of the Act and this right cannot be frustrated merely because as a result of re-determination made under Section 28A(2) read with Section 28A(1) the applicant becomes entitled to receive compensation at par with other land owners. There is nothing in the plain language of Section 28A(3) from which it can be inferred that a person who has not accepted the award made under Section 28A(2) is precluded from making an application to the Collector with the request to refer the matter to the Court. Of course, the Court to which reference is made under Section 28A(3) will have to bear in mind that a person who has not sought reference under Section 18 cannot get compensation higher than the one payable to those who had sought reference under that section.12. Reverting to the facts of this case, we find that on the date of making an award by the Land Acquisition Officer under Section 28A, Appeal Suit No. 978/1990 filed by other land owners against the order of the Reference Court was pending before the High Court. The same was finally disposed of on 10.3.2000 and the matter was remanded to the Reference Court for fresh determination of market value of the acquired land. After reconsidering the matter, the Reference Court passed order dated 17.7.2000 and fixed market value of the acquired land, which was substantially higher than the one determined by earlier order dated 30.10.1989. Therefore, the appellant cannot be denied right to seek determination of fair market value which has to be at least at par with market value fixed by the Reference Courtvide order dated 17.7.2000. The mere fact that the application filed by the appellant under Section 28A(3) remained pending for more than 9 years and it was only on 10.5.2000 that the Collector accorded permission for making reference to the Court, cannot be made a ground to deprive the appellant of his legitimate right to seek further enhancement in the amount of compensation. If the High Court enhances the compensation payable to the other land owners, the appellant will also become entitled to higher compensation. If the High Court dismisses both the appeals, then too the appellant will be entitled to compensation at the rate of Rs. 30,000/- per acre for the land falling in category I and Rs. 15,000/- per acre for the land falling in category II. If, on the other hand, the amount of compensation payable in terms of order dated 17.7.2000 passed by the Reference Court is reduced by the High Court then the amount payable to the appellant will have to adjusted accordingly. ### Response: 1

Narayanappa Vs. Jainarayan Chunnilal Marwadi

1964 voluntarily. He rejected as an after though the story of the appellant that the surrender had been brought about as a result of procedure or undue influence exerted on him by representatives of Parubai - a story put forward by the appellant in his subsequent statement recorded on October 11, 1966 after remand. The matter was carried in appeal by the appellant. In appeal, the Special Deputy Collector took the view that the surrender deed was not executed voluntarily by the appellant as it was result of undue influence exerted on him by Parubais representatives who were present at the time of the execution. The Maharashtra Revenue Tribunal confirmed the finding of the Deputy Collector. The respondents preferred Special Civil Application 186 of 1969 under Article 227 challenging the order of Maharashtra Revenue Tribunal and the High Court has set aside the orders of the Special Deputy Collector and the Maharashtra Revenue Tribunal and restored that of the Additional Tahsildar. It is this order passed by the High Court that has been challenged by the appellant before us in the appeal.3. Mr. Lokur appearing for the appellant has strenuously contended that after all both the Special Deputy Collector as well as the Maharashtra Revenue Tribunal and recorded a concurrent finding of fact that the deed of surrender was involuntary and it was the result of the undue influence exerted on him at the instance of Parubai and such finding of fact could not be interfered with by the High Court under Article 227 of the Constitution. If the matter had really rested with the aspect of appreciation of evidence one way or the other there would have been considerable force in the contention of Mr. Lokur. However, what we find is that approach and appreciation of evidence on the part of the Special Deputy Collector and the Tribunal are vitiated by apparent errors of law committed by them while setting aside they Additional Tahsildars order. In the first place it was never the case of the appellant that there was any pressure or undue influence exerted on him in the matter of the execution of the deed of surrender; his initial case was it was voluntary and there was no pressure from any one and even on April 15, 1964 when he prevaricated he said it was executed by mistake, though voluntary character was not given up and it was only in October 1966 after remand that the case of undue influence was put forward - clearly an afterthought. But the Deputy Collector and Tribunal accepted the latter case by treating appellants earlier case and statement on April 15, 1964 as a nullity which was clearly an erroneous view in law. The Deputy Collector and Tribunal found fault with Tahsildars order by holding that he had committed a breach of Rule 11 without indication what particular provision thereof had been committed a breach of by the Additional Tahsildar. It was pointed out by Mr. Lokur on behalf of the appellant that under Rule 11 it was incumbent upon the tenancy authority to record the statement of the tenant in the absence of the landlords or his representative after taking the tenant into confidence and this procedure was not followed. It is clear that the Deputy Collector took the view, which was confirmed by the Tribunal, that the earlier statement of the appellant on April 15, 1964 was a nullity because it was recorded when Parubai was dead and in the absence of her successors and his subsequent statement dated October 11, 1966 had not been recorded in the absence of the respondents and hence there was a breach of Rule 11. In our opinion it is this erroneous view in law on the part of the Deputy Collector and the Tribunal that enabled the High Court to interfere with their orders. Parubai had died on April 8, 1964, i.e., just about a week before April 15, 1964 when the hearing was fixed and the proceedings had not abated by then and, therefore, simply because Parubai had died, the statement on oath recorded by Naib Tahsildar on April 15, 1964 could not be regarded as nullity. More so when it was required to be recorded in the absence of the landlord. That statement affirmed the voluntary character of the surrender deed but introduced the element of mistake without explaining what was the mistake about. Regarding the subsequent statement recorded on October 11, 1966 the same was really outside the scope of the remand order, for the matter had been remanded for recording the say of the landlord before deciding upon the character of surrender deed which had not been done as required by the proviso to Rule 11. But that apart the purpose of the provision in Rule 11, that a statement of tenant should be recorded in the absence of the landlord is only to provide a safeguard against the probable influence of the landlord at the time of recording the statement of the tenant. If that be the purpose, in out view, that purpose was more than achieved inasmuch as in that statement, notwithstanding the presence of the respondents, the appellant boldly came out with a case of undue influence for the first time giving up the case of mistake. Even so, the Deputy Collector and the Tribunal erroneously harped on the breach of Rule 11. In out view the Deputy Collector and the Tribunal entirely misunderstood the initial case of the appellant and committed an apparent error of law in treating his earlier statement as a nullity and proceeding on that wrong basis accepted the latter case of the appellant which was clearly an after thought. It was in that view of the matter that the High Court thought it fit to interfere with the orders of Deputy Collector and Tribunal. It was not, therefore, a case of merely reappreciating the evidence and interfering with a concurrent finding of fact recorded by the Deputy Collector and Tribunal.

0[ds]The Deputy Collector and Tribunal found fault with Tahsildars order by holding that he had committed a breach of Rule 11 without indication what particular provision thereof had been committed a breach of by the Additional Tahsildar. It was pointed out by Mr. Lokur on behalf of the appellant that under Rule 11 it was incumbent upon the tenancy authority to record the statement of the tenant in the absence of the landlords or his representative after taking the tenant into confidence and this procedure was not followed. It is clear that the Deputy Collector took the view, which was confirmed by the Tribunal, that the earlier statement of the appellant on April 15, 1964 was a nullity because it was recorded when Parubai was dead and in the absence of her successors and his subsequent statement dated October 11, 1966 had not been recorded in the absence of the respondents and hence there was a breach of Rule 11. In our opinion it is this erroneous view in law on the part of the Deputy Collector and the Tribunal that enabled the High Court to interfere with their orders. Parubai had died on April 8, 1964, i.e., just about a week before April 15, 1964 when the hearing was fixed and the proceedings had not abated by then and, therefore, simply because Parubai had died, the statement on oath recorded by Naib Tahsildar on April 15, 1964 could not be regarded as nullity. More so when it was required to be recorded in the absence of the landlord. That statement affirmed the voluntary character of the surrender deed but introduced the element of mistake without explaining what was the mistake about. Regarding the subsequent statement recorded on October 11, 1966 the same was really outside the scope of the remand order, for the matter had been remanded for recording the say of the landlord before deciding upon the character of surrender deed which had not been done as required by the proviso to Rule 11. But that apart the purpose of the provision in Rule 11, that a statement of tenant should be recorded in the absence of the landlord is only to provide a safeguard against the probable influence of the landlord at the time of recording the statement of the tenant. If that be the purpose, in out view, that purpose was more than achieved inasmuch as in that statement, notwithstanding the presence of the respondents, the appellant boldly came out with a case of undue influence for the first time giving up the case of mistake. Even so, the Deputy Collector and the Tribunal erroneously harped on the breach of Rule 11. In out view the Deputy Collector and the Tribunal entirely misunderstood the initial case of the appellant and committed an apparent error of law in treating his earlier statement as a nullity and proceeding on that wrong basis accepted the latter case of the appellant which was clearly an after thought. It was in that view of the matter that the High Court thought it fit to interfere with the orders of Deputy Collector and Tribunal. It was not, therefore, a case of merely reappreciating the evidence and interfering with a concurrent finding of fact recorded by the Deputy Collector and Tribunal.

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: 1964 voluntarily. He rejected as an after though the story of the appellant that the surrender had been brought about as a result of procedure or undue influence exerted on him by representatives of Parubai - a story put forward by the appellant in his subsequent statement recorded on October 11, 1966 after remand. The matter was carried in appeal by the appellant. In appeal, the Special Deputy Collector took the view that the surrender deed was not executed voluntarily by the appellant as it was result of undue influence exerted on him by Parubais representatives who were present at the time of the execution. The Maharashtra Revenue Tribunal confirmed the finding of the Deputy Collector. The respondents preferred Special Civil Application 186 of 1969 under Article 227 challenging the order of Maharashtra Revenue Tribunal and the High Court has set aside the orders of the Special Deputy Collector and the Maharashtra Revenue Tribunal and restored that of the Additional Tahsildar. It is this order passed by the High Court that has been challenged by the appellant before us in the appeal.3. Mr. Lokur appearing for the appellant has strenuously contended that after all both the Special Deputy Collector as well as the Maharashtra Revenue Tribunal and recorded a concurrent finding of fact that the deed of surrender was involuntary and it was the result of the undue influence exerted on him at the instance of Parubai and such finding of fact could not be interfered with by the High Court under Article 227 of the Constitution. If the matter had really rested with the aspect of appreciation of evidence one way or the other there would have been considerable force in the contention of Mr. Lokur. However, what we find is that approach and appreciation of evidence on the part of the Special Deputy Collector and the Tribunal are vitiated by apparent errors of law committed by them while setting aside they Additional Tahsildars order. In the first place it was never the case of the appellant that there was any pressure or undue influence exerted on him in the matter of the execution of the deed of surrender; his initial case was it was voluntary and there was no pressure from any one and even on April 15, 1964 when he prevaricated he said it was executed by mistake, though voluntary character was not given up and it was only in October 1966 after remand that the case of undue influence was put forward - clearly an afterthought. But the Deputy Collector and Tribunal accepted the latter case by treating appellants earlier case and statement on April 15, 1964 as a nullity which was clearly an erroneous view in law. The Deputy Collector and Tribunal found fault with Tahsildars order by holding that he had committed a breach of Rule 11 without indication what particular provision thereof had been committed a breach of by the Additional Tahsildar. It was pointed out by Mr. Lokur on behalf of the appellant that under Rule 11 it was incumbent upon the tenancy authority to record the statement of the tenant in the absence of the landlords or his representative after taking the tenant into confidence and this procedure was not followed. It is clear that the Deputy Collector took the view, which was confirmed by the Tribunal, that the earlier statement of the appellant on April 15, 1964 was a nullity because it was recorded when Parubai was dead and in the absence of her successors and his subsequent statement dated October 11, 1966 had not been recorded in the absence of the respondents and hence there was a breach of Rule 11. In our opinion it is this erroneous view in law on the part of the Deputy Collector and the Tribunal that enabled the High Court to interfere with their orders. Parubai had died on April 8, 1964, i.e., just about a week before April 15, 1964 when the hearing was fixed and the proceedings had not abated by then and, therefore, simply because Parubai had died, the statement on oath recorded by Naib Tahsildar on April 15, 1964 could not be regarded as nullity. More so when it was required to be recorded in the absence of the landlord. That statement affirmed the voluntary character of the surrender deed but introduced the element of mistake without explaining what was the mistake about. Regarding the subsequent statement recorded on October 11, 1966 the same was really outside the scope of the remand order, for the matter had been remanded for recording the say of the landlord before deciding upon the character of surrender deed which had not been done as required by the proviso to Rule 11. But that apart the purpose of the provision in Rule 11, that a statement of tenant should be recorded in the absence of the landlord is only to provide a safeguard against the probable influence of the landlord at the time of recording the statement of the tenant. If that be the purpose, in out view, that purpose was more than achieved inasmuch as in that statement, notwithstanding the presence of the respondents, the appellant boldly came out with a case of undue influence for the first time giving up the case of mistake. Even so, the Deputy Collector and the Tribunal erroneously harped on the breach of Rule 11. In out view the Deputy Collector and the Tribunal entirely misunderstood the initial case of the appellant and committed an apparent error of law in treating his earlier statement as a nullity and proceeding on that wrong basis accepted the latter case of the appellant which was clearly an after thought. It was in that view of the matter that the High Court thought it fit to interfere with the orders of Deputy Collector and Tribunal. It was not, therefore, a case of merely reappreciating the evidence and interfering with a concurrent finding of fact recorded by the Deputy Collector and Tribunal. ### Response: 0

Chiranji Lal (D) By Lrs Vs. Hari Das (D) By Lrs

the decree was engrossed on the stamp paper they did not have any title in the property. 22. This Court while allowing the appeal against the decision of the High Court held that the compromise decree dated 13th February, 1978 being a decree effecting partition by metes and bounds ought to have been engrossed on requisite stamp papers. The deficiency stood supplied by the same being engrossed on stamp papers on 24th May, 1978. The engrossing of the decree on stamp paper validated the compromise decree dated 13th February, 1978 and it became effective and binding with effect from 13th February, 1978 itself. Thus, the Court has categorically held that even if the decree is engrossed on the stamp paper on a subsequent date, the decree would be legally effective from the date when the decree is actually passed. 23. Learned counsel for the respondents contends that Section 35 of the Indian Stamp Act, 1899 provides that an instrument not duly stamped cannot be acted upon. Therefore, a decree passed in a suit for partition cannot be acted upon which means it cannot be enforced until engrossed on stamp paper. It is further contended that Article 136 of the Act presupposes two conditions for the execution of the decree. Firstly, the judgment has to be converted into a decree and secondly, the decree should be enforceable. It is further submitted that a decree becomes enforceable only when the decree is engrossed on the stamp paper. Therefore, the period of limitation begins to run from the date when the decree becomes enforceable i.e. when the decree is engrossed on the stamp paper. 24. Such an interpretation is not permissible having regard to the object and scheme of the Indian Stamp Act, 1899. The Stamp Act is a fiscal measure enacted with an object to secure revenue for the State on certain classes of instruments. It is not enacted to arm a litigant with a weapon of technicality to meet the case of his opponent. The stringent provisions of the Act are conceived in the interest of the revenue. Once that object is secured according to law, the party staking his claim on the instrument will not be defeated on the ground of initial defect in the instrument Hindustan Steel Limited v. Messrs Dilip Construction Company [(1969) 1 SCC 597] . Section 2(14) of the Indian Stamp Act defines an instrument as including every document by which any right or liability is, or purported to be created, transferred, limited, extended, extinguished or recorded. Section 2(15) defines instrument of partition as any instrument whereby co-owners of any property divide or agree to divide such property in severalty, and includes also a final order for effecting a partition passed by any revenue authority or any Civil Court and an award by an arbitrator directing partition. Section 3 provides a list of instruments which shall be chargeable with duty of the amount indicated in Schedule I of the Indian Stamp Act. Article 45 of Schedule I prescribes the proper stamp duty payable in case of an instrument of partition. Section 33 provides for the impounding of the instrument not duly stamped and for examination of the instrument for ascertaining whether the instrument is duly stamped or not. Section 35 provides that no instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties, authority to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer, unless such instrument is duly stamped. Section 40 (b) provides for payment of the proper duty, if the instrument impounded is not duly stamped. Section 42 (1) provides for certifying that proper duty has been paid on the impounded instrument. Sub-section (2) provides that after such certification the instrument shall be admissible in evidence, and may be registered, acted upon and authenticated as if it had been duly stamped. 25. A decree in a suit for partition declares the rights of the parties in the immovable properties and divides the shares by metes and bounds. Since a decree in a suit for partition creates rights and liabilities of the parties with respect to the immovable properties, it is considered as an instrument liable for the payment of stamp duty under the Indian Stamp Act. The object of the Stamp Act being securing the revenue for the State, the scheme of the Stamp Act provides that a decree of partition not duly stamped can be impounded and once the requisite stamp duty along with penalty, if any, is paid the decree can be acted upon. 26. The engrossment of the final decree in a suit for partition would relate back to the date of the decree. The beginning of the period of limitation for executing such a decree cannot be made to depend upon date of the engrossment of such a decree on the stamp paper. The date of furnishing of stamp paper is an uncertain act, within the domain, purview and control of a party. No date or period is fixed for furnishing stamp papers. No rule has been shown to us requiring the court to call upon or give any time for furnishing of stamp paper. A party by his own act of not furnishing stamp paper cannot stop the running of period of limitation. None can take advantage of his own wrong. The proposition that period of limitation would remain suspended till stamp paper is furnished and decree engrossed thereupon and only thereafter the period of twelve years will begin to run would lead to absurdity. In Yeshwant Deorao Deshmukh v. Walchand Ramchand Kothari [1950 SCR 852 ] it was said that the payment of court fee on the amount found due was entirely in the power of the decree holder and there was nothing to prevent him from paying it then and there; it was a decree capable of execution from the very date it was passed.

1[ds]11. The Court held that a decree is said to be enforceable when it is executable. For a decree to be executable, it must be in existence. A decree would be deemed to come into existence immediately on the pronouncement of the judgment and the decree becomes enforceable the moment the judgment is delivered and merely because there will be delay in drawing up of the decree, it cannot be said that the decree is not enforceable till it is prepared because an enforceable decree in one form or the other is available to a decree holder from the date of the judgment till the expiry of the period of limitation under Article 136 of the Act18. Thus, even if there is direction by the Court for furnishing of stamp papers by a particular date for the purposes of engrossing of the decree, the period of limitation begins to run from the date when the decree is passed and not from the date when the decree is engrossed on the stamp papers supplied by the parties19. The Court also held that the period of limitation prescribed in Article 136 of the Act cannot be obliterated by an enactment wholly unconnected therewith, like the Indian Stamp Act. Legislative mandate as sanctioned under Article 136 of the Act cannot be kept in abeyance unless the selfsame legislation makes a provision therefor. The Indian Stamp Act, 1899 has been engrafted in the statute book to consolidate and amend the law relating to stamps. Its applicability thus stands restricted to the scheme of the Indian Stamp Act25. A decree in a suit for partition declares the rights of the parties in the immovable properties and divides the shares by metes and bounds. Since a decree in a suit for partition creates rights and liabilities of the parties with respect to the immovable properties, it is considered as an instrument liable for the payment of stamp duty under the Indian Stamp Act. The object of the Stamp Act being securing the revenue for the State, the scheme of the Stamp Act provides that a decree of partition not duly stamped can be impounded and once the requisite stamp duty along with penalty, if any, is paid the decree can be acted upon26. The engrossment of the final decree in a suit for partition would relate back to the date of the decree. The beginning of the period of limitation for executing such a decree cannot be made to depend upon date of the engrossment of such a decree on the stamp paper. The date of furnishing of stamp paper is an uncertain act, within the domain, purview and control of a party. No date or period is fixed for furnishing stamp papers. No rule has been shown to us requiring the court to call upon or give any time for furnishing of stamp paper. A party by his own act of not furnishing stamp paper cannot stop the running of period of limitation. None can take advantage of his own wrong. The proposition that period of limitation would remain suspended till stamp paper is furnished and decree engrossed thereupon and only thereafter the period of twelve years will begin to run would lead to absurdity. In Yeshwant Deorao Deshmukh v. Walchand Ramchand Kothari [1950 SCR 852 ] it was said that the payment of court fee on the amount found due was entirely in the power of the decree holder and there was nothing to prevent him from paying it then and there; it was a decree capable of execution from the very date it was passed1. The Court held that a decree is said to be enforceable when it is executable. For a decree to be executable, it must be in existence. A decree would be deemed to come into existence immediately on the pronouncement of the judgment and the decree becomes enforceable the moment the judgment is delivered and merely because there will be delay in drawing up of the decree, it cannot be said that the decree is not enforceable till it is prepared because an enforceable decree in one form or the other is available to a decree holder from the date of the judgment till the expiry of the period of limitation under Article 136 of the Act18. Thus, even if there is direction by the Court for furnishing of stamp papers by a particular date for the purposes of engrossing of the decree, the period of limitation begins to run from the date when the decree is passed and not from the date when the decree is engrossed on the stamp papers supplied by the parties19. The Court also held that the period of limitation prescribed in Article 136 of the Act cannot be obliterated by an enactment wholly unconnected therewith, like the Indian Stamp Act. Legislative mandate as sanctioned under Article 136 of the Act cannot be kept in abeyance unless the selfsame legislation makes a provision therefor. The Indian Stamp Act, 1899 has been engrafted in the statute book to consolidate and amend the law relating to stamps. Its applicability thus stands restricted to the scheme of the Indian Stamp Act25. A decree in a suit for partition declares the rights of the parties in the immovable properties and divides the shares by metes and bounds. Since a decree in a suit for partition creates rights and liabilities of the parties with respect to the immovable properties, it is considered as an instrument liable for the payment of stamp duty under the Indian Stamp Act. The object of the Stamp Act being securing the revenue for the State, the scheme of the Stamp Act provides that a decree of partition not duly stamped can be impounded and once the requisite stamp duty along with penalty, if any, is paid the decree can be acted upon26. The engrossment of the final decree in a suit for partition would relate back to the date of the decree. The beginning of the period of limitation for executing such a decree cannot be made to depend upon date of the engrossment of such a decree on the stamp paper. The date of furnishing of stamp paper is an uncertain act, within the domain, purview and control of a party. No date or period is fixed for furnishing stamp papers. No rule has been shown to us requiring the court to call upon or give any time for furnishing of stamp paper. A party by his own act of not furnishing stamp paper cannot stop the running of period of limitation. None can take advantage of his own wrong. The proposition that period of limitation would remain suspended till stamp paper is furnished and decree engrossed thereupon and only thereafter the period of twelve years will begin to run would lead to absurdity. In Yeshwant Deorao Deshmukh v. Walchand Ramchand Kothari [1950 SCR 852 ] it was said that the payment of court fee on the amount found due was entirely in the power of the decree holder and there was nothing to prevent him from paying it then and there; it was a decree capable of execution from the very date it was passed

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: the decree was engrossed on the stamp paper they did not have any title in the property. 22. This Court while allowing the appeal against the decision of the High Court held that the compromise decree dated 13th February, 1978 being a decree effecting partition by metes and bounds ought to have been engrossed on requisite stamp papers. The deficiency stood supplied by the same being engrossed on stamp papers on 24th May, 1978. The engrossing of the decree on stamp paper validated the compromise decree dated 13th February, 1978 and it became effective and binding with effect from 13th February, 1978 itself. Thus, the Court has categorically held that even if the decree is engrossed on the stamp paper on a subsequent date, the decree would be legally effective from the date when the decree is actually passed. 23. Learned counsel for the respondents contends that Section 35 of the Indian Stamp Act, 1899 provides that an instrument not duly stamped cannot be acted upon. Therefore, a decree passed in a suit for partition cannot be acted upon which means it cannot be enforced until engrossed on stamp paper. It is further contended that Article 136 of the Act presupposes two conditions for the execution of the decree. Firstly, the judgment has to be converted into a decree and secondly, the decree should be enforceable. It is further submitted that a decree becomes enforceable only when the decree is engrossed on the stamp paper. Therefore, the period of limitation begins to run from the date when the decree becomes enforceable i.e. when the decree is engrossed on the stamp paper. 24. Such an interpretation is not permissible having regard to the object and scheme of the Indian Stamp Act, 1899. The Stamp Act is a fiscal measure enacted with an object to secure revenue for the State on certain classes of instruments. It is not enacted to arm a litigant with a weapon of technicality to meet the case of his opponent. The stringent provisions of the Act are conceived in the interest of the revenue. Once that object is secured according to law, the party staking his claim on the instrument will not be defeated on the ground of initial defect in the instrument Hindustan Steel Limited v. Messrs Dilip Construction Company [(1969) 1 SCC 597] . Section 2(14) of the Indian Stamp Act defines an instrument as including every document by which any right or liability is, or purported to be created, transferred, limited, extended, extinguished or recorded. Section 2(15) defines instrument of partition as any instrument whereby co-owners of any property divide or agree to divide such property in severalty, and includes also a final order for effecting a partition passed by any revenue authority or any Civil Court and an award by an arbitrator directing partition. Section 3 provides a list of instruments which shall be chargeable with duty of the amount indicated in Schedule I of the Indian Stamp Act. Article 45 of Schedule I prescribes the proper stamp duty payable in case of an instrument of partition. Section 33 provides for the impounding of the instrument not duly stamped and for examination of the instrument for ascertaining whether the instrument is duly stamped or not. Section 35 provides that no instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties, authority to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer, unless such instrument is duly stamped. Section 40 (b) provides for payment of the proper duty, if the instrument impounded is not duly stamped. Section 42 (1) provides for certifying that proper duty has been paid on the impounded instrument. Sub-section (2) provides that after such certification the instrument shall be admissible in evidence, and may be registered, acted upon and authenticated as if it had been duly stamped. 25. A decree in a suit for partition declares the rights of the parties in the immovable properties and divides the shares by metes and bounds. Since a decree in a suit for partition creates rights and liabilities of the parties with respect to the immovable properties, it is considered as an instrument liable for the payment of stamp duty under the Indian Stamp Act. The object of the Stamp Act being securing the revenue for the State, the scheme of the Stamp Act provides that a decree of partition not duly stamped can be impounded and once the requisite stamp duty along with penalty, if any, is paid the decree can be acted upon. 26. The engrossment of the final decree in a suit for partition would relate back to the date of the decree. The beginning of the period of limitation for executing such a decree cannot be made to depend upon date of the engrossment of such a decree on the stamp paper. The date of furnishing of stamp paper is an uncertain act, within the domain, purview and control of a party. No date or period is fixed for furnishing stamp papers. No rule has been shown to us requiring the court to call upon or give any time for furnishing of stamp paper. A party by his own act of not furnishing stamp paper cannot stop the running of period of limitation. None can take advantage of his own wrong. The proposition that period of limitation would remain suspended till stamp paper is furnished and decree engrossed thereupon and only thereafter the period of twelve years will begin to run would lead to absurdity. In Yeshwant Deorao Deshmukh v. Walchand Ramchand Kothari [1950 SCR 852 ] it was said that the payment of court fee on the amount found due was entirely in the power of the decree holder and there was nothing to prevent him from paying it then and there; it was a decree capable of execution from the very date it was passed. ### Response: 1

Union Of India & Anr Vs. Majur Mahajan Mandal & Ors

award is made in pursuance of the settlement under the said section the settlement is inchoate and cannot be said to be effective, in law, prior to the making of the award which was done, in the instant case, between August and September, 1974. It is, therefore, submitted that the additional D.A. can be said to be sanctioned only under the award which was made admittedly after the appointed day, that is, after July 6, 1974. 8. We are unable to accept this contention. It is true that an agreement arrived at between the parties during the pendancy of an industrial dispute before the Industrial Court has to be placed before that court. It is also true that if the Industrial Court is satisfied that certain conditions enumerated in section 115A exist it will not recognise the settlement and dispose of the dispute in accordance with law. If, however, the conditions enumerated in section 115A do not exist the award "shall be made" in terms of the settlement. There is no other option.In this particular case the settlement was placed before the Industrial Court which ultimately passed the awards in conformity with the terms of the settlement. We are not required to consider to consider a case where the Industrial Court has not approved of the settlement under section 115A. 9. Once, therefore, the award is made in terms of the settlement, under section 75 of the Bombay Industrial Relations Act, the award shall come into operation on the date specified in the award or where no such date is specified therein on the date on which it is published under section 74. We are informed that the awards have not yet been published but that should not detain us in this case. It is common ground that the awards were in terms of the settlement which had retrospective operation from January 1, 1974. 10. Since the settlement has merged in the awards the terms of the awards are those specified in the settlement. It is those dates which are, therefore, specified in the awards and, under section 75 of the Bombay Industrial Relations Act, the awards came into operation with effect from January 1, 1974. The sanction of the awards in such a case is the sanction under the settlement and since the settlement was prior to July 6, 1974, the additional D.A. cannot be said to be sanctioned after the appointed day. 100% of the Ahmedabad Rate of D.A. will be payable to the workers with effect from January 1, 1974, and the sanction for that rise was on 28th June, 1974, the date of the settlement which was prior to the appointed day. 11. Sanction must have relevance to the reality of the transaction between the parties. The settlement of 28th June, 1974, makes the increased D.A. of 100% payable with effect from January 1, 1974. Hence, the said rate of increased D.A. which was payable to the workers between January 1, 1974, and July 5, 1974, was sanctioned prior to the appointed day.We have already noted the definition of additional D.A. in section 2(b) which is an integrated definition. The definition clause has twin components both of which will have to be satisfied in order that a particular amount can be held to be additional D.A. To put it clearly the two components are -"(1) additional D.A. is that part of the D.A. which is sanctioned after the appointed day; and (2) which is over and above what was payable immediately before the date from which sanction of the particular rise in D.A. is to take effect." With regard to the first component any unilateral decision to increase the D.A. or a bilateral settlement for its increase, to take only two instances, must take place after the appointed day. 12. It is manifest that if the sanction is after the appointed day it is then only the question of additional D.A. will arise within the meaning of section 2(b). Once it is found that the sanction of rise in D.A. is prior to the appointed day, section 2(b) will not at all be attracted. In that event it will not be necessary even to consider the second component of the definition mentioned above. In the instant case we have already held that the rise in D.A. to 100% of the Ahmedabad Rate of D.A. was sanctioned under the settlement of 28th June, 1974, that is, before the appointed day. One of the principal components of the definition clause is, therefore, clearly absent in this case since there is no sanction for any rise in D. A. after the appointed day. 13. We should observe that this is not a case where Explanation I to section 2(b) is applicable. 14. Mr. Singhvi, for the appellants, submits that in view of the aim and object of the Act the count should lean in favour of an interpretation advancing the remedy by construing the word "sanctioned" in section 2(b) to mean sanctioned by the award and not by the settlement. We have already given our reasons for our inability to accept this submission. One other reason may be added.The Act recognises agreements and settlements and settlements is the same way as awards of Tribunals, vide section 2(c). The definition of "additional wages" under section 2(c) clearly points to that. Any wage revision "whether by or under an agreement or settlement between the parties or any award....." comes within the sweep of the aforesaid definition clause Agreements and settlements are separately and distinctly mentioned along with awards. Settlement is a type of sanction recognised under the Act. There is, therefore, sufficient warrant under the Act to give effect to the sanction by voluntary settlement in respect of D.A. when the same has never been repudiated by any of the concerned parties. When there is no ambiguity in the word "sanctioned" inspection 2(b), recourse to the aim and object of the Act is not even called for in this case. 15.

0[ds]In the instant case we have already held that the rise in D.A. to 100% of the Ahmedabad Rate of D.A. was sanctioned under the settlement of 28th June, 1974, that is, before the appointed day. One of the principal components of the definition clause is, therefore, clearly absent in this case since there is no sanction for any rise in D. A. after the appointed dayWe should observe that this is not a case where Explanation I to section 2(b) is applicableMr. Singhvi, for the appellants, submits that in view of the aim and object of the Act the count should lean in favour of an interpretation advancing the remedy by construing the word "sanctioned" in section 2(b) to mean sanctioned by the award and not by the settlement. We have already given our reasons for our inability to accept this submission. One other reason may be added.The Act recognises agreements and settlements and settlements is the same way as awards of Tribunals, vide section 2(c). The definition of "additional wages" under section 2(c) clearly points to that. Any wage revision "whether by or under an agreement or settlement between the parties or any award....." comes within the sweep of the aforesaid definition clause Agreements and settlements are separately and distinctly mentioned along with awards. Settlement is a type of sanction recognised under the Act. There is, therefore, sufficient warrant under the Act to give effect to the sanction by voluntary settlement in respect of D.A. when the same has never been repudiated by any of the concerned parties. When there is no ambiguity in the word "sanctioned" inspection 2(b), recourse to the aim and object of the Act is not even called for in this case.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: award is made in pursuance of the settlement under the said section the settlement is inchoate and cannot be said to be effective, in law, prior to the making of the award which was done, in the instant case, between August and September, 1974. It is, therefore, submitted that the additional D.A. can be said to be sanctioned only under the award which was made admittedly after the appointed day, that is, after July 6, 1974. 8. We are unable to accept this contention. It is true that an agreement arrived at between the parties during the pendancy of an industrial dispute before the Industrial Court has to be placed before that court. It is also true that if the Industrial Court is satisfied that certain conditions enumerated in section 115A exist it will not recognise the settlement and dispose of the dispute in accordance with law. If, however, the conditions enumerated in section 115A do not exist the award "shall be made" in terms of the settlement. There is no other option.In this particular case the settlement was placed before the Industrial Court which ultimately passed the awards in conformity with the terms of the settlement. We are not required to consider to consider a case where the Industrial Court has not approved of the settlement under section 115A. 9. Once, therefore, the award is made in terms of the settlement, under section 75 of the Bombay Industrial Relations Act, the award shall come into operation on the date specified in the award or where no such date is specified therein on the date on which it is published under section 74. We are informed that the awards have not yet been published but that should not detain us in this case. It is common ground that the awards were in terms of the settlement which had retrospective operation from January 1, 1974. 10. Since the settlement has merged in the awards the terms of the awards are those specified in the settlement. It is those dates which are, therefore, specified in the awards and, under section 75 of the Bombay Industrial Relations Act, the awards came into operation with effect from January 1, 1974. The sanction of the awards in such a case is the sanction under the settlement and since the settlement was prior to July 6, 1974, the additional D.A. cannot be said to be sanctioned after the appointed day. 100% of the Ahmedabad Rate of D.A. will be payable to the workers with effect from January 1, 1974, and the sanction for that rise was on 28th June, 1974, the date of the settlement which was prior to the appointed day. 11. Sanction must have relevance to the reality of the transaction between the parties. The settlement of 28th June, 1974, makes the increased D.A. of 100% payable with effect from January 1, 1974. Hence, the said rate of increased D.A. which was payable to the workers between January 1, 1974, and July 5, 1974, was sanctioned prior to the appointed day.We have already noted the definition of additional D.A. in section 2(b) which is an integrated definition. The definition clause has twin components both of which will have to be satisfied in order that a particular amount can be held to be additional D.A. To put it clearly the two components are -"(1) additional D.A. is that part of the D.A. which is sanctioned after the appointed day; and (2) which is over and above what was payable immediately before the date from which sanction of the particular rise in D.A. is to take effect." With regard to the first component any unilateral decision to increase the D.A. or a bilateral settlement for its increase, to take only two instances, must take place after the appointed day. 12. It is manifest that if the sanction is after the appointed day it is then only the question of additional D.A. will arise within the meaning of section 2(b). Once it is found that the sanction of rise in D.A. is prior to the appointed day, section 2(b) will not at all be attracted. In that event it will not be necessary even to consider the second component of the definition mentioned above. In the instant case we have already held that the rise in D.A. to 100% of the Ahmedabad Rate of D.A. was sanctioned under the settlement of 28th June, 1974, that is, before the appointed day. One of the principal components of the definition clause is, therefore, clearly absent in this case since there is no sanction for any rise in D. A. after the appointed day. 13. We should observe that this is not a case where Explanation I to section 2(b) is applicable. 14. Mr. Singhvi, for the appellants, submits that in view of the aim and object of the Act the count should lean in favour of an interpretation advancing the remedy by construing the word "sanctioned" in section 2(b) to mean sanctioned by the award and not by the settlement. We have already given our reasons for our inability to accept this submission. One other reason may be added.The Act recognises agreements and settlements and settlements is the same way as awards of Tribunals, vide section 2(c). The definition of "additional wages" under section 2(c) clearly points to that. Any wage revision "whether by or under an agreement or settlement between the parties or any award....." comes within the sweep of the aforesaid definition clause Agreements and settlements are separately and distinctly mentioned along with awards. Settlement is a type of sanction recognised under the Act. There is, therefore, sufficient warrant under the Act to give effect to the sanction by voluntary settlement in respect of D.A. when the same has never been repudiated by any of the concerned parties. When there is no ambiguity in the word "sanctioned" inspection 2(b), recourse to the aim and object of the Act is not even called for in this case. 15. ### Response: 0

Commissioner of Service Tax, Ahmedabad Vs. M/s Adani Gas Ltd

not covered in existing meter connection. Further, few of the customers have also requested for termination of the GSAs due to various issues. In such cases, following amount shall be deducted from the Gas Connection Charges and balance shall be refundable. (1) Upgradation of Load: In this case the percentage of amount to be deducted shall be as follows: - table (2) Terminating of Agreement: In this case the percentage of amount to be deducted shall be as follows: table (emphasis supplied) The tabulation of the refund given to the industrial customers of the respondent for 2008-09 is as follows: table 34. The above data indicates that, contrary to the assertion of the respondent that the amount collected as gas connection charges is refunded at the time of discontinuation of the connection, the percentage which has been refunded to the industrial customers has varied from case to case ranging from 25 per cent to 100 per cent. The Adjudicating Authority observed: …the gas connection charges are refunded, based on the number of years of gas supply, when the gas connection contract is discontinued. This clearly evidences that gas connection charges in most of the cases are not refunded completely. The said noticee not only earns interest on the gas connection charges but also earns income by retaining some portion of the gas connection charges at the time of discontinuance of the contract. This is a very strange kind of security deposit which is not only devoid of interest but also on maturity the principal amount gets reduced. Moreover, in reality it may never be refunded if the gas connection is not discontinued. I have also seen the Internal Note dated 13.7.2007 submitted by the said noticee along with his written submission as Annexure-A and I find that the amount to be deducted is 100% when there is upgradation of load or termination of agreement between 3 rd year to 4 th year. This clearly establishes that the liability of the said noticee to refund the said Gas Connection Charges is only upto a period of three years, after that no amount is to be refunded and it eventually becomes income of the said noticee. Moreover, till the time the said amount is partially refunded it remains with the said noticee who is at liberty of using the same in whatever manner he wants to. I have seen the Annexure-B annexed with the written submission dated 4.1.2010 and find that the gas connection charges are refunded to only 13 customers during the year 2008-09. This indicates that effectively, the gas connection charges once recovered from the customers remain with the said noticee and in cases where it is refunded then also some amount is retained by the said notice. 35. With respect to the domestic consumers, the respondent, in their reply to the Show Cause Notice, argued that under the PNGRB Network Tariff Regulations 2008, entities such as the respondent are required to collect refundable interest-free security deposits towards safe-keeping of the meter and are to be refunded in full to the domestic PNG customer in case of a disconnection. The respondent argued that the PNGRB Network Tariff Regulations 2008 further provide that the amount collected as interest-free refundable security deposit is to exist as a liability in their books of account. In support of their contention, the respondent provided their Annual Report for the financial year 2008-09 which depicts the performance in terms of income and profitability. An extract of the report is provided below: Image 36. The above report provides that the respondent has treated an amount of Rs. 5000/- per domestic consumer as refundable interest-free security deposit amounting to Rs. 883.34 lacs. In assessing these rival contentions, the Adjudicating Authority held that: …I find that the attempt of the said notice to align the Finance Act, 1994, with the Petroleum and Natural Gas Regulatory Board Regulations 2008, to determine the taxability of a taxable event is not acceptable and goes in vain. Taxability of a service is governed under Section 65(105) of the Finance Act, 1994 and is not determined under any other Act or Regulations, unless and until the same is specifically provided in the definition given under Section 65(105) of the Finance Act, 1994. The taxability of a service is also not determined by the manner in which the Books of Accounts are maintained…. 37. We find ourselves in agreement with the findings of the Adjudicating Authority. The extent of the refund of gas connection charges collected from industrial, commercial and domestic consumers by the respondent depends on their usage. From the internal note dated 13 July 2007 and the tabulation of customers provided above, it is evident that the percentage of funds refunded varies from customer to customer, while the remaining amount is retained by the respondent. In any case, as regards the domestic customers, no deposit receipts have been provided and instead, the respondent has relied on the tabulation of the refund of deposit to industrial consumers to support their contention. Thus, the argument of the respondent that these gas connection charges collected from industrial, commercial and domestic consumers constitute a refundable security deposit is rejected. 38. Thus construed, we are of the view that the Adjudicating Authority was correct in concluding that the buyer of gas is as interested as the seller in ensuring and verifying the correct quantity of the gas supplied through the instrumentality of the measurement equipment and the pipelines. Additionally, the role of regulating pressure and ensuring the safety of supply of gas performed by the measurement equipment is an essential aspect for the use of the consumer. The SKID equipment fulfils the description in Section 65(105)(zzzzj) of a taxable service: service in relation tangible goods where the recipient of the service has use (without possession or effective control) of the goods. 39. For the above reasons, we are of the view that the Tribunal was in error in interfering with the findings and order of the Adjudicating Authority.

1[ds]15. The applicability of Article 366(29-A)(d) was discussed in a decision of this Court in Bharat Sanchar Nigam Limited and another v. Union of India and others 2006 (3) SCC (1 ). ( BSNL). In BSNL, the Court held that the purpose of Article 366(29- A)(d) was to levy tax on those transactions where there was a transfer of the right to use any goods to the purchaser, instead of passing the title or ownership of the goods. Thus, by a fiction of law, these transactions were now treated as sale. Elucidating on the transfer of the right to use any goods, Dr A R Lakshmanan J. in a concurring opinion held:97. To constitute a transaction for the transfer of the right to use the goods, the transaction must have the following attributes:a. there must be goods available for delivery;b. there must be a consensus ad idem as to the identity of the goods;c. the transferee should have a legal right to use the goods- consequently all legal consequences of such use including any permissions or licenses required therefore should be available to the transferee;d. for the period during which the transferee has such legal right, it has to be the exclusion to the transferor; this is the necessary concomitant of the plain language of the statute viz. a transfer of the right to use and not merely a licence to use the goods;e. having transferred the right to use the goods during the period for which it is to be transferred, the owner cannot again transfer the same rights to others.(emphasis supplied)16. The test laid down in BSNL has been applied by courts to determine whether a transaction involves the transfer of the right to use any goods under Article 366(29-A)(d). In doing so, the courts have analysed the terms of the agreement underlying the transaction to ascertain whether effective control and possession has been transferred by the supplier to the recipient of the goods.17. Therefore, sales tax is levied in pursuance of Article 366(29-A)(d) on transactions which resemble a sale in substance as they result in a transfer of the right to use in goods, instead of the transfer of title in goods. The Finance Act, 1994, deriving authority from the residuary Entry 97 of the Union List, enabled the Central Government to levy tax on services. Service tax was introduced as a response to the advancement of the contemporary world where an indirect tax was necessary to capture consumption of services, which are economically similar to consumption of goods, in as much as they both satisfy human needs.18. The introduction of Section 65(105)(zzzzj) in the Finance Act, 1994, was with the intention of taxing such activities that enable the customers use of the service providers goods without transfer of the right of possession and effective control. This provision creates an element of taxation over a service, as opposed to a deemed sale under Article 366(29-A)(d). For the purpose of clarification, the Department of Revenue issued a Circular, D.O.F. No.334/1/2008-TRU, dated 29 February, 2008. The said circular clarified the applicability of Section 65(105)(zzzzj) vis-à-vis Article 366(29-A)(d).19. The above circular clarified that Section 65(105)(zzzzj) is applicable only to those transactions where there is a supply of tangible goods for use, without the transfer of possession or effective control to the recipient.20. The taxable service is defined as a service which is provided or which is to be provided by any person to another in relation to supply of tangible goods. The provision indicates that the goods may include machinery, equipment or appliances. The crucial ingredient of the definition is that the supply of tangible goods is for the use of another, without transferring the right of possession and effective control of such machinery, equipment and appliances. Hence, in order to attract the definition of a taxable service under sub-clause (zzzzj), the ingredients that have to be fulfilled are:(i) The provision of a service;(ii) The service is provided by a person to another person;(iii) The service is provided in relation to the supply of tangible goods, including machinery, equipment and appliances;(iv) There is no transfer of the right of possession;(v) Effective control over the goods continues to be with the service provider; and(vi) The goods are supplied for use by the recipient of the service.There is an element of service which is the foundation for the levy of the tax.21. A GSA entered into by the respondent on 17 November 2008 with one of its buyers (Polymer Industries) has been adverted to by the contesting parties as a representative sample. Under the terms of the GSA, the respondent as the seller agrees to sell and tender for delivery at the Delivery Point, gas in the quantities, times and at the prices determined in accordance with it.22. The GSA is an agreement between the respondent and its purchaser for regulating the terms on which gas is sold by the respondent. The agreement is of a take or pay genre. The buyer must lift the quantity contracted or pay for it. The agreement provides for the supply of gas at the Delivery Point through gas pipelines constructed from the distribution main to the measurement equipment. Further, both the seller and the buyer have provided warranties for maintaining the measurement equipment in good working condition, in their respective capacities. The measurement equipment, as has been re-iterated by the respondent in the course of their arguments, is installed for the measurement and recording of the volume and pressure of the gas delivered at the Delivery Point and for the safe operation of the buyers facilities.23. At the outset, it is clear from the provisions of the agreement, and it has been admitted by both the parties, that there is no transfer of ownership or possession of the pipelines or the measurement equipment (SKID equipment equipment) by the respondent to its customers. Clause 5.3 of the agreement specifically provides that the Measurement Equipment is to be supplied, installed and maintained by the seller at the cost of the buyer and that the ownership of the equipment will rest with the respondent forever. Clause 5.6 further clarifies that the buyer has no right to adjust, clean, handle, replace, maintain, remove or modify the measurement equipment. Clause 5.10 guarantees that the seller shall have the right of entry at all hours to the Measurement Equipment and associated apparatus at the Buyers premises. The pipelines are also part of the Sellers Facilities under the agreement and are constructed and maintained by the respondent at the cost of the customer. Thus, the ingredient of not transferring the ownership, possession or effective control of the goods under Section 65(105)(zzzzj) is satisfied.In determining as to whether the provisions of Section 65(105)(zzzzj) are attracted, it is necessary to distinguish between the rights and obligations of the respondent (as the seller of gas) and of their purchasers, from the issue of whether the measurement equipment (SKID equipment) is supplied for the use of the purchaser of gas, without transferring the right of possession and effective control.25. The purchaser of gas has an interest in ensuring the accuracy of billing and regulation of supply. The respondent is interested in ensuring that it receives payment for the quantity of gas which is contracted to be supplied to the purchaser. The SKID consists of regulators, valves, filters and the metering equipment. The SKID equipment regulates and records supply. Under the terms of the GSA, the obligation of the seller is to deliver gas to the buyer at the Delivery Point. The gas pipeline from the nearest distribution main to the buyers metering station is constructed and maintained by the seller at the cost of the buyer. The measurement equipment is supplied, installed and maintained by the seller at the cost of the buyer, inspite of ownership of the equipment resting with the respondent as the seller. The measurement equipment is installed and maintained exclusively by the seller. Clause 5.6 indicates that the buyer has no right to adjust, clean, handle, replace, maintain, remove or modify it in any manner. Clause 5.10 guarantees the sellers access to the Measurement Equipment at the buyers premises at all hours. Ownership, control and possession of the measurement equipment is with the respondent. The measurement equipment comprises not only of electronic meters that are useful for determining the quantity of gas supplied to the purchaser at the Delivery Point, but also of isolation valves, filters and regulators that are crucial for regulating the pressure of gas and ensuring safe operation of the buyers facilities. In order to maintain the sanctity of the equipment, the agreement casts the exclusive responsibility to install and maintain it on the respondent as the seller. The terms of the GSA would indicate that the quantity of gas supplied is to be measured at the Delivery Point. For this purpose, the measurement equipment is supplied, installed, owned and maintained by the seller at the cost of the buyer. The working of the measurement equipment is verified periodically by the parties to the agreement. If the buyer doubts its accuracy, this has to be communicated in writing to the seller, who alone is entitled to test, re-calibrate, remove or modify it. Similarly, if the seller has any doubt about the proper working of the measurement equipment it is entitled to check the meter in the presence of the representatives of the buyer. If according to the seller, the existing measurement equipment is not working satisfactorily it would be replaced at the cost of the buyer. These provisions indicate that the supply, installation and maintenance of the measurement equipment is exclusively carried out by the seller. The buyer has contractual remedies against the seller in terms of the GSA. These remedies to the buyer as a purchaser of gas are distinct from the issue as to whether the equipment for which gas connection charges are recovered is used by the buyer.26. Under Section 65(105)(zzzzj), the taxable service is provided or to be provided in relation to the supply of tangible goods for the use of another, without transferring the right of possession and effective control.27. The expression use does not have a fixed meaning. The content of the expression must be based on the context in which the expression is adopted. The use of an article may or may not result in a visible change in its form or substance. Moreover, the nature of use is conditioned by the kind of article which is put to use. Section 65(105) of the Finance Act, 1994 envisages myriad interpretations of the expression use, in a variety of services such as telecommunication, (Section 65(105)(zzzzb), Finance Act, 1994.) renting of immovable property,(Section 65(105)(zzz-z), Finance Act, 1994.) and services related to art, entertainment, and marriage. (Section 65(105)(zzzzr), Finance Act, 1994.) In the case of some articles, use may be signified by a physical operation of the article by the person who uses it. In such a case, actual physical use is what is meant by the supply of the goods for the use of another. In the case of others, the nature of the goods supplied impacts the character of the use to which the goods can be put. As an illustration, Section 65(105)(zzzze) of the Finance Act, 1994, seeks to tax services related to information technology and interprets the right to use to include the right to reproduce, distribute, sell, etc. (0 Circular D.O.F. No.334/1/2008-TRU, dated 29 February, 2008) This understanding of use differs from the supply of tangible goods under Section 65(105)(zzzzj) at hand, where effective control or possession is not ceded. Thus, physical operation is not the only or invariable feature of use. As a corollary to the same, technical expertise over the goods in question is not a sine qua non for determining the ability of the consumer to use the good. Therefore, the expression use also signifies the application of the goods for the purpose for which they have been supplied under the terms of a contract.28. The terms of the GSA indicate that the supply, installation, maintenance and repair of the measurement equipment is exclusively entrusted to the respondent as the seller. These provisions have been incorporated in the GSA to ensure that a buyer does not calibrate or tinker with the equipment. It is an incident of ownership and control being vested with the respondent. The purpose of the SKID equipment and its utility, lie in its ability to regulate the supply and achieve an accurate verification of that which is supplied; in the present case the supply of goods by the respondent to its buyers. This enures to the benefit of the seller and the buyer. The seller is concerned with the precise quantification of the gas which is supplied to the buyer. The buyer has an interest in ensuring the safety of its facilities and that the billing is based on the correct quantity of gas supplied and delivered under the GSA. To postulate, as did the Tribunal, that the measurement equipment is only for the benefit of the seller in measuring the quantity of the gas supplied would not be correct. The GSA is an agreement reflecting mutual rights and obligations between the seller and the purchaser. Both have a vital interest in ensuring the correct recording of the quantity of gas supplied. Additionally, delivery of gas in a safe and regulated manner, enabled by the SKID equipment, is an essential component of the GSA. The SKID equipment subserves the contractual rights of both the seller and the purchaser of gas. Indeed, without the SKID equipment there would be no gas supply agreement. In fact, in the GSA, the buyer has also provided a warranty to ensure that the Buyers Facilities remain technically and operationally compatible with the Sellers Facilities, both of which include the measurement equipment. This warranty would not have been provided if the measurement equipment was not of use to the buyer. The equipment is thus a vital ingredient of the agreement towards protecting the mutual rights of the parties and in ensuring the fulfilment of their reciprocal obligations as seller and buyer in regulating the supply of gas. As an incident of regulating supply, it determines the correct quantity of gas that is supplied. The obligation to supply, install and maintain the equipment is cast upon the seller as an incident of control and possession being with the seller. Section 65(105)(zzzzj) applies precisely in a situation where the use of the goods by a person is not accompanied by control and possession. Use in the context of SKID equipment postulates the utilization of the equipment for the purpose of fulfilling the purpose of the contract. Section 65(105)(zzzzj) does not require exclusivity of use. The SKID equipment is an intrinsic element of the service which is provided by the respondent, acting pursuant to the GSA, as a supplier of natural gas to its buyers.29. While interpreting the term use, the Tribunal in the impugned judgment has relied on its decision in the case of Meru Cab Company Pvt. Ltd. v. Commissioner of Central Excise, Mumbai 2016 (41) STR (444) (Tri-Mum) ( Meru Cab). Meru Cab involved the transfer of a vehicle from a radio taxi operator to the driver, in turn to provide a service to the passengers. We find that the reliance placed on Meru Cab is misplaced as the factual context of the use in the two cases is substantially different. In present matter, the agreement to supply gas, and the measurement equipment and pipelines only involves two parties - the respondent and the ultimate customer. Having said that, we are not expressing any opinion on the correctness of the decision in Meru Cab.30. Thus, we are of the view that the supply of the pipelines and the measurement equipment (SKID equipment) by the respondent, was of use to the customers and is taxable under Section 65(105)(zzzzj) of the Finance Act 1994.34. The above data indicates that, contrary to the assertion of the respondent that the amount collected as gas connection charges is refunded at the time of discontinuation of the connection, the percentage which has been refunded to the industrial customers has varied from case to case ranging from 25 per cent to 100 per cent.36. The above report provides that the respondent has treated an amount of Rs. 5000/- per domestic consumer as refundable interest-free security deposit amounting to Rs. 883.34 lacs. In assessing these rival contentions, the Adjudicating Authority held that:…I find that the attempt of the said notice to align the Finance Act, 1994, with the Petroleum and Natural Gas Regulatory Board Regulations 2008, to determine the taxability of a taxable event is not acceptable and goes in vain. Taxability of a service is governed under Section 65(105) of the Finance Act, 1994 and is not determined under any other Act or Regulations, unless and until the same is specifically provided in the definition given under Section 65(105) of the Finance Act, 1994. The taxability of a service is also not determined by the manner in which the Books of Accounts are maintained….. We find ourselves in agreement with the findings of the Adjudicating Authority. The extent of the refund of gas connection charges collected from industrial, commercial and domestic consumers by the respondent depends on their usage. From the internal note dated 13 July 2007 and the tabulation of customers provided above, it is evident that the percentage of funds refunded varies from customer to customer, while the remaining amount is retained by the respondent. In any case, as regards the domestic customers, no deposit receipts have been provided and instead, the respondent has relied on the tabulation of the refund of deposit to industrial consumers to support their contention. Thus, the argument of the respondent that these gas connection charges collected from industrial, commercial and domestic consumers constitute a refundable security deposit is rejected.38. Thus construed, we are of the view that the Adjudicating Authority was correct in concluding that the buyer of gas is as interested as the seller in ensuring and verifying the correct quantity of the gas supplied through the instrumentality of the measurement equipment and the pipelines. Additionally, the role of regulating pressure and ensuring the safety of supply of gas performed by the measurement equipment is an essential aspect for the use of the consumer. The SKID equipment fulfils the description in Section 65(105)(zzzzj) of a taxable service: service in relation tangible goods where the recipient of the service has use (without possession or effective control) of the goods.39. For the above reasons, we are of the view that the Tribunal was in error in interfering with the findings and order of the Adjudicating Authority.The Adjudicating Authority observed:…the gas connection charges are refunded, based on the number of years of gas supply, when the gas connection contract is discontinued. This clearly evidences that gas connection charges in most of the cases are not refunded completely. The said noticee not only earns interest on the gas connection charges but also earns income by retaining some portion of the gas connection charges at the time of discontinuance of the contract. This is a very strange kind of security deposit which is not only devoid of interest but also on maturity the principal amount gets reduced. Moreover, in reality it may never be refunded if the gas connection is not discontinued. I have also seen the Internal Note dated 13.7.2007 submitted by the said noticee along with his written submission as Annexure-A and I find that the amount to be deducted is 100% when there is upgradation of load or termination of agreement between 3 rd year to 4 th year. This clearly establishes that the liability of the said noticee to refund the said Gas Connection Charges is only upto a period of three years, after that no amount is to be refunded and it eventually becomes income of the said noticee. Moreover, till the time the said amount is partially refunded it remains with the said noticee who is at liberty of using the same in whatever manner he wants to. I have seen the Annexure-B annexed with the written submission dated 4.1.2010 and find that the gas connection charges are refunded to only 13 customers during the year 2008-09. This indicates that effectively, the gas connection charges once recovered from the customers remain with the said noticee and in cases where it is refunded then also some amount is retained by the said notice.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: not covered in existing meter connection. Further, few of the customers have also requested for termination of the GSAs due to various issues. In such cases, following amount shall be deducted from the Gas Connection Charges and balance shall be refundable. (1) Upgradation of Load: In this case the percentage of amount to be deducted shall be as follows: - table (2) Terminating of Agreement: In this case the percentage of amount to be deducted shall be as follows: table (emphasis supplied) The tabulation of the refund given to the industrial customers of the respondent for 2008-09 is as follows: table 34. The above data indicates that, contrary to the assertion of the respondent that the amount collected as gas connection charges is refunded at the time of discontinuation of the connection, the percentage which has been refunded to the industrial customers has varied from case to case ranging from 25 per cent to 100 per cent. The Adjudicating Authority observed: …the gas connection charges are refunded, based on the number of years of gas supply, when the gas connection contract is discontinued. This clearly evidences that gas connection charges in most of the cases are not refunded completely. The said noticee not only earns interest on the gas connection charges but also earns income by retaining some portion of the gas connection charges at the time of discontinuance of the contract. This is a very strange kind of security deposit which is not only devoid of interest but also on maturity the principal amount gets reduced. Moreover, in reality it may never be refunded if the gas connection is not discontinued. I have also seen the Internal Note dated 13.7.2007 submitted by the said noticee along with his written submission as Annexure-A and I find that the amount to be deducted is 100% when there is upgradation of load or termination of agreement between 3 rd year to 4 th year. This clearly establishes that the liability of the said noticee to refund the said Gas Connection Charges is only upto a period of three years, after that no amount is to be refunded and it eventually becomes income of the said noticee. Moreover, till the time the said amount is partially refunded it remains with the said noticee who is at liberty of using the same in whatever manner he wants to. I have seen the Annexure-B annexed with the written submission dated 4.1.2010 and find that the gas connection charges are refunded to only 13 customers during the year 2008-09. This indicates that effectively, the gas connection charges once recovered from the customers remain with the said noticee and in cases where it is refunded then also some amount is retained by the said notice. 35. With respect to the domestic consumers, the respondent, in their reply to the Show Cause Notice, argued that under the PNGRB Network Tariff Regulations 2008, entities such as the respondent are required to collect refundable interest-free security deposits towards safe-keeping of the meter and are to be refunded in full to the domestic PNG customer in case of a disconnection. The respondent argued that the PNGRB Network Tariff Regulations 2008 further provide that the amount collected as interest-free refundable security deposit is to exist as a liability in their books of account. In support of their contention, the respondent provided their Annual Report for the financial year 2008-09 which depicts the performance in terms of income and profitability. An extract of the report is provided below: Image 36. The above report provides that the respondent has treated an amount of Rs. 5000/- per domestic consumer as refundable interest-free security deposit amounting to Rs. 883.34 lacs. In assessing these rival contentions, the Adjudicating Authority held that: …I find that the attempt of the said notice to align the Finance Act, 1994, with the Petroleum and Natural Gas Regulatory Board Regulations 2008, to determine the taxability of a taxable event is not acceptable and goes in vain. Taxability of a service is governed under Section 65(105) of the Finance Act, 1994 and is not determined under any other Act or Regulations, unless and until the same is specifically provided in the definition given under Section 65(105) of the Finance Act, 1994. The taxability of a service is also not determined by the manner in which the Books of Accounts are maintained…. 37. We find ourselves in agreement with the findings of the Adjudicating Authority. The extent of the refund of gas connection charges collected from industrial, commercial and domestic consumers by the respondent depends on their usage. From the internal note dated 13 July 2007 and the tabulation of customers provided above, it is evident that the percentage of funds refunded varies from customer to customer, while the remaining amount is retained by the respondent. In any case, as regards the domestic customers, no deposit receipts have been provided and instead, the respondent has relied on the tabulation of the refund of deposit to industrial consumers to support their contention. Thus, the argument of the respondent that these gas connection charges collected from industrial, commercial and domestic consumers constitute a refundable security deposit is rejected. 38. Thus construed, we are of the view that the Adjudicating Authority was correct in concluding that the buyer of gas is as interested as the seller in ensuring and verifying the correct quantity of the gas supplied through the instrumentality of the measurement equipment and the pipelines. Additionally, the role of regulating pressure and ensuring the safety of supply of gas performed by the measurement equipment is an essential aspect for the use of the consumer. The SKID equipment fulfils the description in Section 65(105)(zzzzj) of a taxable service: service in relation tangible goods where the recipient of the service has use (without possession or effective control) of the goods. 39. For the above reasons, we are of the view that the Tribunal was in error in interfering with the findings and order of the Adjudicating Authority. ### Response: 1

P. V. Godbole Vs. Jagannath Fakirchand

commodities. That Hindu Undivided Family was assessed for the assessment years 1944-45, 1945-46 and 1946-47. The assessment for the year 1944-45 was completed by the Income- tax Officer on March 14, 1949, and an appeal was taken against that assessment to the Appellate Assistant Commissioner and was decided on February 9, 1956, and then an appeal was taken to the Income-tax Appellate Tribunal which has not been shown to have been decided. For the assessment years 1945-46 and 1946-47 the assessment was completed in March and May, 1950, respectively. Appeals were taken against these assessments to the Appellate Assistant Commissioner who remanded the cases to the Income- tax Officer and they have not yet been decided. As regards the assessment year 1946-47 a notice under s. 34(1) was issued and the order in that case was passed on March 6, 1956. Against that order an appeal was taken to the Appel- late Assistant Commissioner which is still pending. It appears that for the year of assessment 1945-46 no notice under s. 34(1) of the Act was issued.In 1946 the respondent on behalf of the Hindu Undivided Family filed a suit against one Jagannath Ramkishan for rendition of accounts as the Munim of the respondent. His defence was that he was a partner and not a Munim which was accepted and the suit was dismissed. An appeal against that decree was dismissed by the High Court. Jagannath Ramkishan died during the pendency of the appeal and his widow Kalavati was impleaded. In the meantime proceedings under s. 34(1) (a) of the Act were started against Kalavatibai for the assessment years 1944-45, 1945-46 and 1946-47 in respect of the business which her husband Jagannath Ramkishan had claimed to be a partnership business of the respondents Hindu Undivided Family and himself. Two orders were passed by the Income-tax Officer for those ), cars. Kalavatibai took appeals against those orders and the Appellate Assistant Commissioner on October 10, 1956, in allowing those appeals gave a finding that the business belonged to the partnership as claimed by Jagannath Ramkishan and the Income-tax Officer was authorised to make assessments under the provisions of s. 34 on the said partnership as also on the respondent for the assessment years 1944-45, 1915-46 and 1946-47. Thereupon a notice was issued with regard to the three assessment years on February 18, 1957, against M//s Jagannath Fakirchand and Jagannath Ramkishan. These notices were challenged and were held to be illegal. Against that order of the High Court this appeal is brought on a certificate of the High Court under Art. 132(1) and Art. 133(1)(b) of the Constitution.5. For the reasons given in S. C. Prashanr, Income-tax Officer v. Vasantsen Dwarkadas ([1964] Vol. 1 S.C.R. 29.), judgment in which has been delivered today, this appeal is dismissed with costs.SARKAR J.-This case is concerned with the three assessment years 1944-45 1945-46 and 1946-47. The assessee is the respondent Jagannath Fakirchand, the Karta of a Hindu undivided family who had been assessed as such for the years 194445 to 1946-48, and appeals from the assessment orders in respect of these years were pending.6. The assessee had filed in 1946 a suit against an ex- employee, Jagannath Ramkishan for accounts of certain transactions. Jagannath Ramkishan contended that he was not an employee but the transactions were the transactions of a business carried on in partnership between him and the assessee. The trial court upheld the contention of Jagannath Ramkishan.7. The asessee appealed to he High Court of Bombay against the decision of the trial court but in the meantime Jagannath Ramkishan had died- and his wife, Kalavatibai, had been substituted in his place in that appeal. The High Court dismissed the appeal but said nothing as to whether Jagannath Ramkrishan was a partner.8. In the view of the decision in the appeal mentioned in the preceeding paragraph, the revenue authorities started proceedings against Kalavatibai under s.34(1) (a) of the Income-tax Act and assessed her on the entire income in the aforesaid three years, realised from the said transactions. Kalavatibai then appealed from this assessment and in the appeal, she contended that her husbands estate was not liable for the tax on the entire income as the income belonged to a firm of which her husband was only one the partners. The appellate Assistant Commissioner accepted this contention of Kalavatibai and observed : "In view of my finding............ that the business belonged to the partnership.......the Income-tax Officer is. hereby authorised to make assessments under the provisions of s. 34 on the said partnership as also on the other partner, Shri Jagannath Fakirchand for the assessment years 1944-45, 1945-46 and 1946-47."In pursuance of this order the Income-tax Officer started proceeding under s. 34 (3) of the Income-tax Act, 1922, against the assessee by issuing a notice on February 18, 1947, calling on him to file a return in respect of the aforesaid three assessment years as that income had escaped assessment. Thereupon the assessee moved the High Court of Bombay under Art. 226 of the Constitution for a writ to quash the aforesaid notice and to prohibit proceedings being taken thereunder. The High Court allowed the writ. Hence this appeal. 9. The only question in this appeal is whether the second proviso to s. 34 (3) of the Income-tax Act, 1922 as amended in 1953, could save the proceedings impugned. For the reasons mentioned in my judgment in The Commissioner of Income-tax, Bihar & Orissa v. Sardar Lakhmir Singh ([1964] Vol. 1 S.C.R. 148.), I think that proviso is invalid as offending Art. 14 of the Constitution and affords no protection to the revenue authorities. It may be added that the impugned notice was issued in consequence of an order under s. 31 in a proceeding to which the assessee was not a party. 10. In the result the appeal is dismissed with costs. 11. For the judgment of Hidayatullah and Raghubar Dayal, JJ., see S. C. Prashar, Income-tax Officer v. Vasantsen Dwarkadas, ante p. 29. 12.

0[ds]For the reasons mentioned in my judgment in The Commissioner of Income-tax, Bihar & Orissa v. Sardar Lakhmir Singh ([1964] Vol. 1 S.C.R. 148.), I think that proviso is invalid as offending Art. 14 of the Constitution and affords no protection to the revenue authorities. It may be added that the impugned notice was issued in consequence of an order under s. 31 in a proceeding to which the assessee was not a party.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: commodities. That Hindu Undivided Family was assessed for the assessment years 1944-45, 1945-46 and 1946-47. The assessment for the year 1944-45 was completed by the Income- tax Officer on March 14, 1949, and an appeal was taken against that assessment to the Appellate Assistant Commissioner and was decided on February 9, 1956, and then an appeal was taken to the Income-tax Appellate Tribunal which has not been shown to have been decided. For the assessment years 1945-46 and 1946-47 the assessment was completed in March and May, 1950, respectively. Appeals were taken against these assessments to the Appellate Assistant Commissioner who remanded the cases to the Income- tax Officer and they have not yet been decided. As regards the assessment year 1946-47 a notice under s. 34(1) was issued and the order in that case was passed on March 6, 1956. Against that order an appeal was taken to the Appel- late Assistant Commissioner which is still pending. It appears that for the year of assessment 1945-46 no notice under s. 34(1) of the Act was issued.In 1946 the respondent on behalf of the Hindu Undivided Family filed a suit against one Jagannath Ramkishan for rendition of accounts as the Munim of the respondent. His defence was that he was a partner and not a Munim which was accepted and the suit was dismissed. An appeal against that decree was dismissed by the High Court. Jagannath Ramkishan died during the pendency of the appeal and his widow Kalavati was impleaded. In the meantime proceedings under s. 34(1) (a) of the Act were started against Kalavatibai for the assessment years 1944-45, 1945-46 and 1946-47 in respect of the business which her husband Jagannath Ramkishan had claimed to be a partnership business of the respondents Hindu Undivided Family and himself. Two orders were passed by the Income-tax Officer for those ), cars. Kalavatibai took appeals against those orders and the Appellate Assistant Commissioner on October 10, 1956, in allowing those appeals gave a finding that the business belonged to the partnership as claimed by Jagannath Ramkishan and the Income-tax Officer was authorised to make assessments under the provisions of s. 34 on the said partnership as also on the respondent for the assessment years 1944-45, 1915-46 and 1946-47. Thereupon a notice was issued with regard to the three assessment years on February 18, 1957, against M//s Jagannath Fakirchand and Jagannath Ramkishan. These notices were challenged and were held to be illegal. Against that order of the High Court this appeal is brought on a certificate of the High Court under Art. 132(1) and Art. 133(1)(b) of the Constitution.5. For the reasons given in S. C. Prashanr, Income-tax Officer v. Vasantsen Dwarkadas ([1964] Vol. 1 S.C.R. 29.), judgment in which has been delivered today, this appeal is dismissed with costs.SARKAR J.-This case is concerned with the three assessment years 1944-45 1945-46 and 1946-47. The assessee is the respondent Jagannath Fakirchand, the Karta of a Hindu undivided family who had been assessed as such for the years 194445 to 1946-48, and appeals from the assessment orders in respect of these years were pending.6. The assessee had filed in 1946 a suit against an ex- employee, Jagannath Ramkishan for accounts of certain transactions. Jagannath Ramkishan contended that he was not an employee but the transactions were the transactions of a business carried on in partnership between him and the assessee. The trial court upheld the contention of Jagannath Ramkishan.7. The asessee appealed to he High Court of Bombay against the decision of the trial court but in the meantime Jagannath Ramkishan had died- and his wife, Kalavatibai, had been substituted in his place in that appeal. The High Court dismissed the appeal but said nothing as to whether Jagannath Ramkrishan was a partner.8. In the view of the decision in the appeal mentioned in the preceeding paragraph, the revenue authorities started proceedings against Kalavatibai under s.34(1) (a) of the Income-tax Act and assessed her on the entire income in the aforesaid three years, realised from the said transactions. Kalavatibai then appealed from this assessment and in the appeal, she contended that her husbands estate was not liable for the tax on the entire income as the income belonged to a firm of which her husband was only one the partners. The appellate Assistant Commissioner accepted this contention of Kalavatibai and observed : "In view of my finding............ that the business belonged to the partnership.......the Income-tax Officer is. hereby authorised to make assessments under the provisions of s. 34 on the said partnership as also on the other partner, Shri Jagannath Fakirchand for the assessment years 1944-45, 1945-46 and 1946-47."In pursuance of this order the Income-tax Officer started proceeding under s. 34 (3) of the Income-tax Act, 1922, against the assessee by issuing a notice on February 18, 1947, calling on him to file a return in respect of the aforesaid three assessment years as that income had escaped assessment. Thereupon the assessee moved the High Court of Bombay under Art. 226 of the Constitution for a writ to quash the aforesaid notice and to prohibit proceedings being taken thereunder. The High Court allowed the writ. Hence this appeal. 9. The only question in this appeal is whether the second proviso to s. 34 (3) of the Income-tax Act, 1922 as amended in 1953, could save the proceedings impugned. For the reasons mentioned in my judgment in The Commissioner of Income-tax, Bihar & Orissa v. Sardar Lakhmir Singh ([1964] Vol. 1 S.C.R. 148.), I think that proviso is invalid as offending Art. 14 of the Constitution and affords no protection to the revenue authorities. It may be added that the impugned notice was issued in consequence of an order under s. 31 in a proceeding to which the assessee was not a party. 10. In the result the appeal is dismissed with costs. 11. For the judgment of Hidayatullah and Raghubar Dayal, JJ., see S. C. Prashar, Income-tax Officer v. Vasantsen Dwarkadas, ante p. 29. 12. ### Response: 0

EX.SEPOY (WASHERMAN) RAM KHILAWAN Vs. UNION OF INDIA

in the public interest, and that their retention will not exceed the sanctioned strength of the regiment/corps. When such an appointment is not available or when their retention is either not considered necessary in the interest of the service or it exceeds the sanctioned strength of the regiment/corps, they will be discharged irrespective of the service put in by them. (b) Ordinarily, permanent low medical category personnel will be retained in service till completion of 15 years service in the case of JCOs and 10 years in the case of OR (including NCOs). However, such personnel may continue to be retained in service beyond the above period until they become due for discharge in the normal manner subject to their willingness and the fulfilment of the stipulation laid in sub-para (a) above.?7. Learned counsel for the appellant relied upon judgment of this Court in Union of India & Ors. v. Rajpal Singh (2009) 1 SCC 216 wherein, this Court has held that if a person is to be discharged on the ground of medical unfitness, such discharge cannot be passed without subjecting him to the Invalidating Board as per procedure laid down in Rule 13. The Court held as under:?30. A plain reading of the Army Order shows that it comes into operation after an opinion has been formed as to whether a particular personnel is to be retained in service or not, if so for what period. If a person is to be retained in service despite his low medical category for a particular period as stipulated in Army Order 46 of 1980, the question of subjecting him to the Invalidating Board may not arise. However, if a person is to be discharged on the ground of medical unfitness, at that stage of his tenure of service or extended service within the meaning of the Army Order, he has to be discharged as per the procedure laid down in Clause I(ii) in Column 2 of the said T able.?8. In the present case, the order of discharge is on the ground that the appellant has been placed in Low Medical Category. The extract from the order of communication of discharge reads as under:?1. The personnel mentioned in Appendix ‘A? to this letter have been placed in Low Medical Category lower than ‘AYE? ad become due for x discharge from service as per policy on discharge of permanent low medical category personnel laid down in Army Order 46/80. They will report to Depot Coy HQ Wing ASC Centre (South), Bangalore-7 and SOS from service w.e.f. the dates shown against their names. No joining time is admissible.?9. The argument of learned counsel for the respondents is that the discharge of the appellant was under clause III(v) of Rule 13(3) of the Rules and, therefore, the question of subjecting the appellant to Invalidating Medical Board does not arise. It is argued that such is the case admitted by the appellant in his statutory complaint as well. 10. We have heard learned counsel for the parties and find that the discharge of the appellant was only under category 13(3)(III)(iii) as he has been found medically unfit for further service. Clause (v) of Rule 13(3)(III) would be applicable in respect of all other classes of discharge which do not find mention in Rule 13(3)(III). The communication of discharge from the service is on the ground that he has been placed in the Low Medical Category. Once he has been put in Low Medical Category, clause (iii) of Rule 13(3)(III) would be applicable as such clause alone deals with discharge if any personnel is found medically unfit for further service. There is no reference to sub-clause (v) of Army Rule 13(3)(III) in the order of discharge. Still further, it is not the recital of a provision which is relevant to determine as to whether the personnel is discharged under clause (v) or clause (iii) of Rule 13(3)(III) of the Rules. It is the object, language and the purport of the discharge which will be relevant to determine whether an army personnel had been discharged under clause (iii) or clause (v). Clause (v) is the residual clause when other clauses are not applicable to such personnel. Since the discharge of the appellant is covered by clause (iii) of Rule 13(3)(III) of the Rules, as the discharge of the appellant was only on the ground of his medical unfitness for further service, therefore, he could not be invalidated out of service without the recommendation of the Invalidating Board. 11. This Court in Smt. Sulekha Rani v. Union of India and Ors. (Civil Appeal No. 1280 of 2019 decided on July 16, 2019) held that when the discharge was on the ground of medical unfitness, the Rule prescribes a particular procedure for discharge. Thus, an order of discharge passed without subjecting the officer to an Invalidating Board would be contrary to the statutory rule. The Court held as under:?10. After considering the facts and material before us, we are of the view that the discharge of the appellants spouse without convening an Invalidation Medical Board suffers from an illegality. The respondents have relied upon the response purportedly addressed by the Jawan to the notice to show cause issued to him. The provisions Rule 13(3)(III)(v) upon which reliance has been placed had no application to the case. It would not operate in an area which is covered by medical unfitness.?12. Therefore, we find that discharge of the appellant was not under the residual clause (v) but under clause (iii) of Rule 13(3)(III) of the Rules. Since the discharge has proceeded without reference to Invalidating Medical Board, such discharge is not legally sustainable. 13. Having said so, in terms of clause (b) of General Principles of Army Order 46 of 1980, he is entitled to be retained for ten years being in the rank of personnel of Other Ranks. Since, he joined the service on October 23, 1987, he would be deemed to be discharged only on October 22, 1997.

1[ds]10. We have heard learned counsel for the parties and find that the discharge of the appellant was only under category 13(3)(III)(iii) as he has been found medically unfit for further service. Clause (v) of Rule 13(3)(III) would be applicable in respect of all other classes of discharge which do not find mention in Rule 13(3)(III). The communication of discharge from the service is on the ground that he has been placed in the Low Medical Category. Once he has been put in Low Medical Category, clause (iii) of Rule 13(3)(III) would be applicable as such clause alone deals with discharge if any personnel is found medically unfit for further service. There is no reference to sub-clause (v) of Army Rule 13(3)(III) in the order of discharge. Still further, it is not the recital of a provision which is relevant to determine as to whether the personnel is discharged under clause (v) or clause (iii) of Rule 13(3)(III) of the Rules. It is the object, language and the purport of the discharge which will be relevant to determine whether an army personnel had been discharged under clause (iii) or clause (v). Clause (v) is the residual clause when other clauses are not applicable to such personnel. Since the discharge of the appellant is covered by clause (iii) of Rule 13(3)(III) of the Rules, as the discharge of the appellant was only on the ground of his medical unfitness for further service, therefore, he could not be invalidated out of service without the recommendation of the Invalidating Board.This Court in Smt. Sulekha Rani v. Union of India and Ors. (Civil Appeal No. 1280 of 2019 decided on July 16, 2019) held that when the discharge was on the ground of medical unfitness, the Rule prescribes a particular procedure for discharge. Thus, an order of discharge passed without subjecting the officer to an Invalidating Board would be contrary to the statutory rule. The Court held asAfter considering the facts and material before us, we are of the view that the discharge of the appellants spouse without convening an Invalidation Medical Board suffers from an illegality. The respondents have relied upon the response purportedly addressed by the Jawan to the notice to show cause issued to him. The provisions Rule 13(3)(III)(v) upon which reliance has been placed had no application to the case. It would not operate in an area which is covered by medical unfitness.Therefore, we find that discharge of the appellant was not under the residual clause (v) but under clause (iii) of Rule 13(3)(III) of the Rules. Since the discharge has proceeded without reference to Invalidating Medical Board, such discharge is not legally sustainable.Having said so, in terms of clause (b) of General Principles of Army Order 46 of 1980, he is entitled to be retained for ten years being in the rank of personnel of Other Ranks. Since, he joined the service on October 23, 1987, he would be deemed to be discharged only on October 22, 1997.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: in the public interest, and that their retention will not exceed the sanctioned strength of the regiment/corps. When such an appointment is not available or when their retention is either not considered necessary in the interest of the service or it exceeds the sanctioned strength of the regiment/corps, they will be discharged irrespective of the service put in by them. (b) Ordinarily, permanent low medical category personnel will be retained in service till completion of 15 years service in the case of JCOs and 10 years in the case of OR (including NCOs). However, such personnel may continue to be retained in service beyond the above period until they become due for discharge in the normal manner subject to their willingness and the fulfilment of the stipulation laid in sub-para (a) above.?7. Learned counsel for the appellant relied upon judgment of this Court in Union of India & Ors. v. Rajpal Singh (2009) 1 SCC 216 wherein, this Court has held that if a person is to be discharged on the ground of medical unfitness, such discharge cannot be passed without subjecting him to the Invalidating Board as per procedure laid down in Rule 13. The Court held as under:?30. A plain reading of the Army Order shows that it comes into operation after an opinion has been formed as to whether a particular personnel is to be retained in service or not, if so for what period. If a person is to be retained in service despite his low medical category for a particular period as stipulated in Army Order 46 of 1980, the question of subjecting him to the Invalidating Board may not arise. However, if a person is to be discharged on the ground of medical unfitness, at that stage of his tenure of service or extended service within the meaning of the Army Order, he has to be discharged as per the procedure laid down in Clause I(ii) in Column 2 of the said T able.?8. In the present case, the order of discharge is on the ground that the appellant has been placed in Low Medical Category. The extract from the order of communication of discharge reads as under:?1. The personnel mentioned in Appendix ‘A? to this letter have been placed in Low Medical Category lower than ‘AYE? ad become due for x discharge from service as per policy on discharge of permanent low medical category personnel laid down in Army Order 46/80. They will report to Depot Coy HQ Wing ASC Centre (South), Bangalore-7 and SOS from service w.e.f. the dates shown against their names. No joining time is admissible.?9. The argument of learned counsel for the respondents is that the discharge of the appellant was under clause III(v) of Rule 13(3) of the Rules and, therefore, the question of subjecting the appellant to Invalidating Medical Board does not arise. It is argued that such is the case admitted by the appellant in his statutory complaint as well. 10. We have heard learned counsel for the parties and find that the discharge of the appellant was only under category 13(3)(III)(iii) as he has been found medically unfit for further service. Clause (v) of Rule 13(3)(III) would be applicable in respect of all other classes of discharge which do not find mention in Rule 13(3)(III). The communication of discharge from the service is on the ground that he has been placed in the Low Medical Category. Once he has been put in Low Medical Category, clause (iii) of Rule 13(3)(III) would be applicable as such clause alone deals with discharge if any personnel is found medically unfit for further service. There is no reference to sub-clause (v) of Army Rule 13(3)(III) in the order of discharge. Still further, it is not the recital of a provision which is relevant to determine as to whether the personnel is discharged under clause (v) or clause (iii) of Rule 13(3)(III) of the Rules. It is the object, language and the purport of the discharge which will be relevant to determine whether an army personnel had been discharged under clause (iii) or clause (v). Clause (v) is the residual clause when other clauses are not applicable to such personnel. Since the discharge of the appellant is covered by clause (iii) of Rule 13(3)(III) of the Rules, as the discharge of the appellant was only on the ground of his medical unfitness for further service, therefore, he could not be invalidated out of service without the recommendation of the Invalidating Board. 11. This Court in Smt. Sulekha Rani v. Union of India and Ors. (Civil Appeal No. 1280 of 2019 decided on July 16, 2019) held that when the discharge was on the ground of medical unfitness, the Rule prescribes a particular procedure for discharge. Thus, an order of discharge passed without subjecting the officer to an Invalidating Board would be contrary to the statutory rule. The Court held as under:?10. After considering the facts and material before us, we are of the view that the discharge of the appellants spouse without convening an Invalidation Medical Board suffers from an illegality. The respondents have relied upon the response purportedly addressed by the Jawan to the notice to show cause issued to him. The provisions Rule 13(3)(III)(v) upon which reliance has been placed had no application to the case. It would not operate in an area which is covered by medical unfitness.?12. Therefore, we find that discharge of the appellant was not under the residual clause (v) but under clause (iii) of Rule 13(3)(III) of the Rules. Since the discharge has proceeded without reference to Invalidating Medical Board, such discharge is not legally sustainable. 13. Having said so, in terms of clause (b) of General Principles of Army Order 46 of 1980, he is entitled to be retained for ten years being in the rank of personnel of Other Ranks. Since, he joined the service on October 23, 1987, he would be deemed to be discharged only on October 22, 1997. ### Response: 1

ESI Corporation Vs. Harrison Malayalam Ltd

to another contract work which might have been undertaken by it really clinches the issue against the respondent. There is another decision of this Court to which our attention was invited by learned counsel for the Corporation in the case of E.S.I. Corporation v. Hotel Kalpaka International, 1993 (1) KLT 251. It has been held by this Court, speaking through Mohan, J., that under S.40 of the Act primary liability is of the employer to pay, not only the employers contribution but also the employees contribution. Therefore, he cannot be heard to contend that since he had not deducted the employees contribution on the wages of the employees, he could not be made liable for the same. It cannot be said that the demand could not be enforced against a closed business as such a finding would, instead of promoting the scheme and avoiding the mischief, perpetrate the mischief. It was further observed that it cannot also be said that because the employees had gone away there is no liability to contribute. The liability to contribute arose from the date of commencement of the establishment and is a continuing liability till the closure. The very object of establishing a common fund under S.26 for the benefit of all the employees will again be thwarted if such a construction is put. 5. In view of the aforesaid decisions of this Court, especially the first decision which is rendered in the case of the respondent Company itself, there is no escape from the conclusion that the claim of the appellant Corporation could not have been successfully challenged by the respondent only on the specious plea that during the relevant period from 1971 to 1982 no data was available with the respondent about the exact number of employees employed by it and the payment made to them during the relevant period. Therefore, on that short ground the appeal will have to be allowed. However, before we do so, we must note two further contentions canvassed by the learned counsel for the respondent seeking a remand of these proceedings to the Insurance Court. Firstly, it was submitted that the workmen engaged by the respondent were of casual nature and the respondents own work was that of a casual contract and, therefore, no liability to contribute under the Act would arise in such a case. Secondly, it was submitted that the total claim of Rs. 21akhs and odd was on the basis that the subcontractors were paid Rs. 33 lakhs and odd during the relevant time by the respondent but that included not only the payment of wages to the employees of the sub-contractors, but also it included transport charges and other miscellaneous items and such a contention was put forward in the application before the insurance Court. It was, therefore, submitted that even if on the main contention the respondent fails on the aforesaid two grounds, for considering these two contentions the matter may be remanded for a fresh decision of the Insurance Court. 6. So far as the first ground seeking for remand is concerned, reliance was placed on para 4 of the judgment of this Court in the respondents own case in Harisson (supra). It has been observed therein that: (JT page 98 para 4). "Shri Pai while not disputing the fact that the Act applies to casual workmen, contended that it cannot be made applicable to the workmen of casual contractors such as the plumbers, electricity repairers, air conditioner repairers, computer repairers, T.V. Repairers etc whom contractors engage for temporary repair works. There is indeed great force in this contention. However, in the present case there is nothing on record to show that the contractor engaged was such casual contractor and the work executed by him was of a casual nature." 7. We fail to appreciate how these observations made in the case of the respondent itself in that earlier case can be of any avail to the respondent in the present case. It is not the case of the respondent nor was it proved on record even in the alternative that the work which the sub-contractors employees did was of such a nature that the main contract itself undertaken by the respondent could be treated to have resulted in the contract work being of casual nature. On the contrary, the evidence is that for 11 years from 1971 to 1982 the respondent did the construction work for McDowell Company. Thus, it was almost of a perennial nature spread over 11 years and during that time the workmen were engaged, though according to the respondent through sub contractors. Consequently, there would remain no occasion for remanding the proceedings for considering the first objection. 8. Regarding the second objection it is necessary to note that though it was the contention of the respondent in application before the Insurance Court that it had engaged sub-contractors who brought their own workmen during the relevant period for carrying out the work of the respondent, there was documentary evidence on record by way of letters dated 5.12.1986, 27.1.1986 and 18.11.1986 received from the so-called sub-contractors to show that they were in fact employees of the respondent and were not sub-contractors. When such evidence was led before the Insurance Court by the Corporation it was incumbent upon the respondent to join the issue and to seek a decision of the Insurance Court on this alternative aspect. That was not done presumably because it was not worthwhile doing so. Therefore, it is now too late in the day for the respondent to claim a remand even on this ground especially when we are told that the respondent is one of the well known companies in Kerala and was carrying construction activities on a large scale for different clients at the relevant time and the claim involved is only Rs. 2 lakhs and odd. For all these reasons, therefore, we are not inclined to accept even the second objection of the respondent for seeking a remand of these proceedings.

1[ds]7. We fail to appreciate how these observations made in the case of the respondent itself in that earlier case can be of any avail to the respondent in the present case. It is not the case of the respondent nor was it proved on record even in the alternative that the work which theemployees did was of such a nature that the main contract itself undertaken by the respondent could be treated to have resulted in the contract work being of casual nature. On the contrary, the evidence is that for 11 years from 1971 to 1982 the respondent did the construction work for McDowell Company. Thus, it was almost of a perennial nature spread over 11 years and during that time the workmen were engaged, though according to the respondent through sub contractors. Consequently, there would remain no occasion for remanding the proceedings for considering the first objection.Regarding the second objection it is necessary to note that though it was the contention of the respondent in application before the Insurance Court that it had engagedwho brought their own workmen during the relevant period for carrying out the work of the respondent, there was documentary evidence on record by way of letters dated 5.12.1986, 27.1.1986 and 18.11.1986 received from thes to show that they were in fact employees of the respondent and were notWhen such evidence was led before the Insurance Court by the Corporation it was incumbent upon the respondent to join the issue and to seek a decision of the Insurance Court on this alternative aspect. That was not done presumably because it was not worthwhile doing so. Therefore, it is now too late in the day for the respondent to claim a remand even on this ground especially when we are told that the respondent is one of the well known companies in Kerala and was carrying construction activities on a large scale for different clients at the relevant time and the claim involved is only Rs. 2 lakhs and odd. For all these reasons, therefore, we are not inclined to accept even the second objection of the respondent for seeking a remand of these proceeding

### Instruction: Analyze the case proceeding and predict whether the appeal/petition will be accepted (1) or rejected (0). ### Input: to another contract work which might have been undertaken by it really clinches the issue against the respondent. There is another decision of this Court to which our attention was invited by learned counsel for the Corporation in the case of E.S.I. Corporation v. Hotel Kalpaka International, 1993 (1) KLT 251. It has been held by this Court, speaking through Mohan, J., that under S.40 of the Act primary liability is of the employer to pay, not only the employers contribution but also the employees contribution. Therefore, he cannot be heard to contend that since he had not deducted the employees contribution on the wages of the employees, he could not be made liable for the same. It cannot be said that the demand could not be enforced against a closed business as such a finding would, instead of promoting the scheme and avoiding the mischief, perpetrate the mischief. It was further observed that it cannot also be said that because the employees had gone away there is no liability to contribute. The liability to contribute arose from the date of commencement of the establishment and is a continuing liability till the closure. The very object of establishing a common fund under S.26 for the benefit of all the employees will again be thwarted if such a construction is put. 5. In view of the aforesaid decisions of this Court, especially the first decision which is rendered in the case of the respondent Company itself, there is no escape from the conclusion that the claim of the appellant Corporation could not have been successfully challenged by the respondent only on the specious plea that during the relevant period from 1971 to 1982 no data was available with the respondent about the exact number of employees employed by it and the payment made to them during the relevant period. Therefore, on that short ground the appeal will have to be allowed. However, before we do so, we must note two further contentions canvassed by the learned counsel for the respondent seeking a remand of these proceedings to the Insurance Court. Firstly, it was submitted that the workmen engaged by the respondent were of casual nature and the respondents own work was that of a casual contract and, therefore, no liability to contribute under the Act would arise in such a case. Secondly, it was submitted that the total claim of Rs. 21akhs and odd was on the basis that the subcontractors were paid Rs. 33 lakhs and odd during the relevant time by the respondent but that included not only the payment of wages to the employees of the sub-contractors, but also it included transport charges and other miscellaneous items and such a contention was put forward in the application before the insurance Court. It was, therefore, submitted that even if on the main contention the respondent fails on the aforesaid two grounds, for considering these two contentions the matter may be remanded for a fresh decision of the Insurance Court. 6. So far as the first ground seeking for remand is concerned, reliance was placed on para 4 of the judgment of this Court in the respondents own case in Harisson (supra). It has been observed therein that: (JT page 98 para 4). "Shri Pai while not disputing the fact that the Act applies to casual workmen, contended that it cannot be made applicable to the workmen of casual contractors such as the plumbers, electricity repairers, air conditioner repairers, computer repairers, T.V. Repairers etc whom contractors engage for temporary repair works. There is indeed great force in this contention. However, in the present case there is nothing on record to show that the contractor engaged was such casual contractor and the work executed by him was of a casual nature." 7. We fail to appreciate how these observations made in the case of the respondent itself in that earlier case can be of any avail to the respondent in the present case. It is not the case of the respondent nor was it proved on record even in the alternative that the work which the sub-contractors employees did was of such a nature that the main contract itself undertaken by the respondent could be treated to have resulted in the contract work being of casual nature. On the contrary, the evidence is that for 11 years from 1971 to 1982 the respondent did the construction work for McDowell Company. Thus, it was almost of a perennial nature spread over 11 years and during that time the workmen were engaged, though according to the respondent through sub contractors. Consequently, there would remain no occasion for remanding the proceedings for considering the first objection. 8. Regarding the second objection it is necessary to note that though it was the contention of the respondent in application before the Insurance Court that it had engaged sub-contractors who brought their own workmen during the relevant period for carrying out the work of the respondent, there was documentary evidence on record by way of letters dated 5.12.1986, 27.1.1986 and 18.11.1986 received from the so-called sub-contractors to show that they were in fact employees of the respondent and were not sub-contractors. When such evidence was led before the Insurance Court by the Corporation it was incumbent upon the respondent to join the issue and to seek a decision of the Insurance Court on this alternative aspect. That was not done presumably because it was not worthwhile doing so. Therefore, it is now too late in the day for the respondent to claim a remand even on this ground especially when we are told that the respondent is one of the well known companies in Kerala and was carrying construction activities on a large scale for different clients at the relevant time and the claim involved is only Rs. 2 lakhs and odd. For all these reasons, therefore, we are not inclined to accept even the second objection of the respondent for seeking a remand of these proceedings. ### Response: 1

Bhimaji Shanker Kulkarni Vs. Dundappa Vithappa Udapudi And Anr

be open to the Civil Court to give any relief to the landlord by way of possession of the agricultural land. If, on the other hand, the Mamlatdar rejects the plea raised under the Tenancy Act, the Civil Court would be entitled to deal with the dispute on the footing that the defendant is a trespasser. 6. In Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), the Court expressed the hope that the legislature would make suitable amendments in the Act. The Bombay Legislature approved of the decision, and gave effect to it by introducing S. 85A by the amending Bombay Act XII of 1956.Section 85A proceeds upon the assumption that though the Civil Court has otherwise jurisdiction to try a suit, it will have no jurisdiction to try an issue arising in the suit, if the issue is required to be settled, decided or dealt with by the Mamlatdar or other competent authority under the Act, and on that assumption, S. 85A provides for suitable machinery for reference of the issue to the Mamlatdar for his decision.Now, the Mamlatdar has jurisdiction under S. 70 to decide the several issues specified therein "for the purposes of this Act, and before the introduction of S. 85A, it was a debatable point whether the expression "for the purposes of this Act meant that the Mamlatdar had jurisdiction to decide those issues only in some proceeding before him under some specific provision of the Act, or whether he had jurisdiction to decide those issues even though they arose for decision in a suit properly cognisable by a Civil Court, so that the jurisdiction of the Civil Court to try those issues in the suit was taken away by S. 85 read with S. 70. Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), settled the point, and held that the Mamlatdar had exclusive jurisdiction to decide those issues even though they arose for decision in a suit properly cognisable by a Civil Court. The result was somewhat startling, for normally the Civil Court has jurisdiction to try all the issues arising in a suit properly cognisable by it. But having regard to the fact that the Bombay Legislature approved of Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), and gave effect to it by introducing S. 85A, we must hold that the decision correctly interpreted the law as it stood before the enactment of S. 85A. It follows that independently of S. 85A. and under the law as it stood before S. 85A came into force, the Courts below were bound to refer to the Mamlatdar the decision of the issue whether the defendant is a tenant. 7. In Mudugere Rangaiah v. M. Rangaiah, ILR (1959) Mys 420, the plaintiff sued for a declaration that he is the kadim tenant in the suit land and prayed for a permanent injunction restraining the defendant from interfering with his possession. Both the plaintiff and the defendant claimed to be tenants under the same landlord. The defendant contended that the suit was not maintainable in a Civil Court in view of S. 46 of the Mysore Tenancy Act (Mysore Act No. XIII of 1952). The Mysore High Court held that the jurisdiction of the Amildar is limited to cases arising by or under the Mysore Tenancy Act, and the decisions that he is required to give under S. 32 of the Act were "for the purposes of the Act and the aforesaid suit did not arise under any of the provisions of the Act and the Civil Court had, therefore, the jurisdiction to decide all the points in dispute in the suit including the question of tenancy and no provision in the Act laid down that a Civil Court was not entitled to try civil proceedings involving the determination of any question falling within S. 32 of the Act, though the Amildar was the competent authority to settle, decide and deal with those questions, had they arisen in proceedings under the Act. Sections 32 and 46 of the Mysore Act are similar to Ss. 70and 85 of the Bombay Act, but there are many points of distinction between the scheme and legislative history of the Mysore Act and those of the Bombay Act. The Mysore High Court considered Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), and also noted some of the points of distinction between the two acts. In the instant case, the question of interpretation of Ss. 32, 46 and other provisions of the Mysore Act does not arise, and we express no opinion on it. We must not be taken to express any opinion one way or the other on the correctness or otherwise of the decision in Mudugere Rangaiahs case, ILR (1959) Mys 420. 8. Mr. Patwardhan also contended that in the second appeal preferred by the plaintiff the High Court had no jurisdiction to set aside the finding of the first appellate Court given in favour of the appellant, namely, the finding that "nothing is due by the plaintiff to the defendants under the transaction, Exhibit 43. There is no substance in this contention. The first appellate Court recorded inconsistent findings. Having held that the Civil Court had no jurisdiction to determine whether defendant No. 1 was a mortgagee in possession or a tenant, the lower appellate Court should have stayed the suit pending decision of that question by the Mamlatdar, and until such a decision was given, the Court could not proceed on the footing that the transaction evidenced by Exhibit 43 was a mortgage and the defendant No. 1 was a mortgagee and hold that nothing was due by the plaintiff to the defendants under the transaction. The High Court had ample power to correct this error and to set aside this inconsistent finding in an appeal filed by the plaintiff, though the defendants had filed no appeal or cross-objections.

0[ds]4. With regard to suits and proceedings by a landowner for possession of agricultural lands, the combined effect of Ss. 29, 70, 85 and 85A of the Act is as follows: The Mamlatdar has exclusive jurisdiction to entertain an application by a landlord for possession of agricultural lands against a tenant, and the Civil Court has no jurisdiction to entertain and try a suit by a landlord against a tenant for possession of agricultural lands. The Mamlatdar has no jurisdiction to try a suit by a landowner for recovery of possession of agricultural lands from a trespasser or from a mortgagee on redemption of a mortgage, and the Civil Court has jurisdiction to entertain such a suit; but if the defendant to the suit pleads that he is a tenant or a protected tenant or a permanent tenant and an issue arises whether he is such a tenant, the Court must refer the issue to the Mamlatdar for determination, and must stay the suit pending such determination, and after the Mamlatdar has decided the issue, the Court may dispose of the suit in the light of the decision of the Mamlatdar5. Section 85A was introduced by Bombay Act XIII of 1956, which came into force on March 23, 1956 during the pendency of the second appeal in this case. The suit out of which this appeal arises was governed by the law as it stood before the introduction of S. 85A. But independently of S. 85A and before it came into force, the Bombay High Court in Dhondi Tukaram v. Hari Dadu, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), held that the effect of Ss. 70 (b) and 85 read in the light of the other provisions of the Act was that if in a suit filed against the defendant on the footing that he is a trespasser he raises the plea that he is a tenant or a protected tenant the Civil Court had no jurisdiction to deal with the plea, and the proper procedure was to refer the issue to the Mamlatdar for his decision and not to dismiss the suit straightway. The Court observed:"Therefore, we hold that in a suit filed against the defendant on the footing that he is a trespasser if he raises the plea that he is a tenant or a protected tenant, the Civil Court would have no jurisdiction to deal with that plea...We would, however, like to add that in all such cases where the Civil Court cannot entertain the plea and accepts the objection that it has no jurisdiction to try it, it should not proceed to dismiss the suit straightway. We think that the proper procedure to adopt in such cases would be to direct the party who raises such a plea to obtain a decision from the Mamlatdar within a reasonable time. If the decision of the Mamlatdar is in favour of the party raising the plea, the suit for possession would have to be dismissed, because it would not be open to the Civil Court to give any relief to the landlord by way of possession of the agricultural land. If, on the other hand, the Mamlatdar rejects the plea raised under the Tenancy Act, the Civil Court would be entitled to deal with the dispute on the footing that the defendant is a trespasser.6. In Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), the Court expressed the hope that the legislature would make suitable amendments in the Act. The Bombay Legislature approved of the decision, and gave effect to it by introducing S. 85A by the amending Bombay Act XII of 1956.Section 85A proceeds upon the assumption that though the Civil Court has otherwise jurisdiction to try a suit, it will have no jurisdiction to try an issue arising in the suit, if the issue is required to be settled, decided or dealt with by the Mamlatdar or other competent authority under the Act, and on that assumption, S. 85A provides for suitable machinery for reference of the issue to the Mamlatdar for his decision.Now, the Mamlatdar has jurisdiction under S. 70 to decide the several issues specified therein "for the purposes of this Act, and before the introduction of S. 85A, it was a debatable point whether the expression "for the purposes of this Act meant that the Mamlatdar had jurisdiction to decide those issues only in some proceeding before him under some specific provision of the Act, or whether he had jurisdiction to decide those issues even though they arose for decision in a suit properly cognisable by a Civil Court, so that the jurisdiction of the Civil Court to try those issues in the suit was taken away by S. 85 read with S. 70. Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), settled the point, and held that the Mamlatdar had exclusive jurisdiction to decide those issues even though they arose for decision in a suit properly cognisable by a Civil Court. The result was somewhat startling, for normally the Civil Court has jurisdiction to try all the issues arising in a suit properly cognisable by it. But having regard to the fact that the Bombay Legislature approved of Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), and gave effect to it by introducing S. 85A, we must hold that the decision correctly interpreted the law as it stood before the enactment of S. 85A. It follows that independently of S. 85A. and under the law as it stood before S. 85A came into force, the Courts below were bound to refer to the Mamlatdar the decision of the issue whether the defendant is a tenant7. In Mudugere Rangaiah v. M. Rangaiah, ILR (1959) Mys 420, the plaintiff sued for a declaration that he is the kadim tenant in the suit land and prayed for a permanent injunction restraining the defendant from interfering with his possession. Both the plaintiff and the defendant claimed to be tenants under the same landlord. The defendant contended that the suit was not maintainable in a Civil Court in view of S. 46 of the Mysore Tenancy Act (Mysore Act No. XIII of 1952). The Mysore High Court held that the jurisdiction of the Amildar is limited to cases arising by or under the Mysore Tenancy Act, and the decisions that he is required to give under S. 32 of the Act were "for the purposes of the Act and the aforesaid suit did not arise under any of the provisions of the Act and the Civil Court had, therefore, the jurisdiction to decide all the points in dispute in the suit including the question of tenancy and no provision in the Act laid down that a Civil Court was not entitled to try civil proceedings involving the determination of any question falling within S. 32 of the Act, though the Amildar was the competent authority to settle, decide and deal with those questions, had they arisen in proceedings under the Act. Sections 32 and 46 of the Mysore Act are similar to Ss. 70and 85 of the Bombay Act, but there are many points of distinction between the scheme and legislative history of the Mysore Act and those of the Bombay Act. The Mysore High Court considered Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), and also noted some of the points of distinction between the two acts. In the instant case, the question of interpretation of Ss. 32, 46 and other provisions of the Mysore Act does not arise, and we express no opinion on it. We must not be taken to express any opinion one way or the other on the correctness or otherwise of the decision in Mudugere Rangaiahs case, ILR (1959) Mys 4208. Mr. Patwardhan also contended that in the second appeal preferred by the plaintiff the High Court had no jurisdiction to set aside the finding of the first appellate Court given in favour of the appellant, namely, the finding that "nothing is due by the plaintiff to the defendants under the transaction, Exhibit 43. There is no substance in this contention. The first appellate Court recorded inconsistent findings.Having held that the Civil Court had no jurisdiction to determine whether defendant No. 1 was a mortgagee in possession or a tenant, the lower appellate Court should have stayed the suit pending decision of that question by the Mamlatdar, and until such a decision was given, the Court could not proceed on the footing that the transaction evidenced by Exhibit 43 was a mortgage and the defendant No. 1 was a mortgagee and hold that nothing was due by the plaintiff to the defendants under the transaction. The High Court had ample power to correct this error and to set aside this inconsistent finding in an appeal filed by the plaintiff, though the defendants had filed no appeal or cross-objections.

### Instruction: Delve into the case proceeding and predict the outcome: is the judgment expected to be in support (1) or in denial (0) of the appeal? ### Input: be open to the Civil Court to give any relief to the landlord by way of possession of the agricultural land. If, on the other hand, the Mamlatdar rejects the plea raised under the Tenancy Act, the Civil Court would be entitled to deal with the dispute on the footing that the defendant is a trespasser. 6. In Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), the Court expressed the hope that the legislature would make suitable amendments in the Act. The Bombay Legislature approved of the decision, and gave effect to it by introducing S. 85A by the amending Bombay Act XII of 1956.Section 85A proceeds upon the assumption that though the Civil Court has otherwise jurisdiction to try a suit, it will have no jurisdiction to try an issue arising in the suit, if the issue is required to be settled, decided or dealt with by the Mamlatdar or other competent authority under the Act, and on that assumption, S. 85A provides for suitable machinery for reference of the issue to the Mamlatdar for his decision.Now, the Mamlatdar has jurisdiction under S. 70 to decide the several issues specified therein "for the purposes of this Act, and before the introduction of S. 85A, it was a debatable point whether the expression "for the purposes of this Act meant that the Mamlatdar had jurisdiction to decide those issues only in some proceeding before him under some specific provision of the Act, or whether he had jurisdiction to decide those issues even though they arose for decision in a suit properly cognisable by a Civil Court, so that the jurisdiction of the Civil Court to try those issues in the suit was taken away by S. 85 read with S. 70. Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), settled the point, and held that the Mamlatdar had exclusive jurisdiction to decide those issues even though they arose for decision in a suit properly cognisable by a Civil Court. The result was somewhat startling, for normally the Civil Court has jurisdiction to try all the issues arising in a suit properly cognisable by it. But having regard to the fact that the Bombay Legislature approved of Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), and gave effect to it by introducing S. 85A, we must hold that the decision correctly interpreted the law as it stood before the enactment of S. 85A. It follows that independently of S. 85A. and under the law as it stood before S. 85A came into force, the Courts below were bound to refer to the Mamlatdar the decision of the issue whether the defendant is a tenant. 7. In Mudugere Rangaiah v. M. Rangaiah, ILR (1959) Mys 420, the plaintiff sued for a declaration that he is the kadim tenant in the suit land and prayed for a permanent injunction restraining the defendant from interfering with his possession. Both the plaintiff and the defendant claimed to be tenants under the same landlord. The defendant contended that the suit was not maintainable in a Civil Court in view of S. 46 of the Mysore Tenancy Act (Mysore Act No. XIII of 1952). The Mysore High Court held that the jurisdiction of the Amildar is limited to cases arising by or under the Mysore Tenancy Act, and the decisions that he is required to give under S. 32 of the Act were "for the purposes of the Act and the aforesaid suit did not arise under any of the provisions of the Act and the Civil Court had, therefore, the jurisdiction to decide all the points in dispute in the suit including the question of tenancy and no provision in the Act laid down that a Civil Court was not entitled to try civil proceedings involving the determination of any question falling within S. 32 of the Act, though the Amildar was the competent authority to settle, decide and deal with those questions, had they arisen in proceedings under the Act. Sections 32 and 46 of the Mysore Act are similar to Ss. 70and 85 of the Bombay Act, but there are many points of distinction between the scheme and legislative history of the Mysore Act and those of the Bombay Act. The Mysore High Court considered Dhondi Tukarams case, ILR (1953) Bom 969 : (AIR 1954 Bom 100 ), and also noted some of the points of distinction between the two acts. In the instant case, the question of interpretation of Ss. 32, 46 and other provisions of the Mysore Act does not arise, and we express no opinion on it. We must not be taken to express any opinion one way or the other on the correctness or otherwise of the decision in Mudugere Rangaiahs case, ILR (1959) Mys 420. 8. Mr. Patwardhan also contended that in the second appeal preferred by the plaintiff the High Court had no jurisdiction to set aside the finding of the first appellate Court given in favour of the appellant, namely, the finding that "nothing is due by the plaintiff to the defendants under the transaction, Exhibit 43. There is no substance in this contention. The first appellate Court recorded inconsistent findings. Having held that the Civil Court had no jurisdiction to determine whether defendant No. 1 was a mortgagee in possession or a tenant, the lower appellate Court should have stayed the suit pending decision of that question by the Mamlatdar, and until such a decision was given, the Court could not proceed on the footing that the transaction evidenced by Exhibit 43 was a mortgage and the defendant No. 1 was a mortgagee and hold that nothing was due by the plaintiff to the defendants under the transaction. The High Court had ample power to correct this error and to set aside this inconsistent finding in an appeal filed by the plaintiff, though the defendants had filed no appeal or cross-objections. ### Response: 0

Syndicate Bank Vs. New Look Rubbers (P) Ltd.

the Managing Director of the company in execution of the decree in O.S.732/87. In fact the KFC was strangulating the industry from one side where as the Bank was doing the same thing on the Managing Director of the company from the other side which was shocking to judicial conscience. In the above circumstances for the ends of justice this court is constrained to interfere and to undo the injustice caused to the petitioner and to save both the industry and the Managing Director of the industry by setting aside the order of taking over the industry and the court sale of the property. The entire amount deposited by the 4th respondent towards price of the auctioned property with 5% of the above amount and interest at 6% from the date of deposit till return shall be paid by the 3rd respondent bank to the 4th respondent. The bank also will have to consider the grant of interest holiday for the period during which the industry had been under the possession of the KFC in pursuance to the take over. Hence for the proper administration of justice, I think it proper to set aside the court sale and to allow C.R.P.2315/98."4. As the order dated 11th April 2001 was a comprehensive one, taking within its ambit the Civil Revision as well as the Writ Petition, two LPAs, one by the Bank and the other by the judgment-debtor, were filed and are pending in the Kerala High Court against the order in the writ petition whereas the present appeal has been filed by the Bank against the order in the Civil Revision. 5. Mr. A.B.Dial, the learned senior counsel for the appellant has pointed out that the High Court had overstepped its jurisdiction as after giving a positive finding that the respondent was not entitled to any relief under section 22 of the SICA or under section 18 FH of the Regulation Act, it had virtually set aside all the effective orders of the Civil Courts which had been made in favour of the appellant Bank and had attained finality. It has further been pleaded that the further direction of the High Court as to the entitlement of the respondent to the benefit of the re-settlement schemes for revival was not the issue before it as the executing court or the High Court could not go beyond the decree itself and hold that the suit which had led the decree was bad having been filed in collusion with one or the other party. Respondent No.2 appearing in person has, however, argued that the High Court had proceeded on the basis that the respondent had been gravely wronged by the Bank and the Kerala Financial Corporation and has also submitted a large number of documents in support of this submission. He has also pointed out that the State Government had taken steps towards the revival of his unit and as such, there was no justification in interfering with the order of the High Court. 6. Before we go to the issues raised, we reproduce here the final directions of the High Court: "1. The order of the 2nd respondent KFC taking possession of the industrial unit New Look Rubbers (P) Ltd. (petitioner company) is set aside and the KFC is directed to surrender possession of the industrial unit to the petitioner forthwith. 2. The 2nd respondent (KFC) shall grant interest holiday for the period from the date of taking possession of the industry till it is handed over to the petitioner. 3. The court sale of the property of the Managing Director of the petitioner company in pursuance to the decree in OS 732/87 of Sub-Court, Trichur, shall stand set aside and the3rd respondent shall return the entire sale amount with a sum equal to 5% of the above amount and with 6% interest on the sale amount from the date of deposit till the date of return to the 4th respondent." 7. We are of the opinion that the High Court has clearly overstepped its jurisdiction. The facts of the case show that the appellant had filed civil suit O.S.No.732/1987 against the respondent for recovery of the sums advanced as loan plus interest. This suit was decreed on 9th April 1990 with the positive finding that there was no harsh or arbitrary behaviour in the proceedings against the respondent. Admittedly, no appeal was filed against the judgment dated 9th April 1990 and it attained finality. The appellant Bank thereafter filed E.P.No.819/1991 for the realization of the decretal amount on which the respondent filed O.S. No.1430/93 praying that the appellant Bank be injuncted from executing the decree in O.S.No.732/1997. This suit too was dismissed on 1st April 1996. Another Pauper Petition No. 19/1997 was filed by the respondent claiming damages from the Bank and this too was dismissed. Admittedly all these matters have attained finality. Two sets of objections in execution petition, E.A. No.847/97 and E.A.No.1197/97 had been filed with regard to the applicability of section 22(1) of SICA and section 18 FH of the Regulation Act and in the meanwhile, the property mortgaged was sold in execution of the decree. The aforesaid objection petitions were dismissed on 21st July 1998. It is against the order in E.A. No.1197/1997 that the present revision was filed. We are therefore of the opinion that in the light of the issues decided by the Civil Court in the various litigations which were allowed to become final and as the decree had already been executed in as much that the mortgaged property has been sold, the directions issued by the High Court are clearly not warranted. We are also of the opinion that there can be no objection to the revival of the respondents unit but that is a matter between the respondent and the Kerala Financial Corporation or other Governmental Agencies and cannot in any manner affect the legal rights that have accrued to the appellant as a consequence of a series of orders/ judgments.

1[ds]7. We are of the opinion that the High Court has clearly overstepped its jurisdiction. The facts of the case show that the appellant had filed civil suit O.S.No.732/1987 against the respondent for recovery of the sums advanced as loan plus interest. This suit was decreed on 9th April 1990 with the positive finding that there was no harsh or arbitrary behaviour in the proceedings against the respondent. Admittedly, no appeal was filed against the judgment dated 9th April 1990 and it attained finality. The appellant Bank thereafter filed E.P.No.819/1991 for the realization of the decretal amount on which the respondent filed O.S. No.1430/93 praying that the appellant Bank be injuncted from executing the decree insuit too was dismissed on 1st April 1996. Another Pauper Petition No. 19/1997 was filed by the respondent claiming damages from the Bank and this too was dismissed. Admittedly all these matters have attained finality. Two sets of objections in execution petition, E.A. No.847/97 and E.A.No.1197/97 had been filed with regard to the applicability of section 22(1) of SICA and section 18 FH of the Regulation Act and in the meanwhile, the property mortgaged was sold in execution of the decree. The aforesaid objection petitions were dismissed on 21st July 1998. It is against the order in E.A. No.1197/1997 that the present revision was filed. We are therefore of the opinion that in the light of the issues decided by the Civil Court in the various litigations which were allowed to become final and as the decree had already been executed in as much that the mortgaged property has been sold, the directions issued by the High Court are clearly not warranted. We are also of the opinion that there can be no objection to the revival of the respondents unit but that is a matter between the respondent and the Kerala Financial Corporation or other Governmental Agencies and cannot in any manner affect the legal rights that have accrued to the appellant as a consequence of a series of orders/ judgments.

### Instruction: Analyze the case proceeding and predict whether the appeal/petition will be accepted (1) or rejected (0). ### Input: the Managing Director of the company in execution of the decree in O.S.732/87. In fact the KFC was strangulating the industry from one side where as the Bank was doing the same thing on the Managing Director of the company from the other side which was shocking to judicial conscience. In the above circumstances for the ends of justice this court is constrained to interfere and to undo the injustice caused to the petitioner and to save both the industry and the Managing Director of the industry by setting aside the order of taking over the industry and the court sale of the property. The entire amount deposited by the 4th respondent towards price of the auctioned property with 5% of the above amount and interest at 6% from the date of deposit till return shall be paid by the 3rd respondent bank to the 4th respondent. The bank also will have to consider the grant of interest holiday for the period during which the industry had been under the possession of the KFC in pursuance to the take over. Hence for the proper administration of justice, I think it proper to set aside the court sale and to allow C.R.P.2315/98."4. As the order dated 11th April 2001 was a comprehensive one, taking within its ambit the Civil Revision as well as the Writ Petition, two LPAs, one by the Bank and the other by the judgment-debtor, were filed and are pending in the Kerala High Court against the order in the writ petition whereas the present appeal has been filed by the Bank against the order in the Civil Revision. 5. Mr. A.B.Dial, the learned senior counsel for the appellant has pointed out that the High Court had overstepped its jurisdiction as after giving a positive finding that the respondent was not entitled to any relief under section 22 of the SICA or under section 18 FH of the Regulation Act, it had virtually set aside all the effective orders of the Civil Courts which had been made in favour of the appellant Bank and had attained finality. It has further been pleaded that the further direction of the High Court as to the entitlement of the respondent to the benefit of the re-settlement schemes for revival was not the issue before it as the executing court or the High Court could not go beyond the decree itself and hold that the suit which had led the decree was bad having been filed in collusion with one or the other party. Respondent No.2 appearing in person has, however, argued that the High Court had proceeded on the basis that the respondent had been gravely wronged by the Bank and the Kerala Financial Corporation and has also submitted a large number of documents in support of this submission. He has also pointed out that the State Government had taken steps towards the revival of his unit and as such, there was no justification in interfering with the order of the High Court. 6. Before we go to the issues raised, we reproduce here the final directions of the High Court: "1. The order of the 2nd respondent KFC taking possession of the industrial unit New Look Rubbers (P) Ltd. (petitioner company) is set aside and the KFC is directed to surrender possession of the industrial unit to the petitioner forthwith. 2. The 2nd respondent (KFC) shall grant interest holiday for the period from the date of taking possession of the industry till it is handed over to the petitioner. 3. The court sale of the property of the Managing Director of the petitioner company in pursuance to the decree in OS 732/87 of Sub-Court, Trichur, shall stand set aside and the3rd respondent shall return the entire sale amount with a sum equal to 5% of the above amount and with 6% interest on the sale amount from the date of deposit till the date of return to the 4th respondent." 7. We are of the opinion that the High Court has clearly overstepped its jurisdiction. The facts of the case show that the appellant had filed civil suit O.S.No.732/1987 against the respondent for recovery of the sums advanced as loan plus interest. This suit was decreed on 9th April 1990 with the positive finding that there was no harsh or arbitrary behaviour in the proceedings against the respondent. Admittedly, no appeal was filed against the judgment dated 9th April 1990 and it attained finality. The appellant Bank thereafter filed E.P.No.819/1991 for the realization of the decretal amount on which the respondent filed O.S. No.1430/93 praying that the appellant Bank be injuncted from executing the decree in O.S.No.732/1997. This suit too was dismissed on 1st April 1996. Another Pauper Petition No. 19/1997 was filed by the respondent claiming damages from the Bank and this too was dismissed. Admittedly all these matters have attained finality. Two sets of objections in execution petition, E.A. No.847/97 and E.A.No.1197/97 had been filed with regard to the applicability of section 22(1) of SICA and section 18 FH of the Regulation Act and in the meanwhile, the property mortgaged was sold in execution of the decree. The aforesaid objection petitions were dismissed on 21st July 1998. It is against the order in E.A. No.1197/1997 that the present revision was filed. We are therefore of the opinion that in the light of the issues decided by the Civil Court in the various litigations which were allowed to become final and as the decree had already been executed in as much that the mortgaged property has been sold, the directions issued by the High Court are clearly not warranted. We are also of the opinion that there can be no objection to the revival of the respondents unit but that is a matter between the respondent and the Kerala Financial Corporation or other Governmental Agencies and cannot in any manner affect the legal rights that have accrued to the appellant as a consequence of a series of orders/ judgments. ### Response: 1

MILKHI RAM Vs. HIMACHAL PRADESH STATE ELECTRICITY BOARD

of executing court was challenged by the Board in Civil Revision No. 16/2006. The Board contended before the High Court that the civil court had no jurisdiction to adjudicate a claim arising out of the ID Act and relief for the aggrieved employee could have been granted, only by the industrial court. It was further contended that plea of absence of jurisdiction can be raised at any stage and the present decree is a legal nullity. 9. On the other hand, the decree holder pointed out that concurrent findings are recorded in favour of the plaintiff. Moreover, the Court had answered the jurisdiction issue in favour of the plaintiff. As such the maintainability of the challenge in Revision before the High Court by the judgment debtor, was questioned by the terminated employee. 10. To address the jurisdictional question posed by the employer, the learned Judge referred to the judgments in Rajasthan SRTC & Ors. vs. Khadarmal (2006) 1 SCC 59, Rajasthan SRTC & Anr. vs. Ugma Ram Choudhry (2006) 1 SCC 61 and opined that the civil court did not have jurisdiction to entertain a claim based on the ID Act and if any decree is passed by the court without jurisdiction, the same shall have no force of law. Following the ratio in these two judgments, the High Court held that the civil court lacked inherent jurisdiction to entertain the suit based on the ID Act and the judgment and decree so passed, are nullity. It was further observed that the plea of decree being a nullity can also be raised at the stage of execution. The Revision petition filed by the judgment debtor was accordingly allowed by setting aside the decree passed in favour of the plaintiff. 11. Challenging the intervention of the High Court against the decree holder, Mr. Ajit Singh Pundir, the learned counsel submits that the appellant has rendered service as a daily wager since 11.12.1976 and his service could not have been terminated without following the due process. According to the appellants counsel even when relief is claimed based on the provisions of the ID Act, the jurisdiction of the civil court is not entirely barred. In support of his contention, Mr. Pundir relies upon Rajasthan State Road Transport Corporation and Ors. vs. Mohar Singh (2008) 5 SCC 542 . 12. On the other hand, Mr. Naresh K. Sharma, the learned counsel for the respondent Board, in support of the impugned judgment, reiterates the contention made before the High Court and submits that jurisdiction of the civil court is ousted when claimed relief is founded on the ID Act. It is further argued that when the civil court had no jurisdiction, the decree is nothing but a nullity and no relief on the basis of such void decree can be claimed by the plaintiff. In order to demonstrate the bonafide of the employer, Mr. Sharma refers to the letter dated 22.8.2001, offering the post of LDC and how the said offer did not fructify only because of the adamancy of the appellant, who failed to furnish a proper joining report. Insofar as the relief of back wages ordered by the civil court, the counsel submits that the Board has already remitted the arrear salaries to the appellant. 13. The above contentions of the parties indicate that the only issue to be considered here is whether the suit before the civil court at the instance of the terminated employee, was maintainable. The civil courts may have the limited jurisdiction in service matters, but jurisdiction may not be available to Court to adjudicate on orders passed by disciplinary authority. The authorities specified under the ID Act including the appropriate government and the industrial courts perform various functions and the ID Act provides for a wider definition of termination of service, the condition precedent of termination of service. The consequence of infringing those, are also provided in the ID Act. When a litigant opts for common law remedy, he may choose either the civil court or the industrial forum. 14. In the present matter, the appellant has clearly founded his claim in the suit, on the provisions of the ID Act and the employer therefore is entitled to raise a jurisdictional objection to the proceedings before the civil court. The courts below including the executing court negated the jurisdictional objection. The High Court in Revision, however has overturned the lower courts order and declared that the decree in favour of the plaintiff is hit by the principle of coram non judice and therefore, the same is a nullity. 15. The cited cases i.e. Khadarmal (supra) and Ugma Ram Choudhry (supra) pertain to employees under the Rajasthan State Road Transport Corporation. The three judges Bench of this Court while adverting to the challenge to termination of service opined that the civil court has no jurisdiction to entertain such cases. For such conclusion, the court referred to two earlier decisions in Rajasthan SRTC vs. Krishna Kant (1995) 5 SCC 75 and Rajasthan SRTC vs. Zakir Hussain (2005) 7 SCC 447 and held that when civil court has no jurisdiction, the decree passed in those proceedings can have no force of law. On the back wages already disbursed to the terminated employee, in Ugma Ram Choudhry (supra), the court on equitable principles observed that the disbursed amount should not be recovered from the employee. 16. As can be seen from the material on record, the challenge to the termination was founded on the provisions of the ID Act. Although jurisdictional objection was raised and a specific issue was framed at the instance of the employer, the issue was answered against the defendant. This Court is unable to accept the view propounded by the courts below and is of the considered opinion that the civil court lacks jurisdiction to entertain a suit structured on the provisions of the ID Act. The decree favouring the plaintiff is a legal nullity and the finding of the High Court to this extent is upheld.

0[ds]The civil courts may have the limited jurisdiction in service matters, but jurisdiction may not be available to Court to adjudicate on orders passed by disciplinary authority. The authorities specified under the ID Act including the appropriate government and the industrial courts perform various functions and the ID Act provides for a wider definition of termination of service, the condition precedent of termination of service. The consequence of infringing those, are also provided in the ID Act. When a litigant opts for common law remedy, he may choose either the civil court or the industrial forum.14. In the present matter, the appellant has clearly founded his claim in the suit, on the provisions of the ID Act and the employer therefore is entitled to raise a jurisdictional objection to the proceedings before the civil court. The courts below including the executing court negated the jurisdictional objection. The High Court in Revision, however has overturned the lower courts order and declared that the decree in favour of the plaintiff is hit by the principle of coram non judice and therefore, the same is a nullity.15. The cited cases i.e. Khadarmal (supra) and Ugma Ram Choudhry (supra) pertain to employees under the Rajasthan State Road Transport Corporation. The three judges Bench of this Court while adverting to the challenge to termination of service opined that the civil court has no jurisdiction to entertain such cases. For such conclusion, the court referred to two earlier decisions in Rajasthan SRTC vs. Krishna Kant (1995) 5 SCC 75 and Rajasthan SRTC vs. Zakir Hussain (2005) 7 SCC 447 and held that when civil court has no jurisdiction, the decree passed in those proceedings can have no force of law. On the back wages already disbursed to the terminated employee, in Ugma Ram Choudhry (supra), the court on equitable principles observed that the disbursed amount should not be recovered from the employee.16. As can be seen from the material on record, the challenge to the termination was founded on the provisions of the ID Act. Although jurisdictional objection was raised and a specific issue was framed at the instance of the employer, the issue was answered against the defendant. This Court is unable to accept the view propounded by the courts below and is of the considered opinion that the civil court lacks jurisdiction to entertain a suit structured on the provisions of the ID Act. The decree favouring the plaintiff is a legal nullity and the finding of the High Court to this extent is upheld.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: of executing court was challenged by the Board in Civil Revision No. 16/2006. The Board contended before the High Court that the civil court had no jurisdiction to adjudicate a claim arising out of the ID Act and relief for the aggrieved employee could have been granted, only by the industrial court. It was further contended that plea of absence of jurisdiction can be raised at any stage and the present decree is a legal nullity. 9. On the other hand, the decree holder pointed out that concurrent findings are recorded in favour of the plaintiff. Moreover, the Court had answered the jurisdiction issue in favour of the plaintiff. As such the maintainability of the challenge in Revision before the High Court by the judgment debtor, was questioned by the terminated employee. 10. To address the jurisdictional question posed by the employer, the learned Judge referred to the judgments in Rajasthan SRTC & Ors. vs. Khadarmal (2006) 1 SCC 59, Rajasthan SRTC & Anr. vs. Ugma Ram Choudhry (2006) 1 SCC 61 and opined that the civil court did not have jurisdiction to entertain a claim based on the ID Act and if any decree is passed by the court without jurisdiction, the same shall have no force of law. Following the ratio in these two judgments, the High Court held that the civil court lacked inherent jurisdiction to entertain the suit based on the ID Act and the judgment and decree so passed, are nullity. It was further observed that the plea of decree being a nullity can also be raised at the stage of execution. The Revision petition filed by the judgment debtor was accordingly allowed by setting aside the decree passed in favour of the plaintiff. 11. Challenging the intervention of the High Court against the decree holder, Mr. Ajit Singh Pundir, the learned counsel submits that the appellant has rendered service as a daily wager since 11.12.1976 and his service could not have been terminated without following the due process. According to the appellants counsel even when relief is claimed based on the provisions of the ID Act, the jurisdiction of the civil court is not entirely barred. In support of his contention, Mr. Pundir relies upon Rajasthan State Road Transport Corporation and Ors. vs. Mohar Singh (2008) 5 SCC 542 . 12. On the other hand, Mr. Naresh K. Sharma, the learned counsel for the respondent Board, in support of the impugned judgment, reiterates the contention made before the High Court and submits that jurisdiction of the civil court is ousted when claimed relief is founded on the ID Act. It is further argued that when the civil court had no jurisdiction, the decree is nothing but a nullity and no relief on the basis of such void decree can be claimed by the plaintiff. In order to demonstrate the bonafide of the employer, Mr. Sharma refers to the letter dated 22.8.2001, offering the post of LDC and how the said offer did not fructify only because of the adamancy of the appellant, who failed to furnish a proper joining report. Insofar as the relief of back wages ordered by the civil court, the counsel submits that the Board has already remitted the arrear salaries to the appellant. 13. The above contentions of the parties indicate that the only issue to be considered here is whether the suit before the civil court at the instance of the terminated employee, was maintainable. The civil courts may have the limited jurisdiction in service matters, but jurisdiction may not be available to Court to adjudicate on orders passed by disciplinary authority. The authorities specified under the ID Act including the appropriate government and the industrial courts perform various functions and the ID Act provides for a wider definition of termination of service, the condition precedent of termination of service. The consequence of infringing those, are also provided in the ID Act. When a litigant opts for common law remedy, he may choose either the civil court or the industrial forum. 14. In the present matter, the appellant has clearly founded his claim in the suit, on the provisions of the ID Act and the employer therefore is entitled to raise a jurisdictional objection to the proceedings before the civil court. The courts below including the executing court negated the jurisdictional objection. The High Court in Revision, however has overturned the lower courts order and declared that the decree in favour of the plaintiff is hit by the principle of coram non judice and therefore, the same is a nullity. 15. The cited cases i.e. Khadarmal (supra) and Ugma Ram Choudhry (supra) pertain to employees under the Rajasthan State Road Transport Corporation. The three judges Bench of this Court while adverting to the challenge to termination of service opined that the civil court has no jurisdiction to entertain such cases. For such conclusion, the court referred to two earlier decisions in Rajasthan SRTC vs. Krishna Kant (1995) 5 SCC 75 and Rajasthan SRTC vs. Zakir Hussain (2005) 7 SCC 447 and held that when civil court has no jurisdiction, the decree passed in those proceedings can have no force of law. On the back wages already disbursed to the terminated employee, in Ugma Ram Choudhry (supra), the court on equitable principles observed that the disbursed amount should not be recovered from the employee. 16. As can be seen from the material on record, the challenge to the termination was founded on the provisions of the ID Act. Although jurisdictional objection was raised and a specific issue was framed at the instance of the employer, the issue was answered against the defendant. This Court is unable to accept the view propounded by the courts below and is of the considered opinion that the civil court lacks jurisdiction to entertain a suit structured on the provisions of the ID Act. The decree favouring the plaintiff is a legal nullity and the finding of the High Court to this extent is upheld. ### Response: 0

Idbi Trusteeship Services Ltd Vs. Hubtown Ltd

another cardinal constitutional value, on the one hand, and arbitrariness on the other, are sworn enemies. The discretion that a Judge exercises under Order XXXVII to refuse leave to defend or to grant conditional or unconditional leave to defend is a discretion akin to Josephs multi-coloured coat - a large number of baffling alternatives present themselves. The life of the law not being logic but the experience of the trial Judge, is what comes to the rescue in these cases; but at the same time informed by guidelines or principles that we propose to lay down to obviate exercise of judicial discretion in an arbitrary manner. At one end of the spectrum is unconditional leave to defend, granted in all cases which present a substantial defence. At the other end of the spectrum are frivolous or vexatious defences, leading to refusal of leave to defend. In between these two extremes are various kinds of defences raised which yield conditional leave to defend in most cases. It is these defences that have to be guided by broad principles which are ultimately applied by the trial Judge so that justice is done on the facts of each given case.18. Accordingly, the principles stated in paragraph 8 of Mechelecs case will now stand superseded, given the amendment of O.XXXVII R.3, and the binding decision of four judges in Milkhirams case, as follows:a. If the defendant satisfies the Court that he has a substantial defence, that is, a defence that is likely to succeed, the plaintiff is not entitled to leave to sign judgment, and the defendant is entitled to unconditional leave to defend the suit;b. if the defendant raises triable issues indicating that he has a fair or reasonable defence, although not a positively good defence, the plaintiff is not entitled to sign judgment, and the defendant is ordinarily entitled to unconditional leave to defend;c. even if the defendant raises triable issues, if a doubt is left with the trial judge about the defendants good faith, or the genuineness of the triable issues, the trial judge may impose conditions both as to time or mode of trial, as well as payment into court or furnishing security. Care must be taken to see that the object of the provisions to assist expeditious disposal of commercial causes is not defeated. Care must also be taken to see that such triable issues are not shut out by unduly severe orders as to deposit or security;d. if the Defendant raises a defence which is plausible but improbable, the trial Judge may impose conditions as to time or mode of trial, as well as payment into court, or furnishing security. As such a defence does not raise triable issues, conditions as to deposit or security or both can extend to the entire principal sum together with such interest as the court feels the justice of the case requires.e. if the Defendant has no substantial defence and/or raises no genuine triable issues, and the court finds such defence to be frivolous or vexatious, then leave to defend the suit shall be refused, and the plaintiff is entitled to judgment forthwith;f. if any part of the amount claimed by the plaintiff is admitted by the defendant to be due from him, leave to defend the suit, (even if triable issues or a substantial defence is raised), shall not be granted unless the amount so admitted to be due is deposited by the defendant in court.19. Coming to the facts of the present case:a. It is clear that a sum of L 418 crores has been paid by FMO, the Dutch company, to Vinca for purchase of shares as well as compulsorily convertible debentures. This transaction by itself is not alleged to be violative of the FEMA regulations.b. The suit is filed only on invocation of the Corporate Guarantee which on its terms is unconditional. It may be added that it is not the defendants case that the said Corporate Guarantee is wrongly invoked.c. Payment under the said Guarantee is to the debenture trustee, an Indian company, for and on behalf of Vinca, another Indian company, so that prima facie again there is no infraction of the FEMA Regulations.d. Since FMO becomes a 99% holder of Vinca after the requisite time period has elapsed, FMO may at that stage utilise the funds received pursuant to the overall structure agreements in India. If this is so, again prima facie there is no breach of FEMA Regulations.e. At the stage that FMO wishes to repatriate such funds, RBI permission would be necessary. If RBI permission is not granted, then again there would be no infraction of FEMA Regulations.f. The judgment in Immami Appa Raos case would be attracted only if the illegal purpose is fully carried out, and not otherwise.20. Based on the aforesaid, it cannot be said that the defendant has raised a substantial defence to the claim made in the suit. Arguably at the highest, as held by the learned Single Judge, even if a triable issue may be said to arise on the application of the FEMA Regulations, nevertheless, we are left with a real doubt about the Defendants good faith and the genuineness of such a triable issue. L 418 crores has been stated to be utilized and submerged in a building construction project, with payments under the structured arrangement mentioned above admittedly being made by the concerned parties until 2011, after which payments stopped being made by them. The defence thus raised appears to us to be in the realm of being `plausible but improbable. This being the case, the plaintiff needs to be protected. In our opinion, the defendant will be granted leave to defend the suit only if it deposits in the Bombay High Court the principal sum of L 418 crores invested by FMO, or gives security for the said amount of L 418 crores, to the satisfaction of the Prothonotary and Senior Master, Bombay High Court within a period of three months from today.

1[ds]12. We find that Milkhirams case is in fact an important judgment on the scope of O.XXXVII of the CPC, and is not a judgment on principles to be applied under Section 115. This judgment, being a judgment of four learned judges of this court, set out, in paragraph 1, O.XXXVII, Rule 3 sub-rules (2) and (3) as amended by the Bombay High Court at the relevant time, asIf the defendant enters an appearance, the plaintiff shall thereafter serve on the defendant a summons for judgment returnable not less than ten clear days from the date of service supported by an affidavit verifying the cause of action and the amount claimed and stating that in his belief there is no defence to the suit.(3) The defendant may at any time within ten days from the service of such summons for judgment by affidavit or otherwise disclosing such facts as may be deemed sufficient to entitle him to defend, apply on such summons for leave to defend the suit. Leave to defend may be granted to him unconditionally or upon such terms as to the Judge appear just.It is thus clear that O.XXXVII has suffered a change in 1976, and that change has made a difference in the law laid down. First and foremost, it is important to remember that Milkhirams case is a direct authority on the amended O.XXXVII provision, as the amended provision in O.XXXVII Rule 3 is the same as the Bombay amendment which this Court was considering in the aforesaid judgment. We must hasten to add that the two provisos to sub-rule (3) were not, however, there in the Bombay amendment. These are new, and the effect to be given to them is something that we will have to decide. The position in law now is that the trial Judge is vested with a discretion which has to result in justice being done on the facts of each case. But Justice, like Equality, another cardinal constitutional value, on the one hand, and arbitrariness on the other, are sworn enemies. The discretion that a Judge exercises under Order XXXVII to refuse leave to defend or to grant conditional or unconditional leave to defend is a discretion akin to Josephs multi-coloured coat - a large number of baffling alternatives present themselves. The life of the law not being logic but the experience of the trial Judge, is what comes to the rescue in these cases; but at the same time informed by guidelines or principles that we propose to lay down to obviate exercise of judicial discretion in an arbitrary manner. At one end of the spectrum is unconditional leave to defend, granted in all cases which present a substantial defence. At the other end of the spectrum are frivolous or vexatious defences, leading to refusal of leave to defend. In between these two extremes are various kinds of defences raised which yield conditional leave to defend in most cases. It is these defences that have to be guided by broad principles which are ultimately applied by the trial Judge so that justice is done on the facts of each given case.18. Accordingly, the principles stated in paragraph 8 of Mechelecs case will now stand superseded, given the amendment of O.XXXVII R.3, and the binding decision of four judges in Milkhirams case, asIf the defendant satisfies the Court that he has a substantial defence, that is, a defence that is likely to succeed, the plaintiff is not entitled to leave to sign judgment, and the defendant is entitled to unconditional leave to defend the suit;b. if the defendant raises triable issues indicating that he has a fair or reasonable defence, although not a positively good defence, the plaintiff is not entitled to sign judgment, and the defendant is ordinarily entitled to unconditional leave to defend;c. even if the defendant raises triable issues, if a doubt is left with the trial judge about the defendants good faith, or the genuineness of the triable issues, the trial judge may impose conditions both as to time or mode of trial, as well as payment into court or furnishing security. Care must be taken to see that the object of the provisions to assist expeditious disposal of commercial causes is not defeated. Care must also be taken to see that such triable issues are not shut out by unduly severe orders as to deposit or security;d. if the Defendant raises a defence which is plausible but improbable, the trial Judge may impose conditions as to time or mode of trial, as well as payment into court, or furnishing security. As such a defence does not raise triable issues, conditions as to deposit or security or both can extend to the entire principal sum together with such interest as the court feels the justice of the case requires.e. if the Defendant has no substantial defence and/or raises no genuine triable issues, and the court finds such defence to be frivolous or vexatious, then leave to defend the suit shall be refused, and the plaintiff is entitled to judgment forthwith;f. if any part of the amount claimed by the plaintiff is admitted by the defendant to be due from him, leave to defend the suit, (even if triable issues or a substantial defence is raised), shall not be granted unless the amount so admitted to be due is deposited by the defendant incannot be said that the defendant has raised a substantial defence to the claim made in the suit. Arguably at the highest, as held by the learned Single Judge, even if a triable issue may be said to arise on the application of the FEMA Regulations, nevertheless, we are left with a real doubt about the Defendants good faith and the genuineness of such a triable issue. L 418 crores has been stated to be utilized and submerged in a building construction project, with payments under the structured arrangement mentioned above admittedly being made by the concerned parties until 2011, after which payments stopped being made by them. The defence thus raised appears to us to be in the realm of being `plausible but improbable. This being the case, the plaintiff needs to be protected. In our opinion, the defendant will be granted leave to defend the suit only if it deposits in the Bombay High Court the principal sum of L 418 crores invested by FMO, or gives security for the said amount of L 418 crores, to the satisfaction of the Prothonotary and Senior Master, Bombay High Court within a period of three months from today.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: another cardinal constitutional value, on the one hand, and arbitrariness on the other, are sworn enemies. The discretion that a Judge exercises under Order XXXVII to refuse leave to defend or to grant conditional or unconditional leave to defend is a discretion akin to Josephs multi-coloured coat - a large number of baffling alternatives present themselves. The life of the law not being logic but the experience of the trial Judge, is what comes to the rescue in these cases; but at the same time informed by guidelines or principles that we propose to lay down to obviate exercise of judicial discretion in an arbitrary manner. At one end of the spectrum is unconditional leave to defend, granted in all cases which present a substantial defence. At the other end of the spectrum are frivolous or vexatious defences, leading to refusal of leave to defend. In between these two extremes are various kinds of defences raised which yield conditional leave to defend in most cases. It is these defences that have to be guided by broad principles which are ultimately applied by the trial Judge so that justice is done on the facts of each given case.18. Accordingly, the principles stated in paragraph 8 of Mechelecs case will now stand superseded, given the amendment of O.XXXVII R.3, and the binding decision of four judges in Milkhirams case, as follows:a. If the defendant satisfies the Court that he has a substantial defence, that is, a defence that is likely to succeed, the plaintiff is not entitled to leave to sign judgment, and the defendant is entitled to unconditional leave to defend the suit;b. if the defendant raises triable issues indicating that he has a fair or reasonable defence, although not a positively good defence, the plaintiff is not entitled to sign judgment, and the defendant is ordinarily entitled to unconditional leave to defend;c. even if the defendant raises triable issues, if a doubt is left with the trial judge about the defendants good faith, or the genuineness of the triable issues, the trial judge may impose conditions both as to time or mode of trial, as well as payment into court or furnishing security. Care must be taken to see that the object of the provisions to assist expeditious disposal of commercial causes is not defeated. Care must also be taken to see that such triable issues are not shut out by unduly severe orders as to deposit or security;d. if the Defendant raises a defence which is plausible but improbable, the trial Judge may impose conditions as to time or mode of trial, as well as payment into court, or furnishing security. As such a defence does not raise triable issues, conditions as to deposit or security or both can extend to the entire principal sum together with such interest as the court feels the justice of the case requires.e. if the Defendant has no substantial defence and/or raises no genuine triable issues, and the court finds such defence to be frivolous or vexatious, then leave to defend the suit shall be refused, and the plaintiff is entitled to judgment forthwith;f. if any part of the amount claimed by the plaintiff is admitted by the defendant to be due from him, leave to defend the suit, (even if triable issues or a substantial defence is raised), shall not be granted unless the amount so admitted to be due is deposited by the defendant in court.19. Coming to the facts of the present case:a. It is clear that a sum of L 418 crores has been paid by FMO, the Dutch company, to Vinca for purchase of shares as well as compulsorily convertible debentures. This transaction by itself is not alleged to be violative of the FEMA regulations.b. The suit is filed only on invocation of the Corporate Guarantee which on its terms is unconditional. It may be added that it is not the defendants case that the said Corporate Guarantee is wrongly invoked.c. Payment under the said Guarantee is to the debenture trustee, an Indian company, for and on behalf of Vinca, another Indian company, so that prima facie again there is no infraction of the FEMA Regulations.d. Since FMO becomes a 99% holder of Vinca after the requisite time period has elapsed, FMO may at that stage utilise the funds received pursuant to the overall structure agreements in India. If this is so, again prima facie there is no breach of FEMA Regulations.e. At the stage that FMO wishes to repatriate such funds, RBI permission would be necessary. If RBI permission is not granted, then again there would be no infraction of FEMA Regulations.f. The judgment in Immami Appa Raos case would be attracted only if the illegal purpose is fully carried out, and not otherwise.20. Based on the aforesaid, it cannot be said that the defendant has raised a substantial defence to the claim made in the suit. Arguably at the highest, as held by the learned Single Judge, even if a triable issue may be said to arise on the application of the FEMA Regulations, nevertheless, we are left with a real doubt about the Defendants good faith and the genuineness of such a triable issue. L 418 crores has been stated to be utilized and submerged in a building construction project, with payments under the structured arrangement mentioned above admittedly being made by the concerned parties until 2011, after which payments stopped being made by them. The defence thus raised appears to us to be in the realm of being `plausible but improbable. This being the case, the plaintiff needs to be protected. In our opinion, the defendant will be granted leave to defend the suit only if it deposits in the Bombay High Court the principal sum of L 418 crores invested by FMO, or gives security for the said amount of L 418 crores, to the satisfaction of the Prothonotary and Senior Master, Bombay High Court within a period of three months from today. ### Response: 1

Ram Nath And Another Vs. M/S. Ram Nath Chhittar Mal And Others

protected against eviction excepting for the reasons given in the proviso. The appellants had filed the original suits for eviction under S. 13(1) proviso (g) which was as under :Section 13(1) "Notwithstanding anything to the contrary contained in any other law or any contract, no decree or order for the recovery of possession of any premises shall be passed by any court in favour of the landlord against any tenant (including a tenant whose tenancy is terminated) :Provided that nothing in this sub-section shall apply to any suit or other proceeding for such recovery of possession if the Court is satisfied -(g) that the premises are bona fide required by the landlord for the purpose of rebuilding the premises or for the replacement of the premises by any building or for the erection of other building and that such building or rebuilding cannot be carried out without the premises being vacated."Thus when the suits were brought the provisions of the Act were invoked. The decrees passed were on the basis that the premises were required by the landlord for rebuilding which falls under S. 13 and the decrees also incorporated the requirements of S. 15 which provides :"The Court shall, when passing any decree or order on the grounds specified in cl. (f) or cl. (g) of the proviso to sub-sec. (1) of S. 13 ascertain from the tenant whether he elects to be placed in occupation of the premises or part thereof from which he is to be evicted and if the tenant so elects, shall record the fact of the election in the decree or order and specify therein the date on or before which he shall deliver possession so as to enable the landlord to commerce the work of repairs or building or rebuilding, as the case may be.2. If the tenant delivers possession on or before the date specified in the decree or order, the landlord shall, on the completion of the work of repairs or building or rebuilding place the tenant in occupation of the premises or part thereof.3. If, after the tenant has delivered possession on or before the date specified in the decree or order the landlord fails to commerce the work of repairs or building or rebuilding within one month of the specified date or fails to complete the work in a reasonable time or having completed the work, fails to place the tenant in occupation of the premises in accordance with sub-sec. (2), the Court may, on the application of the tenant made within one year from the specified date, order the landlord to place the tenant in occupation of the premises or part thereof on the original terms and conditions or to pay to such tenant such compensation as may be fixed by the Court."The compromise, the order and the decree provided (1) that the respondents will vacate their respective shops on March 4, 1953, and hand over possession to the appellants; (2) they elected to get back possession after rebuilding which the appellants agreed to hand back on September 4, 1953; (3) the rent after such possession was to be determined by the court. It was contended on behalf of the appellants that the above facts taken with the circumstances that the decree was passed in a suit under S. 13(1), proviso (g) show that this was an order passed and a decree made in accordance with the terms of S. 15 of the Act. It is significant that the respondents themselves made the applications to the court under S. 15 of the Act.4. For the respondents it was argued that the decree was not one under S. 15 of the Act because the decree was based on a compromise whereby the parties fixed the date of delivery of possession to the appellants; fixed the date for completion of the rebuilding and agreed between themselves as to repossession by the respondents. It was submitted that although the time for giving delivery to the appellants was fixed in the compromise it was not of the essence of the contract.5. In our opinion the contentions raised by the appellants are well founded and the appellants must succeed. The suit for eviction were brought within the framework of the Act and were based on the provisions of S. 13 (1) proviso (g). No eviction would have been possible excepting when conditions laid down in S. 13 were satisfied. The decree which were passed were substantially in accordance with the provisions of S. 15 of the Act and as was contended by the appellants they were decrees under which the premises had to be vacated by the respondents on a specified day. Under that section they had the right to elect and did elect to get possession after rebuilding this possession was to be given by the landlords to the tenants within a reasonable time and six months period was fixed by consent between the parties and the rent, if the respondents were not put into possession on the same terms as before, was to be settled by court and that is what was done under the terms of the consent decree. The applications for being put into possession which were filed by the respondents were really under S. 15(3) of the Act. As the respondents did not deliver possession to the appellants on or before the date specified in the decree the provisions of S. 15 contained in sub-sec. (3) of that Act were not available to them and they were not entitled to be put into possession as prayed by them.6. It was argued that the appellants had taken possession of the premises after the specified date without protest and had even accepted rent upto then and were therefore estopped from raising that defence. The appellants had conceded in the courts below that plea could be raised in a suit if it was brought. In the view we have taken we think it unnecessary to express any opinion on this point.

1[ds]5. In our opinion the contentions raised by the appellants are well founded and the appellants must succeed. The suit for eviction were brought within the framework of the Act and were based on the provisions of S. 13 (1) proviso (g). No eviction would have been possible excepting when conditions laid down in S. 13 were satisfied. The decree which were passed were substantially in accordance with the provisions of S. 15 of the Act and as was contended by the appellants they were decrees under which the premises had to be vacated by the respondents on a specified day. Under that section they had the right to elect and did elect to get possession after rebuilding this possession was to be given by the landlords to the tenants within a reasonable time and six months period was fixed by consent between the parties and the rent, if the respondents were not put into possession on the same terms as before, was to be settled by court and that is what was done under the terms of the consent decree. The applications for being put into possession which were filed by the respondents were really under S. 15(3) of the Act. As the respondents did not deliver possession to the appellants on or before the date specified in the decree the provisions of S. 15 contained in sub-sec. (3) of that Act were not available to them and they were not entitled to be put into possession as prayed by them.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: protected against eviction excepting for the reasons given in the proviso. The appellants had filed the original suits for eviction under S. 13(1) proviso (g) which was as under :Section 13(1) "Notwithstanding anything to the contrary contained in any other law or any contract, no decree or order for the recovery of possession of any premises shall be passed by any court in favour of the landlord against any tenant (including a tenant whose tenancy is terminated) :Provided that nothing in this sub-section shall apply to any suit or other proceeding for such recovery of possession if the Court is satisfied -(g) that the premises are bona fide required by the landlord for the purpose of rebuilding the premises or for the replacement of the premises by any building or for the erection of other building and that such building or rebuilding cannot be carried out without the premises being vacated."Thus when the suits were brought the provisions of the Act were invoked. The decrees passed were on the basis that the premises were required by the landlord for rebuilding which falls under S. 13 and the decrees also incorporated the requirements of S. 15 which provides :"The Court shall, when passing any decree or order on the grounds specified in cl. (f) or cl. (g) of the proviso to sub-sec. (1) of S. 13 ascertain from the tenant whether he elects to be placed in occupation of the premises or part thereof from which he is to be evicted and if the tenant so elects, shall record the fact of the election in the decree or order and specify therein the date on or before which he shall deliver possession so as to enable the landlord to commerce the work of repairs or building or rebuilding, as the case may be.2. If the tenant delivers possession on or before the date specified in the decree or order, the landlord shall, on the completion of the work of repairs or building or rebuilding place the tenant in occupation of the premises or part thereof.3. If, after the tenant has delivered possession on or before the date specified in the decree or order the landlord fails to commerce the work of repairs or building or rebuilding within one month of the specified date or fails to complete the work in a reasonable time or having completed the work, fails to place the tenant in occupation of the premises in accordance with sub-sec. (2), the Court may, on the application of the tenant made within one year from the specified date, order the landlord to place the tenant in occupation of the premises or part thereof on the original terms and conditions or to pay to such tenant such compensation as may be fixed by the Court."The compromise, the order and the decree provided (1) that the respondents will vacate their respective shops on March 4, 1953, and hand over possession to the appellants; (2) they elected to get back possession after rebuilding which the appellants agreed to hand back on September 4, 1953; (3) the rent after such possession was to be determined by the court. It was contended on behalf of the appellants that the above facts taken with the circumstances that the decree was passed in a suit under S. 13(1), proviso (g) show that this was an order passed and a decree made in accordance with the terms of S. 15 of the Act. It is significant that the respondents themselves made the applications to the court under S. 15 of the Act.4. For the respondents it was argued that the decree was not one under S. 15 of the Act because the decree was based on a compromise whereby the parties fixed the date of delivery of possession to the appellants; fixed the date for completion of the rebuilding and agreed between themselves as to repossession by the respondents. It was submitted that although the time for giving delivery to the appellants was fixed in the compromise it was not of the essence of the contract.5. In our opinion the contentions raised by the appellants are well founded and the appellants must succeed. The suit for eviction were brought within the framework of the Act and were based on the provisions of S. 13 (1) proviso (g). No eviction would have been possible excepting when conditions laid down in S. 13 were satisfied. The decree which were passed were substantially in accordance with the provisions of S. 15 of the Act and as was contended by the appellants they were decrees under which the premises had to be vacated by the respondents on a specified day. Under that section they had the right to elect and did elect to get possession after rebuilding this possession was to be given by the landlords to the tenants within a reasonable time and six months period was fixed by consent between the parties and the rent, if the respondents were not put into possession on the same terms as before, was to be settled by court and that is what was done under the terms of the consent decree. The applications for being put into possession which were filed by the respondents were really under S. 15(3) of the Act. As the respondents did not deliver possession to the appellants on or before the date specified in the decree the provisions of S. 15 contained in sub-sec. (3) of that Act were not available to them and they were not entitled to be put into possession as prayed by them.6. It was argued that the appellants had taken possession of the premises after the specified date without protest and had even accepted rent upto then and were therefore estopped from raising that defence. The appellants had conceded in the courts below that plea could be raised in a suit if it was brought. In the view we have taken we think it unnecessary to express any opinion on this point. ### Response: 1

M/S. Munoth Investments Ltd Vs. M/S. Puttukola Properties Ltd.

M.B. Shah, J. Leave granted. 2. Despite service of notice, none appears on behalf of the respondents. 3. By impugned judgment and order dated 27.11.2000 the High Court of Madras allowed Criminal OP No. 14007 of 1999 and quashed the proceedings under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the Act) on the ground that there was breach of mandatory provision in issuing the notice as the cheque was returned on 13th January, 1994 and complainant issued notice on 29th January, 1994, which fell outside the period of 15 days. 4. It is the contention of the learned counsel for the appellant that appellant filed criminal complaint before the Metropolitan Magistrate, Chennai, on the ground that in respect of a liability on a promissory note, a cheque was issued in favour of the complainant on 12.1.1994 for a sum of Rs. 5 lakhs. When the cheque was presented in the blank, it was returned on 13.1.1994 with an endorsement payment stopped by drawer. Hence, appellant issued notice on 29.11.1994 which was received by the respondent on 4.2.1994. It is submitted that the appellant was informed about the dishonour of cheque only on 17.1.1994 as there were Pongal holidays between 14th and 16th January, 1994. For this purpose, he has relied upon deposition of PW 1 Gopal Krishnan, Company Secretary of the appellant-company, PW2 Shri Muralidharan, Manager, Bank of Baroda, who has stated that on 13.1.1994 cheque was received back by the bank with an endorsement payment stopped by the drawer and that debit advice was sent to the complainant on 17.1.1994 as 14th to 16th were holidays for Pongal. 5. In our view, the High Court committed material irregularity in not referring to the aforesaid evidence which was recorded by the Metropolitan Magistrate. Section 138(b) of the Act inter alia provides that the payee has to make demand for the payment of money by giving a notice to the drawer of the cheque within fifteen days of the receipt of information by him from the bank regarding the return of the cheque as unpaid. So fifteen days are to be counted from the receipt of information regarding the return of the cheque as unpaid. In the present case, it is the say of the complainant that the cheque was presented for encashment on 12th, it was returned to the bank on 13th and information was given to the complainant only on 17th, as 14th, 15th and 16th were Pongal holidays. The learned counsel fairly pointed out that in the complaint it has been stated that complainant had received intimation with regard to the return of the said cheque from his banker on 13.1.1994. However, he submitted that this is apparent mistake and for explaining that mistake the appellant has led the evidence before the trial court. Undisputedly, he pointed out that in the State of Tamilnadu 14th to 16th January, 1994 there were Pongal holidays and, therefore, appellant came to learn about the dishonour of his cheque on 17.1.1994. 6. It appears that the High Court has not considered the evidence of PW1 Gopal Krishnan and PW2 Muralidharan and has passed the impugned order holding that notice before filing the complaint under Section 138 of the Act was not issued within stipulated period of fifteen days. It also appears that the Court while quashing the criminal complaint on 27.11.2000, which was filed in 1994, did not call for the record of the proceedings of the trial court for its verification.

1[ds]5. In our view, the High Court committed material irregularity in not referring to the aforesaid evidence which was recorded by the Metropolitan Magistrate. Section 138(b) of the Act inter alia provides that the payee has to make demand for the payment of money by giving a notice to the drawer of the cheque within fifteen days of the receipt of information by him from the bank regarding the return of the cheque as unpaid. So fifteen days are to be counted from the receipt of information regarding the return of the cheque as unpaid. In the present case, it is the say of the complainant that the cheque was presented for encashment on 12th, it was returned to the bank on 13th and information was given to the complainant only on 17th, as 14th, 15th and 16th were Pongal holidays. The learned counsel fairly pointed out that in the complaint it has been stated that complainant had received intimation with regard to the return of the said cheque from his banker on 13.1.1994. However, he submitted that this is apparent mistake and for explaining that mistake the appellant has led the evidence before the trial court. Undisputedly, he pointed out that in the State of Tamilnadu 14th to 16th January, 1994 there were Pongal holidays and, therefore, appellant came to learn about the dishonour of his cheque on 17.1.19946. It appears that the High Court has not considered the evidence of PW1 Gopal Krishnan and PW2 Muralidharan and has passed the impugned order holding that notice before filing the complaint under Section 138 of the Act was not issued within stipulated period of fifteen days. It also appears that the Court while quashing the criminal complaint on 27.11.2000, which was filed in 1994, did not call for the record of the proceedings of the trial court for its verification.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: M.B. Shah, J. Leave granted. 2. Despite service of notice, none appears on behalf of the respondents. 3. By impugned judgment and order dated 27.11.2000 the High Court of Madras allowed Criminal OP No. 14007 of 1999 and quashed the proceedings under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the Act) on the ground that there was breach of mandatory provision in issuing the notice as the cheque was returned on 13th January, 1994 and complainant issued notice on 29th January, 1994, which fell outside the period of 15 days. 4. It is the contention of the learned counsel for the appellant that appellant filed criminal complaint before the Metropolitan Magistrate, Chennai, on the ground that in respect of a liability on a promissory note, a cheque was issued in favour of the complainant on 12.1.1994 for a sum of Rs. 5 lakhs. When the cheque was presented in the blank, it was returned on 13.1.1994 with an endorsement payment stopped by drawer. Hence, appellant issued notice on 29.11.1994 which was received by the respondent on 4.2.1994. It is submitted that the appellant was informed about the dishonour of cheque only on 17.1.1994 as there were Pongal holidays between 14th and 16th January, 1994. For this purpose, he has relied upon deposition of PW 1 Gopal Krishnan, Company Secretary of the appellant-company, PW2 Shri Muralidharan, Manager, Bank of Baroda, who has stated that on 13.1.1994 cheque was received back by the bank with an endorsement payment stopped by the drawer and that debit advice was sent to the complainant on 17.1.1994 as 14th to 16th were holidays for Pongal. 5. In our view, the High Court committed material irregularity in not referring to the aforesaid evidence which was recorded by the Metropolitan Magistrate. Section 138(b) of the Act inter alia provides that the payee has to make demand for the payment of money by giving a notice to the drawer of the cheque within fifteen days of the receipt of information by him from the bank regarding the return of the cheque as unpaid. So fifteen days are to be counted from the receipt of information regarding the return of the cheque as unpaid. In the present case, it is the say of the complainant that the cheque was presented for encashment on 12th, it was returned to the bank on 13th and information was given to the complainant only on 17th, as 14th, 15th and 16th were Pongal holidays. The learned counsel fairly pointed out that in the complaint it has been stated that complainant had received intimation with regard to the return of the said cheque from his banker on 13.1.1994. However, he submitted that this is apparent mistake and for explaining that mistake the appellant has led the evidence before the trial court. Undisputedly, he pointed out that in the State of Tamilnadu 14th to 16th January, 1994 there were Pongal holidays and, therefore, appellant came to learn about the dishonour of his cheque on 17.1.1994. 6. It appears that the High Court has not considered the evidence of PW1 Gopal Krishnan and PW2 Muralidharan and has passed the impugned order holding that notice before filing the complaint under Section 138 of the Act was not issued within stipulated period of fifteen days. It also appears that the Court while quashing the criminal complaint on 27.11.2000, which was filed in 1994, did not call for the record of the proceedings of the trial court for its verification. ### Response: 1

Anil Starch Products Limited Vs. Ahmedabad Chemical Workers' Union And Others

K. N. Wanchoo, J. 1. This is an appeal by special leave against the award of the Industrial Tribunal, Bombay, in a dispute between the Anil Starch Products Ltd., Ahmedabad (hereinafter referred to as the company) and its workmen, in the matter of profit bonus for the year 1953. The dispute arose over the demand made by the workmen for payment of six months wages as bonus for that year. This dispute was referred to the Industrial Tribunal by the Government of Bombay by its order dated July 15, 1955. The company had already paid one months months basic wages as bonus to its workmen and the real dispute was thus only about the remaining bonus for five months. 2. The case of the workmen was that the company had made substantial profits during the year. The wages-cum-dearness allowance paid by the company was low and therefore, profit bonus at the rate of six months wages should be granted to fill the gap between the wages paid and living wage. The company on the other hand contended that it was giving high wages and had already paid one months basic wage as profit bonus and there was no scope for further payment of bonus as the available surplus, according to the Full Bench formula did not justify it. 3. The main dispute before the Tribunal related to three items, namely -(i) Depreciation, and how it should be calculated for the purposes of the Full Bench formula ? (ii) Whether any return should be allowed on the money in the depreciation reserve fund used as working capital; and if so, what ? (iii) What should be the amount to be provided for rehabilitation ? 4. The Industrial Tribunal took into account the total statutory depreciation even though this was against the decision of the Labour Appellate Tribunal in the U. P. Electricity Supply Co., Ltd. v. Their Workmen, 1955-2 Lab LJ 431 (LATI- Bom.). The Tribunal also disallowed any return on depreciation fund, even if any part of it has been used as working capital. Lastly, it reduced the amount claimed for rehabilitation from Rs. 5.16 lacs to Rs. 2 lacs. After making the relevant calculations on this basis it came to the conclusion that there was surplus available for giving bonus at the rate of two months basic wage. It may be mentioned that bonus at the rate of one months basic wage works out at Rs. 18,000. The company thereupon applied for special leave to appeal which was granted; and that is how the matter has now come before us for decision. 5. The three points which were agitated before the Tribunal have also been raised before us. We shall first take the question of depreciation. This matter has been considered by us in Associated Cement Companies Ltd., Bombay v. Its Workmen, C. As. Nos. 459 and 460 of 1957 : (AIR 1959 SC 967 ) judgment in which is delivered today.In accordance with the decision in these appeals we are of opinion that depreciation should be allowed on the basis of what is called notional normal depreciation. Income-tax should be deducted on the basis of the amount payable, which means that the entire statutory depreciation has to be taken into account for purposes of income-tax.This is also the decision of this Court in Meenakshi Mills, Ltd., Madurai v. Commissioner of Income-tax, Madras, (1956) SCR 691 : ( (S) AIR 1957 SC 49 ). In the calculations that we are making in this appeal, this method is being followed. 6. We then come to the question whether any return should be allowed on depreciation reserve used as working capital. The Tribunal, in our opinion, was in error in not allowing any return on the depreciation reserve used as working capital.The reasons given by it for this view are, in our opinion, untenable and unsatisfactory. Method of accounting has nothing to do with the question whether a return should be allowed on depreciation reserve or such part of it as may have been actually available and used as working capital.We also cannot understand why if money is available in the depreciation reserve and has actually been used as working capital during the year, as explained in Tata Oil Mills Co., Ltd. v.Its Workmen, C. A. No. 31 of 1958 : (AIR 1959 SC 1065 ) no return should be allowed on it, simply because provision for depreciation out of which depreciation reserve is accumulated is made from year to year in the accounts. We have considered this matter at length in the appeal, C. A. No. 321 of 1958: (AIR 1959 SC 1065 ) (supra), judgment in which is delivered today, and for reasons given there we are of opinion that if there is in fact money available in the depreciation reserve and if that money is used actually as working capital as explained there, a return should be allowed on the same.Learned counsel for the respondents, however, wanted to contest that the sum of Rs. 14 lacs shown in the depreciation reserve was not available for being used as working capital. It is enough to say in that connection that an affidavit was filed by the manager of the company to the effect that all its reserves including the depreciation fund had been used as working capital. The manager appeared as a witness for the company before the Tribunal and swore that the affidavit made by him was correct. He was cross-examined as to the amount required for rehabilitation, which was also given by him in that affidavit; but no question was put to him to challenge his statement that the entire depreciation reserve had been used as working capital. The Tribunal also did not go into the question whether any money was available in the depreciation reserve fund and had been actually used as working capital. It dismissed the claim for return on the depreciation reserve on entirely different grounds.

1[ds]The Tribunal, in our opinion, was in error in not allowing any return on the depreciation reserve used as working capital.The reasons given by it for this view are, in our opinion, untenable and unsatisfactory. Method of accounting has nothing to do with the question whether a return should be allowed on depreciation reserve or such part of it as may have been actually available and used as working capital.We also cannot understand why if money is available in the depreciation reserve and has actually been used as working capital during the year, as explained in Tata Oil Mills Co., Ltd. v.Its Workmen, C. A. No. 31 of 1958 : (AIR 1959 SC 1065 ) no return should be allowed on it, simply because provision for depreciation out of which depreciation reserve is accumulated is made from year to year in the accountsWe have considered this matter at length in the appeal, C. A. No. 321 of 1958: (AIR 1959 SC 1065 ) (supra), judgment in which is delivered today, and for reasons given there we are of opinion that if there is in fact money available in the depreciation reserve and if that money is used actually as working capital as explained there, a return should be allowed on the sameIt is enough to say in that connection that an affidavit was filed by the manager of the company to the effect that all its reserves including the depreciation fund had been used as working capital. The manager appeared as a witness for the company before the Tribunal and swore that the affidavit made by him was correct. He was cross-examined as to the amount required for rehabilitation, which was also given by him in that affidavit; but no question was put to him to challenge his statement that the entire depreciation reserve had been used as working capital. The Tribunal also did not go into the question whether any money was available in the depreciation reserve fund and had been actually used as working capital. It dismissed the claim for return on the depreciation reserve on entirely different grounds7. As to the question of rehabilitation, we do not think it necessary in this appeal to go into that; for even accepting the sum of .71 lacs allowed by the Tribunal, there will be nothing left to justify the grant of any further profit bonus beyond that given by the company. This matter may be gone into again in any future adjudication that may arise8. We now come to the calculations in accordance with the Full Bench formula, subject to what we have saidIn lacs Rs

### Instruction: Given the specifics of the case proceeding, anticipate the court's ruling: will it favor (1) or oppose (0) the appellant’s request? ### Input: K. N. Wanchoo, J. 1. This is an appeal by special leave against the award of the Industrial Tribunal, Bombay, in a dispute between the Anil Starch Products Ltd., Ahmedabad (hereinafter referred to as the company) and its workmen, in the matter of profit bonus for the year 1953. The dispute arose over the demand made by the workmen for payment of six months wages as bonus for that year. This dispute was referred to the Industrial Tribunal by the Government of Bombay by its order dated July 15, 1955. The company had already paid one months months basic wages as bonus to its workmen and the real dispute was thus only about the remaining bonus for five months. 2. The case of the workmen was that the company had made substantial profits during the year. The wages-cum-dearness allowance paid by the company was low and therefore, profit bonus at the rate of six months wages should be granted to fill the gap between the wages paid and living wage. The company on the other hand contended that it was giving high wages and had already paid one months basic wage as profit bonus and there was no scope for further payment of bonus as the available surplus, according to the Full Bench formula did not justify it. 3. The main dispute before the Tribunal related to three items, namely -(i) Depreciation, and how it should be calculated for the purposes of the Full Bench formula ? (ii) Whether any return should be allowed on the money in the depreciation reserve fund used as working capital; and if so, what ? (iii) What should be the amount to be provided for rehabilitation ? 4. The Industrial Tribunal took into account the total statutory depreciation even though this was against the decision of the Labour Appellate Tribunal in the U. P. Electricity Supply Co., Ltd. v. Their Workmen, 1955-2 Lab LJ 431 (LATI- Bom.). The Tribunal also disallowed any return on depreciation fund, even if any part of it has been used as working capital. Lastly, it reduced the amount claimed for rehabilitation from Rs. 5.16 lacs to Rs. 2 lacs. After making the relevant calculations on this basis it came to the conclusion that there was surplus available for giving bonus at the rate of two months basic wage. It may be mentioned that bonus at the rate of one months basic wage works out at Rs. 18,000. The company thereupon applied for special leave to appeal which was granted; and that is how the matter has now come before us for decision. 5. The three points which were agitated before the Tribunal have also been raised before us. We shall first take the question of depreciation. This matter has been considered by us in Associated Cement Companies Ltd., Bombay v. Its Workmen, C. As. Nos. 459 and 460 of 1957 : (AIR 1959 SC 967 ) judgment in which is delivered today.In accordance with the decision in these appeals we are of opinion that depreciation should be allowed on the basis of what is called notional normal depreciation. Income-tax should be deducted on the basis of the amount payable, which means that the entire statutory depreciation has to be taken into account for purposes of income-tax.This is also the decision of this Court in Meenakshi Mills, Ltd., Madurai v. Commissioner of Income-tax, Madras, (1956) SCR 691 : ( (S) AIR 1957 SC 49 ). In the calculations that we are making in this appeal, this method is being followed. 6. We then come to the question whether any return should be allowed on depreciation reserve used as working capital. The Tribunal, in our opinion, was in error in not allowing any return on the depreciation reserve used as working capital.The reasons given by it for this view are, in our opinion, untenable and unsatisfactory. Method of accounting has nothing to do with the question whether a return should be allowed on depreciation reserve or such part of it as may have been actually available and used as working capital.We also cannot understand why if money is available in the depreciation reserve and has actually been used as working capital during the year, as explained in Tata Oil Mills Co., Ltd. v.Its Workmen, C. A. No. 31 of 1958 : (AIR 1959 SC 1065 ) no return should be allowed on it, simply because provision for depreciation out of which depreciation reserve is accumulated is made from year to year in the accounts. We have considered this matter at length in the appeal, C. A. No. 321 of 1958: (AIR 1959 SC 1065 ) (supra), judgment in which is delivered today, and for reasons given there we are of opinion that if there is in fact money available in the depreciation reserve and if that money is used actually as working capital as explained there, a return should be allowed on the same.Learned counsel for the respondents, however, wanted to contest that the sum of Rs. 14 lacs shown in the depreciation reserve was not available for being used as working capital. It is enough to say in that connection that an affidavit was filed by the manager of the company to the effect that all its reserves including the depreciation fund had been used as working capital. The manager appeared as a witness for the company before the Tribunal and swore that the affidavit made by him was correct. He was cross-examined as to the amount required for rehabilitation, which was also given by him in that affidavit; but no question was put to him to challenge his statement that the entire depreciation reserve had been used as working capital. The Tribunal also did not go into the question whether any money was available in the depreciation reserve fund and had been actually used as working capital. It dismissed the claim for return on the depreciation reserve on entirely different grounds. ### Response: 1

Union Of India Vs. M/S Popular Builders, Calcutta

the Chief Engineer, the authority under Clause 25 of the agreement to appoint an arbitrator and pursuant to the said request, the Chief Engineer by his letter dated 25.11.93 did appoint an arbitrator. Subsequently, the appointed arbitrator was changed. Pursuant to an order of the High Court and before the arbitrator, the respondent filed his claim on different heads. The Union of India-appellant herein, filed his objection as well as filed a counter claim before the arbitrator. The learned Arbitrator ultimately passed an award and that award was filed before the High Court, for being made a rule of Court under Section 14 of the Arbitration Act, 1940. The Union of India filed an objection under Sections 30 and 33 for setting aside the award. The learned Single Judge considered the objections filed by the Union of India and rejecting the same, made the award a rule of Court. Against the aforesaid order of the learned Single Judge, an appeal was carried to the Division Bench under Section 39 of the Arbitration Act. The Division Bench having dismissed the Union Governments appeal by the impugned order, the present appeal has been preferred by the Union of India. From the judgments of the learned Single Judge, rejecting the objections of the Union of India as well as the impugned judgment of the Division Bench, it appears that the Union of India had urged the sole point of limitation and the same had been negatived by the courts below and in our view rightly.3. Mr. A. Subba Rao, the learned counsel for the Union of India however raised the question that the final bill having been accepted by the respondent-contractor, without any objection, there did not subsist any arbitrable dispute to be referred to arbitration, invoking Clause 25 of the agreement and, therefore, the impugned award has to be set aside. In support of this contention, reliance has been placed on two decisions of this Court - M/s. P.K. Ramaiah and Company v. Chairman & Managing Director, National Thermal Power Corpn., 1994 Supp.(3) S.C.C. 126, as well as a three-Judge Bench decision of this Court in Nathani Steels Ltd. v. Associated Constructions, 1995 Supp.(3) S.C.C. 324.4. Mr. L. Nageswara Rao, appearing for the respondent-claimant on the other hand contended that this objection had not specifically been taken in the objection, that was filed under Sections 30 and 33 of the Arbitration Act, and, therefore, the Union Government should not be permitted to take up this plea in this forum. He further contended that pursuant to the request made by the Contractor, the Chief Engineer himself having appointed as arbitrator on the ground that dispute submits for arbitration and in the arbitration proceeding, the Union Government having fully participated and further, subsequent to the award, a rectification application having been filed by the Union Government and in that application also, only challenge being made on the quantum and not on the ground of absence of arbitrable disputes, it would not be appropriate for this Court to allow the Union Government to take this plea at this belated stage. He also contended that the two decisions referred to by the Union Government are prior the appointment of arbitrator and none of these decisions are applicable to the case in hand, where an award has been passed by the appointed arbitrator after due participation of Union Government in the arbitration proceedings.5. Having considered the rival submissions at the Bar and on careful scrutiny of the objections filed by the Union Government under Sections 30 and 33 of the Arbitration Act, though we find sufficient force in the contention of Mr. Nageswara Rao, but the existence of a dispute being the condition precedent for appointment of an arbitrator under Clause 25 and in view of the two decisions of this Court and that the respondent-claimant did receive the final bill without any protest, we are not persuaded to outright reject the contention of Mr. Subba Rao, appearing for the Union Government. It transpires from the award itself that only as against claim item No. 2, the Union of India had pleaded that the said claim cannot be entertained in view of the receipt of the final bill by the contractor without any protest, though the arbitrator had rejected the said plea of the Union of India. It is no doubt true as contended by Mr. Nageswara Rao that neither the judgment of the learned Single Judge nor the judgment of the Division Bench, which is under challenge in this appeal before this Court did indicate the fact that the Union of India had raised this contention before the aforesaid two forums below but notwithstanding the same when the existence of an arbitrable dispute is the condition precedent for exercise of power for appointment of an arbitrator under Clause 25 and since the final bill that was prepared by the appropriate authority was accepted by the respondent without any protest as is apparent from the letter of the claimant-contractor and the question had been raised before the arbitrator in respect of the claim item No. 2 by the Union of India, we think it appropriate to hold that as far as claim item No. 2 is concerned, the same could not have been a matter of reference of an arbitrable dispute and as such, the award of the arbitrator to that extent must be set aside. So far as the other claim items are concerned, the Union of India not having taken any objection to the same on the aforesaid score and that even the objection filed under Sections 30 and 33 of the Arbitration Act not being specific on that issue, we do not think it appropriate to allow the Union Government to raise that objection, so far as the other items of claim are concerned. Accordingly, the impugned award in respect of claim item No. 2 is set aside and the rest of the award amount, stand affirmed. The appeal is allowed in part. 6.

1[ds]5. Having considered the rival submissions at the Bar and on careful scrutiny of the objections filed by the Union Government under Sections 30 and 33 of the Arbitration Act, though we find sufficient force in the contention of Mr. Nageswara Rao, but the existence of a dispute being the condition precedent for appointment of an arbitrator under Clause 25 and in view of the two decisions of this Court and that the respondent-claimant did receive the final bill without any protest, we are not persuaded to outright reject the contention of Mr. Subba Rao, appearing for the Union Government. It transpires from the award itself that only as against claim item No. 2, the Union of India had pleaded that the said claim cannot be entertained in view of the receipt of the final bill by the contractor without any protest, though the arbitrator had rejected the said plea of the Union of India. It is no doubt true as contended by Mr. Nageswara Rao that neither the judgment of the learned Single Judge nor the judgment of the Division Bench, which is under challenge in this appeal before this Court did indicate the fact that the Union of India had raised this contention before the aforesaid two forums below but notwithstanding the same when the existence of an arbitrable dispute is the condition precedent for exercise of power for appointment of an arbitrator under Clause 25 and since the final bill that was prepared by the appropriate authority was accepted by the respondent without any protest as is apparent from the letter of the claimant-contractor and the question had been raised before the arbitrator in respect of the claim item No. 2 by the Union of India, we think it appropriate to hold that as far as claim item No. 2 is concerned, the same could not have been a matter of reference of an arbitrable dispute and as such, the award of the arbitrator to that extent must be set aside. So far as the other claim items are concerned, the Union of India not having taken any objection to the same on the aforesaid score and that even the objection filed under Sections 30 and 33 of the Arbitration Act not being specific on that issue, we do not think it appropriate to allow the Union Government to raise that objection, so far as the other items of claim are concerned. Accordingly, the impugned award in respect of claim item No. 2 is set aside and the rest of the award amount, stand affirmed.

### Instruction: Analyze the case proceeding and predict whether the appeal/petition will be accepted (1) or rejected (0). ### Input: the Chief Engineer, the authority under Clause 25 of the agreement to appoint an arbitrator and pursuant to the said request, the Chief Engineer by his letter dated 25.11.93 did appoint an arbitrator. Subsequently, the appointed arbitrator was changed. Pursuant to an order of the High Court and before the arbitrator, the respondent filed his claim on different heads. The Union of India-appellant herein, filed his objection as well as filed a counter claim before the arbitrator. The learned Arbitrator ultimately passed an award and that award was filed before the High Court, for being made a rule of Court under Section 14 of the Arbitration Act, 1940. The Union of India filed an objection under Sections 30 and 33 for setting aside the award. The learned Single Judge considered the objections filed by the Union of India and rejecting the same, made the award a rule of Court. Against the aforesaid order of the learned Single Judge, an appeal was carried to the Division Bench under Section 39 of the Arbitration Act. The Division Bench having dismissed the Union Governments appeal by the impugned order, the present appeal has been preferred by the Union of India. From the judgments of the learned Single Judge, rejecting the objections of the Union of India as well as the impugned judgment of the Division Bench, it appears that the Union of India had urged the sole point of limitation and the same had been negatived by the courts below and in our view rightly.3. Mr. A. Subba Rao, the learned counsel for the Union of India however raised the question that the final bill having been accepted by the respondent-contractor, without any objection, there did not subsist any arbitrable dispute to be referred to arbitration, invoking Clause 25 of the agreement and, therefore, the impugned award has to be set aside. In support of this contention, reliance has been placed on two decisions of this Court - M/s. P.K. Ramaiah and Company v. Chairman & Managing Director, National Thermal Power Corpn., 1994 Supp.(3) S.C.C. 126, as well as a three-Judge Bench decision of this Court in Nathani Steels Ltd. v. Associated Constructions, 1995 Supp.(3) S.C.C. 324.4. Mr. L. Nageswara Rao, appearing for the respondent-claimant on the other hand contended that this objection had not specifically been taken in the objection, that was filed under Sections 30 and 33 of the Arbitration Act, and, therefore, the Union Government should not be permitted to take up this plea in this forum. He further contended that pursuant to the request made by the Contractor, the Chief Engineer himself having appointed as arbitrator on the ground that dispute submits for arbitration and in the arbitration proceeding, the Union Government having fully participated and further, subsequent to the award, a rectification application having been filed by the Union Government and in that application also, only challenge being made on the quantum and not on the ground of absence of arbitrable disputes, it would not be appropriate for this Court to allow the Union Government to take this plea at this belated stage. He also contended that the two decisions referred to by the Union Government are prior the appointment of arbitrator and none of these decisions are applicable to the case in hand, where an award has been passed by the appointed arbitrator after due participation of Union Government in the arbitration proceedings.5. Having considered the rival submissions at the Bar and on careful scrutiny of the objections filed by the Union Government under Sections 30 and 33 of the Arbitration Act, though we find sufficient force in the contention of Mr. Nageswara Rao, but the existence of a dispute being the condition precedent for appointment of an arbitrator under Clause 25 and in view of the two decisions of this Court and that the respondent-claimant did receive the final bill without any protest, we are not persuaded to outright reject the contention of Mr. Subba Rao, appearing for the Union Government. It transpires from the award itself that only as against claim item No. 2, the Union of India had pleaded that the said claim cannot be entertained in view of the receipt of the final bill by the contractor without any protest, though the arbitrator had rejected the said plea of the Union of India. It is no doubt true as contended by Mr. Nageswara Rao that neither the judgment of the learned Single Judge nor the judgment of the Division Bench, which is under challenge in this appeal before this Court did indicate the fact that the Union of India had raised this contention before the aforesaid two forums below but notwithstanding the same when the existence of an arbitrable dispute is the condition precedent for exercise of power for appointment of an arbitrator under Clause 25 and since the final bill that was prepared by the appropriate authority was accepted by the respondent without any protest as is apparent from the letter of the claimant-contractor and the question had been raised before the arbitrator in respect of the claim item No. 2 by the Union of India, we think it appropriate to hold that as far as claim item No. 2 is concerned, the same could not have been a matter of reference of an arbitrable dispute and as such, the award of the arbitrator to that extent must be set aside. So far as the other claim items are concerned, the Union of India not having taken any objection to the same on the aforesaid score and that even the objection filed under Sections 30 and 33 of the Arbitration Act not being specific on that issue, we do not think it appropriate to allow the Union Government to raise that objection, so far as the other items of claim are concerned. Accordingly, the impugned award in respect of claim item No. 2 is set aside and the rest of the award amount, stand affirmed. The appeal is allowed in part. 6. ### Response: 1

Shah Mathuradas Maganlal and Company Vs. Nagappa Shankarappa Malage and Others

to exist only up to 6 November, 1953. On the redemption of the mortgage the respondent had a right to recover possession both on the terms of the mortgage deed and under section 62 of the transfer of Property Act.The second feature in the Mortgage Deed is that the appellant was given power to sub-let. Section 15 of the Bombay, Rents, Hotel and Lodging House Rates Control Act, 1947 as it stood in 1953 forbade any sub-letting. In 1959 the words but subject to any contract to the contrary were introduced into the said section 15, with the result that in the absence of the contract to the contrary, the tenant is not to sub-let or transfer. Before 1959 there could be no subletting. In the Mortgage Deed, there is provision for sub-letting. The provision for sub-letting shows that the character of tenant is lost.Third, the mortgagor is to do repair works and is also to undertake repairs.Fourth, the possession was to be under the agreement. Though the Mortgage Deed was made on 21 May, 1953, the tenancy was continued till about 7 November, 1953. The possession of the appellant as mortgagee was confirmed from 7 November, 1953. This is rightly held to be unequivocal conduct showing that no tenancy was to exist from 7 November, 1953 but the relationship was that of mortgagor and mortgagee. If the intention of the parties was to revive the tenancy there was no necessity of a term that the appellant might let out the property to any one.The contention of the appellant was that there was no surrender and there was marger of the interest of the mortgagee and the tenant. Ordinarily, the doctrine of marger applies to extinction of mortgage security. This occurs by the marger of a lower in a higher security and by the merger of a lesser estate in greater estate. Where the capacity in which a person in possession of the mortgagees rights is something quite different from the capacity in which he is in possession of the equity of redemption, the mere fact that the two capacities are united in the same physical person cannot result in a marger."For a marger to arise, it is necessary that a lesser e state and a higher estate should merge in one person at one and the same time and in the same right, and no interest in the property should remain outsion. In the case of a lease the estate that is in the lessor is a reversion. In the case of a mortgage the estate that is outstanding is the equity of redemption of the mortgagtor. Therefore, there cannot be a merger of lease and mortgage in respect of the same property since neither of them is a higher or leaser estate. than the other. The view expressed in Narayan v. Ramchandra (1) is correct.6. Section 111 of the Transfer of Property Act is clauses (e) and (f) deal with surrender, and in clause (d) with merger. Clause (d) states that lease in movable properties determines in case t he interest of the lessee or the lessor in the whole of the property becomes vested at the same time in one person in the same right. When a leasehold and a reversion coincide there is a merger of a lesser estate in the greater. The leasehold is t he lesser estate, for it is carved out of the estate of the owner, which is the reversion. The lesser estate is merged in the greater. The lease determines and merges in the reversion. If the lessor purchases the lessees interest, the lease is extinguished, as the same man cannot be at the same time both landlord and tenant. The interests of the lessor and of the lessee must be in the whole of the property, otherwise there is no merger. The interest of the lessor and the lessee in the whole of the property should become vested at the same time in one person in the same right. Thus a lease is not extinguished because the lessee purchases a part of the reversion.A surrender under clauses (e) and (f) of section 111 of the Transfer of Property Act, is an yielding up of the term of the lessees interest to him who has the immediate reversion or the lessors interest. It takes effect like a contract by mutual consent on the lessors acceptance of the act of the lessee. The lessee cannot, therefore, surrender unless the term is vested in him; and the surrender must be to a person in whom the immediate reversion expectant on the term is vested. Implied surrender by operation of law occurs by the creation of a new relationship, or by relinquishment of possession. It the lessee accepts a new lease that in itself is a surrender. Surrender can also be implied from the consent of the parties or from such facts as the relinquishment of pos session by the lessee and taking over possession by the lessor. Relinquishment of possession operates as an implied surrender. There must be a taking of possession, not necessarily a physical taking, but something amounting to a virtual taking of possession. Whether this has occurred is a question of fact. In the present case if the mortgagor was not able to redeem the appellant mortgagee was to enjoy the property in accordance with the terms of the mortgage and also to sell the property for recovery of debts. This feature shows that appellant surrendered the tenancy from 7 November, 1953.7. In the present case the terms of the deed show that the mortgagee undertook to deliver possession of the property to the mortgagor on the expiry of a period of 10 years. The Mortgage Deed shows that the tenancy was surrendered on 7 November, 1963 and thereafter the possession was only that of mortgagor. There would be no question of the tenancy being kept in abeyance or the tenancy reviving on the expiration of the period of mortgage.

0[ds]For a marger to arise, it is necessary that a lesser e state and a higher estate should merge in one person at one and the same time and in the same right, and no interest in the property should remain outsion. In the case of a lease the estate that is in the lessor is a reversion. In the case of a mortgage the estate that is outstanding is the equity of redemption of the mortgagtor. Therefore, there cannot be a merger of lease and mortgage in respect of the same property since neither of them is a higher or leaser estate. than the other. The view expressed in Narayan v. Ramchandra (1) is111 of the Transfer of Property Act is clauses (e) and (f) deal with surrender, and in clause (d) with merger. Clause (d) states that lease in movable properties determines in case t he interest of the lessee or the lessor in the whole of the property becomes vested at the same time in one person in the same right. When a leasehold and a reversion coincide there is a merger of a lesser estate in the greater. The leasehold is t he lesser estate, for it is carved out of the estate of the owner, which is the reversion. The lesser estate is merged in the greater. The lease determines and merges in the reversion. If the lessor purchases the lessees interest, the lease is extinguished, as the same man cannot be at the same time both landlord and tenant. The interests of the lessor and of the lessee must be in the whole of the property, otherwise there is no merger. The interest of the lessor and the lessee in the whole of the property should become vested at the same time in one person in the same right. Thus a lease is not extinguished because the lessee purchases a part of the reversion.A surrender under clauses (e) and (f) of section 111 of the Transfer of Property Act, is an yielding up of the term of the lessees interest to him who has the immediate reversion or the lessors interest. It takes effect like a contract by mutual consent on the lessors acceptance of the act of the lessee. The lessee cannot, therefore, surrender unless the term is vested in him; and the surrender must be to a person in whom the immediate reversion expectant on the term is vested. Implied surrender by operation of law occurs by the creation of a new relationship, or by relinquishment of possession. It the lessee accepts a new lease that in itself is a surrender. Surrender can also be implied from the consent of the parties or from such facts as the relinquishment of pos session by the lessee and taking over possession by the lessor. Relinquishment of possession operates as an implied surrender. There must be a taking of possession, not necessarily a physical taking, but something amounting to a virtual taking of possession. Whether this has occurred is a question of fact. In the present case if the mortgagor was not able to redeem the appellant mortgagee was to enjoy the property in accordance with the terms of the mortgage and also to sell the property for recovery of debts. This feature shows that appellant surrendered the tenancy from 7 November,the present case the terms of the deed show that the mortgagee undertook to deliver possession of the property to the mortgagor on the expiry of a period of 10 years. The Mortgage Deed shows that the tenancy was surrendered on 7 November, 1963 and thereafter the possession was only that of mortgagor. There would be no question of the tenancy being kept in abeyance or the tenancy reviving on the expiration of the period of mortgage.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: to exist only up to 6 November, 1953. On the redemption of the mortgage the respondent had a right to recover possession both on the terms of the mortgage deed and under section 62 of the transfer of Property Act.The second feature in the Mortgage Deed is that the appellant was given power to sub-let. Section 15 of the Bombay, Rents, Hotel and Lodging House Rates Control Act, 1947 as it stood in 1953 forbade any sub-letting. In 1959 the words but subject to any contract to the contrary were introduced into the said section 15, with the result that in the absence of the contract to the contrary, the tenant is not to sub-let or transfer. Before 1959 there could be no subletting. In the Mortgage Deed, there is provision for sub-letting. The provision for sub-letting shows that the character of tenant is lost.Third, the mortgagor is to do repair works and is also to undertake repairs.Fourth, the possession was to be under the agreement. Though the Mortgage Deed was made on 21 May, 1953, the tenancy was continued till about 7 November, 1953. The possession of the appellant as mortgagee was confirmed from 7 November, 1953. This is rightly held to be unequivocal conduct showing that no tenancy was to exist from 7 November, 1953 but the relationship was that of mortgagor and mortgagee. If the intention of the parties was to revive the tenancy there was no necessity of a term that the appellant might let out the property to any one.The contention of the appellant was that there was no surrender and there was marger of the interest of the mortgagee and the tenant. Ordinarily, the doctrine of marger applies to extinction of mortgage security. This occurs by the marger of a lower in a higher security and by the merger of a lesser estate in greater estate. Where the capacity in which a person in possession of the mortgagees rights is something quite different from the capacity in which he is in possession of the equity of redemption, the mere fact that the two capacities are united in the same physical person cannot result in a marger."For a marger to arise, it is necessary that a lesser e state and a higher estate should merge in one person at one and the same time and in the same right, and no interest in the property should remain outsion. In the case of a lease the estate that is in the lessor is a reversion. In the case of a mortgage the estate that is outstanding is the equity of redemption of the mortgagtor. Therefore, there cannot be a merger of lease and mortgage in respect of the same property since neither of them is a higher or leaser estate. than the other. The view expressed in Narayan v. Ramchandra (1) is correct.6. Section 111 of the Transfer of Property Act is clauses (e) and (f) deal with surrender, and in clause (d) with merger. Clause (d) states that lease in movable properties determines in case t he interest of the lessee or the lessor in the whole of the property becomes vested at the same time in one person in the same right. When a leasehold and a reversion coincide there is a merger of a lesser estate in the greater. The leasehold is t he lesser estate, for it is carved out of the estate of the owner, which is the reversion. The lesser estate is merged in the greater. The lease determines and merges in the reversion. If the lessor purchases the lessees interest, the lease is extinguished, as the same man cannot be at the same time both landlord and tenant. The interests of the lessor and of the lessee must be in the whole of the property, otherwise there is no merger. The interest of the lessor and the lessee in the whole of the property should become vested at the same time in one person in the same right. Thus a lease is not extinguished because the lessee purchases a part of the reversion.A surrender under clauses (e) and (f) of section 111 of the Transfer of Property Act, is an yielding up of the term of the lessees interest to him who has the immediate reversion or the lessors interest. It takes effect like a contract by mutual consent on the lessors acceptance of the act of the lessee. The lessee cannot, therefore, surrender unless the term is vested in him; and the surrender must be to a person in whom the immediate reversion expectant on the term is vested. Implied surrender by operation of law occurs by the creation of a new relationship, or by relinquishment of possession. It the lessee accepts a new lease that in itself is a surrender. Surrender can also be implied from the consent of the parties or from such facts as the relinquishment of pos session by the lessee and taking over possession by the lessor. Relinquishment of possession operates as an implied surrender. There must be a taking of possession, not necessarily a physical taking, but something amounting to a virtual taking of possession. Whether this has occurred is a question of fact. In the present case if the mortgagor was not able to redeem the appellant mortgagee was to enjoy the property in accordance with the terms of the mortgage and also to sell the property for recovery of debts. This feature shows that appellant surrendered the tenancy from 7 November, 1953.7. In the present case the terms of the deed show that the mortgagee undertook to deliver possession of the property to the mortgagor on the expiry of a period of 10 years. The Mortgage Deed shows that the tenancy was surrendered on 7 November, 1963 and thereafter the possession was only that of mortgagor. There would be no question of the tenancy being kept in abeyance or the tenancy reviving on the expiration of the period of mortgage. ### Response: 0

M/S Hira Lall & Sons & Ors Vs. M/S Lakhsmi Commercial Bank

Babu, J. 1. This is a petition filed for transfer of original application No. 846 of 1996 pending before the Debts Recovery Tribunal (hereinafter referred to as "the Tribunal") to the High Court of Delhi. 2. The allegations in the application before the Tribunal are that the petitioners requested for opening Letters of Credit in favour of M/s. Palmex Enterprises of Singapore for a sum of US dollars 205992.51 to cover the payment of consignment of PVC, C & F Bombay; that the respondent issued letter of credit in favour of the said seller for the said sum; that the letter of credit was transmitted to the seller through a negotiating bank authorising him under this Letter of Credit and the claim reimbursement by debiting the account of respondent-bank with their New York office; that the seller is purported to have shipped goods on 30.8.1979 and negotiated documents as required under the Letter of Credit on 31.8.1979 with the negotiating bank; that the negotiating bank made the payment and on receipt of the original documents the issuing bank presented them to the buyer and asked the buyer to pay the amount; that the petitioner did not pay and hence the application before the Tribunal. The petitioner took the stand that it had come to know that the ship carrying the goods had sunk; that this fact was informed to the bank and the documents of goods were received by the respondent as sent by the petitioner; that the bank lodged formal claims with the Insurance Company under copy to the petitioner; that the bank retired the documents despite non-acceptance by the petitioner and informed the petitioner accordingly; that the petitioner informed the respondent of their negligence; that a suit had been filed by the respondent-bank against the petitioners on 9.7.1980; that the leave to defend having been refused, a decree was passed; that an appeal was filed against the order refusing the grant leave. In the meanwhile, the Recovery of Debts Due to Bank and Financial Institutions Act, 1993 (hereinafter referred to as "the Act") came into force which established a Tribunal thereunder to exercise the jurisdiction, power and authority under the Act in respect of cases filed by the banks and financial institutions. Thus, the aforesaid suit also stood transferred to the Tribunal. It is claim that there are several cases of similar nature pending before the High Court wherein on account of sinking of the ships importers lodged claims with the Insurance Companies, while Banks filed suits against the various importers under the Letters of Credit since importers disputed documents as discrepant and not in terms thereof. On refusal by the Insurance Companies to pay the claims of the importers, they filed suits for recovery of insurance claim. It is contended that in the suits filed by importers against Insurance Companies and in the suits filed by the Banks certain common issues arise. Therefore, it is prayed that this matter should be re-transferred to the High Court. The petitioners request is strongly resisted by the respondent. 3. It is clear that Article 139-A of the Constitution is not attracted to cases of this nature as this is not a case where transfer of a case from one High Court to another High Court is sought for. It is also doubtful whether Section 25 of the Code of Civil Procedure would be applicable since the transfer of the proceeding is not from one State to another State. Whether inherent jurisdiction of this Court would be attracted to a proceeding of this nature is also in doubt. However, it may not be necessary to go into that aspect of the matter in the view we propose to take in this case. 4. This is an application based on a Letter of Credit. The settled legal position is that a Letter of Credit constitutes sole contract with the banker and its authorising the bank issuing Letter of Credit has no concern with any question that may arise between the seller and the purchaser of goods in respect of the purchase price; that there should, however, be strict compliance both by the customer at whose instance Letter of Credit was issued and by the banker, with his instructions; that in a claim on Letter of Credit defence of fraud or apprehension of irretrievable injustice or non-compliance with instructions could also be raised. All such defences could be urged or agitated before the Tribunal by the petitioner and on a decision by it, an appeal also could be filed. 5. A suit based on insurance claim and a claim based on Letter of Credit arise out of different causes of action though it may be true that in the case pending before the High Court against Insurance Company and in the application before the Tribunal certain common issues may arise. The exact nature of the other suits filed by other parties which are stated to be pending in the High Court and the cause for retention on its file is not available on record. Apart from this fact, we may notice that when exclusive jurisdiction has been given to the Tribunal under the Act in respect of matters that could be dealt with under Section 17 of the Act, the jurisdiction in other courts to entertain and decide such matters for recovery of debts due to banks and financial institutions stood ousted as provided under Section 18 of the Act. Further Section 31 of the Act provides for transfer of case from civil courts to the Tribunal. Our view in this regard is consistent with what has been enunciated in Union of India & Anr. vs. Delhi High Court Bar Association & Ors. (2002) 2 SCR 450 , wherein this Court, after examining the entire scheme of the Act, upheld the constitutional validity of the same. 6. In this background, we do not think that it is expedient for the ends of justice to direct transfer of this case to the High Court.

0[ds]The settled legal position is that a Letter of Credit constitutes sole contract with the banker and its authorising the bank issuing Letter of Credit has no concern with any question that may arise between the seller and the purchaser of goods in respect of the purchase price; that there should, however, be strict compliance both by the customer at whose instance Letter of Credit was issued and by the banker, with his instructions; that in a claim on Letter of Credit defence of fraud or apprehension of irretrievable injustice or non-compliance with instructions could also be raised. All such defences could be urged or agitated before the Tribunal by the petitioner and on a decision by it, an appeal also could befrom this fact, we may notice that when exclusive jurisdiction has been given to the Tribunal under the Act in respect of matters that could be dealt with under Section 17 of the Act, the jurisdiction in other courts to entertain and decide such matters for recovery of debts due to banks and financial institutions stood ousted as provided under Section 18 of the Act. Further Section 31 of the Act provides for transfer of case from civil courts to the Tribunal. Our view in this regard is consistent with what has been enunciated in Union of India & Anr. vs. Delhi High Court Bar Association & Ors. (2002) 2 SCR 450 , wherein this Court, after examining the entire scheme of the Act, upheld the constitutional validity of the same.

### Instruction: Analyze the case proceeding and predict whether the appeal/petition will be accepted (1) or rejected (0). ### Input: Babu, J. 1. This is a petition filed for transfer of original application No. 846 of 1996 pending before the Debts Recovery Tribunal (hereinafter referred to as "the Tribunal") to the High Court of Delhi. 2. The allegations in the application before the Tribunal are that the petitioners requested for opening Letters of Credit in favour of M/s. Palmex Enterprises of Singapore for a sum of US dollars 205992.51 to cover the payment of consignment of PVC, C & F Bombay; that the respondent issued letter of credit in favour of the said seller for the said sum; that the letter of credit was transmitted to the seller through a negotiating bank authorising him under this Letter of Credit and the claim reimbursement by debiting the account of respondent-bank with their New York office; that the seller is purported to have shipped goods on 30.8.1979 and negotiated documents as required under the Letter of Credit on 31.8.1979 with the negotiating bank; that the negotiating bank made the payment and on receipt of the original documents the issuing bank presented them to the buyer and asked the buyer to pay the amount; that the petitioner did not pay and hence the application before the Tribunal. The petitioner took the stand that it had come to know that the ship carrying the goods had sunk; that this fact was informed to the bank and the documents of goods were received by the respondent as sent by the petitioner; that the bank lodged formal claims with the Insurance Company under copy to the petitioner; that the bank retired the documents despite non-acceptance by the petitioner and informed the petitioner accordingly; that the petitioner informed the respondent of their negligence; that a suit had been filed by the respondent-bank against the petitioners on 9.7.1980; that the leave to defend having been refused, a decree was passed; that an appeal was filed against the order refusing the grant leave. In the meanwhile, the Recovery of Debts Due to Bank and Financial Institutions Act, 1993 (hereinafter referred to as "the Act") came into force which established a Tribunal thereunder to exercise the jurisdiction, power and authority under the Act in respect of cases filed by the banks and financial institutions. Thus, the aforesaid suit also stood transferred to the Tribunal. It is claim that there are several cases of similar nature pending before the High Court wherein on account of sinking of the ships importers lodged claims with the Insurance Companies, while Banks filed suits against the various importers under the Letters of Credit since importers disputed documents as discrepant and not in terms thereof. On refusal by the Insurance Companies to pay the claims of the importers, they filed suits for recovery of insurance claim. It is contended that in the suits filed by importers against Insurance Companies and in the suits filed by the Banks certain common issues arise. Therefore, it is prayed that this matter should be re-transferred to the High Court. The petitioners request is strongly resisted by the respondent. 3. It is clear that Article 139-A of the Constitution is not attracted to cases of this nature as this is not a case where transfer of a case from one High Court to another High Court is sought for. It is also doubtful whether Section 25 of the Code of Civil Procedure would be applicable since the transfer of the proceeding is not from one State to another State. Whether inherent jurisdiction of this Court would be attracted to a proceeding of this nature is also in doubt. However, it may not be necessary to go into that aspect of the matter in the view we propose to take in this case. 4. This is an application based on a Letter of Credit. The settled legal position is that a Letter of Credit constitutes sole contract with the banker and its authorising the bank issuing Letter of Credit has no concern with any question that may arise between the seller and the purchaser of goods in respect of the purchase price; that there should, however, be strict compliance both by the customer at whose instance Letter of Credit was issued and by the banker, with his instructions; that in a claim on Letter of Credit defence of fraud or apprehension of irretrievable injustice or non-compliance with instructions could also be raised. All such defences could be urged or agitated before the Tribunal by the petitioner and on a decision by it, an appeal also could be filed. 5. A suit based on insurance claim and a claim based on Letter of Credit arise out of different causes of action though it may be true that in the case pending before the High Court against Insurance Company and in the application before the Tribunal certain common issues may arise. The exact nature of the other suits filed by other parties which are stated to be pending in the High Court and the cause for retention on its file is not available on record. Apart from this fact, we may notice that when exclusive jurisdiction has been given to the Tribunal under the Act in respect of matters that could be dealt with under Section 17 of the Act, the jurisdiction in other courts to entertain and decide such matters for recovery of debts due to banks and financial institutions stood ousted as provided under Section 18 of the Act. Further Section 31 of the Act provides for transfer of case from civil courts to the Tribunal. Our view in this regard is consistent with what has been enunciated in Union of India & Anr. vs. Delhi High Court Bar Association & Ors. (2002) 2 SCR 450 , wherein this Court, after examining the entire scheme of the Act, upheld the constitutional validity of the same. 6. In this background, we do not think that it is expedient for the ends of justice to direct transfer of this case to the High Court. ### Response: 0

Carl Still G.M.B.H. & Another Vs. State of Bihar & Others

It follows that the agreement dated December 19, 1953, being a contract for the construction of works, one and indivisible, the respondents have no right to impose a tax on the materials supplied in execution of that contract on the footing that such supply is a sale.11. It is next contended for the respondents that, whatever the merits of the contentions based on the construction of the contract, the proper forum to agitate them would be the authorities constituted under the Act to hear and decide disputes relating to assessment of tax, that it was open to the appellants to satisfy those authorities that there have been no sales such as are liable to be taxed, that indeed they were bound to pursue the remedies under the Act before they could invoke the jurisdiction of the Court under Art. 226 and that the learned Judges of the High Court were, therefore, right in declining to entertain the present petitions. It is true that if a statute sets up a Tribunal and confides to it jurisdiction over certain matters and if a proceeding is properly taken before it in respect of such matters, the High Court will not, in the exercise of its extraordinary jurisdiction under Art. 226, issue a prerogative writ so as to remove the proceedings out of the hands of the Tribunal or interfere with their course before it. But it is equally well settled that, when proceedings are taken before a Tribunal under a provision of law, which is ultra vires, it is open to a party aggrieved thereby to move the court under Art. 226 for issuing appropriate writs for quashing them on the ground that they are incompetent, without his being obliged to wait until those proceedings run their full course. That has been held by this Court in State of Bombay v. The United Motors (India) Ltd., 1953 SCR 1069 at p. 1077 : (AIR 1953 SC 252 at p. 256), Himmatlal Harilal Mehta v. State of M. P., 1954 SCR 1122 at p. 1127 : (AIR 1954 SC 403 at p. 405) and The Bengal Immunity Co. Ltd. v. The State of Bihar, (1955) 2 SCR 603 at pp. 617, 619, 764-766 : ((S) AIR 1955 SC 661 at pp. 668, 669, 726-727). The position that emerges is that, if the proceedings before the Sales Tax Officer are founded on the provisions of the Act, which authorizes the levy of the tax on the supply of materials in construction contracts, then they must in view of the decision in 1939 SCR 379 : (AIR 1958 SC 560 ) be held to be incompetent and quashed. But if the proceedings relate to any extent to sales otherwise than under the contract, then the enquiry with respect to them must proceed before the authorities under the Act and the application under Art. 226 must fail.12. We must now examine the true scope of the proceedings before the Sales Tax Officer in the light of the above principles. We start with this that the Act contains provisions imposing a tax on the supply of materials under a construction contract. The appellants were indisputably engaged in construction works under the agreement dated December 19, 1953, and it is not suggested that they were carrying on any independent business as dealers in the State of Bihar. Presumably, therefore, when the sales tax authorities took proceeding against them, it was in respect of materials supplied by them under their contract dated December 19, 1953. When the appellants, in response to the notice issued by the third respondent, contested their liability to be taxed, it was on the ground that the supplies of materials under the contract were not sales. When the appellants next moved the court under Art. 226 for quashing the proceedings, they urged that the provisions of the Act, in so far as they purported to impose a tax on the materials supplied in the performance of the contract, as if they were sold, were ultra vires. If the respondents sought to tax the appellants on the footing that sales of materials were effected outside the contract, it was their duty to have put that case forward in answer to the petition. They did nothing of the kind. They did not file even a counter-statement. At the time of the argument when faced with the decision of this Court in 1959 SCR 379 : (AIR 1958 SC 560 ) their entire case was that the agreement between the parties should be construed as involving a sale of materials, and that their value could be ascertained from the invoices, account books and the course of dealings between the parties. No contention was urged that there were sales of materials which fell outside the agreement between the appellants and the Owner. The learned Judges of the High Court in dismissing the petitions made it clear that the investigation before the sales tax authorities must be as regards their liability to pay sales tax "upon proper construction of the contract." In this Court also, the respondents seek in their statement to maintain the liability of the appellants only on the basis of the contract, reliance being placed on Cl. 15 already referred to and on S. 9 of the Sale of Goods Act. There is no claim that the appellants are liable on the basis of sales falling outside the agreement. It was stated before us for the appellants, and not contradicted by the respondents, that the Sindri Fertilisers and Chemicals (Private) Ltd., is a company controlled by the Government. If that is so, the respondents were at all times in possession of facts which would have shown whether the appellants entered into any transaction de hors the agreement, and it is significant that at no stage have they alleged any such facts. We are satisfied that the proceedings have at all stages gone on the footing that the liability of the appellants arose under the contract and not otherwise.

1[ds]8. It is clear from the above clauses that the subject matter of the agreement was the installation of the coke oven battery and its accessories, that the sum of Rs. 2,31,50,000 was the price agreed to be paid for the execution of those works, and that there was no agreement for the sale of materials, as such by the appellants to the owner. In other words, the agreement in question is a contract entire and indivisible for the construction of specified works for a lump sum and not a contract of sale of materials as such.The argument based on S. 9 of the Sale of Goods Act is, in our opinion, equally unsound. What that section enacts is that where there is a contract of sale of movables but the price is not mentioned, it has to be fixed either in the manner provided in the agreement or by having regard to the course of dealings between the parties, and where that is not possible, the buyer has to pay the seller a reasonable price. But the section presupposes that there is a contract of sale of goods, and, as held in 1959 SCR 379 : AIR 1958 SC 560 ) such a contract requires that there must have been an agreement between the parties for the sale of the very goods in which eventually property passes. If, as held by us, Cl. 15 does not embody an agreement for the sale of materials as such, there is no contract of sale with respect to them and S. 9 of the Sale of Goods Act can have no application.The contention, therefore, that Cl. 15 of the agreement could be read as amounting to a contract of sale of materials, and that the price therefor could be fixed as provided in S. 9 of the Sale of Goods Act by recourse to the account books of the appellants or the invoices or the course of dealings between them and the owner,must be rejected as untenable. It follows that the agreement dated December 19, 1953, being a contract for the construction of works, one and indivisible, the respondents have no right to impose a tax on the materials supplied in execution of that contract on the footing that such supply is ais true that if a statute sets up a Tribunal and confides to it jurisdiction over certain matters and if a proceeding is properly taken before it in respect of such matters, the High Court will not, in the exercise of its extraordinary jurisdiction under Art. 226, issue a prerogative writ so as to remove the proceedings out of the hands of the Tribunal or interfere with their course before it. But it is equally well settled that, when proceedings are taken before a Tribunal under a provision of law, which is ultra vires, it is open to a party aggrieved thereby to move the court under Art. 226 for issuing appropriate writs for quashing them on the ground that they are incompetent, without his being obliged to wait until those proceedings run their full course. That has been held by this Court in State of Bombay v. The United Motors (India) Ltd., 1953 SCR 1069 at p. 1077 : (AIR 1953 SC 252 at p. 256), Himmatlal Harilal Mehta v. State of M. P., 1954 SCR 1122 at p. 1127 : (AIR 1954 SC 403 at p. 405) and The Bengal Immunity Co. Ltd. v. The State of Bihar, (1955) 2 SCR 603 at pp. 617, 619, 764-766 : ((S) AIR 1955 SC 661 at pp. 668, 669, 726-727). The position that emerges is that, if the proceedings before the Sales Tax Officer are founded on the provisions of the Act, which authorizes the levy of the tax on the supply of materials in construction contracts, then they must in view of the decision in 1939 SCR 379 : (AIR 1958 SC 560 ) be held to be incompetent and quashed. But if the proceedings relate to any extent to sales otherwise than under the contract, then the enquiry with respect to them must proceed before the authorities under the Act and the application under Art. 226 mustthe respondents sought to tax the appellants on the footing that sales of materials were effected outside the contract, it was their duty to have put that case forward in answer to the petition. They did nothing of the kind. They did not file even a counter-statement. At the time of the argument when faced with the decision of this Court in 1959 SCR 379 : (AIR 1958 SC 560 ) their entire case was that the agreement between the parties should be construed as involving a sale of materials, and that their value could be ascertained from the invoices, account books and the course of dealings between the parties. No contention was urged that there were sales of materials which fell outside the agreement between the appellants and the Owner. The learned Judges of the High Court in dismissing the petitions made it clear that the investigation before the sales tax authorities must be as regards their liability to pay sales tax "upon proper construction of the contract." In this Court also, the respondents seek in their statement to maintain the liability of the appellants only on the basis of the contract, reliance being placed on Cl. 15 already referred to and on S. 9 of the Sale of Goods Act. There is no claim that the appellants are liable on the basis of sales falling outside the agreement. It was stated before us for the appellants, and not contradicted by the respondents, that the Sindri Fertilisers and Chemicals (Private) Ltd., is a company controlled by the Government. If that is so, the respondents were at all times in possession of facts which would have shown whether the appellants entered into any transaction de hors the agreement, and it is significant that at no stage have they alleged any such facts. We are satisfied that the proceedings have at all stages gone on the footing that the liability of the appellants arose under the contract and not

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: It follows that the agreement dated December 19, 1953, being a contract for the construction of works, one and indivisible, the respondents have no right to impose a tax on the materials supplied in execution of that contract on the footing that such supply is a sale.11. It is next contended for the respondents that, whatever the merits of the contentions based on the construction of the contract, the proper forum to agitate them would be the authorities constituted under the Act to hear and decide disputes relating to assessment of tax, that it was open to the appellants to satisfy those authorities that there have been no sales such as are liable to be taxed, that indeed they were bound to pursue the remedies under the Act before they could invoke the jurisdiction of the Court under Art. 226 and that the learned Judges of the High Court were, therefore, right in declining to entertain the present petitions. It is true that if a statute sets up a Tribunal and confides to it jurisdiction over certain matters and if a proceeding is properly taken before it in respect of such matters, the High Court will not, in the exercise of its extraordinary jurisdiction under Art. 226, issue a prerogative writ so as to remove the proceedings out of the hands of the Tribunal or interfere with their course before it. But it is equally well settled that, when proceedings are taken before a Tribunal under a provision of law, which is ultra vires, it is open to a party aggrieved thereby to move the court under Art. 226 for issuing appropriate writs for quashing them on the ground that they are incompetent, without his being obliged to wait until those proceedings run their full course. That has been held by this Court in State of Bombay v. The United Motors (India) Ltd., 1953 SCR 1069 at p. 1077 : (AIR 1953 SC 252 at p. 256), Himmatlal Harilal Mehta v. State of M. P., 1954 SCR 1122 at p. 1127 : (AIR 1954 SC 403 at p. 405) and The Bengal Immunity Co. Ltd. v. The State of Bihar, (1955) 2 SCR 603 at pp. 617, 619, 764-766 : ((S) AIR 1955 SC 661 at pp. 668, 669, 726-727). The position that emerges is that, if the proceedings before the Sales Tax Officer are founded on the provisions of the Act, which authorizes the levy of the tax on the supply of materials in construction contracts, then they must in view of the decision in 1939 SCR 379 : (AIR 1958 SC 560 ) be held to be incompetent and quashed. But if the proceedings relate to any extent to sales otherwise than under the contract, then the enquiry with respect to them must proceed before the authorities under the Act and the application under Art. 226 must fail.12. We must now examine the true scope of the proceedings before the Sales Tax Officer in the light of the above principles. We start with this that the Act contains provisions imposing a tax on the supply of materials under a construction contract. The appellants were indisputably engaged in construction works under the agreement dated December 19, 1953, and it is not suggested that they were carrying on any independent business as dealers in the State of Bihar. Presumably, therefore, when the sales tax authorities took proceeding against them, it was in respect of materials supplied by them under their contract dated December 19, 1953. When the appellants, in response to the notice issued by the third respondent, contested their liability to be taxed, it was on the ground that the supplies of materials under the contract were not sales. When the appellants next moved the court under Art. 226 for quashing the proceedings, they urged that the provisions of the Act, in so far as they purported to impose a tax on the materials supplied in the performance of the contract, as if they were sold, were ultra vires. If the respondents sought to tax the appellants on the footing that sales of materials were effected outside the contract, it was their duty to have put that case forward in answer to the petition. They did nothing of the kind. They did not file even a counter-statement. At the time of the argument when faced with the decision of this Court in 1959 SCR 379 : (AIR 1958 SC 560 ) their entire case was that the agreement between the parties should be construed as involving a sale of materials, and that their value could be ascertained from the invoices, account books and the course of dealings between the parties. No contention was urged that there were sales of materials which fell outside the agreement between the appellants and the Owner. The learned Judges of the High Court in dismissing the petitions made it clear that the investigation before the sales tax authorities must be as regards their liability to pay sales tax "upon proper construction of the contract." In this Court also, the respondents seek in their statement to maintain the liability of the appellants only on the basis of the contract, reliance being placed on Cl. 15 already referred to and on S. 9 of the Sale of Goods Act. There is no claim that the appellants are liable on the basis of sales falling outside the agreement. It was stated before us for the appellants, and not contradicted by the respondents, that the Sindri Fertilisers and Chemicals (Private) Ltd., is a company controlled by the Government. If that is so, the respondents were at all times in possession of facts which would have shown whether the appellants entered into any transaction de hors the agreement, and it is significant that at no stage have they alleged any such facts. We are satisfied that the proceedings have at all stages gone on the footing that the liability of the appellants arose under the contract and not otherwise. ### Response: 1

Bajaj Auto Limited Vs. Western Maharashtra Development Corporation Limited

when the act agreed to be done is such that compensation in money for its non-performance would not afford adequate relief. In the case of a contract to transfer movable property, normally specific performance is not granted except in circumstances specified in the explanation to Section 10. One of the exceptions is where the property is of special value or interest to the plaintiff, or consists of goods which are not easily obtainable in the market. It has been held by a long line of authority that shares in a private limited company would come within the phrase not easily obtainable in the market (see Jainarain Ram Lundia v. Surajmull Sagarmull[AIR 1949 FC 211 : 1949 FCR 379] , AIR at p. 218). The Privy Council in Bank of India Ltd. v. Jamsetji A.H. Chinoy [AIR 1950 PC 90 : 77 IA 76] (AIR p. 96, para 21) said:It is also the opinion of the Board that, having regard to the nature of the Company and the limited market for its shares, damages would not be an adequate remedy.The specific performance of a contract for transfers of shares in a private limited company could be granted.145. In Rangaraj case [(1992) 1 SCC 160 : AIR 1992 SC 453 ] relied upon by the respondents, an agreement was entered into between the members of the family who were the only shareholders of a private company. The agreement was that for all times to come each of the branches of the family would always continue to hold equal number of shares and that if any member in either of the branches wished to sell his share/shares, he would give the first option of purchase to the members of that branch and only if the offer so made was not accepted, the shares would be sold to others. This was a blanket restriction on all the shareholders, present and future. Contrary to the agreement, one of the shareholders of one branch sold his shares to members of the second branch. Such sale was challenged in a suit as being void and not binding on the other shareholders. This Court rejected the challenge holding that the agreement imposed a restriction on shareholders rights to transfer shares which was contrary to the Articles of Association of the Company. It was, therefore, held that such a restriction was not binding on the Company or its shareholders. The decision is entirely distinguishable on facts. There is no such restriction on the transferability of shares in the Karar. It was an agreement between particular shareholders relating to the transfer of specified shares, namely, those inherited from the late Sukumaran and Madhavi, inter se. It was unnecessary for the Company or the other shareholders to be a party to the agreement. As provided in clause 10 of the Karar , Exhibits R-59 and R-60 did not obviate compliance with the Karar. Both Exts. R-59 and R-60 were executed on 15-7-1985, several months prior to the Karar. The parties who had consciously entered into the agreement regarding the transfer of their parents shares are, therefore, obliged to act in terms of the Karar. The defence of Ravi and Srinivasan based on Exts. R-59 and R-60 should not, in the circumstances, have been accepted by the Division Bench. Having regard to the nature of the shareholding, on the basis of the law as enunciated by the Federal Court and the Privy Council in the decisions noted above, it must be held that the Karar was specifically performable.(emphasis supplied)44. We must mention here that the Division Bench of this Court in Messer Holdings Ltd.(Supra) has relied upon the judgment of the Supreme Court in Madhusoodhanans case to come to the conclusions that it did.45. We must also make note of the fact that the view expressed in Rangarajs case has not been subscribed to by a three Judge Bench of the Supreme Court in the case of Vodafone International Holdings BV vs. Union of India and Another(2012) 6 SCC 613 ). Though the issue before us did not directly arise before the Supreme Court in Vodafones case, at paragraphs 261 and 262 of the said judgment, the Supreme Court opined as under:-Shareholders agreement261. Shareholders Agreement (for short SHA) is essentially a contract between some or all other shareholders in a company, the purpose of which is to confer rights and impose obligations over and above those provided by the company law. SHA is a private contract between the shareholders compared to the articles of association of the company, which is a public document. Being a private document it binds parties thereof and not the other remaining shareholders in the company . Advantage of SHA is that it gives greater flexibility, unlike the articles of association. It also makes provisions for resolution of any dispute between the shareholders and also how the future capital contributions have to be made. Provisions of the SHA may also go contrary to the provisions of the articles of association, in that event, naturally provisions of the articles of association would govern and not the provisions made in SHA.262. The nature of SHA was considered by a two-Judge Bench of this Court in V.B. Rangaraj v . V.B. Gopalakrishnan [(1992) 1 SCC 160] . In that case, an agreement was entered into between shareholders of a private company wherein a restriction was imposed on a living member of the company to transfer his shares only to a member of his own branch of the family, such restrictions were, however, not envisaged or provided for within the articles of association. This Court has taken the view that provisions of the shareholders agreement imposing restrictions even when consistent with company legislation, are to be authorised only when they are incorporated in the articles of association, a view we do not subscribe to.(emphasis supplied)In view of the above discussion, we find that the reliance placed by the Respondent on the judgment of the Supreme Court in Rangarajs case is wholly misplaced.

1[ds]d with the judgment in Messer Holdings Ltd., Mr. Khambatta, the learned senior counsel appearing on behalf of the Respondent, submitted that whether a particular clause was a restriction on transferability of shares had to be necessarily decided on a case to case basis. He submitted that the facts in the case of Messer Holdings Ltd.(Supra) were materially different than the ones before us. The first distinguishing feature he pointed out was that, under Clause 6.1 in Messer Holdings Ltd., there was no restriction on price whereas Clause 7 of the Protocol Agreement before us compelled the Respondent to sell the shares at a price not determined by the Respondent but determined through the process of arbitration. According to Mr Khambatta, this was a very significant distinguishing feature.We cannot agree. We do not think that this distinguishing feature can make any difference to the ratio laid down in Messer Holdings Ltd. Once it is held that consensual agreements/arrangements entered into by the shareholders of a public company with a third party regarding his own specified shares (either by way of sale,or otherwise), do not impinge on free transferability of shares as contemplated under sectionthis so called distinction pails into insignificance. If the parties are free to enter into a consensual arrangement which does not infract free transferability as contemplated under sectionwe see no reason to hold that merely because the price of the shares is to be determined by the process of arbitration, the same would to be in violation of sectionThe fact that the price of the shares is to be determined by the process of arbitration is also a term of the very same consensual arrangement which is not violative of the provisions of sectionWe, therefore, find no substance in this argument.36.The second distinguishing feature that Mr. Khambatta sought to highlight is that in the facts of our case, this consensual arrangement as set out in clause 7 of the Protocol Agreement was also incorporated in Articles of Association of MSL whereas that was not the case before the Division Bench in the case of Messer Holdings Ltd. In furtherance of this argument, Mr. Khambatta submitted that the Protocol Agreement and more particularly Clause 7 thereof, was incorporated into the Articles of MSL and was therefore subsumed therein and did not independently survive. Once it was subsumed in the Articles and the same could not be incorporated the Articles of a public company, the same could notin a different avatar, was the submission.We cannot agree with this argument. Merely because the Protocol Agreement was incorporated into the Articles of MSL, does not mean that the Protocol Agreement by itself (or clause 7 thereof) ceased to exist. The Protocol Agreement governs the rights and liabilities of the parties thereto and would continue notwithstanding the fact that they were incorporated in the Articles of MSL. Therefore, even if we are to assume that such a clause was not permissible in the Articles of a public company, that would not in any way destroy the rights created under the said Agreementbetween the parties. The rights and liabilities created under the said Protocol Agreement would continue to bind the parties thereto. Even if we are to hold that the company (namely MSL) was not bound by the terms of the Protocol Agreement, it would only mean that if the Respondent sought to sell their shareholding in breach of Clause 7 of the Protocol Agreement, the company (MSL) would not be in a position to refuse such transfer, in the absence of any Court or other judicial authority granting an injunction restraining it from doing so. This does not mean that the parties to the Protocol Agreement cannot, in appropriate proceedings, seek to enforce its terms. It is one thing to say that the said clause will not bind the company and it is wholly another to contend that the said clause would not bind the parties thereto. We are, therefore, of the view that notwithstanding the fact that the Protocol Agreement was incorporated in the Articles of Association of MSL, the same would not change the nature of that agreement namely being a consensual agreement/arrangement entered into between the parties determining the manner in which each party is allowed to dispose of its particular shareholding. At the highest and assuming everything in favour of the Respondent, it could be only be held that such a clause would not bind the company. However, it would certainly bind the parties to the Protocol Agreement. We, therefore, find no substance in this argument.37. Even otherwise, we find force in the argument of Mr. Chinoy that such a clause (clause 7), even if incorporated in the Articles of Association of a public company, would not in any way violate the principles of free transferability of shares as contemplated under section111A of the CompaniesAct. Clause 7 of the Protocol Agreement and which finds place in the Articles of MSL by virtue of incorporation of the Protocol Agreement in its Articles, only sets out how the Respondent and the Appellant are to deal with their respective shareholdings. It is not a blanketclause which binds all the shareholders of MSL to sell their shares only to other members of MSL, which clauses are incorporated in the Articles of Association of a private company.clauses in the Articles of a private company are in the nature of a blanket restriction on all its members, and such clauses if incorporated in the Articles of a public company would certainly amount to a restriction on free transferability of shares as envisaged under sectionHowever, that is not the case before us. Clause 7 of the Protocol Agreement and which has been incorporated in the Articles of Association of MSL, only relates to the shareholding of the Appellant and the Respondent and their rights and liabilities in relation thereto. It does not in any way affect the rights and/or liabilities of the other members of MSL. In this view of the matter, we are of the view that merely because Clause 7 of the Protocol Agreement was incorporated in the Articles of MSL, would not invalidate the same. We are also persuaded to take this view because we find that in todays global reality, joint ventures are extremely common and clauses similar to Clause 7 of the Protocol Agreement may become necessary to ensure that a joint promotor of a company does not sell his shareholding to a competitor who then possibly could get control of his rival. In this view of the matter and looking to the totality of the facts and circumstances of the case, we are clearly of the view that Clause 7 of the Protocol Agreement does not in any way impinge upon the principle of free transferability of shares as contemplated under section111A of the Companiese are unable to uphold the order of the learned Single Judge insofar as it set aside the impugned award on the ground that Clause 7 of the Protocol Agreement imposed a restriction on free transferability of shares as contemplated under section111A of the CompaniesAct, 1956.42. Having held so, we shall now deal with the judgments relied upon by Mr. Khambatta. Thefirst two judgments of the Supreme Court relied upon by Mr. Khambatta are in the case of Needle Industries Ltd (Supra) and Darius Kavasmaneck (Supra).On going through the aforesaid judgments, we do not find anything therein that supports the contentions of the Respondent as raised herein. Neither of these judgments decide the issue that an agreement voluntarily entered into by an individual shareholder giving a right ofto a third person regarding his own shares, constitutes a restriction imposed on the right of a shareholder to transfer his shares and is therefore accordingly impermissible by virtue of section111A of the CompaniesAct. The said two judgments hold that a private company, by virtue of section 3(1)(iii), must contain provisions in its Articles of Association placing a restriction on the right of shareholders to transfer their shares, whilst a public company cannot have such a general restriction on transfer of shares by its members. We do not see how these judgments can be of any assistance in deciding the issue raised before us.Following the letter of 27th October 2003, a joint reference to arbitration was made on 29th December, 2003. The terms of reference contained an express statement of fact that the Appellant had expressed its willingness to buy the stake held by the Respondent in MSL and that the Respondent indicated its desire to sell its stake in MSL. However, what remained in dispute was the price per share to be determined, and hence, in accordance with Clause 7 of the Protocol Agreement, the question of rate at which the Appellant was to purchase the equity shares held by the Respondent in MSL, was being referred. All this material would clearly indicate that there was a concluded contract between the parties as on 3rd May, 2003 and looking at the letter dated 27th October, 2003 as well as the joint reference dated 29th December 2003, clearly establishes that even the parties understood it to be so. If according to the Respondent there was no concluded contract, then there would have been no occasion to either address the letter dated 27th October, 2003 to the Arbitrator or make a joint reference to him under clause 7 of the Protocol Agreement for determining the rate at which the shareholding of the Respondent would be sold to the Appellant. It is only for the first time in the application filed by the Respondent before the Arbitrator on 6th April 2004, that the Respondent sought to question as to whether a concluded contract had been arrived at. This to our mind was obviously anand was a clear deviation from the manner in which the Respondent had understood the course of dealings between the parties. We therefore have no hesitation in holding that on the basis of the correspondence exchanged between the parties and the Arbitrator, there was a concluded contract for sale of the Respondents 27% shareholding in MSL to the Appellant. The only question that the Arbitrator had to decide was the rate at which the said shares were to be sold as contemplated under Clause 7 of the Protocol Agreement and it was on this basis that a joint reference was made to the Arbitrator. We, therefore, are unable to agree with the submission of Mr Samdani that on reading the correspondence between the parties viz. the letters dated 9th April 2003, 3rd May 2003, 10th May, 2003 and 6th June, 2003 it was established that there was no concluded contract as on 3rd May, 2003.59. We are also unable to agree with the submission of Mr Samdani that because the parties were notwith respect to the date on which the valuation was required to be done, there was no concluded contract or that determining the same was outside the scope of the joint reference made to the Arbitrator. It may be noted that the joint reference was made to the Arbitrator on the basis that there was a concluded contract between the parties with reference to the sale of the Respondents 27% shareholding in MSL to the Appellant. The only question that the Arbitrator was required to decide was the rate at which the said shareholding ought to be sold. In deciding this question, necessarily as a matter of fact, the Arbitrator had to ascertain the date on which the shares of the Respondent were to be valued. A decision on the date was an integral part of deciding the rate at which the Respondents 27% shareholding was to be sold to the Appellant.60. To our mind, this is also contemplated in the joint reference dated 29th December, 2003 which specifically states that the Arbitrator shall take into account the Protocol Agreement covenants and all other concerned factors which may have an impact on the share price of MSL shares while giving the arbitral award. It cannot seriously be disputed that the date of valuation would certainly be one of the factors which would have an impact on the share price of MSL shares.61. The Arbitrator held that the relevant date of valuation would be 3rd May 2003, which was the date on which the concluded contract was arrived at between the parties. In our view, in holding so, the Arbitrator had not transgressed and / or exceeded his jurisdiction, and the determination of the date on which the valuation was to be done, was very much within the scope of the joint reference dated 29th December, 2003. We find that the Arbitrator has correctly taken the date as 3rd May, 2003 being the date when a concluded contract was arrived at between the parties for the sale of the Respondents 27% shareholding in MSL to the Appellant. We find that the Arbitrator has dealt with this issue in detail from paragraphs 30 to 36 of the award. We do not find any perversity in the same. Similarly, we find that the learned Single Judge has dealt with this issue in paragraphs 16 to 19 of the impugned order and we are in full agreement with the reasoning contained therein. This contention, therefore, of Mr Samdani will also have to beMSL is a listed Company whose shares are quoted on the Stock Exchange. Despite this, both the valuers viz. Mr Raghuram as well as Mr Bansi Mehta did not adopt this method of valuation because the average quoted price of MSL shares in 2003 was approx Rs.65/per share which did not reflect its true value. It is for this reason that both the valuers adopted the NAV method with one distinction viz. Mr Raghuram valued it on a going concern basis without giving any discounts whereas Mr Bansi Mehta valued it on a liquidation basis and for the purposes of valuation, took into account certain discounts.In the facts of the present case, as stated earlier, Mr Raghuram as well as Mr Bansi Mehta both preferred to adopt the NAV method (which is really speaking thevalue method, or valuation with reference to the assets of the company) subject to one distinction, viz. that Mr Raghuram adopted the NAV method on a going concern basis without taking into account any discounts, whereas Mr Bansi Mehta adopted the NAV method on a liquidation basis and took into account certain discounts for the purposes of valuation. This was done by Mr. Bansi Mehta in view of the peculiar circumstances of MSLs functioning and the fact that its operating segment was not only making repeated losses over the years but that admittedly it was incapable of making any profits. Both the aforesaid reports were considered in detail by thetaking into consideration the totality of the facts of the case and he peculiar circumstances of MSLs functioning and the fact that its operating segment (core business) was not only making repeated losses over the years, but admittedly it was incapable of making any profits, the Arbitrator accepted the valuation of Mr. Bansi Mehta, which valued the shares of MSL on the NAV method on liquidation basis. It has come on record that the net profit of a company of this magnitude for the financial year 2003, was merely Rs. 34 lacs after adjusting the operating loss of Rs.5 Crores against the income received from the investments. As stated earlier, the core business of MSL (assembling scooters) was not only suffering repeated losses over the years but was not even in a position tolet alone make any profits. We, therefore, find that the learned Arbitrator committed no error in accepting Mr. Bansi Mehtas valuation report which values the shares of MSL on the NAV method on a liquidation basis. The Arbitrator has accepted said report of Mr. Bansi Mehta after carefully taking into consideration the evidence of Mr. Bansi Mehta as well as his cross examination. Looking to the reasoning and the analysis of the evidence done by the Arbitrator, we do not think that the arbitral award suffers from any patent illegality or perversity either entitling the learned single judge (under section 34) or us (under section 37) to interfere with the same. We therefore find that the learned Single Judge rightly declined to interfere with the arbitral award on this issue. We must also mention here that the only distinction that was sought to be made by Mr Samdani between the going concern valuation and the liquidation basis valuation was that when the valuation was done on the NAV method on a going concern basis, there was no question of taking into account any discounts, whilst arriving at the valuation. However, Mr Samdani was unable to make good this submission. We fail to see on what basis this submission is made. To our mind discounts are to be applied on the market value of the assets because what has to be worked out is what a shareholder can expect to get after all the assets of the Company are notionally sold and in abstract theory the entire sale proceeds are distributed to the shareholders. Whatever dues the Company would have to pay (statutory or otherwise) whilst selling its assets would have to be taken into account whilst arriving at the market value of the assets being sold. This to our mind, would be the position whether you value the Company on the NAV method on a going concern basis or on the NAV method on a liquidation basis. We therefore fail to see on what basis it is submitted that when a Company is valued on the NAV method on a going concern basis, there is no question of any discounts.In the facts of the present case, we have already found that Mr Bansi Mehta adopted a recognised method of valuation which was accepted by the Arbitrator and did not proceed on a fundamentally erroneous basis so that the said valuation could be assailed. As stated earlier, Mr Bansi Mehta chose to value the shares of MSL by adopting the NAV method on a liquidation basis looking to the peculiar functioning of MSL and the facts and circumstances of the case. Furthermore, it is not as if Mr Bansi Mehtas valuation report was treated as gospel truth and accepted by the Arbitrator. The Arbitrator took into account the first and the second valuation reports of Mr Raghuram as well as the valuation report of Mr Bansi Mehta and after analyzing the detailed evidence led by the parties in relation to the said reports, sought to accept Mr Bansi Mehtas report subject to two changes as indicated earlier. Valuation being a question of fact as laid down by the Supreme Court in G.L. Sultanias case, coupled with the fact that the scope of interference with an arbitral award under section 34 of the Act is in any case only on certain limited parameters, we would be entitled to interfere with the award only if it is demonstrated that by accepting the discounts taken into consideration by Mr. Bansi Mehta in his valuation report, the Arbitrator committed any patent illegality or the award suffered from the vice of perversity.77. Having said this, we shall now deal with each of the discounts independently. The first discount taken into account was an amount of Rs.30 crores towards VRS (Voluntary Retirement Scheme). Before we deal with this discount on merits, we must mention here that as rightly submitted by Mr Chinoy, no such ground is taken in section 34 petition and neither was the said contention urged before the learned Single Judge. In fact the contentions raised before the learned Single Judge have been listed at paragraph 13 of the impugned order and there is no mention of this contention. This is probably why we find no discussion on this issue in the impugned judgment. We would therefore be justified in not allowing Mr Samdani to urge this contention for the first time before us.In addition to the aforesaid, we may also note that Mr Raghuram himself in his first report (as on 30th June 2002), considering the value of MSL shares on the NAV method on a liquidation basis, had also provided for an adjustment of Rs.222.44 million towards VRS costs. This in fact has been taken note of even by the Arbitrator in paragraph 60 of the arbitral award. We therefore do not find any illegality or perversity in the arbitral award when this adjustment towards VRS was taken into account for the purpose of arriving at the valuation of MSL shares. This argument of Mr Samdani will therefore have to bemust note what Mr. Bansi Mehta has stated in his valuation report as well as his evidence before the Arbitrator. Mr Bansi Mehta has pointed out that in valuing the shares of MSL on the basis of thevalue of its assets on a notional liquidation, what has to be worked out is what a shareholder can expect to get if the investee company (in this case, MSL) were to realize its investment, and in abstract theory distribute the entire proceeds of such asset sale to its shareholders.The Arbitrator, after taking note of all the material on record, held that if MSL was to sell the BAL shares held by it, MSL would have to pay 10.5% towards capital gains tax, would have to transfer 10% of the receipt to Reserves and would have to pay 12.5% plus surcharge as the dividend tax. It is on this basis, and after carefully considering the evidence of Mr. Bansi Mehta, that the Arbitrator has discounted sale value of BAL shares by 30%. We also find that if the shares of MSL were required to be valued on the basis of the NAV method on a notional sale / liquidation basis, the value amount realized by a notional sale of its assets, would necessarily have to be discounted/reduced by the costs which would have to be statutorily incurred on such notional sale.Looking to the valuation report and the evidence of Mr. Bansi Mehta, as well as the detailed reasoning of the Arbitrator on this aspect, we are unable to agree with Mr. Samdani that the Arbitrator committed any fundamental error whilst accepting the discount of 30% on the sale value of BAL shares. We do not find any perversity or patent illegality or any error apparent on the face of the award that makes it vulnerable to challenge on this aspect. This argument of Mr. Samdani would therefore also have to be rejected.However, in the facts of the present case, we find the reliance placed on the aforesaid provisions as wholly misplaced. As noted earlier, Mr. Bansi Mehta in his evidence clearly stipulated in paragraph 5.4 of his report that the fair market value of BAL shares must allow for a discount of about 30% and that the BAL shares held by MSL valued at the six monthly average rate set out in Appendix5 of his valuation report should be further discounted by no less than the 30%. It is on the basis of this evidence that the Arbitrator had applied the discount of 30% to the value of BAL shares. This figure of 30% is directly traceable to the evidence of Mr. Bansi Mehta, who has in categorical terms stated that the discount should be no less than the 30%. The observations of the Arbitrator in paragraph 100 of the arbitral award fixing the 30% discount on the ground that it should be just, fair and reasonable and would meet the ends of justice, cannot be read in isolation or be utilized to suggest that the Arbitrator was applying his own notion of what was fair, equitable and just. We, therefore, do not find any substance in this argument.91. However, whilst we are dealing with paragraph 100 of the arbitral award, it would be important to mention that in one area, there is an error of fact on the part of the Arbitrator where he refers to the first report of Raghuram as having indicated a discount of 30% to 40%. Admittedly, the discount that was referred to in the first report of Raghuram dealt with the discount on MSLs shares and not BAL shares. On this aspect, the Arbitrator has clearly made a mistake. However, we do not think that the mistake is such that would vitiate the entire arbitral award. As discussed earlier, there was a wealth of evidence before the Arbitrator and which was accepted by him, to demonstrate that a discount of 30% on the sale value of BAL shares was sustainable, both on a conceptual as well as an empirical basis.Mr. Bansi Mehta, therefore, has stated his reasons for taking the book value of theshares/investments as opposed to their market value. He has further stated that he has adopted this approach since he believed that there may not be any material difference between the market value and the book value of these pure financial assets. He has further stated that prima facie almost the entire appreciation may have arisen on account of MSLs share holding in BAL which were considered separately in the valuation report and have been valued on their market value. In answer to Question No.164 also, Mr. Bansi Mehta has stated that theinvestments can beeasily and his own data indicated that there was not much appreciation in these investments. As there was no material appreciation on these investments, Mr. Bansi Mehta thought that it was a fit case to value theinvestments on their book value as opposed to their market value. Mr. Bansi Mehta, in answer to Question No.173, has explained that if he had valued these investments on the market value basis, he would have had to apply a discount to that value as was done in the case of BAL shares and in such an eventuality the market value of these investments would have been lower than their book value. This is the justification given by Mr. Bansi Mehta for valuing theshares/investments on their book value as opposed to their market value.95. On going through the evidence of Mr. Bansi Mehta as well as the reasoning of the Arbitrator, we do not find any fundamental error in the approach of Mr. Bansi Mehta in valuing theshares/investments on a book value basis as opposed to their market value. There is cogent justification with evidence for valuing theshares/investments on their book value as opposed to their market value. We also find that the learned Single Judge has followed the same reasoning in paragraph 31 of the impugned order and we fully agree with the reasoning contained therein. We, therefore, are unable to agree with the submissions of Mr. Samdani that because theshares/investments were valued at their book value, the same was a fundamental error in the approach of valuation that opened up the arbitral award to challenge. This argument of Mr. Samdani would also therefore have to be rejected.On the aspect of control premium, we note that this issue has been discussed in great detail by the Arbitrator in paragraphs 59, 65, 74 and 75 of the arbitral award. The Arbitrator, in paragraph 59 of the arbitral award has referred to the first valuation report of Mr Raghuram (as on 30th June, 2002) where he himself concluded that though the sale of the Respondents 27% shareholding to the Appellant would give the Appellant 51% shareholding in MSL, the nature of the shareholders agreement between the Appellant and the Respondent had already bestowed effective management control to the Appellant without boardroom control. Mr Raghuram therefore himself concluded that the peculiar nature of the shareholders agreement between the Appellant and the Respondent would imply that the rationale for control premium might not exist. The conclusion of Mr Raghuram in the said first valuation report was that taking into consideration the peculiar nature of the shareholders agreement between the Appellant and the Respondent would result in a market discount being offered to an alternative potential buyer to compensate for the lack of effective control.Having opined in his first valuation report that instead of any control premium being applied, the circumstances called for a discount being given on account of the fact that the Appellant was already having management control, Mr Raghuram in his second report did a complete turn around and concluded that in the same circumstances as stated above, a control premium to the extent of 84.85 % would be applicable and that too on the fair value of share and not the market value thereof, which at that time was approximately Rs.65/per share. The Arbitrator considered all these factors (especially in paragraphs 59, 65, 70, 74 and 75 of the award) and concluded that there was no basis for the inclusion / addition of any control premium. We find that the Arbitrator has considered all the relevant evidence placed before him and then come to the conclusion that the rationale for control premium would, therefore, not exist in the facts of this case. We do not think that the findings of the Arbitrator on this aspect suffer from any perversity or patent illegality, entitling us to interfere with the same under section 34 of the Arbitration and Conciliation Act, 1996.99. For the reasons stated earlier in this judgment, we do not find any merit in the Cross Objections. We must mention here that under the arbitral award, the Arbitrator directed that the 30,85,712 equity shares of MSL held by the Respondent herein, are to be valued for the purpose of sale to the Appellant at Rs.151.63/per share. As per the said direction, the amount that would have to be paid by the Appellant to the Respondent for the purchase of the said 30,85,712 equity shares would come to Rs.46,78,86,510.56. In the peculiar facts and circumstances of the case, and considering the fact that this amount has admittedly not been paid till date by the Appellant to the Respondent herein, we think that the interests of justice would be served, if this amount is paid by the Appellant to the Respondent together with simple interest @ 18% per annum from the date of the Award (14th January, 2006) till payment.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: when the act agreed to be done is such that compensation in money for its non-performance would not afford adequate relief. In the case of a contract to transfer movable property, normally specific performance is not granted except in circumstances specified in the explanation to Section 10. One of the exceptions is where the property is of special value or interest to the plaintiff, or consists of goods which are not easily obtainable in the market. It has been held by a long line of authority that shares in a private limited company would come within the phrase not easily obtainable in the market (see Jainarain Ram Lundia v. Surajmull Sagarmull[AIR 1949 FC 211 : 1949 FCR 379] , AIR at p. 218). The Privy Council in Bank of India Ltd. v. Jamsetji A.H. Chinoy [AIR 1950 PC 90 : 77 IA 76] (AIR p. 96, para 21) said:It is also the opinion of the Board that, having regard to the nature of the Company and the limited market for its shares, damages would not be an adequate remedy.The specific performance of a contract for transfers of shares in a private limited company could be granted.145. In Rangaraj case [(1992) 1 SCC 160 : AIR 1992 SC 453 ] relied upon by the respondents, an agreement was entered into between the members of the family who were the only shareholders of a private company. The agreement was that for all times to come each of the branches of the family would always continue to hold equal number of shares and that if any member in either of the branches wished to sell his share/shares, he would give the first option of purchase to the members of that branch and only if the offer so made was not accepted, the shares would be sold to others. This was a blanket restriction on all the shareholders, present and future. Contrary to the agreement, one of the shareholders of one branch sold his shares to members of the second branch. Such sale was challenged in a suit as being void and not binding on the other shareholders. This Court rejected the challenge holding that the agreement imposed a restriction on shareholders rights to transfer shares which was contrary to the Articles of Association of the Company. It was, therefore, held that such a restriction was not binding on the Company or its shareholders. The decision is entirely distinguishable on facts. There is no such restriction on the transferability of shares in the Karar. It was an agreement between particular shareholders relating to the transfer of specified shares, namely, those inherited from the late Sukumaran and Madhavi, inter se. It was unnecessary for the Company or the other shareholders to be a party to the agreement. As provided in clause 10 of the Karar , Exhibits R-59 and R-60 did not obviate compliance with the Karar. Both Exts. R-59 and R-60 were executed on 15-7-1985, several months prior to the Karar. The parties who had consciously entered into the agreement regarding the transfer of their parents shares are, therefore, obliged to act in terms of the Karar. The defence of Ravi and Srinivasan based on Exts. R-59 and R-60 should not, in the circumstances, have been accepted by the Division Bench. Having regard to the nature of the shareholding, on the basis of the law as enunciated by the Federal Court and the Privy Council in the decisions noted above, it must be held that the Karar was specifically performable.(emphasis supplied)44. We must mention here that the Division Bench of this Court in Messer Holdings Ltd.(Supra) has relied upon the judgment of the Supreme Court in Madhusoodhanans case to come to the conclusions that it did.45. We must also make note of the fact that the view expressed in Rangarajs case has not been subscribed to by a three Judge Bench of the Supreme Court in the case of Vodafone International Holdings BV vs. Union of India and Another(2012) 6 SCC 613 ). Though the issue before us did not directly arise before the Supreme Court in Vodafones case, at paragraphs 261 and 262 of the said judgment, the Supreme Court opined as under:-Shareholders agreement261. Shareholders Agreement (for short SHA) is essentially a contract between some or all other shareholders in a company, the purpose of which is to confer rights and impose obligations over and above those provided by the company law. SHA is a private contract between the shareholders compared to the articles of association of the company, which is a public document. Being a private document it binds parties thereof and not the other remaining shareholders in the company . Advantage of SHA is that it gives greater flexibility, unlike the articles of association. It also makes provisions for resolution of any dispute between the shareholders and also how the future capital contributions have to be made. Provisions of the SHA may also go contrary to the provisions of the articles of association, in that event, naturally provisions of the articles of association would govern and not the provisions made in SHA.262. The nature of SHA was considered by a two-Judge Bench of this Court in V.B. Rangaraj v . V.B. Gopalakrishnan [(1992) 1 SCC 160] . In that case, an agreement was entered into between shareholders of a private company wherein a restriction was imposed on a living member of the company to transfer his shares only to a member of his own branch of the family, such restrictions were, however, not envisaged or provided for within the articles of association. This Court has taken the view that provisions of the shareholders agreement imposing restrictions even when consistent with company legislation, are to be authorised only when they are incorporated in the articles of association, a view we do not subscribe to.(emphasis supplied)In view of the above discussion, we find that the reliance placed by the Respondent on the judgment of the Supreme Court in Rangarajs case is wholly misplaced. ### Response: 1

State Of U.P. Vs. Ram Daras Yadav

on security duty on 19.2.1990 from 0200 hours to 0400 hours aimed rifle at Gajendra Kumar Singh and threatened to eliminate him. A preliminary enquiry was conducted in the aforesaid incident by the Company Commander who prima facie found that the respondent had behaved in an indisciplined manner and he also made an unsuccessful attempt to harm his colleague constable Gajendra Kumar Singh. It was concluded in the preliminary enquiry that the reputation of the force had also been lowered by the said constable Gajendra Kumar Singh. Hence, both the respondent and constable Gajendra Kumar Singh were placed under suspension and it was recommended that the proceedings be launched against them under section 7 of the Police Act and departmental proceedings be conducted against the aforesaid persons under para 490 of the U.P. Police Regulations. 4. Explanations were called from the respondent and constable Gajendra Kumar Singh and thereafter the charges against the respondent were found established. The Commandant of the Battalion concluded that the charges of indiscipline and unbecoming conduct were proved against the respondent and hence it was ordered that the respondent be terminated from the police service. The services of the respondent were terminated by an order dated 16.1.1991. 5. The appeal preferred by the respondent before the Deputy Inspector of Police, P.A.C., Varanasi Range was also dismissed. The respondent aggrieved by the said order preferred a writ petition before the Allahabad High Court. In the counter-affidavit, the appellant State of UP justified the action against the respondent. In the writ petition it was alleged that the respondent and Gajendra Kumar Singh filed complaints against each other on the instigation of their superiors to cause harm to both of them. It was further alleged that the respondent and Gajendra Kumar Singh both gave in writing that they were coerced to make complaints and they had no grouse against each other. 6. In the writ petition it was also urged that the respondent was not given sufficient and reasonable opportunity to cross-examine the witnesses and even a copy of the charge-sheet was not provided to him. 7. It was further urged before the High Court that the action against the respondent was not covered under section 7 of the Police Act and as such there was no allegation of negligence against the respondent. Section 7 of the Police Act reads as under:- 7. Appointment, dismissal etc. of inferior officers - Subject to provisions of Article 311 of the Constitution and to such rules as the State Government may from time to time make under this Act, the Inspector General, Deputy Inspectors General, Assistants Inspectors-General and District Superintendent of Police, may at any time dismiss, suspend or reduce any police officer of the subordinate rank whom they shall think fits remiss or negligent in the discharge of his duty or unfit for the same; or may award any one or more of the following punishments to any police officer of the subordinate ranks who shall discharge his duty in a careless or negligent manner, or who by any act of his own shall render himself unfit for the discharge thereof namely: a) Fine to any amount not exceeding one months pay; b) Confinement to quarters for a term not exceeding fifteen days, with or without punishment - drill, extra guards, fatigue or other duty; c) Deprivation of good conduct pay; d) Removal from any office of distinction or special emoluments; e) Withholding of increments or promotion including stoppage at an efficiency bar. 8. According to the impugned judgment, action under section 7 is not unjustified. In the impugned judgment, it is incorporated that when Gajendra Kumar Singh had given in writing that no such incident took place then it was incumbent upon the Enquiry Officer to consider this aspect. The High Court observed that Gajendra Kumar Singh was the best witness to prove the factum of pointing the gun on him, but he refused that any such incident took place. The respondent admittedly moved an application before the Enquiry Officer to depute Gajendra Kumar Singh as a defence helper but no order was passed on that application. The High Court further held that the best evidence of the incident had been ignored by both the Enquiry Officer and by the Appellate Authority and thus the impugned orders cannot be sustained. 9. We have heard the learned counsel for the State of U.P. and the respondent. Learned counsel for the State of U.P. submitted that the observations of the High Court that no such incident took place is not sustainable in view of the fact that in the complaint filed by Gajendra Kumar Singh it is stated that the incident took place. The appellant is justified in asserting that the incident had infact taken place and there were exchange of abuses between the two constables. Now we are called upon to determine whether in the facts and circumstances of the case the sentence imposed on the respondent was justified? 10. We are quite conscious of the fact that we are dealing with a disciplined police organization. Discipline is the backbone of the police force. Highest degree of discipline is imperative for the smooth functioning of a police force. Both the respondent and Gajendra Kumar Singh have stated that infact the incident had not taken place and they were coerced to file complaints at the instance of the superior officials. It is difficult for us to examine the veracity of this allegation by the respondent and Gajendra Kumar Singh. Without arriving at any definite conclusion regarding veracity of allegation and counter-allegations, we are clearly of the opinion that the punishment of dismissal awarded in the facts and circumstances of the case is clearly disproportionate. 11. In our considered view, the impugned order of the High Court requires modification and consequently, the order of termination dated 16.1.1991 is set aside and instead we direct that the respondents two increments be withheld and the respondent be reinstated in service forthwith with 50% back-wages.

1[ds]The appellant is justified in asserting that the incident had infact taken place and there were exchange of abuses between the two constables10. We are quite conscious of the fact that we are dealing with a disciplined police organization. Discipline is the backbone of the police force. Highest degree of discipline is imperative for the smooth functioning of a police force. Both the respondent and Gajendra Kumar Singh have stated that infact the incident had not taken place and they were coerced to file complaints at the instance of the superior officials. It is difficult for us to examine the veracity of this allegation by the respondent and Gajendra Kumar Singh. Without arriving at any definite conclusion regarding veracity of allegation and, we are clearly of the opinion that the punishment of dismissal awarded in the facts and circumstances of the case is clearly disproportionate11. In our considered view, the impugned order of the High Court requires modification and consequently, the order of termination dated 16.1.1991 is set aside and instead we direct that the respondents two increments be withheld and the respondent be reinstated in service forthwith with 50%

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: on security duty on 19.2.1990 from 0200 hours to 0400 hours aimed rifle at Gajendra Kumar Singh and threatened to eliminate him. A preliminary enquiry was conducted in the aforesaid incident by the Company Commander who prima facie found that the respondent had behaved in an indisciplined manner and he also made an unsuccessful attempt to harm his colleague constable Gajendra Kumar Singh. It was concluded in the preliminary enquiry that the reputation of the force had also been lowered by the said constable Gajendra Kumar Singh. Hence, both the respondent and constable Gajendra Kumar Singh were placed under suspension and it was recommended that the proceedings be launched against them under section 7 of the Police Act and departmental proceedings be conducted against the aforesaid persons under para 490 of the U.P. Police Regulations. 4. Explanations were called from the respondent and constable Gajendra Kumar Singh and thereafter the charges against the respondent were found established. The Commandant of the Battalion concluded that the charges of indiscipline and unbecoming conduct were proved against the respondent and hence it was ordered that the respondent be terminated from the police service. The services of the respondent were terminated by an order dated 16.1.1991. 5. The appeal preferred by the respondent before the Deputy Inspector of Police, P.A.C., Varanasi Range was also dismissed. The respondent aggrieved by the said order preferred a writ petition before the Allahabad High Court. In the counter-affidavit, the appellant State of UP justified the action against the respondent. In the writ petition it was alleged that the respondent and Gajendra Kumar Singh filed complaints against each other on the instigation of their superiors to cause harm to both of them. It was further alleged that the respondent and Gajendra Kumar Singh both gave in writing that they were coerced to make complaints and they had no grouse against each other. 6. In the writ petition it was also urged that the respondent was not given sufficient and reasonable opportunity to cross-examine the witnesses and even a copy of the charge-sheet was not provided to him. 7. It was further urged before the High Court that the action against the respondent was not covered under section 7 of the Police Act and as such there was no allegation of negligence against the respondent. Section 7 of the Police Act reads as under:- 7. Appointment, dismissal etc. of inferior officers - Subject to provisions of Article 311 of the Constitution and to such rules as the State Government may from time to time make under this Act, the Inspector General, Deputy Inspectors General, Assistants Inspectors-General and District Superintendent of Police, may at any time dismiss, suspend or reduce any police officer of the subordinate rank whom they shall think fits remiss or negligent in the discharge of his duty or unfit for the same; or may award any one or more of the following punishments to any police officer of the subordinate ranks who shall discharge his duty in a careless or negligent manner, or who by any act of his own shall render himself unfit for the discharge thereof namely: a) Fine to any amount not exceeding one months pay; b) Confinement to quarters for a term not exceeding fifteen days, with or without punishment - drill, extra guards, fatigue or other duty; c) Deprivation of good conduct pay; d) Removal from any office of distinction or special emoluments; e) Withholding of increments or promotion including stoppage at an efficiency bar. 8. According to the impugned judgment, action under section 7 is not unjustified. In the impugned judgment, it is incorporated that when Gajendra Kumar Singh had given in writing that no such incident took place then it was incumbent upon the Enquiry Officer to consider this aspect. The High Court observed that Gajendra Kumar Singh was the best witness to prove the factum of pointing the gun on him, but he refused that any such incident took place. The respondent admittedly moved an application before the Enquiry Officer to depute Gajendra Kumar Singh as a defence helper but no order was passed on that application. The High Court further held that the best evidence of the incident had been ignored by both the Enquiry Officer and by the Appellate Authority and thus the impugned orders cannot be sustained. 9. We have heard the learned counsel for the State of U.P. and the respondent. Learned counsel for the State of U.P. submitted that the observations of the High Court that no such incident took place is not sustainable in view of the fact that in the complaint filed by Gajendra Kumar Singh it is stated that the incident took place. The appellant is justified in asserting that the incident had infact taken place and there were exchange of abuses between the two constables. Now we are called upon to determine whether in the facts and circumstances of the case the sentence imposed on the respondent was justified? 10. We are quite conscious of the fact that we are dealing with a disciplined police organization. Discipline is the backbone of the police force. Highest degree of discipline is imperative for the smooth functioning of a police force. Both the respondent and Gajendra Kumar Singh have stated that infact the incident had not taken place and they were coerced to file complaints at the instance of the superior officials. It is difficult for us to examine the veracity of this allegation by the respondent and Gajendra Kumar Singh. Without arriving at any definite conclusion regarding veracity of allegation and counter-allegations, we are clearly of the opinion that the punishment of dismissal awarded in the facts and circumstances of the case is clearly disproportionate. 11. In our considered view, the impugned order of the High Court requires modification and consequently, the order of termination dated 16.1.1991 is set aside and instead we direct that the respondents two increments be withheld and the respondent be reinstated in service forthwith with 50% back-wages. ### Response: 1

M.D. Dhanapal Vs. State

1. These special leave petitions are against the orders dated 30.4.2019 and 16.5.2019 passed by the High Court of Madras (Madurai Bench) in Crl.O.P.(MD) No. 6462 of 2019 and Crl.M.P. (MD) No. 4654 of 2019 respectively.2. On 21.4.2019, on the occasion of the Chithra Pournami festival about seven pilgrims were killed and 10 injured in a stampede outside the temple of Lord Sri Vaalavaikkum Vandithurai Karuppannasamy at Muthiyampalayam Village in Tiruchirapalli District, Tamil Nadu.3. By the impugned order dated 30.4.2019, the High Court granted bail to the Petitioner, M.D. Dhanapal, the Chief Priest of Lord Sri Vaalavaikkum Vandithurai Karuppannasamy Temple at Muthiyampalayam Village, Thuraiyr Taluk, Tiruchirapalli, who had been arrested pursuant to an F.I.R. in connection with the accident, on condition that he would pay Rs. 10,00,000/- (Rupees ten lakhs only) each by bank drafts in the name of one of the family members/legal heirs of each of the deceased pilgrims who had come to the temple in connection with some of the temple rituals and got killed in the stampede outside the Temple. The Petitioner is aggrieved by the onerous condition of having to pay a total amount of Rs. 70,00,000/- (Rupees Seventy Lakhs only) upfront, as a condition for bail.4. The High Court cannot be faulted as from the orders impugned it is patently clear that it was the learned lawyer appearing on behalf of the Petitioner who had offered to pay Rs. 10,00,000/- (Rupees ten lakhs only) to the family members/legal heirs of each of the deceased pilgrims.5. An application was also made for modification of the order dated 30.4.2019 whereupon an order dated 16.5.2019 was passed, extending the time to make the deposit by a further period of three weeks. The said order is also in question.6. In this Court it is submitted that the Petitioner, who was rendering devotional services in a relatively small Temple at Tiruchirapalli, with little income does not have the requisite funds.7. If the Petitioner lacks funds, undertaking ought not to have been given to the Court. Be that as it may, it is well settled that bail cannot be made conditional upon heavy deposits beyond the financial capacity of an applicant for bail.8. On a perusal of the F.I.R. lodged by the Village Administrative Officer in Muthaiampalayam Village, it appears that an accident took place when "Pidikkas were being distributed on the occasion of Chithira Pavurnami Festival". The Petitioner was not even named in the F.I.R. From the averments in the F.I.R., it does not appear that the Petitioner was responsible for the death. There appears to have been suffocation due to congestion and rush. Even otherwise, it does not appear incarceration of the Petitioner is necessary for investigation or that the Petitioner will evade the process of law or tamper with evidence if set at liberty.9. We are also informed that the State Government and the Central Government have paid compensation of Rs. 1,00,000/- (Rupees one lakh only) and Rs. 2,00,000/- (Rupees two lakhs only) respectively to the victims.

1[ds]4. The High Court cannot be faulted as from the orders impugned it is patently clear that it was the learned lawyer appearing on behalf of the Petitioner who had offered to pay Rs. 10,00,000/- (Rupees ten lakhs only) to the family members/legal heirs of each of the deceased pilgrims5. An application was also made for modification of the order dated 30.4.2019 whereupon an order dated 16.5.2019 was passed, extending the time to make the deposit by a further period of three weeks. The said order is also in question6. In this Court it is submitted that the Petitioner, who was rendering devotional services in a relatively small Temple at Tiruchirapalli, with little income does not have the requisite funds7. If the Petitioner lacks funds, undertaking ought not to have been given to the Court. Be that as it may, it is well settled that bail cannot be made conditional upon heavy deposits beyond the financial capacity of an applicant for bail8. On a perusal of the F.I.R. lodged by the Village Administrative Officer in Muthaiampalayam Village, it appears that an accident took place when "Pidikkas were being distributed on the occasion of Chithira Pavurnami Festival". The Petitioner was not even named in the F.I.R. From the averments in the F.I.R., it does not appear that the Petitioner was responsible for the death. There appears to have been suffocation due to congestion and rush. Even otherwise, it does not appear incarceration of the Petitioner is necessary for investigation or that the Petitioner will evade the process of law or tamper with evidence if set at liberty9. We are also informed that the State Government and the Central Government have paid compensation of Rs. 1,00,000/- (Rupees one lakh only) and Rs. 2,00,000/- (Rupees two lakhs only) respectively to the victims.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: 1. These special leave petitions are against the orders dated 30.4.2019 and 16.5.2019 passed by the High Court of Madras (Madurai Bench) in Crl.O.P.(MD) No. 6462 of 2019 and Crl.M.P. (MD) No. 4654 of 2019 respectively.2. On 21.4.2019, on the occasion of the Chithra Pournami festival about seven pilgrims were killed and 10 injured in a stampede outside the temple of Lord Sri Vaalavaikkum Vandithurai Karuppannasamy at Muthiyampalayam Village in Tiruchirapalli District, Tamil Nadu.3. By the impugned order dated 30.4.2019, the High Court granted bail to the Petitioner, M.D. Dhanapal, the Chief Priest of Lord Sri Vaalavaikkum Vandithurai Karuppannasamy Temple at Muthiyampalayam Village, Thuraiyr Taluk, Tiruchirapalli, who had been arrested pursuant to an F.I.R. in connection with the accident, on condition that he would pay Rs. 10,00,000/- (Rupees ten lakhs only) each by bank drafts in the name of one of the family members/legal heirs of each of the deceased pilgrims who had come to the temple in connection with some of the temple rituals and got killed in the stampede outside the Temple. The Petitioner is aggrieved by the onerous condition of having to pay a total amount of Rs. 70,00,000/- (Rupees Seventy Lakhs only) upfront, as a condition for bail.4. The High Court cannot be faulted as from the orders impugned it is patently clear that it was the learned lawyer appearing on behalf of the Petitioner who had offered to pay Rs. 10,00,000/- (Rupees ten lakhs only) to the family members/legal heirs of each of the deceased pilgrims.5. An application was also made for modification of the order dated 30.4.2019 whereupon an order dated 16.5.2019 was passed, extending the time to make the deposit by a further period of three weeks. The said order is also in question.6. In this Court it is submitted that the Petitioner, who was rendering devotional services in a relatively small Temple at Tiruchirapalli, with little income does not have the requisite funds.7. If the Petitioner lacks funds, undertaking ought not to have been given to the Court. Be that as it may, it is well settled that bail cannot be made conditional upon heavy deposits beyond the financial capacity of an applicant for bail.8. On a perusal of the F.I.R. lodged by the Village Administrative Officer in Muthaiampalayam Village, it appears that an accident took place when "Pidikkas were being distributed on the occasion of Chithira Pavurnami Festival". The Petitioner was not even named in the F.I.R. From the averments in the F.I.R., it does not appear that the Petitioner was responsible for the death. There appears to have been suffocation due to congestion and rush. Even otherwise, it does not appear incarceration of the Petitioner is necessary for investigation or that the Petitioner will evade the process of law or tamper with evidence if set at liberty.9. We are also informed that the State Government and the Central Government have paid compensation of Rs. 1,00,000/- (Rupees one lakh only) and Rs. 2,00,000/- (Rupees two lakhs only) respectively to the victims. ### Response: 1

Suman Singh Vs. Sanjay Singh

proved constitute “mental cruelty” so as to attract the provisions of Section 13 (1) (ia) of the Act for granting decree of divorce. 25) Keeping in view the law laid down in Samar Ghosh’s case (supra), when we examine the grounds taken by the respondent in his petition for proving the mental cruelty for grant of divorce against the appellant, we find that none of the grounds satisfies either individually or collectively the test laid down in Samar Ghosh’s case (supra) so as to entitle the respondent to claim a decree of divorce.26) This we hold for more than one reason. First, almost all the grounds taken by the respondent in his petition were stale or/and isolated and did not subsist to enable the respondent to seek a decree for dissolution of marriage. In other words, the incidents of cruelty alleged had taken place even, according to the respondent, immediately after marriage. They were solitary incidents relating to the behavior of the appellant. Second, assuming that one or more grounds constituted an act of cruelty, yet we find that the acts complained of were condoned by the parties due to their subsequent conduct inasmuch as admittedly both lived together till 2006 and the appellant gave birth to their second daughter in 2006. Third, most of the incidents of alleged cruelty pertained to the period prior to 2006 and some were alleged to have occurred after 2006. Those pertained to period after 2006 were founded on general allegations with no details pleaded such as when such incident occurred (year, month, date etc.), what was its background, who witnessed, what the appellant actually said etc.27) In our view, the incidents which occurred prior to 2006 could not be relied on to prove the instances of cruelty because they were deemed to have been condoned by the acts of the parties. So far as the instances alleged after 2006 were concerned, they being isolated instances, did not constitute an act of cruelty.28) A petition seeking divorce on some isolated incidents alleged to have occurred 8-10 years prior to filing of the date of petition cannot furnish a subsisting cause of action to seek divorce after 10 years or so of occurrence of such incidents. The incidents alleged should be of recurring nature or continuing one and they should be in near proximity with the filing of the petition.29) Few isolated incidents of long past and that too found to have been condoned due to compromising behavior of the parties cannot constitute an act of cruelty within the meaning of Section 13 (1)(ia)of the Act.30) In our considered opinion, both the Courts below failed to take note of this material aspect of the case and thus committed jurisdictional error in passing a decree for dissolution of marriage.31) We cannot, therefore, countenance the approach of the High Court because it did not, in the first instance, examine the grounds taken in the petition to find out as to whether such grounds constitute mental cruelty or not? The finding, therefore, though concurrent does not bind this Court.32) We are not impressed by the submission of the learned counsel for the respondent that an incident which occurred somewhere in 2010 when the appellant visited the office of the respondent and alleged to have misbehaved with the respondent in front of other officers would constitute an act of cruelty on the part of the appellant so as to enable the respondent to claim divorce. In the first place, no decree for divorce on one isolated incident can be passed. Secondly, there could be myriad reasons for causing such isolated incident. Merely because both exchanged some verbal conversation in presence of others would not be enough to constitute an act of cruelty unless it is further supported by some incidents of alike nature. It was not so.33) We are also not impressed by the submission of the learned counsel for the respondent that since the appellant had made allegation against the respondent of his having extra-marital relation and hence such allegation would also constitute an act of cruelty on the part of the appellant entitling the respondent to claim decree for dissolution of marriage.34) Similarly, we are also not impressed by the submission of learned counsel for the respondent that since both have been living separately for quite some time and hence this may be considered a good ground to give divorce.35) In the first place, the respondent did not seek a decree of dissolution of marriage on these grounds. Second, the grounds of cruelty taken by the respondent in his petition does not include these grounds. Third, even if some stray allegations were made by the wife in her pleading/evidence as were relied upon by the learned counsel are of no relevance because, as mentioned above, these ground were not pleaded in the petition by the respondent for seeking a decree of divorce and nor were put in issue; and lastly, the burden being on the respondent, the same could be discharged by the respondent by pleading and then proving. It was not so done. It is for these reasons, we cannot accept the aforementioned two submissions for affirming the decree of divorce.36) This takes us to the next question as to whether the appellant was able to make out any case for restitution of conjugal rights against the respondent.37) Having perused her petition and evidence, we are of the view that the appellant is entitled for a decree for restitution of conjugal rights against the respondent.38) In our considered view, as it appears to us from perusal of the evidence that it is the respondent who withdrew from the appellants company without there being any reasonable cause to do so. Now that we have held on facts that the respondent failed to make out any case of cruelty against the appellant, it is clear to us that it was the respondent who withdrew from the company of the appellant without reasonable cause and not the vice versa.

1[ds]22) Having heard the learned counsel for the parties and on perusal of the record of the case, we are inclined to allow the appeals and while setting aside the impugned order, dismiss the divorce petition filed by the respondent(husband) against the appellant and, in consequence, allow the petition filed by the appellant(wife) for restitution of conjugal rights against the respondentKeeping in view the law laid down in Samarcase (supra), when we examine the grounds taken by the respondent in his petition for proving the mental cruelty for grant of divorce against the appellant, we find that none of the grounds satisfies either individually or collectively the test laid down in Samarcase (supra) so as to entitle the respondent to claim a decree of divorce.26) This we hold for more than one reason. First, almost all the grounds taken by the respondent in his petition were stale or/and isolated and did not subsist to enable the respondent to seek a decree for dissolution of marriage. In other words, the incidents of cruelty alleged had taken place even, according to the respondent, immediately after marriage. They were solitary incidents relating to the behavior of the appellant. Second, assuming that one or more grounds constituted an act of cruelty, yet we find that the acts complained of were condoned by the parties due to their subsequent conduct inasmuch as admittedly both lived together till 2006 and the appellant gave birth to their second daughter in 2006. Third, most of the incidents of alleged cruelty pertained to the period prior to 2006 and some were alleged to have occurred after 2006. Those pertained to period after 2006 were founded on general allegations with no details pleaded such as when such incident occurred (year, month, date etc.), what was its background, who witnessed, what the appellant actually said etc.27) In our view, the incidents which occurred prior to 2006 could not be relied on to prove the instances of cruelty because they were deemed to have been condoned by the acts of the parties. So far as the instances alleged after 2006 were concerned, they being isolated instances, did not constitute an act of cruelty.28) A petition seeking divorce on some isolated incidents alleged to have occurred 8-10 years prior to filing of the date of petition cannot furnish a subsisting cause of action to seek divorce after 10 years or so of occurrence of such incidents. The incidents alleged should be of recurring nature or continuing one and they should be in near proximity with the filing of the petition.29) Few isolated incidents of long past and that too found to have been condoned due to compromising behavior of the parties cannot constitute an act of cruelty within the meaning of Section 13 (1)(ia)of the Act.30) In our considered opinion, both the Courts below failed to take note of this material aspect of the case and thus committed jurisdictional error in passing a decree for dissolution of marriage.31) We cannot, therefore, countenance the approach of the High Court because it did not, in the first instance, examine the grounds taken in the petition to find out as to whethersuch grounds constitute mental cruelty ornot? The finding, therefore, though concurrent does not bind this Court.32) We are not impressed by the submission of the learned counsel for the respondent that an incident which occurred somewhere in 2010 when the appellant visited the office of the respondent and alleged to have misbehaved with the respondent in front of other officers would constitute an act of cruelty on the part of the appellant so as to enable the respondent to claim divorce. In the first place, no decree for divorce on one isolated incident can be passed. Secondly, there could be myriad reasons for causing such isolated incident. Merely because both exchanged some verbal conversation in presence of others would not be enough to constitute an act of cruelty unless it is further supported by some incidents of alike nature. It was not so.33) We are also not impressed by the submission of the learned counsel for the respondent that since the appellant had made allegation against the respondent of his having extra-marital relation and hence such allegation would also constitute an act of cruelty on the part of the appellant entitling the respondent to claim decree for dissolution of marriage.34) Similarly, we are also not impressed by the submission of learned counsel for the respondent that since both have been living separately for quite some time and hence this may be considered a good ground to give divorce.35) In the first place, the respondent did not seek a decree of dissolution of marriage on these grounds. Second, the grounds of cruelty taken by the respondent in his petition does not include these grounds. Third, even if some stray allegations were made by the wife in her pleading/evidence as were relied upon by the learned counsel are of no relevance because, as mentioned above, these ground were not pleaded in the petition by the respondent for seeking a decree of divorce and nor were put in issue; and lastly, the burden being on the respondent, the same could be discharged by the respondent by pleading and then proving. It was not so done. It is for these reasons, we cannot accept the aforementioned two submissions for affirming the decree of divorce.36) This takes us to the next question as to whetherthe appellant was able to make out any case for restitution of conjugal rights against therespondent.37) Having perused her petition and evidence, we are of the view that the appellant is entitled for a decree for restitution of conjugal rights against the respondent.38) In our considered view, as it appears to us from perusal of the evidence that it is the respondent who withdrew from the appellants company without there being any reasonable cause to do so. Now that we have held on facts that the respondent failed to make out any case of cruelty against the appellant, it is clear to us that it was the respondent who withdrew from the company of the appellant without reasonable cause and not the vice versa.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: proved constitute “mental cruelty” so as to attract the provisions of Section 13 (1) (ia) of the Act for granting decree of divorce. 25) Keeping in view the law laid down in Samar Ghosh’s case (supra), when we examine the grounds taken by the respondent in his petition for proving the mental cruelty for grant of divorce against the appellant, we find that none of the grounds satisfies either individually or collectively the test laid down in Samar Ghosh’s case (supra) so as to entitle the respondent to claim a decree of divorce.26) This we hold for more than one reason. First, almost all the grounds taken by the respondent in his petition were stale or/and isolated and did not subsist to enable the respondent to seek a decree for dissolution of marriage. In other words, the incidents of cruelty alleged had taken place even, according to the respondent, immediately after marriage. They were solitary incidents relating to the behavior of the appellant. Second, assuming that one or more grounds constituted an act of cruelty, yet we find that the acts complained of were condoned by the parties due to their subsequent conduct inasmuch as admittedly both lived together till 2006 and the appellant gave birth to their second daughter in 2006. Third, most of the incidents of alleged cruelty pertained to the period prior to 2006 and some were alleged to have occurred after 2006. Those pertained to period after 2006 were founded on general allegations with no details pleaded such as when such incident occurred (year, month, date etc.), what was its background, who witnessed, what the appellant actually said etc.27) In our view, the incidents which occurred prior to 2006 could not be relied on to prove the instances of cruelty because they were deemed to have been condoned by the acts of the parties. So far as the instances alleged after 2006 were concerned, they being isolated instances, did not constitute an act of cruelty.28) A petition seeking divorce on some isolated incidents alleged to have occurred 8-10 years prior to filing of the date of petition cannot furnish a subsisting cause of action to seek divorce after 10 years or so of occurrence of such incidents. The incidents alleged should be of recurring nature or continuing one and they should be in near proximity with the filing of the petition.29) Few isolated incidents of long past and that too found to have been condoned due to compromising behavior of the parties cannot constitute an act of cruelty within the meaning of Section 13 (1)(ia)of the Act.30) In our considered opinion, both the Courts below failed to take note of this material aspect of the case and thus committed jurisdictional error in passing a decree for dissolution of marriage.31) We cannot, therefore, countenance the approach of the High Court because it did not, in the first instance, examine the grounds taken in the petition to find out as to whether such grounds constitute mental cruelty or not? The finding, therefore, though concurrent does not bind this Court.32) We are not impressed by the submission of the learned counsel for the respondent that an incident which occurred somewhere in 2010 when the appellant visited the office of the respondent and alleged to have misbehaved with the respondent in front of other officers would constitute an act of cruelty on the part of the appellant so as to enable the respondent to claim divorce. In the first place, no decree for divorce on one isolated incident can be passed. Secondly, there could be myriad reasons for causing such isolated incident. Merely because both exchanged some verbal conversation in presence of others would not be enough to constitute an act of cruelty unless it is further supported by some incidents of alike nature. It was not so.33) We are also not impressed by the submission of the learned counsel for the respondent that since the appellant had made allegation against the respondent of his having extra-marital relation and hence such allegation would also constitute an act of cruelty on the part of the appellant entitling the respondent to claim decree for dissolution of marriage.34) Similarly, we are also not impressed by the submission of learned counsel for the respondent that since both have been living separately for quite some time and hence this may be considered a good ground to give divorce.35) In the first place, the respondent did not seek a decree of dissolution of marriage on these grounds. Second, the grounds of cruelty taken by the respondent in his petition does not include these grounds. Third, even if some stray allegations were made by the wife in her pleading/evidence as were relied upon by the learned counsel are of no relevance because, as mentioned above, these ground were not pleaded in the petition by the respondent for seeking a decree of divorce and nor were put in issue; and lastly, the burden being on the respondent, the same could be discharged by the respondent by pleading and then proving. It was not so done. It is for these reasons, we cannot accept the aforementioned two submissions for affirming the decree of divorce.36) This takes us to the next question as to whether the appellant was able to make out any case for restitution of conjugal rights against the respondent.37) Having perused her petition and evidence, we are of the view that the appellant is entitled for a decree for restitution of conjugal rights against the respondent.38) In our considered view, as it appears to us from perusal of the evidence that it is the respondent who withdrew from the appellants company without there being any reasonable cause to do so. Now that we have held on facts that the respondent failed to make out any case of cruelty against the appellant, it is clear to us that it was the respondent who withdrew from the company of the appellant without reasonable cause and not the vice versa. ### Response: 1

United India Insurance Co. Ltd.,Shimla Vs. Tilak Singh

limited to the extent it was specifically covered. After referring to the English Road Traffic Act, 1960, and Halsburys Laws of England (Third Edition) this Court came to the conclusion that section 95 of the 1939 Act required that the policy of insurance must be a policy insuring the insured against any liability incurred by him in respect of death or bodily injury to a third party and rejected the contention that the words "third party" were wide enough to cover all persons except the insured and the insurer. This Court held as under : (vide para 20). "Therefore it is not required that a policy of insurance should cover risk to the passengers who are not carried for hire or reward. As under Section 95 the risk to a passenger in a vehicle who is not carried for hire or reward is not required to be insured the plea of the counsel for the insurance company will have to be accepted and the insurance company held not liable under the requirements of the Motor Vehicles Act." 16. In Amrit Lal Sood and another vs. Kaushalya Devi Thapar and others (1998) 3 SCC 744 it was held that in that particular case that the terms of the policy were wide enough to cover a gratuitous passenger and, therefore, there was liability towards the gratuitous person. 17. In Dr. T.V. Jose vs. Chacko P.M. alias Thankachan and others (2001) 8 SCC 748 Variava, J., had an occasion to survey the law with regard to the liability of insurance companies in respect of gratuitous passengers. After referring to a number of decisions of this Court the learned Judge observed (vide para 20) "the law on this subject is clear, a third-party policy does not cover liability to gratuitous passengers who are not carried for hire or reward." The insurer company was held not liable to reimburse the appellant. 18. Thus, even under the 1939 Act the established legal position was that unless there was a specific coverage of the risk pertaining to a gratuitous passenger in the policy, the insurer was not liable. We find that clause (ii) of the proviso to section 95(1) has been eliminated while drafting section 147 of the 1988 Act. Under sub-section (1)(b) under the 1988 Act, compulsory policy of insurance required under the statute must now provide against any liability which may be incurred by the owner of the vehicle "in respect of the death of or bodily injury to any person including owner of the goods or authorised representative carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place." B. The 1988 Act 19. The argument that the risk pertaining to a third party would extend to a person other than the parties to the insurance contract was raised in New India Assurance Company vs. Satpal Singh and others (2000) 1 SCC 237 where after contrasting the language of section 95(1) of the 1939 Act with the provisions of section 147(1) of the 1988 Act this Court held: "The result is that under the new Act an insurance policy covering third party risk is not required to exclude gratuitous passengers in a vehicle, no matter that the vehicle is of any type or class. Hence the decisions rendered under the old Act vis-a-vis gratuitous passengers are of no avail while considering the liability of the insurance company in respect of any accident which occurred or would occur after the new Act came into force." 20. The view expressed in Satpal Singhs case (supra) however, has been specifically overruled in the subsequent judgment of a Bench of three judges in New India Assurance Company vs. Asha Rani and others (2003) 2 SCC 223. In the case the discussion arose in connection with carrying passengers in a goods vehicle. This Court after referring to the terms of section 147 of the 1988 Act, as contrasted with section 95 of the 1939 Act, held that the judgment in Satpal Singhs case (supra) had been incorrectly decided and that the insurer will not be liable to pay compensation. In the concurring judgment of Sinha, J., after contrasting the language used in the 1939 Act with that of the 1988 Act, it has been observed (vide paras 25 and 27): "25. Section 147 of 1988 Act, inter alia, prescribes compulsory coverage against the death of or bodily injury to any passengers of "public service vehicle". Proviso appended thereto categorically states that compulsory coverage in respect of drivers and conductors of public service vehicle and employees carried in a goods vehicle would be limited to the liability under the Workmens Compensation Act. It does not speak of any passenger in a good carriage. 27. Furthermore, sub-clauses (i) of Clause (b) of sub-section (1) of Section 147 speaks of liability which may be incurred by the owner of a vehicle in respect of death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place, whereas sub-clause (ii) thereof deals with liability which may be incurred by the owner of a vehicle against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place."21. In our view, although the observations made in Asha Ranis case (supra) were in connection with carrying passengers in a goods vehicle, the same would apply with equal force to gratuitous passengers in any other vehicle also. Thus, we must uphold the contention of the appellant- insurance company that it owed no liability towards the injuries suffered by the deceased Rajinder Singh who was a pillion rider, as the insurance policy was a statutory policy, and hence it did not cover the risk of death of or bodily injury to gratuitous passengers.

1[ds]There was no intention evidenced in the 1988 Act to make a clean departure from the previous position in law. Section 217 (4) evidences an intention to the contrary. Thus, the situation would be governed by Section 6(c) of the General Clauses Act, which provides that the repeal of an Act would not affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed.Thus, in our view, the situation in law which arises from the failure of the transferor to notify the insurer of the fact of transfer of ownership of the insured vehicle is no different, whether under sectionThus, even under the 1939 Act the established legal position was that unless there was a specific coverage of the risk pertaining to a gratuitous passenger in the policy, the insurer was not liable. We find that clause (ii) of the proviso to section 95(1) has been eliminated while drafting section 147 of the 1988 Act. Under(1)(b) under the 1988 Act, compulsory policy of insurance required under the statute must now provide against any liability which may be incurred by the owner of the vehicle "in respect of the death of or bodily injury to any person including owner of the goods or authorised representative carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place.place."21. In our view, although the observations made in Asha Ranis case (supra) were in connection with carrying passengers in a goods vehicle, the same would apply with equal force to gratuitous passengers in any other vehicle also. Thus, we must uphold the contention of the appellantinsurance company that it owed no liability towards the injuries suffered by the deceased Rajinder Singh who was a pillion rider, as the insurance policy was a statutory policy, and hence it did not cover the risk of death of or bodily injury to gratuitous passengers.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: limited to the extent it was specifically covered. After referring to the English Road Traffic Act, 1960, and Halsburys Laws of England (Third Edition) this Court came to the conclusion that section 95 of the 1939 Act required that the policy of insurance must be a policy insuring the insured against any liability incurred by him in respect of death or bodily injury to a third party and rejected the contention that the words "third party" were wide enough to cover all persons except the insured and the insurer. This Court held as under : (vide para 20). "Therefore it is not required that a policy of insurance should cover risk to the passengers who are not carried for hire or reward. As under Section 95 the risk to a passenger in a vehicle who is not carried for hire or reward is not required to be insured the plea of the counsel for the insurance company will have to be accepted and the insurance company held not liable under the requirements of the Motor Vehicles Act." 16. In Amrit Lal Sood and another vs. Kaushalya Devi Thapar and others (1998) 3 SCC 744 it was held that in that particular case that the terms of the policy were wide enough to cover a gratuitous passenger and, therefore, there was liability towards the gratuitous person. 17. In Dr. T.V. Jose vs. Chacko P.M. alias Thankachan and others (2001) 8 SCC 748 Variava, J., had an occasion to survey the law with regard to the liability of insurance companies in respect of gratuitous passengers. After referring to a number of decisions of this Court the learned Judge observed (vide para 20) "the law on this subject is clear, a third-party policy does not cover liability to gratuitous passengers who are not carried for hire or reward." The insurer company was held not liable to reimburse the appellant. 18. Thus, even under the 1939 Act the established legal position was that unless there was a specific coverage of the risk pertaining to a gratuitous passenger in the policy, the insurer was not liable. We find that clause (ii) of the proviso to section 95(1) has been eliminated while drafting section 147 of the 1988 Act. Under sub-section (1)(b) under the 1988 Act, compulsory policy of insurance required under the statute must now provide against any liability which may be incurred by the owner of the vehicle "in respect of the death of or bodily injury to any person including owner of the goods or authorised representative carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place." B. The 1988 Act 19. The argument that the risk pertaining to a third party would extend to a person other than the parties to the insurance contract was raised in New India Assurance Company vs. Satpal Singh and others (2000) 1 SCC 237 where after contrasting the language of section 95(1) of the 1939 Act with the provisions of section 147(1) of the 1988 Act this Court held: "The result is that under the new Act an insurance policy covering third party risk is not required to exclude gratuitous passengers in a vehicle, no matter that the vehicle is of any type or class. Hence the decisions rendered under the old Act vis-a-vis gratuitous passengers are of no avail while considering the liability of the insurance company in respect of any accident which occurred or would occur after the new Act came into force." 20. The view expressed in Satpal Singhs case (supra) however, has been specifically overruled in the subsequent judgment of a Bench of three judges in New India Assurance Company vs. Asha Rani and others (2003) 2 SCC 223. In the case the discussion arose in connection with carrying passengers in a goods vehicle. This Court after referring to the terms of section 147 of the 1988 Act, as contrasted with section 95 of the 1939 Act, held that the judgment in Satpal Singhs case (supra) had been incorrectly decided and that the insurer will not be liable to pay compensation. In the concurring judgment of Sinha, J., after contrasting the language used in the 1939 Act with that of the 1988 Act, it has been observed (vide paras 25 and 27): "25. Section 147 of 1988 Act, inter alia, prescribes compulsory coverage against the death of or bodily injury to any passengers of "public service vehicle". Proviso appended thereto categorically states that compulsory coverage in respect of drivers and conductors of public service vehicle and employees carried in a goods vehicle would be limited to the liability under the Workmens Compensation Act. It does not speak of any passenger in a good carriage. 27. Furthermore, sub-clauses (i) of Clause (b) of sub-section (1) of Section 147 speaks of liability which may be incurred by the owner of a vehicle in respect of death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place, whereas sub-clause (ii) thereof deals with liability which may be incurred by the owner of a vehicle against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place."21. In our view, although the observations made in Asha Ranis case (supra) were in connection with carrying passengers in a goods vehicle, the same would apply with equal force to gratuitous passengers in any other vehicle also. Thus, we must uphold the contention of the appellant- insurance company that it owed no liability towards the injuries suffered by the deceased Rajinder Singh who was a pillion rider, as the insurance policy was a statutory policy, and hence it did not cover the risk of death of or bodily injury to gratuitous passengers. ### Response: 1

Kollipara Sriramulu Vs. T. Aswathanarayana & Ors

further contact between the parties, it is a question of construction whether the execution of the further contract is a condition or term of the bargain or whether it is a mere expression of the desire of the parties as to the manner in which the transaction already agreed to will in fact go through. In the former case there is no enforceable contract either because the condition is unfulfilled or because the law does not recognise a contract to enter into a contract. In the latter case there is a binding contract and the reference to the more formal document may be ignored.,In other words, there may be a case where the signing of a further formal agreement is made a condition or term of the bargain, and if the formal agreement is not approved and signed there is no concluded contract.In Rossiter v. Miller. (1878) 3 AC 1124 Lord Cairns said :"If you find not an unqualified acceptance subject to the condition that an agreement is to be prepared and agreed upon between the parties. and until that condition is fulfilled no contract is to arise then you cannot find a concluded contract."In Currimbhoy, and Co. Ltd. v . Creet, 60 Ind App 297 = (AIR 1933 PC 29 ) the Judicial Committee expressed the view that the principle of the English law which is summarised in the judgment of Parker, J. in (1912) 1 Ch 284 was applicable in India.The question in the present appeals is whether the execution of a formal agreement was intended to be a condition of the bargain dated July 6, 1952 or whether it was a mere expression of the desire of the parties for a formal agreement which can be ignored. The evidence adduced on behalf of respondent No. 1 does not show that the drawing up of a written agreement was a pre-requisite to the coming into effect of the oral agreement. It is therefore not possib1e to accept the contention of the appellant that the oral agreement was ineffective in law because there is no execution of any formal written document. As regards the other point, it is true that there is no specific agreement with regard to the mode of payment but this does not necessarily make the agreement ineffective The mere omission to settle the mode of payment does not affect the completeness of the contract because the vital terms of the contract like the price and area of the land and the time for completion of the sale were all fixed. We accordingly hold that Mr. Gokhale is unable to make good his argument on this aspect of the case.4. We shall next deal with the question whether the appellant was a bona fide purchaser for value without notice of the prior oral agreement. The first sale deed obtained by the appellant was on July 26, 1952. P. W. 2 stated in his evidence that the appellant told him that he had been aware of the agreement in favour of respondent No. 1 at the time of the purchases under Exs. B-6 to B-10. It is true that P. W. 2 added that the appellant did not say distinctly that he was aware of the agreement between the respondent and defendants 1 to 9. Upon this point the appellant himself was unable to remember whether he had told P. W 2 to that effect. In any case, P. Ws. 5 and 6 deposed that they went to the appellant on July 7 1952 and asked him to part with his shares in favour of respondent No. 1. It is not denied by the appellant that he met P. Ws. 5 and 6 on July 7, 1952. It is also significant that the purchase money paid by the appellant was very nearly the same as that payable under the agreement in respondent No. 1s favour. On the basis of this evidence the High Court reached the conclusion that the appellant had notice of the prior oral agreement; We see no reason to differ from the finding of the High Court on this point.5. It was finally contended that the High Court ought not to have given any direction that as far as possible the site upon which the cinema building stands should be allotted to the share of respondent No. 1 if it is comprised within the 137 shares to which he was entitled. It was stated on behalf of the appellant that there was no equity in favour of respondent No 1 as he was a lessee for 10 years and all the constructions were made with the full knowledge that he was a lessee for a limited period.In any case. it was said that the appellant should have been given permission under Section 3 of the Partition Act (Partition Act No IV of 1893) when respondent No. 1 himself invoked the provisions of S. 2 of that Act. It was also argued that the High Court had no jurisdiction to modify any portion of the judgment dated March 25, 1960 by a subsequent order dated June 21. 1960 without an application for review. In our opinion, the contention put forward on behalf of the appellant is well founded and since no application was made on behalf of the first respondent under Section 2 of the Partition Act we are of opinion that the following direction of the High Court in the preliminary decree should be deleted:"(7). That the lower Court shall as far as possible allot to the appellant the site upon which the appellants buildings stand and further direct that if that procedure cannot be adopted conveniently or equitably the procedure laid down in the judgment reported in (1957) 2 Andh WR 488 = (AIR 1958 Andh Pra 647) be followed."It will, of course, be open to the parties to make representations and for the High Court to give equitable directions in the allotment of shares to be made in the final partition decree.

0[ds]It was the case of respondent No. 1 that on July 6, 1952 there was a meeting of all the male partners at the house of Desu Virabhadrayya and at that meeting there was an agreement reached between all of them (except the appellant) and him-self that they should sell to him their shares (and the shares of those whom they represented) at the rate of Rs. 3375 for eight shares. A written agreement was to be drawn in 2 or 3 days and the mode of payment of the purchase money was also to be settled later. It was further agreed that the sale deeds were to be executed in three months. In pursuance of the agreement all the co-sharers except defendants I to 9 executed sale deeds and the plaintiff therefore became the owner of 98 shares. The first witness in proof of the oral agreement was respondent No. 1 himself. He deposed that P. Ws. 5, 6 and 8, Sri Devata Rama Mohana Rao, Sri Addepalli Nageswara Rao and Sri Thoomu Srimannarayana respectively were present at the meeting of the shareholders. He also said that the first defendant, the son of the 2nd defendant, was there to represent the latter, and that Gopala Krishnaiah, son of the 3rd defendant, and the 7th defendant (who represents the 5th and 6th defendants) and Alavala Subbayya (husband of the 8th defendant and father of the 9th defendant) were present when the agreement was settled. He added that the sale deed was to be executed in three months and that draft agreement, Ex. A-6 was also prepared 2 or 3 daysour opinion, the discrepancy is immaterial and the High Court was right in accepting the evidence of this witness as true. The evidence of respondent No. 1 is corroborated by P. W. 7 who said that except the women shareholders all other shareholders were present at the meeting of July 6, 1952 and the subject for consideration was the sale of the site of the cinema theatre to respondent No. 1. He added that the price of the whole site was fixed at Rs. 67,500 and that all the partners except the appellant agreed to sell away theiris true that P. W. 8 is the cousin brother of respondent No. l, but this can be no ground in itself for rejecting his testimony P. Ws. 2 and 3 have also given important corroborative evidence P. W. 2. Sri D. Subha Rao is the Subordinate judge of Bapatla. He deposed that the first respondent told him that there was an oral agreement for the purchase of the shares concluded in the first week of July, 1952. Exhibit A-22 dated July 9, 1952, a letter written by P. W. 2 to respondent No. 1 supports the evidence of P. W. 2. P. W. 2, Sri S. Narayana Rao, a District Judge and a family friend of respondent No. l also testified that he was informed of the negotiations by the respondent for purchasing the shares and he was also told by the first respondent about the conclusion of thefact that the parties refer to the preparation of an agreement by which the terms agreed upon are to be put in a more formal shape does not prevent the existence of a binding contract. There are, however, cases where the reference to a future contract is made in such terms as to show that the parties did not intend to be bound until a formal contract isis true that P. W. 2 added that the appellant did not say distinctly that he was aware of the agreement between the respondent and defendants 1 to 9. Upon this point the appellant himself was unable to remember whether he had told P. W 2 to that effect. In any case, P. Ws. 5 and 6 deposed that they went to the appellant on July 7 1952 and asked him to part with his shares in favour of respondent No. 1. It is not denied by the appellant that he met P. Ws. 5 and 6 on July 7, 1952. It is also significant that the purchase money paid by the appellant was very nearly the same as that payable under the agreement in respondent No. 1s favour. On the basis of this evidence the High Court reached the conclusion that the appellant had notice of the prior oral agreement; We see no reason to differ from the finding of the High Court on this point.5. It was finally contended that the High Court ought not to have given any direction that as far as possible the site upon which the cinema building stands should be allotted to the share of respondent No. 1 if it is comprised within the 137 shares to which he was entitled. It was stated on behalf of the appellant that there was no equity in favour of respondent No 1 as he was a lessee for 10 years and all the constructions were made with the full knowledge that he was a lessee for a limited period.In any case. it was said that the appellant should have been given permission under Section 3 of the Partition Act (Partition Act No IV of 1893) when respondent No. 1 himself invoked the provisions of S. 2 of that Act. It was also argued that the High Court had no jurisdiction to modify any portion of the judgment dated March 25, 1960 by a subsequent order dated June 21. 1960 without an application for review. In our opinion, the contention put forward on behalf of the appellant is well founded and since no application was made on behalf of the first respondent under Section 2 of the Partition Act

### Instruction: Given the specifics of the case proceeding, anticipate the court's ruling: will it favor (1) or oppose (0) the appellant’s request? ### Input: further contact between the parties, it is a question of construction whether the execution of the further contract is a condition or term of the bargain or whether it is a mere expression of the desire of the parties as to the manner in which the transaction already agreed to will in fact go through. In the former case there is no enforceable contract either because the condition is unfulfilled or because the law does not recognise a contract to enter into a contract. In the latter case there is a binding contract and the reference to the more formal document may be ignored.,In other words, there may be a case where the signing of a further formal agreement is made a condition or term of the bargain, and if the formal agreement is not approved and signed there is no concluded contract.In Rossiter v. Miller. (1878) 3 AC 1124 Lord Cairns said :"If you find not an unqualified acceptance subject to the condition that an agreement is to be prepared and agreed upon between the parties. and until that condition is fulfilled no contract is to arise then you cannot find a concluded contract."In Currimbhoy, and Co. Ltd. v . Creet, 60 Ind App 297 = (AIR 1933 PC 29 ) the Judicial Committee expressed the view that the principle of the English law which is summarised in the judgment of Parker, J. in (1912) 1 Ch 284 was applicable in India.The question in the present appeals is whether the execution of a formal agreement was intended to be a condition of the bargain dated July 6, 1952 or whether it was a mere expression of the desire of the parties for a formal agreement which can be ignored. The evidence adduced on behalf of respondent No. 1 does not show that the drawing up of a written agreement was a pre-requisite to the coming into effect of the oral agreement. It is therefore not possib1e to accept the contention of the appellant that the oral agreement was ineffective in law because there is no execution of any formal written document. As regards the other point, it is true that there is no specific agreement with regard to the mode of payment but this does not necessarily make the agreement ineffective The mere omission to settle the mode of payment does not affect the completeness of the contract because the vital terms of the contract like the price and area of the land and the time for completion of the sale were all fixed. We accordingly hold that Mr. Gokhale is unable to make good his argument on this aspect of the case.4. We shall next deal with the question whether the appellant was a bona fide purchaser for value without notice of the prior oral agreement. The first sale deed obtained by the appellant was on July 26, 1952. P. W. 2 stated in his evidence that the appellant told him that he had been aware of the agreement in favour of respondent No. 1 at the time of the purchases under Exs. B-6 to B-10. It is true that P. W. 2 added that the appellant did not say distinctly that he was aware of the agreement between the respondent and defendants 1 to 9. Upon this point the appellant himself was unable to remember whether he had told P. W 2 to that effect. In any case, P. Ws. 5 and 6 deposed that they went to the appellant on July 7 1952 and asked him to part with his shares in favour of respondent No. 1. It is not denied by the appellant that he met P. Ws. 5 and 6 on July 7, 1952. It is also significant that the purchase money paid by the appellant was very nearly the same as that payable under the agreement in respondent No. 1s favour. On the basis of this evidence the High Court reached the conclusion that the appellant had notice of the prior oral agreement; We see no reason to differ from the finding of the High Court on this point.5. It was finally contended that the High Court ought not to have given any direction that as far as possible the site upon which the cinema building stands should be allotted to the share of respondent No. 1 if it is comprised within the 137 shares to which he was entitled. It was stated on behalf of the appellant that there was no equity in favour of respondent No 1 as he was a lessee for 10 years and all the constructions were made with the full knowledge that he was a lessee for a limited period.In any case. it was said that the appellant should have been given permission under Section 3 of the Partition Act (Partition Act No IV of 1893) when respondent No. 1 himself invoked the provisions of S. 2 of that Act. It was also argued that the High Court had no jurisdiction to modify any portion of the judgment dated March 25, 1960 by a subsequent order dated June 21. 1960 without an application for review. In our opinion, the contention put forward on behalf of the appellant is well founded and since no application was made on behalf of the first respondent under Section 2 of the Partition Act we are of opinion that the following direction of the High Court in the preliminary decree should be deleted:"(7). That the lower Court shall as far as possible allot to the appellant the site upon which the appellants buildings stand and further direct that if that procedure cannot be adopted conveniently or equitably the procedure laid down in the judgment reported in (1957) 2 Andh WR 488 = (AIR 1958 Andh Pra 647) be followed."It will, of course, be open to the parties to make representations and for the High Court to give equitable directions in the allotment of shares to be made in the final partition decree. ### Response: 0

Vinod M. Chitalia Vs. Union of India

November 2005 and 25 December 2005, from that given to DRI(Customs dept.) on 25 April 2005, as recorded in the order of the Tribunal in the matter of APL. (See para 16 at page 240 of the Appeal Memo) Therefore there is in fact no retraction of any particular statement by Manoj Jain. It is pertinent to note that the Appellant in his grounds of appeal before the Tribunal had not taken any specific ground with regard to retraction of statement by Manoj Jain. (Page 208 of the Appeal Memo) In the circumstances, in the present case, there is no question of retraction of the statement made by Manoj Jain Director of APL Limited to the DRI. Consequently, the question of the original statement being made to the DRI under threat cannot arise. In any event it is to be noted that in the impugned Order, (at para 21 at page 270 of the Appeal Memo) it is recorded that the changed statement was made only four months after the earlier statement made by Manoj Jain to DRI and in any event the same is corroborated by other evidence. The Tribunal has also recorded a finding of fact that there is nothing on record to indicate that any force was used to record the statements of the Appellant or Manoj Jain - Director of APL Limited or other persons.20. The statements made to DRI can be used in the present proceeding as they pertain to the same transaction. It must be borne in mind that under Section 108 of the Customs Act, 1962 the statements recorded before the DRI are deemed to be in a judicial proceeding within the meaning of Section 193 and 228 of the Indian Penal Code, 1860. The solemnity and sanctity attached to the statement made in a judicial proceeding therefore attaches to the statement made under the Customs Act to the DRI. Therefore there is no prohibition in relying upon statements made under the Customs Act 1962 for the purposes of the adjudication proceeding under the FEMA, more so when reliance is placed upon documents to the complaint made to the Adjudicating Authority.21. Section 3(b) provides that no person shall make any payment to or for the credit of any person resident outside India in any manner. In the present case, there is a complete absence of any legitimate consideration, such as the supply of goods against which an inward remittance as high as Rs. 75.39 crores was received. Hence, the only possible inference that would arise is that the inward remittance of Rs.75.39 crores was matched by a hawala transaction involving transactions through a person resident outside India. Similarly, under Section 3(d), no person shall enter into any financial transaction in India as consideration for or in association with the acquisition or creation or transfer of a right to acquire any asset outside India. Money is a form of assets. The acquisition of money outside India is the acquisition of an asset. This acquisition would be subject to the FEMA and has to be in accordance with law. The Appellant was a party to financial transactions in India which constituted a consideration for the receipt of inward remittances amounting to Rs. 75.39 crores from abroad which were not backed by any lawful consideration involving a genuine export of goods. The adjudicating authority has found that the amount which was received by APL through banking channels was not actually due to them against any goods exported. This amount as held by the adjudicating authority, represented an amount transmitted from India through unauthorised channels to show a legitimate inward remittance.In assessing these findings, the Court cannot be oblivious of the fact that clandestine transactions of the nature involved in the present case, are within the peculiar knowledge of persons such as the Appellant, who are parties to those transactions. The burden which is cast upon the adjudicating authority to establish a violation must be assessed from a robust and common sense perspective. Clandestine violations take place under the cloak of secrecy. To impose a burden of establishing in an adjudication proceeding, every conceivable link of an unlawful transaction would result in a manifest failure of justice and would defeat the underlying purpose of the Act. The standard of proof in an adjudication proceeding cannot be equated with the rigorous standard in a criminal trial. The proof required in an adjudication proceeding is on a preponderance of possibilities. The Department has discharged the burden cast upon it of proving the breach of Sections 3(b) and 3(d).22. Before concluding, it is necessary for us to refer to the fact that the Tribunal, in a passing reference to the earlier decision has observed that APL, its Chairman and Directors were not persons entitled to be exonerated of the charges by the Tribunal. The issue as to the complicity of APL, its Chairman and Directors stands governed by the earlier decision of the Tribunal. Surprisingly, no appeal has been filed by the Union of India or by the Enforcement Directorate against the earlier decision of the Tribunal dated 31 August 2009 and the limitation for filing such an appeal under Section 35 may perhaps have expired by now. Counsel for the Respondents also has no explanation as to why no appeal was filed in the earlier case. Be that as it may, those observations of the Tribunal cannot be construed as affecting the rights of any third parties who were not before the Court, since the Tribunal was and this Court is concerned only with the involvement of those who are parties to the appeal proceedings. Independently, the evidence against the Appellant is sufficient to sustain the finding of breach of Sections 3(b) and 3(d). The penalty is not disproportionate, but is commensurate with the gravity of the charge, the nature of the misconduct and the role attributed to the Appellant.23. For the aforesaid reasons, we are of the view that no question of law would arise in the appeal.

0[ds]17. The Settlement Commission under Section 127H of the Customs Act, 1962 has power to grant immunity to any person who has made an application to it for settlement. The immunity is from prosecution under the Customs Act, 1962 and also either wholly or in part from the imposition of a penalty or fine under the Customs Act. Therefore the immunity is only from penalty under the Customs Act and not in respect of any other Act including the FEMA. Further Section 127J of the Customs Act 1962 states that an order of the Settlement Commission shall be conclusive as to the matters stated therein and no matter covered by such order shall be reopened in any proceeding under this Act or any other law for the time being in force. Therefore the orders of the Settlement Commission are considered to be conclusive of the matters stated therein and cannot be challenged in any other proceeding under any other law including FEMA. In the light of the aforesaid provision the order of the Settlement Commission dated 7 June 2006 in respect of the findings of fact recorded therein is conclusive.18. In any event, the Appellant herein is barred from raising the issue of his involvement in manipulating documents to enable foreign exchange procurement to the tune of Rs.75 crores as remittances without effecting physical export. This is for the reason that the Appellant would be bound by the principle of issue estoppel. The principle ofbars a Court from exercising its jurisdiction to determine a lis, if it has attained finality between the parties. On the other hand the doctrine of issue estoppel is invoked against a party from raising an issue in a subsequent proceeding, if the same has been decided in an earlier lis by a competent court (See Bhanu Kumar Jain). (2005) 1 SCC 787. Similarly in Ishwar Datta, (2005) 7 SCC 190 the Supreme Court held that issue of estoppel would arise where a particular issue forming a necessary ingredient in a cause of action has been litigated and decided. Then in a subsequent proceeding involving a different cause of action to which the same issue is relevant it cannot be reopened. On the basis of the above decision, it is clear that even on the principle of issue estoppel, the impugned Order was correct in relying upon a finding in the order of the Settlement Commission dated 7 June 2006 which has been accepted by the Appellant and has the necessary ingredient for imposition of penalty under the FEMA.Before the Tribunal it was urged on behalf of the Appellant that the statement of Manojof APL Ltd. has been retracted and therefore, the earlier statement cannot be considered to be voluntary and true (Paragraph 20 page 269 of the Appeal Memo). It is pertinent to note that the retraction which was urged by the Appellant before the Tribunal was on the basis that different statements were given to the Enforcement Directorate on 23 and 25 November 2005 and 25 December 2005, from that given to DRI(Customs dept.) on 25 April 2005, as recorded in the order of the Tribunal in the matter of APL. (See para 16 at page 240 of the Appeal Memo) Therefore there is in fact no retraction of any particular statement by Manoj Jain. It is pertinent to note that the Appellant in his grounds of appeal before the Tribunal had not taken any specific ground with regard to retraction of statement by Manoj Jain. (Page 208 of the Appeal Memo) In the circumstances, in the present case, there is no question of retraction of the statement made by Manoj Jain Director of APL Limited to the DRI. Consequently, the question of the original statement being made to the DRI under threat cannot arise. In any event it is to be noted that in the impugned Order, (at para 21 at page 270 of the Appeal Memo) it is recorded that the changed statement was made only four months after the earlier statement made by Manoj Jain to DRI and in any event the same is corroborated by other evidence. The Tribunal has also recorded a finding of fact that there is nothing on record to indicate that any force was used to record the statements of the Appellant or Manoj JainDirector of APL Limited or other persons.20. The statements made to DRI can be used in the present proceeding as they pertain to the same transaction. It must be borne in mind that under Section 108 of the Customs Act, 1962 the statements recorded before the DRI are deemed to be in a judicial proceeding within the meaning of Section 193 and 228 of the Indian Penal Code, 1860. The solemnity and sanctity attached to the statement made in a judicial proceeding therefore attaches to the statement made under the Customs Act to the DRI. Therefore there is no prohibition in relying upon statements made under the Customs Act 1962 for the purposes of the adjudication proceeding under the FEMA, more so when reliance is placed upon documents to the complaint made to the Adjudicating Authority.Before concluding, it is necessary for us to refer to the fact that the Tribunal, in a passing reference to the earlier decision has observed that APL, its Chairman and Directors were not persons entitled to be exonerated of the charges by the Tribunal. The issue as to the complicity of APL, its Chairman and Directors stands governed by the earlier decision of the Tribunal. Surprisingly, no appeal has been filed by the Union of India or by the Enforcement Directorate against the earlier decision of the Tribunal dated 31 August 2009 and the limitation for filing such an appeal under Section 35 may perhaps have expired by now. Counsel for the Respondents also has no explanation as to why no appeal was filed in the earlier case. Be that as it may, those observations of the Tribunal cannot be construed as affecting the rights of any third parties who were not before the Court, since the Tribunal was and this Court is concerned only with the involvement of those who are parties to the appeal proceedings. Independently, the evidence against the Appellant is sufficient to sustain the finding of breach of Sections 3(b) and 3(d). The penalty is not disproportionate, but is commensurate with the gravity of the charge, the nature of the misconduct and the role attributed to the Appellant.23. For the aforesaid reasons, we are of the view that no question of law would arise in the appeal.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: November 2005 and 25 December 2005, from that given to DRI(Customs dept.) on 25 April 2005, as recorded in the order of the Tribunal in the matter of APL. (See para 16 at page 240 of the Appeal Memo) Therefore there is in fact no retraction of any particular statement by Manoj Jain. It is pertinent to note that the Appellant in his grounds of appeal before the Tribunal had not taken any specific ground with regard to retraction of statement by Manoj Jain. (Page 208 of the Appeal Memo) In the circumstances, in the present case, there is no question of retraction of the statement made by Manoj Jain Director of APL Limited to the DRI. Consequently, the question of the original statement being made to the DRI under threat cannot arise. In any event it is to be noted that in the impugned Order, (at para 21 at page 270 of the Appeal Memo) it is recorded that the changed statement was made only four months after the earlier statement made by Manoj Jain to DRI and in any event the same is corroborated by other evidence. The Tribunal has also recorded a finding of fact that there is nothing on record to indicate that any force was used to record the statements of the Appellant or Manoj Jain - Director of APL Limited or other persons.20. The statements made to DRI can be used in the present proceeding as they pertain to the same transaction. It must be borne in mind that under Section 108 of the Customs Act, 1962 the statements recorded before the DRI are deemed to be in a judicial proceeding within the meaning of Section 193 and 228 of the Indian Penal Code, 1860. The solemnity and sanctity attached to the statement made in a judicial proceeding therefore attaches to the statement made under the Customs Act to the DRI. Therefore there is no prohibition in relying upon statements made under the Customs Act 1962 for the purposes of the adjudication proceeding under the FEMA, more so when reliance is placed upon documents to the complaint made to the Adjudicating Authority.21. Section 3(b) provides that no person shall make any payment to or for the credit of any person resident outside India in any manner. In the present case, there is a complete absence of any legitimate consideration, such as the supply of goods against which an inward remittance as high as Rs. 75.39 crores was received. Hence, the only possible inference that would arise is that the inward remittance of Rs.75.39 crores was matched by a hawala transaction involving transactions through a person resident outside India. Similarly, under Section 3(d), no person shall enter into any financial transaction in India as consideration for or in association with the acquisition or creation or transfer of a right to acquire any asset outside India. Money is a form of assets. The acquisition of money outside India is the acquisition of an asset. This acquisition would be subject to the FEMA and has to be in accordance with law. The Appellant was a party to financial transactions in India which constituted a consideration for the receipt of inward remittances amounting to Rs. 75.39 crores from abroad which were not backed by any lawful consideration involving a genuine export of goods. The adjudicating authority has found that the amount which was received by APL through banking channels was not actually due to them against any goods exported. This amount as held by the adjudicating authority, represented an amount transmitted from India through unauthorised channels to show a legitimate inward remittance.In assessing these findings, the Court cannot be oblivious of the fact that clandestine transactions of the nature involved in the present case, are within the peculiar knowledge of persons such as the Appellant, who are parties to those transactions. The burden which is cast upon the adjudicating authority to establish a violation must be assessed from a robust and common sense perspective. Clandestine violations take place under the cloak of secrecy. To impose a burden of establishing in an adjudication proceeding, every conceivable link of an unlawful transaction would result in a manifest failure of justice and would defeat the underlying purpose of the Act. The standard of proof in an adjudication proceeding cannot be equated with the rigorous standard in a criminal trial. The proof required in an adjudication proceeding is on a preponderance of possibilities. The Department has discharged the burden cast upon it of proving the breach of Sections 3(b) and 3(d).22. Before concluding, it is necessary for us to refer to the fact that the Tribunal, in a passing reference to the earlier decision has observed that APL, its Chairman and Directors were not persons entitled to be exonerated of the charges by the Tribunal. The issue as to the complicity of APL, its Chairman and Directors stands governed by the earlier decision of the Tribunal. Surprisingly, no appeal has been filed by the Union of India or by the Enforcement Directorate against the earlier decision of the Tribunal dated 31 August 2009 and the limitation for filing such an appeal under Section 35 may perhaps have expired by now. Counsel for the Respondents also has no explanation as to why no appeal was filed in the earlier case. Be that as it may, those observations of the Tribunal cannot be construed as affecting the rights of any third parties who were not before the Court, since the Tribunal was and this Court is concerned only with the involvement of those who are parties to the appeal proceedings. Independently, the evidence against the Appellant is sufficient to sustain the finding of breach of Sections 3(b) and 3(d). The penalty is not disproportionate, but is commensurate with the gravity of the charge, the nature of the misconduct and the role attributed to the Appellant.23. For the aforesaid reasons, we are of the view that no question of law would arise in the appeal. ### Response: 0

Indian Aluminium Cables Ltd. & Anr Vs. Excise And Taxation Officer & Anr

under the Punjab General Sales Tax Act had filed returns for the 4 quarters of the financial year ending on March 31, 1955 as also for the 4 quarters for the financial year ending on March 31, 1956. In respect of each year the Sales Tax Assessing Officer served three successive notices on the dealer one on March 7, 1958, the other on April 4, 1958, and the third on August 18, 1959. The first two notices were merely under section 11(2) of the Act. But in the last notice which was issued after the expiry of 3 years it was stated that on the dealers failure to produce the documents and other evidence mentioned in the not ice, the case would be decided on best judgment assessment basis. The dealer did not comply with any of the notices and challenged with success by a petition under Article 32 of the Constitution the right of the authorities to, make a best judgment assessment. In that connection it was pointed out that the period of 3 years mentioned in sub section (4) of section 11 of the Act had to be counted from the expiry of the period in relation to which the returns had been filed and on expiry of the said period the authorities could not proceed to make the best judgment assessment. The third and t he last notice given on August 18, 1959 was taken to be a notice to the dealer that the assessing authority was proceeding to make the best judgment assessment and since this was done more than 3 years after expiry of all the 8 quarters in respect of the two years it was held to be without jurisdiction and the respondent was restrained from making any best judgment assessment on the petitioner for sales tax for any quarter of the financial years 1954-55 and 1955-56. The decision of this Court in Madan Lal Aroras(12 S.T.C. 387.) case justifies our apprehension which we have mentioned in the beginning of our judgment to the effect that if a dealer fails t o comply with the notice issued under section 11 (2) of the Act, then in such a case, even though there may not be any time limit for issuance of a notice, but on the dealers failure to comply with it the assessing authority may be obliged to take recourse to sub- section (4) attracting the bar of limitation of 5 years for proceeding to assess on the best judgment basis. The majority, however, was wrong when they said at page 949 of 15 S.T.C. with reference to Madan Lal Aroras case:"In the case before the Supreme Court, two notices were within three years and the third notice was beyond three years and their Lordships held that the third notice beyond three years, the Assessing Authority had no jurisdiction to make the assessment. If the phrase "proceed to assess" bears the meaning which the learned counsel for the State contends for, namely, that only a step towards assessment has to be taken and the assessment can be made at any time after the period of three years, their Lordships would on the basis of the two notices within the period of limitation, have come to a different conclusion and that is not what has been done." 12. This was, it appears to us, clearly a mistaken reading of the judgment of this Court. The majority in our opinion, was also wrong in importing the period of limitation provided in sub-sections (4), (5) and (6) of section 11 of the Act into sub-section (3) and in holding, therefore, that an assessment under sub-section (3) must also be completed within 3 years from the last date on which the return should be filed under the Act. We are again constrain ed to point out that the majority of the Full Bench committed a mistake in thinking that, this Court had held in Madan Lal Aroras case that the period of 3 years had to be counted from the last date on which the return should be filed. The decision of the Full Bench of the Punjab High Court in the case of Ramashwar Lals case (supra) is clearly erroneous and must be over-ruled. Pandit, J. in his dissenting opinion had, by and large, taken a correct view in favour of the Revenue. 13. Lastly, we may also make a reference to a recent decision of this Court delivered by one of us (Untwalia, J.) in the case of Gurbaksh Singh v. Union of India &Others ([1976] 3 S.C.R. 247.) An argument quite similar to the one advanced before us was advanced on behalf of the assessee appellant in that case before this Court. It was argued that the period of 4 years of limitation prescribed under sub-section (2a) of section 11 of the Bengal Finance (Sales Tax) Act, 1941 as extended to the Union Territory of Delhi, should be imported into the revisional and the appellate power of the authorities conferred on them under section 20. This argument was repelled and it was pointed out that .the legislature had not provided any period within which an order was to be made by an Appellate or Revisional authority; no such period should be imported in the exercise of the power on the basis of section 11 (2a). Mr. Desai relied upon the penaltimate paragraph of this decision in support of his contention that in any view of the matter notice under section 11 (2) had to be issued and the assessment completed within a reasonable time. We do not accept this contention to be sound. The argument as presented cannot be accepted to be correct. In Gurbaksh Singhs case it was not stated that the exercise of the revisional power suo moto could not be made after an undue long delay. On such an assumption it was merely found as a fact that there was no undue delay in the suo moto exercise of the power.

0[ds]But we think it is high time that the decision of the Full Bench of the High Court in Rameshwar Lals case should be clearly and expressly over-ruled now. An identical view had been expressed by his Court reversing the decision of the Punjab High Court in Letters Patent Appeal No. 319/63 in the case of The State of Punjab and another v. Murlidhar Mahabir Prasad(21 S.T.C. 29.)The majority opinion of the Full Bench of the Punjab High Court was delivered by two judges in the case of Rameshwarlal Sarupchandra (Supra) Pandit Jave a dissenting opinion. It is wrong to say, as stated by the majority, that the expression "proceed to assess" and the word "assess" connote the same meaning. The ratio of the majority opinion is chiefly based upon the decision of the Full Bench of the Bombay High Court in Bisesar Houses case which decision was not approved by this Court and must be deemed to have been overruled. The majority we may also point out with respect, committed a mistake in appreciating the decision of this Court in the case of Madan Lal Arora v. The Excise and Taxation Officer, Amritsar(12 S.T.C. 387) Sarkar, J., as he then was, delivering the judgment on behalf of a Constitution Bench of this Court adverted to the facts of the case and stated that the registered dealer under the Punjab General Sales Tax Act had filed returns for the 4 quarters of the financial year ending on March 31, 1955 as also for the 4 quarters for the financial year ending on March 31, 1956. In respect of each year the Sales Tax Assessing Officer served three successive notices on the dealer one on March 7, 1958, the other on April 4, 1958, and the third on August 18, 1959. The first two notices were merely under section 11(2) of the Act. But in the last notice which was issued after the expiry of 3 years it was stated that on the dealers failure to produce the documents and other evidence mentioned in the not ice, the case would be decided on best judgment assessment basis. The dealer did not comply with any of the notices and challenged with success by a petition under Article 32 of the Constitution the right of the authorities to, make a best judgment assessment. In that connection it was pointed out that the period of 3 years mentioned in sub section (4) of section 11 of the Act had to be counted from the expiry of the period in relation to which the returns had been filed and on expiry of the said period the authorities could not proceed to make the best judgment assessment. The third and t he last notice given on August 18, 1959 was taken to be a notice to the dealer that the assessing authority was proceeding to make the best judgment assessment and since this was done more than 3 years after expiry of all the 8 quarters in respect of the two years it was held to be without jurisdiction and the respondent was restrained from making any best judgment assessment on the petitioner for sales tax for any quarter of the financial years 1954-55 and 1955-56. The decision of this Court in Madan Lal Aroras(12 S.T.C. 387.) case justifies our apprehension which we have mentioned in the beginning of our judgment to the effect that if a dealer fails t o comply with the notice issued under section 11 (2) of the Act, then in such a case, even though there may not be any time limit for issuance of a notice, but on the dealers failure to comply with it the assessing authority may be obliged to take recourse to sub- section (4) attracting the bar of limitation of 5 years for proceeding to assess on the best judgment basis. The majority, however, was wrong when they said at page 949 of 15 S.T.C. with reference to Madan Lal Arorasn the case before the Supreme Court, two notices were within three years and the third notice was beyond three years and their Lordships held that the third notice beyond three years, the Assessing Authority had no jurisdiction to make the assessment. If the phrase "proceed to assess" bears the meaning which the learned counsel for the State contends for, namely, that only a step towards assessment has to be taken and the assessment can be made at any time after the period of three years, their Lordships would on the basis of the two notices within the period of limitation, have come to a different conclusion and that is not what has been done."This was, it appears to us, clearly a mistaken reading of the judgment of this Court. The majority in our opinion, was also wrong in importing the period of limitation provided in sub-sections (4), (5) and (6) of section 11 of the Act into sub-section (3) and in holding, therefore, that an assessment under sub-section (3) must also be completed within 3 years from the last date on which the return should be filed under the Act. We are again constrain ed to point out that the majority of the Full Bench committed a mistake in thinking that, this Court had held in Madan Lal Aroras case that the period of 3 years had to be counted from the last date on which the return should be filed. The decision of the Full Bench of the Punjab High Court in the case of Ramashwar Lals case (supra) is clearly erroneous and must be over-ruled. Pandit, J. in his dissenting opinion had, by and large, taken a correct view in favour of the RevenueLastly, we may also make a reference to a recent decision of this Court delivered by one of us (Untwalia, J.) in the case of Gurbaksh Singh v. Union of India &Others ([1976] 3 S.C.R. 247.) An argument quite similar to the one advanced before us was advanced on behalf of the assessee appellant in that case before this Court. It was argued that the period of 4 years of limitation prescribed under sub-section (2a) of section 11 of the Bengal Finance (Sales Tax) Act, 1941 as extended to the Union Territory of Delhi, should be imported into the revisional and the appellate power of the authorities conferred on them under section 20. This argument was repelled and it was pointed out that .the legislature had not provided any period within which an order was to be made by an Appellate or Revisional authority; no such period should be imported in the exercise of the power on the basis of section 11 (2a). Mr. Desai relied upon the penaltimate paragraph of this decision in support of his contention that in any view of the matter notice under section 11 (2) had to be issued and the assessment completed within a reasonable time. We do not accept this contention to be sound. The argument as presented cannot be accepted to be correct. In Gurbaksh Singhs case it was not stated that the exercise of the revisional power suo moto could not be made after an undue long delay. On such an assumption it was merely found as a fact that there was no undue delay in the suo moto exercise of the power.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: under the Punjab General Sales Tax Act had filed returns for the 4 quarters of the financial year ending on March 31, 1955 as also for the 4 quarters for the financial year ending on March 31, 1956. In respect of each year the Sales Tax Assessing Officer served three successive notices on the dealer one on March 7, 1958, the other on April 4, 1958, and the third on August 18, 1959. The first two notices were merely under section 11(2) of the Act. But in the last notice which was issued after the expiry of 3 years it was stated that on the dealers failure to produce the documents and other evidence mentioned in the not ice, the case would be decided on best judgment assessment basis. The dealer did not comply with any of the notices and challenged with success by a petition under Article 32 of the Constitution the right of the authorities to, make a best judgment assessment. In that connection it was pointed out that the period of 3 years mentioned in sub section (4) of section 11 of the Act had to be counted from the expiry of the period in relation to which the returns had been filed and on expiry of the said period the authorities could not proceed to make the best judgment assessment. The third and t he last notice given on August 18, 1959 was taken to be a notice to the dealer that the assessing authority was proceeding to make the best judgment assessment and since this was done more than 3 years after expiry of all the 8 quarters in respect of the two years it was held to be without jurisdiction and the respondent was restrained from making any best judgment assessment on the petitioner for sales tax for any quarter of the financial years 1954-55 and 1955-56. The decision of this Court in Madan Lal Aroras(12 S.T.C. 387.) case justifies our apprehension which we have mentioned in the beginning of our judgment to the effect that if a dealer fails t o comply with the notice issued under section 11 (2) of the Act, then in such a case, even though there may not be any time limit for issuance of a notice, but on the dealers failure to comply with it the assessing authority may be obliged to take recourse to sub- section (4) attracting the bar of limitation of 5 years for proceeding to assess on the best judgment basis. The majority, however, was wrong when they said at page 949 of 15 S.T.C. with reference to Madan Lal Aroras case:"In the case before the Supreme Court, two notices were within three years and the third notice was beyond three years and their Lordships held that the third notice beyond three years, the Assessing Authority had no jurisdiction to make the assessment. If the phrase "proceed to assess" bears the meaning which the learned counsel for the State contends for, namely, that only a step towards assessment has to be taken and the assessment can be made at any time after the period of three years, their Lordships would on the basis of the two notices within the period of limitation, have come to a different conclusion and that is not what has been done." 12. This was, it appears to us, clearly a mistaken reading of the judgment of this Court. The majority in our opinion, was also wrong in importing the period of limitation provided in sub-sections (4), (5) and (6) of section 11 of the Act into sub-section (3) and in holding, therefore, that an assessment under sub-section (3) must also be completed within 3 years from the last date on which the return should be filed under the Act. We are again constrain ed to point out that the majority of the Full Bench committed a mistake in thinking that, this Court had held in Madan Lal Aroras case that the period of 3 years had to be counted from the last date on which the return should be filed. The decision of the Full Bench of the Punjab High Court in the case of Ramashwar Lals case (supra) is clearly erroneous and must be over-ruled. Pandit, J. in his dissenting opinion had, by and large, taken a correct view in favour of the Revenue. 13. Lastly, we may also make a reference to a recent decision of this Court delivered by one of us (Untwalia, J.) in the case of Gurbaksh Singh v. Union of India &Others ([1976] 3 S.C.R. 247.) An argument quite similar to the one advanced before us was advanced on behalf of the assessee appellant in that case before this Court. It was argued that the period of 4 years of limitation prescribed under sub-section (2a) of section 11 of the Bengal Finance (Sales Tax) Act, 1941 as extended to the Union Territory of Delhi, should be imported into the revisional and the appellate power of the authorities conferred on them under section 20. This argument was repelled and it was pointed out that .the legislature had not provided any period within which an order was to be made by an Appellate or Revisional authority; no such period should be imported in the exercise of the power on the basis of section 11 (2a). Mr. Desai relied upon the penaltimate paragraph of this decision in support of his contention that in any view of the matter notice under section 11 (2) had to be issued and the assessment completed within a reasonable time. We do not accept this contention to be sound. The argument as presented cannot be accepted to be correct. In Gurbaksh Singhs case it was not stated that the exercise of the revisional power suo moto could not be made after an undue long delay. On such an assumption it was merely found as a fact that there was no undue delay in the suo moto exercise of the power. ### Response: 0

Durga Das Khanna Vs. Commissioner Of Income-Tax, Calcutta

for defraying other charges and expenses. The payment of rent was expressly stipulated at the rate of Rs. 2100 per month and there was no indication whatsoever that any different or higher rate of rent was agreed to. It is further submitted that there was no material or evidence on which it could be found that the cinema would have fetched any higher rent, the admitted cost of construction being about Rs. 1,00,000. Alternatively the sum of Rs. 55,200 could be regarded only as payment of salami (premium) and could not be treated as revenue receipt, the payment being of a non-recurring nature.5. It seems to us that the departmental authorities as well as the High Court were in error in treating the amount of Rs. 55,200 as advance payment of rent. The lease by which the cinema house was demised did not contain any condition or stipulation from which it could be inferred that the aforesaid amount had been paid by way of advance rent. The transaction embodied in the indenture of lease was clearly business-like. The lessees wanted the building for running it as a cinema house and the lessor agreed to give it to them but apparently represented that he did not have enough money to complete it in accordance with the suggestion and requirement of the lessees. The lessees agreed to pay him the aforesaid amount by way of a lump sum without making any provision for its adjustment towards the rent or repayment by the lessor. The essential question, however, is whether on the terms of the lease and in the absence of any other material or evidence could it be held that the sum of Rs. 55,200 was paid by way of advance rental? The view which has been expressed by the Tribunal as also the High Court that the lease was for a comparatively short period of thirty years and that the aforesaid amount had to be spread over that period by way of rent in addition to a rental of Rs. 2,100 per month cannot be sustained as no foundation was laid for it by any cogent evidence. The departmental authorities can well be said to have based their decision on mere conjectures as there was nothing whatsoever to substantiate the suggestion that the real rental value of the cinema house was in the region of Rs. 2,250 per month and not Rs. 2,100 which was the agreed rent.6. It can equally well be said that the payment of the amount in question to the appellant was in the nature of a premium (salami). In the words of Lord Greene M. R. in Henriksen v. Grafton Hotel Ltd., (1942) 24 Tax Cas 453:"A payment of this character appears to me to fall into the same class as the payment of a premium of a lease, which is admittedly not deductible. In the case of such a premium it is nothing to the point to say that the parties if they had chosen, might have suppressed the premium and made a corresponding increase in the rent. No doubt they might have done so, but they did not do so in fact."Fazl Ali, J., (as he then was) in Commissioner of Income-tax, Bihar and Orissa v. Visweshwar Singh, 1939-7 ITR 536 (Pat), referred to the distinction between a single payment made at the time of the settlement of the demised property and recurring payments made during the period of its enjoyment by the lessee. This distinction, according to the learned Judge, is clearly recognised in Section 105 of the Transfer of Property Act which defines both premium and rent. This is what was observed at page 545:"It is obvious that if the premium represents the whole or part of the price of the land it cannot be income. As pointed out by Sir George Lowndes in the Commissioner of Income-tax, Bengal v. Messrs Shaw Wallace and Co., AIR 1932 PC 138 , income in the Indian Income-tax Act connotes a periodical monetary return, coming in with sort of regularity or expected regularity from definite sources. The premium or salami which is paid once for all and is not recurring payment, hardly satisfies this test. I concede that in some cases where the rent is ridiculously low and the premium abnormally high, it may be possible to argue that the premium includes advance rent. . .........It has not been even remotely suggested in the present case that the rent of Rs. 2,100 per month was ridiculously low as compared with the amount of Rs. 55,200 paid in lump sum. It is true that the question whether premium is a capital or a revenue receipt cannot be decided as a pure question of law. Its decision necessarily depends upon the facts and circumstances of each case. It would not however, be wrong to say that prima facie premium or salami is not income and it would be for the income-tax authorities to show that facts exist which would make it a revenue receipt. There is another factor which is of substantial importance in the present case. According to the terms of the lease the payment of rent was to commence not from the date of the lease which was February 23, 1946, but with effect from June 1, 1946. It is also not disputed that the lessees entered into possession after the cinema house had been completed which was subsequent to the date of the lease. These facts coupled with the payment of a lump sum which was of a non-recurring nature showed that the amount in question had all the characteristics of a capital payment and was not revenue.This would be in accord with the principles laid down by this Court in Member for the Board of Agricultural Income-tax v. Sindhurani Chaudhurani, 1957-32 ITR 169 =(AIR 1957 SC 729 ) which was a case of settlement of agricultural land but in which the principles governing the payment of premium or salami have been fully discussed.

1[ds]5. It seems to us that the departmental authorities as well as the High Court were in error in treating the amount of Rs. 55,200 as advance payment of rent. The lease by which the cinema house was demised did not contain any condition or stipulation from which it could be inferred that the aforesaid amount had been paid by way of advance rent. The transaction embodied in the indenture of lease was clearly business-like. The lessees wanted the building for running it as a cinema house and the lessor agreed to give it to them but apparently represented that he did not have enough money to complete it in accordance with the suggestion and requirement of the lessees. The lessees agreed to pay him the aforesaid amount by way of a lump sum without making any provision for its adjustment towards the rent or repayment by thet has not been even remotely suggested in the present case that the rent of Rs. 2,100 per month was ridiculously low as compared with the amount of Rs. 55,200 paid in lump sum. It is true that the question whether premium is a capital or a revenue receipt cannot be decided as a pure question of law. Its decision necessarily depends upon the facts and circumstances of each case. It would not however, be wrong to say that prima facie premium or salami is not income and it would be for the income-tax authorities to show that facts exist which would make it a revenue receipt. There is another factor which is of substantial importance in the present case. According to the terms of the lease the payment of rent was to commence not from the date of the lease which was February 23, 1946, but with effect from June 1, 1946. It is also not disputed that the lessees entered into possession after the cinema house had been completed which was subsequent to the date of the lease. These facts coupled with the payment of a lump sum which was of a non-recurring nature showed that the amount in question had all the characteristics of a capital payment and was notwould be in accord with the principles laid down by this Court in Member for the Board of Agricultural Income-tax v. Sindhurani Chaudhurani, 1957-32 ITR 169 =(AIR 1957 SC 729 ) which was a case of settlement of agricultural land but in which the principles governing the payment of premium or salami have been fully discussed.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: for defraying other charges and expenses. The payment of rent was expressly stipulated at the rate of Rs. 2100 per month and there was no indication whatsoever that any different or higher rate of rent was agreed to. It is further submitted that there was no material or evidence on which it could be found that the cinema would have fetched any higher rent, the admitted cost of construction being about Rs. 1,00,000. Alternatively the sum of Rs. 55,200 could be regarded only as payment of salami (premium) and could not be treated as revenue receipt, the payment being of a non-recurring nature.5. It seems to us that the departmental authorities as well as the High Court were in error in treating the amount of Rs. 55,200 as advance payment of rent. The lease by which the cinema house was demised did not contain any condition or stipulation from which it could be inferred that the aforesaid amount had been paid by way of advance rent. The transaction embodied in the indenture of lease was clearly business-like. The lessees wanted the building for running it as a cinema house and the lessor agreed to give it to them but apparently represented that he did not have enough money to complete it in accordance with the suggestion and requirement of the lessees. The lessees agreed to pay him the aforesaid amount by way of a lump sum without making any provision for its adjustment towards the rent or repayment by the lessor. The essential question, however, is whether on the terms of the lease and in the absence of any other material or evidence could it be held that the sum of Rs. 55,200 was paid by way of advance rental? The view which has been expressed by the Tribunal as also the High Court that the lease was for a comparatively short period of thirty years and that the aforesaid amount had to be spread over that period by way of rent in addition to a rental of Rs. 2,100 per month cannot be sustained as no foundation was laid for it by any cogent evidence. The departmental authorities can well be said to have based their decision on mere conjectures as there was nothing whatsoever to substantiate the suggestion that the real rental value of the cinema house was in the region of Rs. 2,250 per month and not Rs. 2,100 which was the agreed rent.6. It can equally well be said that the payment of the amount in question to the appellant was in the nature of a premium (salami). In the words of Lord Greene M. R. in Henriksen v. Grafton Hotel Ltd., (1942) 24 Tax Cas 453:"A payment of this character appears to me to fall into the same class as the payment of a premium of a lease, which is admittedly not deductible. In the case of such a premium it is nothing to the point to say that the parties if they had chosen, might have suppressed the premium and made a corresponding increase in the rent. No doubt they might have done so, but they did not do so in fact."Fazl Ali, J., (as he then was) in Commissioner of Income-tax, Bihar and Orissa v. Visweshwar Singh, 1939-7 ITR 536 (Pat), referred to the distinction between a single payment made at the time of the settlement of the demised property and recurring payments made during the period of its enjoyment by the lessee. This distinction, according to the learned Judge, is clearly recognised in Section 105 of the Transfer of Property Act which defines both premium and rent. This is what was observed at page 545:"It is obvious that if the premium represents the whole or part of the price of the land it cannot be income. As pointed out by Sir George Lowndes in the Commissioner of Income-tax, Bengal v. Messrs Shaw Wallace and Co., AIR 1932 PC 138 , income in the Indian Income-tax Act connotes a periodical monetary return, coming in with sort of regularity or expected regularity from definite sources. The premium or salami which is paid once for all and is not recurring payment, hardly satisfies this test. I concede that in some cases where the rent is ridiculously low and the premium abnormally high, it may be possible to argue that the premium includes advance rent. . .........It has not been even remotely suggested in the present case that the rent of Rs. 2,100 per month was ridiculously low as compared with the amount of Rs. 55,200 paid in lump sum. It is true that the question whether premium is a capital or a revenue receipt cannot be decided as a pure question of law. Its decision necessarily depends upon the facts and circumstances of each case. It would not however, be wrong to say that prima facie premium or salami is not income and it would be for the income-tax authorities to show that facts exist which would make it a revenue receipt. There is another factor which is of substantial importance in the present case. According to the terms of the lease the payment of rent was to commence not from the date of the lease which was February 23, 1946, but with effect from June 1, 1946. It is also not disputed that the lessees entered into possession after the cinema house had been completed which was subsequent to the date of the lease. These facts coupled with the payment of a lump sum which was of a non-recurring nature showed that the amount in question had all the characteristics of a capital payment and was not revenue.This would be in accord with the principles laid down by this Court in Member for the Board of Agricultural Income-tax v. Sindhurani Chaudhurani, 1957-32 ITR 169 =(AIR 1957 SC 729 ) which was a case of settlement of agricultural land but in which the principles governing the payment of premium or salami have been fully discussed. ### Response: 1

Maharashtra Sugar Mills Limited Vs. State of Bombay & Others

muster labour and contract labour employed by the Mills."The appeal Court relied upon the agreement signed by the contractor who recruited harvesting labour. Though there was no such contract or agreement between the contractors and non harvesting contract labour, the High Court found on evidence that the position of non-harvesting labour was more or less the same as that of harvesting labour. The final conclusion of the appeal Court on this point is in these words:"Therefore, on a review of this evidence it is difficult to hold that the Industrial Tribunal was in error or was not justified in coming to the conclusion that contract labour were employees of the company within the meaning of the Industrial Relations Act . .. It was open to the Industrial Court to review all the evidence and all the circumstances and what we have to decide is whether on such a review the Tribunal was not justified in drawing the conclusion that it did. We really go further and we are of the opinion that even it we were ourselves considering this evidence as a Court of first instance we would have come to the same conclusion."6. Mr. Chatterjee for the appellants contended that there was no material on the record from which this conclusion of the appeal Court could be supported. He urged that there was no relationship, contractual or otherwise, of any kind between the company and the seasonal labour employed by the contractors who had entered into agreements with the company for carrying out certain operations of a seasonal kind on the companys farms, that the contractors used to collect families and they used to do work along with them collectively and not singly, that the bills were made in the name of the contractors and that it was not known on what basis the remuneration was to be calculated or distributed, that no muster roll was kept by the company in respect of this contract labour and that there is no way in which the company can identify the persons comprised in these family groups, whose number was fluctuating. It was suggested that the true nature of the relationship of these persons with the contractor was that of partners or of sub-contractors and not of employer and employee and that a lump sum payment was made according to the result of the operations conducted by them on acreage basis, the company not knowing what happened to the money after it was handed over to the contractors.7. We are of the opinion that none of these contentions has force in view of the terms of Ex. I which is a specimen agreement regarding, the operations of sugar cane cutting and transport,, entered into by, the company with the so-called contractors. cls. 4, 12, 13 and 16 of this agreement tell a different tale. These Clauses are in these terms:"(4) I am to engage, for the purpose of carrying out works according to your instructions and for supervision, responsible servants such as you may approve of, at my cost. And I am not personally to leave the work and go away personally elsewhere without your permission.(12) I am to distribute wages of the coolies engaged by me and that in your presence, if you do the same, I have no objection. I am not to give occasion for complaint in this respect.(13) If your officers, distribute wages to the coolies engaged by me, I have no objection. I am not to give occasion for complaint in this respect.(16) After I have carried out to your satisfaction all pieces of work undertaken hereby, you are to refund the deposit amount in my name either to me or directly to my workers. Neither myself nor the coolies or cart man leaving before the end of the season, without taking previous permission from you in writing will be entitled to the proportionate refund of their deposit."It cannot be seriously disputed that the contractors engaged by the company were under the responsibility of employing responsible servants (as the company may approve of) for carrying on the operation entrusted to them and that these servants or coolies were to be paid wages by the contractor, and if thought necessary by the company directly. The modus operandi of the company with the contractors was that each contractor was asked how much men he could supply. Usually a contractor agreed to supply between 5 to 25 people and according to the capacity, for work of this number he was entrusted with the operations on the farm. The contract labour got the same amenities from the company as the muster roll labour. They got grains at concession rates from grain shops, they were supplied housing material free, they also got concessions with regard to green fodder, sugar cane, green crops; Cloth was also distributed to labour of this type. In the face of this material, it is not possible to uphold the contention raised by Mr. Chatterjee. In these circumstances it cannot be said that the appeal Court was in error in holding that the persons employed by the contractor were his employees within the definition of that expression given in the Act.8. It was urged by Mr. Chatterjee that in the case of non-harvesting labour no written contract had been put in, and it was not known on what terms non-harvesting contract labour was being employed by the contractor. The High Court drew the inference and in our opinion, legitimately, from the evidence that the position of the non-harvesting contract labour was identical with harvesting contract labour. That labour was also recruited in the same manner through the instrumentality of the contractors. It appears to us that the only difference between muster roll labour and contract labour employed by the company in 1947-48 was that in case of the former there was a direct contract between the company while in the case of the latter the relationship was brought about through the intervention or interposition of a contractor.

0[ds]7. We are of the opinion that none of these contentions has force in view of the terms of Ex. I which is a specimen agreement regarding, the operations of sugar cane cutting and transport,, entered into by, the company with thecontractors. cls. 4, 12, 13 and 16 of this agreement tell a differentcannot be seriously disputed that the contractors engaged by the company were under the responsibility of employing responsible servants (as the company may approve of) for carrying on the operation entrusted to them and that these servants or coolies were to be paid wages by the contractor, and if thought necessary by the company directly. The modus operandi of the company with the contractors was that each contractor was asked how much men he could supply. Usually a contractor agreed to supply between 5 to 25 people and according to the capacity, for work of this number he was entrusted with the operations on the farm. The contract labour got the same amenities from the company as the muster roll labour. They got grains at concession rates from grain shops, they were supplied housing material free, they also got concessions with regard to green fodder, sugar cane, green crops; Cloth was also distributed to labour of this type. In the face of this material, it is not possible to uphold the contention raised by Mr. Chatterjee. In these circumstances it cannot be said that the appeal Court was in error in holding that the persons employed by the contractor were his employees within the definition of that expression given in theHigh Court drew the inference and in our opinion, legitimately, from the evidence that the position of thecontract labour was identical with harvesting contract labour. That labour was also recruited in the same manner through the instrumentality of the contractors. It appears to us that the only difference between muster roll labour and contract labour employed by the company inwas that in case of the former there was a direct contract between the company while in the case of the latter the relationship was brought about through the intervention or interposition of a contractor.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: muster labour and contract labour employed by the Mills."The appeal Court relied upon the agreement signed by the contractor who recruited harvesting labour. Though there was no such contract or agreement between the contractors and non harvesting contract labour, the High Court found on evidence that the position of non-harvesting labour was more or less the same as that of harvesting labour. The final conclusion of the appeal Court on this point is in these words:"Therefore, on a review of this evidence it is difficult to hold that the Industrial Tribunal was in error or was not justified in coming to the conclusion that contract labour were employees of the company within the meaning of the Industrial Relations Act . .. It was open to the Industrial Court to review all the evidence and all the circumstances and what we have to decide is whether on such a review the Tribunal was not justified in drawing the conclusion that it did. We really go further and we are of the opinion that even it we were ourselves considering this evidence as a Court of first instance we would have come to the same conclusion."6. Mr. Chatterjee for the appellants contended that there was no material on the record from which this conclusion of the appeal Court could be supported. He urged that there was no relationship, contractual or otherwise, of any kind between the company and the seasonal labour employed by the contractors who had entered into agreements with the company for carrying out certain operations of a seasonal kind on the companys farms, that the contractors used to collect families and they used to do work along with them collectively and not singly, that the bills were made in the name of the contractors and that it was not known on what basis the remuneration was to be calculated or distributed, that no muster roll was kept by the company in respect of this contract labour and that there is no way in which the company can identify the persons comprised in these family groups, whose number was fluctuating. It was suggested that the true nature of the relationship of these persons with the contractor was that of partners or of sub-contractors and not of employer and employee and that a lump sum payment was made according to the result of the operations conducted by them on acreage basis, the company not knowing what happened to the money after it was handed over to the contractors.7. We are of the opinion that none of these contentions has force in view of the terms of Ex. I which is a specimen agreement regarding, the operations of sugar cane cutting and transport,, entered into by, the company with the so-called contractors. cls. 4, 12, 13 and 16 of this agreement tell a different tale. These Clauses are in these terms:"(4) I am to engage, for the purpose of carrying out works according to your instructions and for supervision, responsible servants such as you may approve of, at my cost. And I am not personally to leave the work and go away personally elsewhere without your permission.(12) I am to distribute wages of the coolies engaged by me and that in your presence, if you do the same, I have no objection. I am not to give occasion for complaint in this respect.(13) If your officers, distribute wages to the coolies engaged by me, I have no objection. I am not to give occasion for complaint in this respect.(16) After I have carried out to your satisfaction all pieces of work undertaken hereby, you are to refund the deposit amount in my name either to me or directly to my workers. Neither myself nor the coolies or cart man leaving before the end of the season, without taking previous permission from you in writing will be entitled to the proportionate refund of their deposit."It cannot be seriously disputed that the contractors engaged by the company were under the responsibility of employing responsible servants (as the company may approve of) for carrying on the operation entrusted to them and that these servants or coolies were to be paid wages by the contractor, and if thought necessary by the company directly. The modus operandi of the company with the contractors was that each contractor was asked how much men he could supply. Usually a contractor agreed to supply between 5 to 25 people and according to the capacity, for work of this number he was entrusted with the operations on the farm. The contract labour got the same amenities from the company as the muster roll labour. They got grains at concession rates from grain shops, they were supplied housing material free, they also got concessions with regard to green fodder, sugar cane, green crops; Cloth was also distributed to labour of this type. In the face of this material, it is not possible to uphold the contention raised by Mr. Chatterjee. In these circumstances it cannot be said that the appeal Court was in error in holding that the persons employed by the contractor were his employees within the definition of that expression given in the Act.8. It was urged by Mr. Chatterjee that in the case of non-harvesting labour no written contract had been put in, and it was not known on what terms non-harvesting contract labour was being employed by the contractor. The High Court drew the inference and in our opinion, legitimately, from the evidence that the position of the non-harvesting contract labour was identical with harvesting contract labour. That labour was also recruited in the same manner through the instrumentality of the contractors. It appears to us that the only difference between muster roll labour and contract labour employed by the company in 1947-48 was that in case of the former there was a direct contract between the company while in the case of the latter the relationship was brought about through the intervention or interposition of a contractor. ### Response: 0

Anand Agro Chem India Ltd Vs. Suresh Chandra

contention of Mr. Ram Jethmalani, Senior Advocate is that the property of the sugar mill has already been attached to recover the dues and the sale notice has been issued and unless there is proof of the minimal fairness of willful failure to pay in spite of sufficient means, the arrest cannot be ordered and it would be violative of Article 21 of the Constitution of India and placed reliance on the decision of this Court in Jolly George Varghese and Another vs. The Bank of Cochin (1980) 2 SCC 360. He further contended that in any event the Director, whom he - representing, is a senior citizen above 65 years of age and hence he cannot be arrested as a defaulter in payment of arrear of land revenue as stipulated in Section 171 of the Uttar Pradesh Revenue Code, 2006.6. When the matter was listed before this Court on 7.10.2013, Dr. Rajeev Dhawan, learned Senior Advocate appearing for the appellant said that the Directors of the mill undertake to pay Rs.4.55 crores representing fifty per cent of the total amount to the concerned authority within a period of six weeks and this Court stayed the arrest subject to fulfillment of the condition. Again the matter was listed on 19.11.2013 and Dr. Rajeev Dhawan, learned senior counsel said that by mistake he made a statement about the total amount payable by the writ petitioner but the amount is far less than that and requested for time to file additional affidavit on behalf of the appellant. In the next two hearings the matter was adjourned on the request made by the appellant and thereafter the matter was heard. 7. Section 17 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 stipulates that the occupier of the sugar – factory shall make speedy payment of cane price and in the event of default, sub-Section (4) stipulates that the Cane Commissioner shall forward to the Collector a certificate specifying the amount of arrears of the cane price due from the occupier and the Collector shall proceed to recover the said amount from such occupier as if it were an arrear of land revenue. Section 170 of the Uttar Pradesh Revenue Code, 2006 prescribes the process for recovery of arrears of land revenue, wherein it is mentioned that it may be recovered by anyone or more of the processes mentioned therein which includes by arrest and detention of the defaulter and attachment and sale of his movable property. 8. The Division Bench of the Allahabad High Court in its order dated 26.4.2013 has directed the District Magistrate, Hathras, namely, the Collector to take immediate action against the Directors and occupiers of the appellant-sugar mill against whom several orders have been passed under the U.P. Sugarcane (Regulation and Supply) Act, 1913 and this Court has confirmed the said order. The Division Bench in the present application considered the plea of the - appellant for the stay of arrest and after hearing both sides rejected the said plea by the impugned order and we find no error in it. 9. We say so firstly because order dated 26th April, 2013 passed by the Division Bench of the Allahabad High Court directing the District Magistrate to take immediate action against the Directors of the sugar mill has already been affirmed by this Court in appeal. The question whether or not one of the Directors who is said to be 65 years old could be arrested as a defaulter and committed to prison under Section 171 of the Uttar Pradesh Revenue Code, 2006, could and indeed ought to have been raised by the appellants either before the High Court or before this Court in appeal preferred against the order passed by the High Court. No such contention was, however, urged at that stage.10. Secondly, because the company and its Directors have not made their promises good by paying even the amounts which they had offered to pay. A plain reading of order dated 1st May, 2013 passed by this Court in SLP (C) No.16633 of 2013 extracted above would show that the company and its Directors - had assured the Commissioner that they would pay Rs.160 lacs towards price of sugarcane within two weeks besides an amount of Rs.700 lacs to be paid in installments, the first of which installment was to be paid on 15th May, 2013. No such payment was, however, made by the company and its Directors. That apart, the statement made at the bar on 7th October, 2013 by Dr. Rajeev Dhawan, learned senior counsel, for the appellant that the Directors would pay Rs.4.55 crores is also sought to be withdrawn on the ground that the same was made under a mistake. It is evident that the company and its Directors have been despite promises made on their behalf committing breach of such assurances on one pretext or the other.11. Thirdly, because there is nothing before us to suggest that the company and its Directors are incapable of raising funds for liquidating the outstanding liability towards dues payable to the farmers. Simply because the sugar factory has been attached, is no reason for us to assume that the company or its Directors are in any financial distress thereby disabling them from making the payments recoverable from them. The fact situation in the - present case is, therefore, completely different from that in Jolly George Varghese case (supra) relied upon by Mr. Ram Jethmalani.12. In the light of the above, we see no compelling reason for us to interfere with the order passed by the High Court in exercise of our extraordinary jurisdiction. We regret to say that the amounts due to the farmers towards price of the sugarcane and incidentals remains to be paid to them for several years in the past thereby accumulating huge liability against the company. That is not a happy situation nor can repeated invocation of the process of law by the appellant be a remedy for it.

0[ds]8. The Division Bench of the Allahabad High Court in its order dated 26.4.2013 has directed the District Magistrate, Hathras, namely, the Collector to take immediate action against the Directors and occupiers of themill against whom several orders have been passed under the U.P. Sugarcane (Regulation and Supply) Act, 1913 and this Court has confirmed the said order. The Division Bench in the present application considered the plea of theappellant for the stay of arrest and after hearing both sides rejected the said plea by the impugned order and we find no error inWe say so firstly because order dated 26th April, 2013 passed by the Division Bench of the Allahabad High Court directing the District Magistrate to take immediate action against the Directors of the sugar mill has already been affirmed by this Court inquestion whether or not one of the Directors who is said to be 65 years old could be arrested as a defaulter and committed to prison under Section 171 of the Uttar Pradesh Revenue Code, 2006, could and indeed ought to have been raised by the appellants either before the High Court or before this Court in appeal preferred against the order passed by the High Court. No such contention was, however, urged at that stage.10. Secondly, because the company and its Directors have not made their promises good by paying even the amounts which they had offered to pay. A plain reading of order dated 1st May, 2013 passed by this Court in SLP (C) No.16633 of 2013 extracted above would show that the company and its Directorshad assured the Commissioner that they would pay Rs.160 lacs towards price of sugarcane within two weeks besides an amount of Rs.700 lacs to be paid in installments, the first of which installment was to be paid on 15th May, 2013. No such payment was, however, made by the company and its Directors. That apart, the statement made at the bar on 7th October, 2013 by Dr. Rajeev Dhawan, learned senior counsel, for the appellant that the Directors would pay Rs.4.55 crores is also sought to be withdrawn on the ground that the same was made under a mistake. It is evident that the company and its Directors have been despite promises made on their behalf committing breach of such assurances on one pretext or the other.11. Thirdly, because there is nothing before us to suggest that the company and its Directors are incapable of raising funds for liquidating the outstanding liability towards dues payable to the farmers. Simply because the sugar factory has been attached, is no reason for us to assume that the company or its Directors are in any financial distress thereby disabling them from making the payments recoverable from them. The fact situation in thepresent case is, therefore, completely different from that in Jolly George Varghese case (supra) relied upon by Mr. Ram Jethmalani.12. In the light of the above, we see no compelling reason for us to interfere with the order passed by the High Court in exercise of our extraordinary jurisdiction. We regret to say that the amounts due to the farmers towards price of the sugarcane and incidentals remains to be paid to them for several years in the past thereby accumulating huge liability against the company. That is not a happy situation nor can repeated invocation of the process of law by the appellant be a remedy for it.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: contention of Mr. Ram Jethmalani, Senior Advocate is that the property of the sugar mill has already been attached to recover the dues and the sale notice has been issued and unless there is proof of the minimal fairness of willful failure to pay in spite of sufficient means, the arrest cannot be ordered and it would be violative of Article 21 of the Constitution of India and placed reliance on the decision of this Court in Jolly George Varghese and Another vs. The Bank of Cochin (1980) 2 SCC 360. He further contended that in any event the Director, whom he - representing, is a senior citizen above 65 years of age and hence he cannot be arrested as a defaulter in payment of arrear of land revenue as stipulated in Section 171 of the Uttar Pradesh Revenue Code, 2006.6. When the matter was listed before this Court on 7.10.2013, Dr. Rajeev Dhawan, learned Senior Advocate appearing for the appellant said that the Directors of the mill undertake to pay Rs.4.55 crores representing fifty per cent of the total amount to the concerned authority within a period of six weeks and this Court stayed the arrest subject to fulfillment of the condition. Again the matter was listed on 19.11.2013 and Dr. Rajeev Dhawan, learned senior counsel said that by mistake he made a statement about the total amount payable by the writ petitioner but the amount is far less than that and requested for time to file additional affidavit on behalf of the appellant. In the next two hearings the matter was adjourned on the request made by the appellant and thereafter the matter was heard. 7. Section 17 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 stipulates that the occupier of the sugar – factory shall make speedy payment of cane price and in the event of default, sub-Section (4) stipulates that the Cane Commissioner shall forward to the Collector a certificate specifying the amount of arrears of the cane price due from the occupier and the Collector shall proceed to recover the said amount from such occupier as if it were an arrear of land revenue. Section 170 of the Uttar Pradesh Revenue Code, 2006 prescribes the process for recovery of arrears of land revenue, wherein it is mentioned that it may be recovered by anyone or more of the processes mentioned therein which includes by arrest and detention of the defaulter and attachment and sale of his movable property. 8. The Division Bench of the Allahabad High Court in its order dated 26.4.2013 has directed the District Magistrate, Hathras, namely, the Collector to take immediate action against the Directors and occupiers of the appellant-sugar mill against whom several orders have been passed under the U.P. Sugarcane (Regulation and Supply) Act, 1913 and this Court has confirmed the said order. The Division Bench in the present application considered the plea of the - appellant for the stay of arrest and after hearing both sides rejected the said plea by the impugned order and we find no error in it. 9. We say so firstly because order dated 26th April, 2013 passed by the Division Bench of the Allahabad High Court directing the District Magistrate to take immediate action against the Directors of the sugar mill has already been affirmed by this Court in appeal. The question whether or not one of the Directors who is said to be 65 years old could be arrested as a defaulter and committed to prison under Section 171 of the Uttar Pradesh Revenue Code, 2006, could and indeed ought to have been raised by the appellants either before the High Court or before this Court in appeal preferred against the order passed by the High Court. No such contention was, however, urged at that stage.10. Secondly, because the company and its Directors have not made their promises good by paying even the amounts which they had offered to pay. A plain reading of order dated 1st May, 2013 passed by this Court in SLP (C) No.16633 of 2013 extracted above would show that the company and its Directors - had assured the Commissioner that they would pay Rs.160 lacs towards price of sugarcane within two weeks besides an amount of Rs.700 lacs to be paid in installments, the first of which installment was to be paid on 15th May, 2013. No such payment was, however, made by the company and its Directors. That apart, the statement made at the bar on 7th October, 2013 by Dr. Rajeev Dhawan, learned senior counsel, for the appellant that the Directors would pay Rs.4.55 crores is also sought to be withdrawn on the ground that the same was made under a mistake. It is evident that the company and its Directors have been despite promises made on their behalf committing breach of such assurances on one pretext or the other.11. Thirdly, because there is nothing before us to suggest that the company and its Directors are incapable of raising funds for liquidating the outstanding liability towards dues payable to the farmers. Simply because the sugar factory has been attached, is no reason for us to assume that the company or its Directors are in any financial distress thereby disabling them from making the payments recoverable from them. The fact situation in the - present case is, therefore, completely different from that in Jolly George Varghese case (supra) relied upon by Mr. Ram Jethmalani.12. In the light of the above, we see no compelling reason for us to interfere with the order passed by the High Court in exercise of our extraordinary jurisdiction. We regret to say that the amounts due to the farmers towards price of the sugarcane and incidentals remains to be paid to them for several years in the past thereby accumulating huge liability against the company. That is not a happy situation nor can repeated invocation of the process of law by the appellant be a remedy for it. ### Response: 0

National Textile Corporation And Another Vs. State Of Maharashtra And Others

aforesaid which have vested in the Central Government under sub- section (1) of section 3 shall, by force of such vesting, be freed and discharged from any trust, obligation, mortgage, charge, lien and all other incumbrances affecting it, and any attachment, injunction or decree or order of any court restricting the use of such property in an y manner shall be deemed to have been withdrawn." The other sub-sections of section 4 are not relevant for the present purpose. 2. The National Textile Corporation applied to the High Court for being substituted in place of the original appellant in the letters patent appeal which was pending and the application was allowed. The main contention on behalf of the substituted appellant in the High Court was that the two notifications under sections 4 and 6 of the Land Acquisition Act must be held to have become ineffective in view of section 4(2) of the Sick Textile Act which provides that-all property which vests in the Central Government under section 3(1) does so free from all "incumbrances affecting it." The High. Court dismissed the appeal holding that the notifications under the Land Acquisition Act were not incumbrances within the meaning of section 4(2) of the Sick Textile Act. In the appeal before us filed with special leave obtained from this Court, the National Textile Corporation questions the correctness of the view taken by the High Court. 3. Thus the only question for determination in the appeal is whether the notifications issued under the Land Acquisition Act are incumbrances within the meaning of the word as used in section 4(2 of the Sick Textile Act. Section 3 and the first two sub-sections of section 4 of the Sick Textile Act are the only provisions relevant in this context. Section 3 provides that on the appointed day every sick textile undertaking shall vest absolutely in the Central Government, and then in the National Textile Corporation. Subsection (1 ) of section 4 states that the undertakings vesting in the Central Government under section 3 sh all be deemed to include all assets, rights and interests in the ownership, possession or control of the owners of such undertakings immediately before the appointed day. Sub- section (2) of section 4 provides that all property vesting in the Central Government under section 3 shall, "by force of such vesting, be freed and discharged from any trust, obligation, mortgage, charge, lien and all other incumbrances affecting it, and any attachment, injunction or decree or order of any court restricting the use of such property in any manner shall be deemed to have been withdrawn". 4. Counsel for the appellant argues that sub- section (2) of section 4 is intended to vest the sick textile undertakings in the Central Government free from all fetters, and the notifications issued under the Land Acquisition Act which had the effect of freezing the price of the land were fetters falling in the category of "other incumbrances" mentioned in section 4(2) of the Sick Textile Act. The term incumbrance has not been defined in the Act. In Whartons Law lexicon incumbrance is described as being a claim, lien or liability, attached to property. This is the sense in which the term is ordinarily used. An incumbrance in this sense has to be a liability " attached to property", it must be a burden or liability that runs with the land, as the High Court has held. But a notification issued by the Government under the Land Acquisition Act is not a burden Or liability that is attached to the property. The sovereign right of the State to take proceedings for the acquisition of any land for public purpose is similar to its right to impose a tax on the land which is paramount to the ownership over the land and outside it". [see The Collector of Bombay v. Nusserwanji Rattanji Mistri &others [1955] 1 SCR 1311 ( at 1323). Under sub-section (2) of section 4 of the Sick Textile Act all property which have vested in the Central Government under section 3 (1) shall be freed and discharged from any trust, obligation, mortgage, charge, lien and all other incumbrances affecting it, and any attachment, injunction or decree or order of any court restricting the use of such property shall be deemed to have been withdrawn. Counsel for the respondent. State of Maharashtra, submits that the term incumbrance should take colour from the different kinds of burden on the land specified in section 4(2) preceding the words all other incumbrances "it is argued that incumbrance in the context means Some burden or liability that is attached to the property , like mortgage, charge, lien That this is so would also appear from what follows the words "all other incumbrances affecting it". Having said that the vesting will be free from trust, obligation , mortgage, charge, lien and all other incumbrances affecting it. sub-section (2) goes on to add that "any attachment. injunction or decree or order of any court restricting the use of such property in any manner shall be deemed to have been withdrawn" upon vesting. If the appellants construction of the provision were correct, and incumbrance meant any kind of fetter, any attachment, injunction or decree or order restricting the use of the property would be included in "all other incumbrances" and it would have been quite unnecessary to mention them separately. This makes it clear that fetters on the property like attachment, injunction or decree or order of any court restricting the use of the property which are deemed to have been withdrawn upon the property vesting in the Central Government are not really incumbrances within the meaning of the word as used in sub-section (2) of section 4. We therefore agree with the High Court that the notifications issued under sections 4 and 6 of the Land Acquisition Act are not incumbrances and cannot be held to have become inoperative on the land in question vesting in the Central Government. 5.

0[ds]The term incumbrance has not been defined in the Act. In Whartons Law lexicon incumbrance is described as being a claim, lien or liability, attached to property. This is the sense in which the term is ordinarily used. An incumbrance in this sense has to be a liability " attached to property", it must be a burden or liability that runs with the land, as the High Court has held. But a notification issued by the Government under the Land Acquisition Act is not a burden Or liability that is attached to the property. The sovereign right of the State to take proceedings for the acquisition of any land for public purpose is similar to its right to impose a tax on the land which is paramount to the ownership over the land and outside it". [see The Collector of Bombay v. Nusserwanji Rattanji Mistri &others [1955] 1 SCR 1311 ( at 1323). Under sub-section (2) of section 4 of the Sick Textile Act all property which have vested in the Central Government under section 3 (1) shall be freed and discharged from any trust, obligation, mortgage, charge, lien and all other incumbrances affecting it, and any attachment, injunction or decree or order of any court restricting the use of such property shall be deemed to have been withdrawn.Having said that the vesting will be free from trust, obligation , mortgage, charge, lien and all other incumbrances affecting it. sub-section (2) goes on to add that "any attachment. injunction or decree or order of any court restricting the use of such property in any manner shall be deemed to have been withdrawn" upon vesting. If the appellants construction of the provision were correct, and incumbrance meant any kind of fetter, any attachment, injunction or decree or order restricting the use of the property would be included in "all other incumbrances" and it would have been quite unnecessary to mention them separately. This makes it clear that fetters on the property like attachment, injunction or decree or order of any court restricting the use of the property which are deemed to have been withdrawn upon the property vesting in the Central Government are not really incumbrances within the meaning of the word as used in sub-section (2) of section 4. We therefore agree with the High Court that the notifications issued under sections 4 and 6 of the Land Acquisition Act are not incumbrances and cannot be held to have become inoperative on the land in question vesting in the Central Government.

### Instruction: Analyze the case proceeding and predict whether the appeal/petition will be accepted (1) or rejected (0). ### Input: aforesaid which have vested in the Central Government under sub- section (1) of section 3 shall, by force of such vesting, be freed and discharged from any trust, obligation, mortgage, charge, lien and all other incumbrances affecting it, and any attachment, injunction or decree or order of any court restricting the use of such property in an y manner shall be deemed to have been withdrawn." The other sub-sections of section 4 are not relevant for the present purpose. 2. The National Textile Corporation applied to the High Court for being substituted in place of the original appellant in the letters patent appeal which was pending and the application was allowed. The main contention on behalf of the substituted appellant in the High Court was that the two notifications under sections 4 and 6 of the Land Acquisition Act must be held to have become ineffective in view of section 4(2) of the Sick Textile Act which provides that-all property which vests in the Central Government under section 3(1) does so free from all "incumbrances affecting it." The High. Court dismissed the appeal holding that the notifications under the Land Acquisition Act were not incumbrances within the meaning of section 4(2) of the Sick Textile Act. In the appeal before us filed with special leave obtained from this Court, the National Textile Corporation questions the correctness of the view taken by the High Court. 3. Thus the only question for determination in the appeal is whether the notifications issued under the Land Acquisition Act are incumbrances within the meaning of the word as used in section 4(2 of the Sick Textile Act. Section 3 and the first two sub-sections of section 4 of the Sick Textile Act are the only provisions relevant in this context. Section 3 provides that on the appointed day every sick textile undertaking shall vest absolutely in the Central Government, and then in the National Textile Corporation. Subsection (1 ) of section 4 states that the undertakings vesting in the Central Government under section 3 sh all be deemed to include all assets, rights and interests in the ownership, possession or control of the owners of such undertakings immediately before the appointed day. Sub- section (2) of section 4 provides that all property vesting in the Central Government under section 3 shall, "by force of such vesting, be freed and discharged from any trust, obligation, mortgage, charge, lien and all other incumbrances affecting it, and any attachment, injunction or decree or order of any court restricting the use of such property in any manner shall be deemed to have been withdrawn". 4. Counsel for the appellant argues that sub- section (2) of section 4 is intended to vest the sick textile undertakings in the Central Government free from all fetters, and the notifications issued under the Land Acquisition Act which had the effect of freezing the price of the land were fetters falling in the category of "other incumbrances" mentioned in section 4(2) of the Sick Textile Act. The term incumbrance has not been defined in the Act. In Whartons Law lexicon incumbrance is described as being a claim, lien or liability, attached to property. This is the sense in which the term is ordinarily used. An incumbrance in this sense has to be a liability " attached to property", it must be a burden or liability that runs with the land, as the High Court has held. But a notification issued by the Government under the Land Acquisition Act is not a burden Or liability that is attached to the property. The sovereign right of the State to take proceedings for the acquisition of any land for public purpose is similar to its right to impose a tax on the land which is paramount to the ownership over the land and outside it". [see The Collector of Bombay v. Nusserwanji Rattanji Mistri &others [1955] 1 SCR 1311 ( at 1323). Under sub-section (2) of section 4 of the Sick Textile Act all property which have vested in the Central Government under section 3 (1) shall be freed and discharged from any trust, obligation, mortgage, charge, lien and all other incumbrances affecting it, and any attachment, injunction or decree or order of any court restricting the use of such property shall be deemed to have been withdrawn. Counsel for the respondent. State of Maharashtra, submits that the term incumbrance should take colour from the different kinds of burden on the land specified in section 4(2) preceding the words all other incumbrances "it is argued that incumbrance in the context means Some burden or liability that is attached to the property , like mortgage, charge, lien That this is so would also appear from what follows the words "all other incumbrances affecting it". Having said that the vesting will be free from trust, obligation , mortgage, charge, lien and all other incumbrances affecting it. sub-section (2) goes on to add that "any attachment. injunction or decree or order of any court restricting the use of such property in any manner shall be deemed to have been withdrawn" upon vesting. If the appellants construction of the provision were correct, and incumbrance meant any kind of fetter, any attachment, injunction or decree or order restricting the use of the property would be included in "all other incumbrances" and it would have been quite unnecessary to mention them separately. This makes it clear that fetters on the property like attachment, injunction or decree or order of any court restricting the use of the property which are deemed to have been withdrawn upon the property vesting in the Central Government are not really incumbrances within the meaning of the word as used in sub-section (2) of section 4. We therefore agree with the High Court that the notifications issued under sections 4 and 6 of the Land Acquisition Act are not incumbrances and cannot be held to have become inoperative on the land in question vesting in the Central Government. 5. ### Response: 0

State Of Kerala And Anr Vs. The Gwalior Rayon Silk Manufacturing (Wvg.) Co. Ltd. Etc

standing in such portions of the private forests as are or may be assigned under Section 10. No such fund is created for the purpose of the trees standing in the reserve area. But that does not mean that the value of the trees in the reserve area can be utilized for purposes other than those specifically mentioned in Section 10. That will be part of the scheme and Government will have to make adequate provision as to how the value of the trees can be utilized for purposes directed towards the promotion of agriculture or welfare of the agricultural population or for purposes ancillary thereto. 21. Another objection was that assignment of land without demarcation and survey was impracticable and productive of strife. We do not see why assignment of land is impracticable in the absence of survey. Even before the introduction of the survey, lands had been assigned and cultivated by agriculturists. The process of assignment must involve demarcation of the land assigned. Sub-section (3) of Sec. 10 says the extent of private forests or lands comprised in private forests which may be assigned to each of the categories of persons specified in subsection (1) and the order of preference in which assignment may be made shall be such as may be prescribed. After determining the extent of the land to be assigned, the land, when assigned, will have to be inevitably demarcated by the officers who make the assignment. That is not an insuperable difficulty. As a matter of fact we know from the affidavit on behalf of the Government that about 3 lakh acres of forests land have been already distributed. Indeed steps should be taken for an early survey in the interest of law and order. But survey is not the sine qua non of any genuine scheme for distribution of land. We do not think that the High Court has given any substantial reasons for coming to the conclusion that the scheme of agrarian reform is a teasing illusion and a promise in un-reality. 22. In an attempt to show that the impugned Act was a piece of colourable legislation, reference was made to the Kerala Private Forests Acquisition Bill, 1968 L. A. Bill No. 33 of 1968 which provided for the acquisition of private forests on payment of compensation for the acquisition. That Bill, it is contended, was allowed to lapse and the present Act was enacted with the obvious intention of expropriating vast forest lands without paying compensation. We can hardly countenance such an argument. The question really is, in the first place, of the competence of the legislature to pass the impugned Act and, in the second, whether the Act is constitutional in the sense that it is protected by Section 31A (l). So far as the competence of the legislature is concerned, no objection is made before us. As to its constitutionality we have shown that the Act purports to vest the janmam rights to the forests in the Government as a step in the implementation of agrarian reform. If this could be constitutionally done by the legislature, the fact that at an earlier stage the Government was toying with the idea of paying compensation to owners of private forests is of little consequence. The dominant purpose of the impugned Act, as already pointed out, is to distribute forest lands for agricultural purposes after making reservations of portions of the forests for the benefit of the agricultural community. The fear is expressed that such a course if, genuinely implemented, may lead to deforestation on a large scale leading to soil erosion and silting of rivers and streams and will actually turn out to be detrimental to the interests of the agricultural community in the long run. It is undoubtedly true that reckless deforestation might lead to very unhappy results. But we have no material before us for expressing opinion on such a matter. It is for the legislature to balance the comparative advantages of a scheme like the one envisaged in the Act against the possible disadvantages of resulting deforestation. There are many imponderables to which we have no safe guides. It is presumed that the legislature knows the needs of its people and will balance the present advantages against possible future disadvantages. If there is pressure on land and the legislature feels that forest lands in some areas can be conveniently and, without much damage to the community as a whole, utilized for settling a large proportion of the agricultural population, it is perfectly open, under the constitutional powers vested in the legislature, to make a suitable law, and if the law is constitutionally valid this court can hardly strike it down on the ground that in the long run the legislation instead of turning out to be a boon will turn out to be a curse. 23. Mr. Menon who appeared for the respondent in Civil Appeal No. 1398/72 put forward a plea of equitable estoppel peculiar to his client company. It appears that the Company established itself in Kerala for the production of rayon cloth pulp on an understanding that the Government would bind itself to supply the raw material. Later Government was unable to supply the material and by an agreement undertook not to legislate for the acquisition of private forests for a period of 60 years if the Company purchased forest lands for the purpose of its supply of raw-materials. Accordingly, the Company purchased 30,000 acres of private forests from the Nilambhuri Govila Kannan estate for Rs. 75/-lakhs and, therefore, it was argued that, so far as the company is concerned, the agreement not to legislate should operate as equitable estoppel against the States. We do not see how an agreement of the Government can preclude legislation on the subject. The High Court has rightly pointed out that the surrender by the Government of its legislative powers to be used for public good cannot avail the company or operate against the Government as equitable estoppel.

1[ds]15. It must be remembered that what is stated generally about the nature of the reserve forest lands in the old State of Travancore Cochin applies equally to the private forest lands of Malabar District because all these forests are contiguous and form one long belt of a mountainous terrain now forming part of the State of Kerala. It will be thus seen that all forest lands, whether reserve or private, have been applied for generations for the settlement of agriculturists whether such settlements were authorised or unauthorised. Vast areas in the forests were clear-felled, as the expression goes, for bringing patches and blocks of lands under agriculture. Several types of produce were obtained by agriculture and a large population lives on the same. Plantations of coffee, tea, rubber, cardamom and the like were grown on an extensive scale in these forests. In recent years Industrialists have taken leases of vast areas of these forests from their owners and a fraction of the same has been brought under cultivation by planting eucalyptus and other types of trees useful for paper and other industries. Large areas in these forests seem to be even now in their pristine form but are capable of being utilized by absorbing a large proportion of the population by settling them on the land. These forests, therefore, have attained a peculiar character owing to their geography and climate and the evidence available to us shows that vast areas of these forests are still capable of supporting a large agricultural populationThe definition of estate is an inclusive definition. In sub-clauses (i), (ii) and (iii) certain categories of rights and lands are included in the definition of the word estateThe dominant purpose of the impugned Act, as already pointed out, is to distribute forest lands for agricultural purposes after making reservations of portions of the forests for the benefit of the agricultural community. The fear is expressed that such a course if, genuinely implemented, may lead to deforestation on a large scale leading to soil erosion and silting of rivers and streams and will actually turn out to be detrimental to the interests of the agricultural community in the long run. It is undoubtedly true that reckless deforestation might lead to very unhappy results. But we have no material before us for expressing opinion on such a matter. It is for the legislature to balance the comparative advantages of a scheme like the one envisaged in the Act against the possible disadvantages of resulting deforestation. There are many imponderables to which we have no safe guides. It is presumed that the legislature knows the needs of its people and will balance the present advantages against possible future disadvantages. If there is pressure on land and the legislature feels that forest lands in some areas can be conveniently and, without much damage to the community as a whole, utilized for settling a large proportion of the agricultural population, it is perfectly open, under the constitutional powers vested in the legislature, to make a suitable law, and if the law is constitutionally valid this court can hardly strike it down on the ground that in the long run the legislation instead of turning out to be a boon will turn out to be a curset appears that the Company established itself in Kerala for the production of rayon cloth pulp on an understanding that the Government would bind itself to supply the raw material. Later Government was unable to supply the material and by an agreement undertook not to legislate for the acquisition of private forests for a period of 60 years if the Company purchased forest lands for the purpose of its supply of raw-materials. Accordingly, the Company purchased 30,000 acres of private forests from the Nilambhuri Govila Kannan estate for Rs. 75/-lakhs and, therefore, it was argued that, so far as the company is concerned, the agreement not to legislate should operate as equitable estoppel against the States. We do not see how an agreement of the Government can preclude legislation on the subject. The High Court has rightly pointed out that the surrender by the Government of its legislative powers to be used for public good cannot avail the company or operate against the Government as equitable estoppelIt is thus clear to those who understand developmental dialectic and rural planning that agrarian reform is more humanist than mere land reform and scientifically viewed, covers not merely abolition of intermediary tenures, zamindaris and the like but re-structuring of village life itself taking in its broad embrace the socio-economic regeneration of the rural population.The Indian Constitution is a social instrument with an economic mission and the sense and sweep of its provisions must be gathered by judicial statesmen on that seminal footingWe, on our part, do not think there is any merit in it.Once we find the legislative area is barricaded by Art. 31A, it cannot be breached by Arts. 14, 19 and 31 and judicial break-in is constitutionally interdicted. But, at the same time, we must hasten to point out that Art. 31A is no charter of legislative freedom to refuse compensation altogether in every case. The Court may not strike down a statute for non-payment of compensation but the legislature is expected, except in exceptional sociohistorical setting, to provide just payment for the deprived persons. To exclude judicial review is not to black out the beneficent provisions of Articles 14, 19 and 31.May be the present legislation dealing with extensive antiquated Janman rights relates to the exceptional category. All that we can say is that this is an area where not the court but the elector is the proper corrective instrument.

### Instruction: From the information provided in the case proceeding, infer whether the court's decision will be positive (1) or negative (0) for the appellant. ### Input: standing in such portions of the private forests as are or may be assigned under Section 10. No such fund is created for the purpose of the trees standing in the reserve area. But that does not mean that the value of the trees in the reserve area can be utilized for purposes other than those specifically mentioned in Section 10. That will be part of the scheme and Government will have to make adequate provision as to how the value of the trees can be utilized for purposes directed towards the promotion of agriculture or welfare of the agricultural population or for purposes ancillary thereto. 21. Another objection was that assignment of land without demarcation and survey was impracticable and productive of strife. We do not see why assignment of land is impracticable in the absence of survey. Even before the introduction of the survey, lands had been assigned and cultivated by agriculturists. The process of assignment must involve demarcation of the land assigned. Sub-section (3) of Sec. 10 says the extent of private forests or lands comprised in private forests which may be assigned to each of the categories of persons specified in subsection (1) and the order of preference in which assignment may be made shall be such as may be prescribed. After determining the extent of the land to be assigned, the land, when assigned, will have to be inevitably demarcated by the officers who make the assignment. That is not an insuperable difficulty. As a matter of fact we know from the affidavit on behalf of the Government that about 3 lakh acres of forests land have been already distributed. Indeed steps should be taken for an early survey in the interest of law and order. But survey is not the sine qua non of any genuine scheme for distribution of land. We do not think that the High Court has given any substantial reasons for coming to the conclusion that the scheme of agrarian reform is a teasing illusion and a promise in un-reality. 22. In an attempt to show that the impugned Act was a piece of colourable legislation, reference was made to the Kerala Private Forests Acquisition Bill, 1968 L. A. Bill No. 33 of 1968 which provided for the acquisition of private forests on payment of compensation for the acquisition. That Bill, it is contended, was allowed to lapse and the present Act was enacted with the obvious intention of expropriating vast forest lands without paying compensation. We can hardly countenance such an argument. The question really is, in the first place, of the competence of the legislature to pass the impugned Act and, in the second, whether the Act is constitutional in the sense that it is protected by Section 31A (l). So far as the competence of the legislature is concerned, no objection is made before us. As to its constitutionality we have shown that the Act purports to vest the janmam rights to the forests in the Government as a step in the implementation of agrarian reform. If this could be constitutionally done by the legislature, the fact that at an earlier stage the Government was toying with the idea of paying compensation to owners of private forests is of little consequence. The dominant purpose of the impugned Act, as already pointed out, is to distribute forest lands for agricultural purposes after making reservations of portions of the forests for the benefit of the agricultural community. The fear is expressed that such a course if, genuinely implemented, may lead to deforestation on a large scale leading to soil erosion and silting of rivers and streams and will actually turn out to be detrimental to the interests of the agricultural community in the long run. It is undoubtedly true that reckless deforestation might lead to very unhappy results. But we have no material before us for expressing opinion on such a matter. It is for the legislature to balance the comparative advantages of a scheme like the one envisaged in the Act against the possible disadvantages of resulting deforestation. There are many imponderables to which we have no safe guides. It is presumed that the legislature knows the needs of its people and will balance the present advantages against possible future disadvantages. If there is pressure on land and the legislature feels that forest lands in some areas can be conveniently and, without much damage to the community as a whole, utilized for settling a large proportion of the agricultural population, it is perfectly open, under the constitutional powers vested in the legislature, to make a suitable law, and if the law is constitutionally valid this court can hardly strike it down on the ground that in the long run the legislation instead of turning out to be a boon will turn out to be a curse. 23. Mr. Menon who appeared for the respondent in Civil Appeal No. 1398/72 put forward a plea of equitable estoppel peculiar to his client company. It appears that the Company established itself in Kerala for the production of rayon cloth pulp on an understanding that the Government would bind itself to supply the raw material. Later Government was unable to supply the material and by an agreement undertook not to legislate for the acquisition of private forests for a period of 60 years if the Company purchased forest lands for the purpose of its supply of raw-materials. Accordingly, the Company purchased 30,000 acres of private forests from the Nilambhuri Govila Kannan estate for Rs. 75/-lakhs and, therefore, it was argued that, so far as the company is concerned, the agreement not to legislate should operate as equitable estoppel against the States. We do not see how an agreement of the Government can preclude legislation on the subject. The High Court has rightly pointed out that the surrender by the Government of its legislative powers to be used for public good cannot avail the company or operate against the Government as equitable estoppel. ### Response: 1

Rajwinder Kaur and Ors Vs. Oriental Bank of Commerce and Ors

1. Leave granted.2. Civil Suit No. 731 of 1995 instituted by the Appellants has been dismissed by three forums leading to the present appeal Under Article 136 of the Constitution of India. Ordinarily and in the normal course this Court would not have been inclined to examine the matter in view of the consistent findings recorded by three forums. However, having considered the facts we are of the view that the matter deserves a closer look for which we have heard the learned Counsels for the parties at length.3. The Plaintiffs (Appellants herein) case in the Civil Suit No. 731 of 1995 is that the decree obtained by the Respondent Bank in Civil Suit No. 419 of 1994, which is one for recovery of a sum of Rs. 2,34,170/- along with interest thereon is void, illegal and inoperative in law. Accordingly, a declaration to the above effect was prayed for in the suit.4. A few dates will require recapitulation at this stage.The father of the Appellant No. 1 had executed an agreement to purchase the suit property mortgaged in favour of the Bank which is the subject matter of Civil Suit No. 419 of 1994. The mortgage in favour of the Respondent Bank was in the year 1990 whereas the agreement and the suit for specific performance thereof was filed earlier to the date of mortgage i.e. in the year 1989. The said suit was decreed in the year 1992 and the sale deed in execution of the decree was executed in favour of the Plaintiffs in the year 1994, to be specific on 12th April, 1994. It is thereafter that the Civil Suit No. 419 of 1994 was filed by the Respondent Bank i.e. on 6th August, 1994 and that too without impleading the Plaintiffs who had by that time became owners of the suit property in respect of which the mortgage was created in favour of the Respondent-Bank. If the Plaintiffs were the owners of the suit property we do not see how the suit filed by the Respondent Bank could have proceeded at all in the absence of the Plaintiffs as a party to the said suit. The suit filed by the Respondent-Bank, therefore, clearly suffered from the defect of non-joinder of all necessary parties and the decree passed therein in favour of the Respondent Bank, therefore, was a nullity. That apart, the agreement to sell and the suit for specific performance being anterior to the date of creation of the mortgage, the civil suit filed by the Respondent-Bank for recovery of the mortgaged amount would be hit by the doctrine of lis pendens inasmuch as the suit for specific performance was decreed and the decree executed by execution of the sale deed. We, therefore, do not see how the decree passed in the suit filed by the Respondent-Bank for recovery of the mortgaged amount could be sustained. These are vital aspects of the case that were overlooked by the learned courts below including the fact that the agreement to sell the property in respect of which mortgage was created has already been entered into in favour of the Plaintiff father as far back as on 13th February, 1986 and girdawaris of the said property were changed/corrected in favour of the father of the Appellant No. 1 vide Rapat No. 177 dated 7th February, 1989 as per the order of the Tehsildar, Ajnala which is exhibited as Exhibit P7 in the case.5. In the light of the above facts we hold that the findings of the learned courts below to the effect that the Plaintiffs suit (Civil Suit No. 731 of 1995) for setting the decree passed in Civil Suit No. 419 of 1994 (filed by the Respondent-Bank) was without any merit suffer from errors apparent on the face of the record and the said findings would partake the character of perverse findings in law warranting exercise of jurisdiction Under Section 100 of the Code of Civil Procedure, 1908. The High Court having failed to do so we correct the order of the High Court and allow this appeal and decree the Plaintiffs suit (Civil Suit No. 731 of 1995) and declare that the decree passed in Civil Suit No. 419 of 1994 (filed by the Respondent-Bank) is null, void and inoperative insofar as the Appellants are concerned.

1[ds]If the Plaintiffs were the owners of the suit property we do not see how the suit filed by the Respondent Bank could have proceeded at all in the absence of the Plaintiffs as a party to the said suit. The suit filed by the Respondent-Bank, therefore, clearly suffered from the defect of non-joinder of all necessary parties and the decree passed therein in favour of the Respondent Bank, therefore, was a nullity. That apart, the agreement to sell and the suit for specific performance being anterior to the date of creation of the mortgage, the civil suit filed by the Respondent-Bank for recovery of the mortgaged amount would be hit by the doctrine of lis pendens inasmuch as the suit for specific performance was decreed and the decree executed by execution of the sale deed. We, therefore, do not see how the decree passed in the suit filed by the Respondent-Bank for recovery of the mortgaged amount could be sustained. These are vital aspects of the case that were overlooked by the learned courts below including the fact that the agreement to sell the property in respect of which mortgage was created has already been entered into in favour of the Plaintiff father as far back as on 13th February, 1986 and girdawaris of the said property were changed/corrected in favour of the father of the Appellant No. 1 vide Rapat No. 177 dated 7th February, 1989 as per the order of the Tehsildar, Ajnala which is exhibited as Exhibit P7 in the case5. In the light of the above facts we hold that the findings of the learned courts below to the effect that the Plaintiffs suit (Civil Suit No. 731 of 1995) for setting the decree passed in Civil Suit No. 419 of 1994 (filed by the Respondent-Bank) was without any merit suffer from errors apparent on the face of the record and the said findings would partake the character of perverse findings in law warranting exercise of jurisdiction Under Section 100 of the Code of Civil Procedure, 1908. The High Court having failed to do so we correct the order of the High Court and allow this appeal and decree the Plaintiffs suit (Civil Suit No. 731 of 1995) and declare that the decree passed in Civil Suit No. 419 of 1994 (filed by the Respondent-Bank) is null, void and inoperative insofar as the Appellants are concerned.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: 1. Leave granted.2. Civil Suit No. 731 of 1995 instituted by the Appellants has been dismissed by three forums leading to the present appeal Under Article 136 of the Constitution of India. Ordinarily and in the normal course this Court would not have been inclined to examine the matter in view of the consistent findings recorded by three forums. However, having considered the facts we are of the view that the matter deserves a closer look for which we have heard the learned Counsels for the parties at length.3. The Plaintiffs (Appellants herein) case in the Civil Suit No. 731 of 1995 is that the decree obtained by the Respondent Bank in Civil Suit No. 419 of 1994, which is one for recovery of a sum of Rs. 2,34,170/- along with interest thereon is void, illegal and inoperative in law. Accordingly, a declaration to the above effect was prayed for in the suit.4. A few dates will require recapitulation at this stage.The father of the Appellant No. 1 had executed an agreement to purchase the suit property mortgaged in favour of the Bank which is the subject matter of Civil Suit No. 419 of 1994. The mortgage in favour of the Respondent Bank was in the year 1990 whereas the agreement and the suit for specific performance thereof was filed earlier to the date of mortgage i.e. in the year 1989. The said suit was decreed in the year 1992 and the sale deed in execution of the decree was executed in favour of the Plaintiffs in the year 1994, to be specific on 12th April, 1994. It is thereafter that the Civil Suit No. 419 of 1994 was filed by the Respondent Bank i.e. on 6th August, 1994 and that too without impleading the Plaintiffs who had by that time became owners of the suit property in respect of which the mortgage was created in favour of the Respondent-Bank. If the Plaintiffs were the owners of the suit property we do not see how the suit filed by the Respondent Bank could have proceeded at all in the absence of the Plaintiffs as a party to the said suit. The suit filed by the Respondent-Bank, therefore, clearly suffered from the defect of non-joinder of all necessary parties and the decree passed therein in favour of the Respondent Bank, therefore, was a nullity. That apart, the agreement to sell and the suit for specific performance being anterior to the date of creation of the mortgage, the civil suit filed by the Respondent-Bank for recovery of the mortgaged amount would be hit by the doctrine of lis pendens inasmuch as the suit for specific performance was decreed and the decree executed by execution of the sale deed. We, therefore, do not see how the decree passed in the suit filed by the Respondent-Bank for recovery of the mortgaged amount could be sustained. These are vital aspects of the case that were overlooked by the learned courts below including the fact that the agreement to sell the property in respect of which mortgage was created has already been entered into in favour of the Plaintiff father as far back as on 13th February, 1986 and girdawaris of the said property were changed/corrected in favour of the father of the Appellant No. 1 vide Rapat No. 177 dated 7th February, 1989 as per the order of the Tehsildar, Ajnala which is exhibited as Exhibit P7 in the case.5. In the light of the above facts we hold that the findings of the learned courts below to the effect that the Plaintiffs suit (Civil Suit No. 731 of 1995) for setting the decree passed in Civil Suit No. 419 of 1994 (filed by the Respondent-Bank) was without any merit suffer from errors apparent on the face of the record and the said findings would partake the character of perverse findings in law warranting exercise of jurisdiction Under Section 100 of the Code of Civil Procedure, 1908. The High Court having failed to do so we correct the order of the High Court and allow this appeal and decree the Plaintiffs suit (Civil Suit No. 731 of 1995) and declare that the decree passed in Civil Suit No. 419 of 1994 (filed by the Respondent-Bank) is null, void and inoperative insofar as the Appellants are concerned. ### Response: 1

T.D.Gopalan Vs. The Commissioner Of Hindu Religious And Chari- Tabl

or private. 12. Mr. Natesan says that if the evidence of the witnesses produced by the defendants is not accepted as was not rightly accepted by the District Judge then there will be hardly any features or circumstances barring some of the physical features of the temple and the fact that people have been allowed to worship and take part in the festivals and ceremonies and even to make some offerings though without their having the right to worship in the temple which would be sufficient to make a temple which was private in origin a public temple. According to Mr. Natesan even the witnesses of the defendants had shown consciousness of the temple being private. He has laid a great deal of emphasis on the absence of any property attached to the temple which might be endowed. He says that admittedly only two shops were built by the family and out of the rents received from those shops together with other contributions made by the members of the family the expenses of the temple were being met. He has relied a great deal on the decision of a Division Bench of the Madras High Court in Madras Hindu Religious Endowments Board v. V. N. D. Ammal, (1953) 2 Mad LJ 688 = (AIR 1954 Mad 482 ). There reliance had been placed on the following features : (1) that when the temple was built it 1919 Kumbabishekam was performed on a grand scale; (2) the respondent had made Utsavamurthis and built Chaprams and the deities were also taken in procession on special occasions; (3) a Gurukkal had been engaged to perform the pooja regularly and (4) the temple has got a Gopuram and other features which are usually found in a public temple. This is what Venkatarama Ayyar J., as he then was, observed."It is true that the facts that there is an utsava-idol and there are processions are generally indicative of the fact that it is a public temple. But then no property has been dedicated for the upkeep of the temple. The worship is maintained and the expenses are met from out of the private funds of the respondent. In the absence of any property being dedicated for the maintenance of worship in the temple, it is difficult to hold that the temple has been dedicated to the public." 13. At this stage the provisions of S. 9 (12) of the Madras Act 2 of 1927 which defines a temple may be noticed. According to that definition it is a place by whatever designation known used as a place of public religious worship and dedicated or used as of right by the Hindu community or any section thereof as a place of public religious worship. In the Madras Hindu Religious and Charitable Endowments Act (Act 22 of 1959) the definition of "temple is given in subclause (20) of S. 6. It is practically in the same terms as in the earlier Act. 14. In our judgment the High Court was in error in holding that members of the public had been worshipping at the Mandapam in dispute without let or hindrance. In arriving at that conclusion it appears to have believed the witnesses produced by the defendants. It has also relied on the principle that in the absence of any evidence to show that such user was permissive it could be presumed that it was as of right. We have already pointed out that the High Court, while appraising the evidence of the witnesses, has not discussed the reasons and grounds given by the learned District Judge for not relying on the defendants witnesses. Mr. A. V. Rangam who appears for the contesting respondent has endeavoured to take us through the evidence of the witnesses for demonstrating that the reasons given by the learned District Judge were neither cogent nor sufficient to discard the testimony of the defendants witnesses. But we are unable to agree with him that the appreciation of evidence by the learned Judge was open to criticism as suggested by him Apart from this the High Court did not consider the evidence produced by the plaintiff without which many matters could not be properly appreciated or explained. The other finding of the High Court that the temple was being run by contributions and benefactions obtained from members of the public was also based mainly on the evidence produced by the defendants. In our opinion the conclusion of the learned District Judge on that point receives more support from the entire material on the record. 15. It is significant that the High Court did not attach sufficient importance to three matters which, in the present case, were of material consequence. The first was that the origin of the Mandapam had been proved to be private. The second was that its management had remained throughout in the members of the Thoguluva family. The third was the absence of any endowed property. There was no Gopuram or Dwajasthamba nor a Nagara bell nor Hundial in the suit temple. The learned District Judge adverted to the evidence on all these and other relevant matters and we concur with him in his conclusions. 16. It is true that the suit temple had some physical characteristic and features which are generally to be found in a public temple. I+ was also established that persons who were outsiders in the sense that they did not belong to the Thoguluva family used to come and worship at the temple and made offerings there. There were also some jewels and other articles in the temple. But the determination of the question whether the temple was public or private did not depend on some facts or set of facts alone. The entire evidence, both documentary and oral, had to be considered as a whole keeping in view the principles already noticed by us. We are satisfied that the learned District Judge came to the correct conclusion that the suit temple was private in character.

1[ds]14. In our judgment the High Court was in error in holding that members of the public had been worshipping at the Mandapam in dispute without let or hindrance. In arriving at that conclusion it appears to have believed the witnesses produced by the defendants. It has also relied on the principle that in the absence of any evidence to show that such user was permissive it could be presumed that it was as of right. We have already pointed out that the High Court, while appraising the evidence of the witnesses, has not discussed the reasons and grounds given by the learned District Judge for not relying on the defendants witnesses. Mr. A. V. Rangam who appears for the contesting respondent has endeavoured to take us through the evidence of the witnesses for demonstrating that the reasons given by the learned District Judge were neither cogent nor sufficient to discard the testimony of the defendants witnesses. But we are unable to agree with him that the appreciation of evidence by the learned Judge was open to criticism as suggested by him Apart from this the High Court did not consider the evidence produced by the plaintiff without which many matters could not be properly appreciated or explained. The other finding of the High Court that the temple was being run by contributions and benefactions obtained from members of the public was also based mainly on the evidence produced by the defendants. In our opinion the conclusion of the learned District Judge on that point receives more support from the entire material on the record15. It is significant that the High Court did not attach sufficient importance to three matters which, in the present case, were of material consequence. The first was that the origin of the Mandapam had been proved to be private. The second was that its management had remained throughout in the members of the Thoguluva family. The third was the absence of any endowed property. There was no Gopuram or Dwajasthamba nor a Nagara bell nor Hundial in the suit temple. The learned District Judge adverted to the evidence on all these and other relevant matters and we concur with him in his conclusions16. It is true that the suit temple had some physical characteristic and features which are generally to be found in a public temple. I+ was also established that persons who were outsiders in the sense that they did not belong to the Thoguluva family used to come and worship at the temple and made offerings there. There were also some jewels and other articles in the temple.But the determination of the question whether the temple was public or private did not depend on some facts or set of facts. The entire evidence, both documentary and oral, had to be considered as a whole keeping in view the principles already noticed by us. We are satisfied that the learned District Judge came to the correct conclusion that the suit temple was private in character.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: or private. 12. Mr. Natesan says that if the evidence of the witnesses produced by the defendants is not accepted as was not rightly accepted by the District Judge then there will be hardly any features or circumstances barring some of the physical features of the temple and the fact that people have been allowed to worship and take part in the festivals and ceremonies and even to make some offerings though without their having the right to worship in the temple which would be sufficient to make a temple which was private in origin a public temple. According to Mr. Natesan even the witnesses of the defendants had shown consciousness of the temple being private. He has laid a great deal of emphasis on the absence of any property attached to the temple which might be endowed. He says that admittedly only two shops were built by the family and out of the rents received from those shops together with other contributions made by the members of the family the expenses of the temple were being met. He has relied a great deal on the decision of a Division Bench of the Madras High Court in Madras Hindu Religious Endowments Board v. V. N. D. Ammal, (1953) 2 Mad LJ 688 = (AIR 1954 Mad 482 ). There reliance had been placed on the following features : (1) that when the temple was built it 1919 Kumbabishekam was performed on a grand scale; (2) the respondent had made Utsavamurthis and built Chaprams and the deities were also taken in procession on special occasions; (3) a Gurukkal had been engaged to perform the pooja regularly and (4) the temple has got a Gopuram and other features which are usually found in a public temple. This is what Venkatarama Ayyar J., as he then was, observed."It is true that the facts that there is an utsava-idol and there are processions are generally indicative of the fact that it is a public temple. But then no property has been dedicated for the upkeep of the temple. The worship is maintained and the expenses are met from out of the private funds of the respondent. In the absence of any property being dedicated for the maintenance of worship in the temple, it is difficult to hold that the temple has been dedicated to the public." 13. At this stage the provisions of S. 9 (12) of the Madras Act 2 of 1927 which defines a temple may be noticed. According to that definition it is a place by whatever designation known used as a place of public religious worship and dedicated or used as of right by the Hindu community or any section thereof as a place of public religious worship. In the Madras Hindu Religious and Charitable Endowments Act (Act 22 of 1959) the definition of "temple is given in subclause (20) of S. 6. It is practically in the same terms as in the earlier Act. 14. In our judgment the High Court was in error in holding that members of the public had been worshipping at the Mandapam in dispute without let or hindrance. In arriving at that conclusion it appears to have believed the witnesses produced by the defendants. It has also relied on the principle that in the absence of any evidence to show that such user was permissive it could be presumed that it was as of right. We have already pointed out that the High Court, while appraising the evidence of the witnesses, has not discussed the reasons and grounds given by the learned District Judge for not relying on the defendants witnesses. Mr. A. V. Rangam who appears for the contesting respondent has endeavoured to take us through the evidence of the witnesses for demonstrating that the reasons given by the learned District Judge were neither cogent nor sufficient to discard the testimony of the defendants witnesses. But we are unable to agree with him that the appreciation of evidence by the learned Judge was open to criticism as suggested by him Apart from this the High Court did not consider the evidence produced by the plaintiff without which many matters could not be properly appreciated or explained. The other finding of the High Court that the temple was being run by contributions and benefactions obtained from members of the public was also based mainly on the evidence produced by the defendants. In our opinion the conclusion of the learned District Judge on that point receives more support from the entire material on the record. 15. It is significant that the High Court did not attach sufficient importance to three matters which, in the present case, were of material consequence. The first was that the origin of the Mandapam had been proved to be private. The second was that its management had remained throughout in the members of the Thoguluva family. The third was the absence of any endowed property. There was no Gopuram or Dwajasthamba nor a Nagara bell nor Hundial in the suit temple. The learned District Judge adverted to the evidence on all these and other relevant matters and we concur with him in his conclusions. 16. It is true that the suit temple had some physical characteristic and features which are generally to be found in a public temple. I+ was also established that persons who were outsiders in the sense that they did not belong to the Thoguluva family used to come and worship at the temple and made offerings there. There were also some jewels and other articles in the temple. But the determination of the question whether the temple was public or private did not depend on some facts or set of facts alone. The entire evidence, both documentary and oral, had to be considered as a whole keeping in view the principles already noticed by us. We are satisfied that the learned District Judge came to the correct conclusion that the suit temple was private in character. ### Response: 1

M/S Modi Cements Limited Vs. Shri Kuchil Kumar Nandi

and to ensure credibility in transacting business through cheques. It is for this reason we are of the considered view that the observations of this Court in Electronics Trade & Technology Development Corporation Ltd., Secunderabad (supra) in paragraph 6 to the effect "Suppose after the cheque is issued to the payee or to the holder in due course and before it is presented for encashment, notice is issued to him not to present the same for encashment and yet the payee or holder in due course presents the cheque to the Bank for payment and when it is returned on instructions, Section 138 does not get attracted", does not fit in with the object and purpose for which the above chapter has been brought on the Statute Book. 17. The above view has been referred to in KK. Sidharthan(supra) as is clear from Paras 5 and 6 of the judgment. Paras 5 and 6 read as under- "5. The above apart, though in the aforesaid case this Court held that even "stop payment" instruction would attract the mischief of Section 138, it has been observed in Para 6, that if "after the cheque is issued to the payee or to the holder in due course and before it is presented for encashment, notice is issued to him not to present the same for encashment and yet the payee or holder in due course present the cheque to the Bank for payment and when it is returned on instruction, Section 138 does not get attracted". "6. From the facts mentioned above, we are satisfied that in the present case cheques were presented after the appellant had directed its Bank to "stop payment". We have said so because though it has been averred in the complaint that the cheque dated 10.10.1994 was presented for collection on that date itself through the Bank of the respondent which is Catholic Syrian Bank Ltd., from the aforesaid letter of the Indian Overseas Branch, we find that the cheque was presented on 15.10.1994 (in clearing). The Lawyers notice to the respondent being of 4th October, which had been replied on 12th from Cochi, which is the place of the respondent, whereas the Advocate who issued notice on behalf of the appellant was at Thrissur, it would seem to us that the first cheque had even been presented after the instruction of "stop payment" issued by the appellant had become known to the respondent". With the above observations, the complaint under Section 139 of the Act was quashed. 18. The aforesaid propositions in both these reported judgments, in our considered view, with great respect are contrary to the spirit and object of Sections 138 and 139 of the Act. If we are to accept this proposition it will make Section 138 a dead letter, for, by giving instructions to the Bank to stop payment immediately after issuing a cheque against a debt or liability the drawer can easily get rid of the penal consequences notwithstanding the fact that a deemed offence was committed. Further the following observations in para 6 in Electronics Trade & Technology Development Corporation Ltd." Secunderabad (supra). "...... Section 138 of the Act intended to prevent dishonesty on the part of the drawer of negotiable instrument to draw a cheque without sufficient funds in his account maintained by him in a Bank and induce the payee or holder in due course to act upon it. Section 138 draws presumption that one commits the offence if he issues the cheque dishonestly" in our opinion, do not also lay down the law correctly. 19. Section 138 of the Act is a penal provision wherein if a person draws a cheque on an account maintained by him with the Banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part of any debt or other liability, is returned by the Bank unpaid, on the ground either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that Bank, such person shall be deemed to have committed an offence. The distinction between the deeming provision and the presumption is well discernible. To illustrate, if a person draws a cheque with no sufficient funds available to his credit on the date of issue, but makes the arrangement or deposits the amount thereafter before the cheque is out in the Bank by the drawee, and the cheque is honoured, in such a situation drawing of presumption of dishonesty on the part of the drawer under Section 138 would not be justified. Section 138 of the Act gets attracted only when the cheque is dishonoured. 20. On careful reading of Section 138 of the Act, we are unable to subscribe to the view that Section 138 of the Act draws presumption of dishonesty against drawer of the cheque if he without sufficient funds to his credit in his Bank Account to honour the cheque issues the same and, therefore, amounts to an offence under Section 138 of the Act. For the reasons stated hereinabove, we are unable to share the views expressed by this Court in the above two cases and we respectfully differ with the same regarding interpretation of Section 138 of the Act to the limited extent as indicated above.21. It is needless to emphasize that the Court taking cognizance of the complaint under Section 138 of the Act is required to be satisfied as to whether a prima facie case is made out under the said provision. The drawer of the cheque undoubtedly gets an opportunity under Section 139 of the Act to re-put the presumption at the trial. It is for this reason we are of the considered opinion that the complaints of the appellant could not have been dismissed by the High Court at the threshold.

1[ds]15. According to the learned Counsel if the observation of this Court in Electronics Trade & Technology Development Corporation Ltd., Secundarabad(supra) to the effect, "Suppose after the cheque is issued to the payee or to the holder in due course and before it is presented for encashment, notice is issued to him not to present the same for encashment and yet the payee or holder in due course presents the cheque to the Bank for payment and when it is returned on instructions, Section 138 does not get attracted" is accepted as good law, the very object of introducing Section 138 in the Act would be defeated.16. We see great force in the above submission because once the cheque is issued by the drawer a presumption under Section 139 must follow and merely because the drawer issues a notice to the drawee or to the Bank for stoppage of the payment it will not preclude in action under Section 138 of the Act by the drawee or the holder of a cheque in due course. The object of Chapter XVII, which is intituted as "Of penalties in case of dishonour of certain cheques for insufficiency of funds in the accounts"and contains Sections 138 to 142, is to promote the efficacy of banking operations and to ensure credibility in transacting business through cheques. It is for this reason we are of the considered view that the observations of this Court in Electronics Trade & Technology Development Corporation Ltd., Secunderabad (supra) in paragraph 6 to the effect "Suppose after the cheque is issued to the payee or to the holder in due course and before it is presented for encashment, notice is issued to him not to present the same for encashment and yet the payee or holder in due course presents the cheque to the Bank for payment and when it is returned on instructions, Section 138 does not get attracted", does not fit in with the object and purpose for which the above chapter has been brought on the Statute Book.On careful reading of Section 138 of the Act, we are unable to subscribe to the view that Section 138 of the Act draws presumption of dishonesty against drawer of the cheque if he without sufficient funds to his credit in his Bank Account to honour the cheque issues the same and, therefore, amounts to an offence under Section 138 of the Act. For the reasons stated hereinabove, we are unable to share the views expressed by this Court in the above two cases and we respectfully differ with the same regarding interpretation of Section 138 of the Act to the limited extent as indicated above.21. It is needless to emphasize that the Court taking cognizance of the complaint under Section 138 of the Act is required to be satisfied as to whether a prima facie case is made out under the said provision. The drawer of the cheque undoubtedly gets an opportunity under Section 139 of the Act to re-put the presumption at the trial. It is for this reason we are of the considered opinion that the complaints of the appellant could not have been dismissed by the High Court at the threshold.

### Instruction: Assess the case proceedings and provide a prediction: is the court likely to rule in favor of (1) or against (0) the appellant/petitioner? ### Input: and to ensure credibility in transacting business through cheques. It is for this reason we are of the considered view that the observations of this Court in Electronics Trade & Technology Development Corporation Ltd., Secunderabad (supra) in paragraph 6 to the effect "Suppose after the cheque is issued to the payee or to the holder in due course and before it is presented for encashment, notice is issued to him not to present the same for encashment and yet the payee or holder in due course presents the cheque to the Bank for payment and when it is returned on instructions, Section 138 does not get attracted", does not fit in with the object and purpose for which the above chapter has been brought on the Statute Book. 17. The above view has been referred to in KK. Sidharthan(supra) as is clear from Paras 5 and 6 of the judgment. Paras 5 and 6 read as under- "5. The above apart, though in the aforesaid case this Court held that even "stop payment" instruction would attract the mischief of Section 138, it has been observed in Para 6, that if "after the cheque is issued to the payee or to the holder in due course and before it is presented for encashment, notice is issued to him not to present the same for encashment and yet the payee or holder in due course present the cheque to the Bank for payment and when it is returned on instruction, Section 138 does not get attracted". "6. From the facts mentioned above, we are satisfied that in the present case cheques were presented after the appellant had directed its Bank to "stop payment". We have said so because though it has been averred in the complaint that the cheque dated 10.10.1994 was presented for collection on that date itself through the Bank of the respondent which is Catholic Syrian Bank Ltd., from the aforesaid letter of the Indian Overseas Branch, we find that the cheque was presented on 15.10.1994 (in clearing). The Lawyers notice to the respondent being of 4th October, which had been replied on 12th from Cochi, which is the place of the respondent, whereas the Advocate who issued notice on behalf of the appellant was at Thrissur, it would seem to us that the first cheque had even been presented after the instruction of "stop payment" issued by the appellant had become known to the respondent". With the above observations, the complaint under Section 139 of the Act was quashed. 18. The aforesaid propositions in both these reported judgments, in our considered view, with great respect are contrary to the spirit and object of Sections 138 and 139 of the Act. If we are to accept this proposition it will make Section 138 a dead letter, for, by giving instructions to the Bank to stop payment immediately after issuing a cheque against a debt or liability the drawer can easily get rid of the penal consequences notwithstanding the fact that a deemed offence was committed. Further the following observations in para 6 in Electronics Trade & Technology Development Corporation Ltd." Secunderabad (supra). "...... Section 138 of the Act intended to prevent dishonesty on the part of the drawer of negotiable instrument to draw a cheque without sufficient funds in his account maintained by him in a Bank and induce the payee or holder in due course to act upon it. Section 138 draws presumption that one commits the offence if he issues the cheque dishonestly" in our opinion, do not also lay down the law correctly. 19. Section 138 of the Act is a penal provision wherein if a person draws a cheque on an account maintained by him with the Banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part of any debt or other liability, is returned by the Bank unpaid, on the ground either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that Bank, such person shall be deemed to have committed an offence. The distinction between the deeming provision and the presumption is well discernible. To illustrate, if a person draws a cheque with no sufficient funds available to his credit on the date of issue, but makes the arrangement or deposits the amount thereafter before the cheque is out in the Bank by the drawee, and the cheque is honoured, in such a situation drawing of presumption of dishonesty on the part of the drawer under Section 138 would not be justified. Section 138 of the Act gets attracted only when the cheque is dishonoured. 20. On careful reading of Section 138 of the Act, we are unable to subscribe to the view that Section 138 of the Act draws presumption of dishonesty against drawer of the cheque if he without sufficient funds to his credit in his Bank Account to honour the cheque issues the same and, therefore, amounts to an offence under Section 138 of the Act. For the reasons stated hereinabove, we are unable to share the views expressed by this Court in the above two cases and we respectfully differ with the same regarding interpretation of Section 138 of the Act to the limited extent as indicated above.21. It is needless to emphasize that the Court taking cognizance of the complaint under Section 138 of the Act is required to be satisfied as to whether a prima facie case is made out under the said provision. The drawer of the cheque undoubtedly gets an opportunity under Section 139 of the Act to re-put the presumption at the trial. It is for this reason we are of the considered opinion that the complaints of the appellant could not have been dismissed by the High Court at the threshold. ### Response: 1

J.H. Patel (D) BY LRS. & Others Vs. Nuboard Manufacturing Co. Ltd. & Others

"protected workmen" and that no prior approval was obtained to conduct any inquiry. 9. Mr. Sunny Chaudhary, learned counsel appearing for the respondents submitted that undoubtedly the workmen had lodged the Complaint against the senior officers of the respondent Company in the Magistrates Court. This damaged the reputation of the Company, and this amounted to defamation and therefore the management was entitled to proceed at the departmental level. According to him, the conduct on the part of the workmen amounted to disorderly behaviour and although the management had passed the dismissal order merely on receiving the explanation from the workmen (and without holding an inquiry), evidence had been led before the Labour Court and after considering the evidence, the learned Judge had come to the conclusion that misconduct had been established. He submitted that therefore the Labour Court was wrong in awarding 50% compensation from the date of dismissal until the date of its judgment and the High Court was fully justified in passing the order that it had passed deleting the order of compensation which was awarded to the workmen. 10. We have noted the submissions of both the learned counsel. As far as the issue of the workmen being "protected workmen" is concerned, presently we are not required to go into that aspect. Similarly, as far as the issue of non obtaining prior approval is concerned, inasmuch as Section 6(E)(2)(b) of the Uttar Pradesh Industrial Disputes Act is pari passu to Section 32(2)(b) of the Industrial Disputes Act, 1947, undoubtedly the management was required to obtain the prior approval from the Labour Court inasmuch as an earlier proceeding was pending in the Labour Court. However, the consequence thereof cannot be that the management will be disentitled to prove the misconduct in Court. This has been the view taken by this Court in Rajasthan State Road Transport Corporation & Anr. Vs. Satya Prakash, (2013) 9 SCC 232 , which explains the law laid down earlier by a Constitution Bench of this Court in Jaipur Zila Sahkari Bhoomi Vikas Bank Ltd. Vs. Ram Gopal Sharma and Ors., (2002) 2 SCC 244. Therefore, the management cannot be faulted merely on that ground. 11. The fact, however, remains that the opportunity to prove the misconduct was made available to the management in the Labour Court in the present case. The employer examined two of their witnesses, namely Mr. A.H. Shah, Director (EW-1) and Mr. J.B. Dalal, Administrative Officer (E-2). However, from the judgment rendered by the Labour Court what we find is that there is no discussion, whatsoever, with respect to the evidence led by these two witnesses. The judgment does not contain any reason in support of the conclusion arrived at by the Labour Court that misconduct was proved before the Labour Court on the basis of the evidence which was led before it. The management chose to proceed departmentally against the workmen after the acquittal of its officers in the Criminal Court. It did not afford any opportunity to the workmen at the departmental level. Afterwards, when the dispute was taken to the Labour Court, it was the responsibility of the management to prove the misconduct in Court, and that ought to be done by leading evidence of the witnesses which, of course, they did. However, the evidence has to be discussed by the Labour Court. In the present case, there is no discussion whatsoever about the evidence as to why the Labour Court came to the conclusion that the misconduct is established. In the circumstances, the findings of the Labour Court cannot be sustained that the management had proved the misconduct. Inasmuch as the misconduct was not proved, the workmen were entitled to get the relief that they were seeking, namely the declaration that the termination of their services was bad in law and then the consequential relief. When the matter was carried to the High Court, the High Court also lost sight of that fact and, on the other hand, it deleted whatever compensation was awarded to the workmen by the Labour Court. In our view, the order of the High Court is erroneous on the very ground.12. In the circumstances, this appeal will have to be allowed which we hereby allow, set aside the order of the High Court as well as that of the Labour Court and decide the dispute raised by the workmen in their favour, namely that the termination of their services was unjustified on merits.13. Then we come to the aspect of relief. Out of three appellants before this Court, J.H. Patel has expired and his heirs are on record. Mr. Upadhyay does not dispute that as far as the other two workmen Mr. Asharam and Ram Kishan are concerned, they must have reached the age of superannuation. In the circumstances, we award compensation to these workmen towards back-wages quantified at 50%, with interest at 6% per annum, from the date of dismissal until the date of superannuation/death, whichever is earlier. 14. At this stage, on instructions, Mr. Chaudhary, learned counsel appearing for the respondents states that the first respondent Company is no longer functioning, and a proceeding is pending before the BIFR. He therefore makes a request that the back-wages be reduced to 40% and no interest be awarded thereon. Mr. Upadhyay learned counsel for the appellants submits that the appellants are agreeable to this suggestion provided the said amount is paid within a period of three months hereafter. In the circumstances, we give this option to the first respondent viz to pay 40% of the back-wages from the date of dismissal until the date of superannuation/death, whichever is earlier provided the amount is so paid within three months. If the compensation is so paid, the amount of interest will stand waived. In the event, however, the amount of 40% is not paid within a period of three months hereafter, the earlier part of the order, namely that respondent No.1 should pay 50% of the back-wages with 6% interest will be operative.

1[ds]In the present case, there is no discussion whatsoever about the evidence as to why the Labour Court came to the conclusion that the misconduct is established. In the circumstances, the findings of the Labour Court cannot be sustained that the management had proved the misconduct. Inasmuch as the misconduct was not proved, the workmen were entitled to get the relief that they were seeking, namely the declaration that the termination of their services was bad in law and then the consequential relief. When the matter was carried to the High Court, the High Court also lost sight of that fact and, on the other hand, it deleted whatever compensation was awarded to the workmen by the Labour Court. In our view, the order of the High Court is erroneous on the very ground.12. In the circumstances, this appeal will have to be allowed which we hereby allow, set aside the order of the High Court as well as that of the Labour Court and decide the dispute raised by the workmen in their favour, namely that the termination of their services was unjustified on merits.13. Then we come to the aspect of relief. Out of three appellants before this Court, J.H. Patel has expired and his heirs are on record. Mr. Upadhyay does not dispute that as far as the other two workmen Mr. Asharam and Ram Kishan are concerned, they must have reached the age of superannuation. In the circumstances, we award compensation to these workmen towards back-wages quantified at 50%, with interest at 6% per annum, from the date of dismissal until the date of superannuation/death, whichever is earlier.At this stage, on instructions, Mr. Chaudhary, learned counsel appearing for the respondents states that the first respondent Company is no longer functioning, and a proceeding is pending before the BIFR. He therefore makes a request that the back-wages be reduced to 40% and no interest be awarded thereon. Mr. Upadhyay learned counsel for the appellants submits that the appellants are agreeable to this suggestion provided the said amount is paid within a period of three months hereafter. In the circumstances, we give this option to the first respondent viz to pay 40% of the back-wages from the date of dismissal until the date of superannuation/death, whichever is earlier provided the amount is so paid within three months. If the compensation is so paid, the amount of interest will stand waived. In the event, however, the amount of 40% is not paid within a period of three months hereafter, the earlier part of the order, namely that respondent No.1 should pay 50% of the back-wages with 6% interest will be operative.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: "protected workmen" and that no prior approval was obtained to conduct any inquiry. 9. Mr. Sunny Chaudhary, learned counsel appearing for the respondents submitted that undoubtedly the workmen had lodged the Complaint against the senior officers of the respondent Company in the Magistrates Court. This damaged the reputation of the Company, and this amounted to defamation and therefore the management was entitled to proceed at the departmental level. According to him, the conduct on the part of the workmen amounted to disorderly behaviour and although the management had passed the dismissal order merely on receiving the explanation from the workmen (and without holding an inquiry), evidence had been led before the Labour Court and after considering the evidence, the learned Judge had come to the conclusion that misconduct had been established. He submitted that therefore the Labour Court was wrong in awarding 50% compensation from the date of dismissal until the date of its judgment and the High Court was fully justified in passing the order that it had passed deleting the order of compensation which was awarded to the workmen. 10. We have noted the submissions of both the learned counsel. As far as the issue of the workmen being "protected workmen" is concerned, presently we are not required to go into that aspect. Similarly, as far as the issue of non obtaining prior approval is concerned, inasmuch as Section 6(E)(2)(b) of the Uttar Pradesh Industrial Disputes Act is pari passu to Section 32(2)(b) of the Industrial Disputes Act, 1947, undoubtedly the management was required to obtain the prior approval from the Labour Court inasmuch as an earlier proceeding was pending in the Labour Court. However, the consequence thereof cannot be that the management will be disentitled to prove the misconduct in Court. This has been the view taken by this Court in Rajasthan State Road Transport Corporation & Anr. Vs. Satya Prakash, (2013) 9 SCC 232 , which explains the law laid down earlier by a Constitution Bench of this Court in Jaipur Zila Sahkari Bhoomi Vikas Bank Ltd. Vs. Ram Gopal Sharma and Ors., (2002) 2 SCC 244. Therefore, the management cannot be faulted merely on that ground. 11. The fact, however, remains that the opportunity to prove the misconduct was made available to the management in the Labour Court in the present case. The employer examined two of their witnesses, namely Mr. A.H. Shah, Director (EW-1) and Mr. J.B. Dalal, Administrative Officer (E-2). However, from the judgment rendered by the Labour Court what we find is that there is no discussion, whatsoever, with respect to the evidence led by these two witnesses. The judgment does not contain any reason in support of the conclusion arrived at by the Labour Court that misconduct was proved before the Labour Court on the basis of the evidence which was led before it. The management chose to proceed departmentally against the workmen after the acquittal of its officers in the Criminal Court. It did not afford any opportunity to the workmen at the departmental level. Afterwards, when the dispute was taken to the Labour Court, it was the responsibility of the management to prove the misconduct in Court, and that ought to be done by leading evidence of the witnesses which, of course, they did. However, the evidence has to be discussed by the Labour Court. In the present case, there is no discussion whatsoever about the evidence as to why the Labour Court came to the conclusion that the misconduct is established. In the circumstances, the findings of the Labour Court cannot be sustained that the management had proved the misconduct. Inasmuch as the misconduct was not proved, the workmen were entitled to get the relief that they were seeking, namely the declaration that the termination of their services was bad in law and then the consequential relief. When the matter was carried to the High Court, the High Court also lost sight of that fact and, on the other hand, it deleted whatever compensation was awarded to the workmen by the Labour Court. In our view, the order of the High Court is erroneous on the very ground.12. In the circumstances, this appeal will have to be allowed which we hereby allow, set aside the order of the High Court as well as that of the Labour Court and decide the dispute raised by the workmen in their favour, namely that the termination of their services was unjustified on merits.13. Then we come to the aspect of relief. Out of three appellants before this Court, J.H. Patel has expired and his heirs are on record. Mr. Upadhyay does not dispute that as far as the other two workmen Mr. Asharam and Ram Kishan are concerned, they must have reached the age of superannuation. In the circumstances, we award compensation to these workmen towards back-wages quantified at 50%, with interest at 6% per annum, from the date of dismissal until the date of superannuation/death, whichever is earlier. 14. At this stage, on instructions, Mr. Chaudhary, learned counsel appearing for the respondents states that the first respondent Company is no longer functioning, and a proceeding is pending before the BIFR. He therefore makes a request that the back-wages be reduced to 40% and no interest be awarded thereon. Mr. Upadhyay learned counsel for the appellants submits that the appellants are agreeable to this suggestion provided the said amount is paid within a period of three months hereafter. In the circumstances, we give this option to the first respondent viz to pay 40% of the back-wages from the date of dismissal until the date of superannuation/death, whichever is earlier provided the amount is so paid within three months. If the compensation is so paid, the amount of interest will stand waived. In the event, however, the amount of 40% is not paid within a period of three months hereafter, the earlier part of the order, namely that respondent No.1 should pay 50% of the back-wages with 6% interest will be operative. ### Response: 1

M/S. Cable Corpn. Of India Ltd Vs. Additional Commissioner Of Labour

matter or, as the case may be, cause it to be referred, to a Tribunal for adjudication.Provided that where a reference has been made to a Tribunal under this sub-section, it shall pass an award within a period of thirty days from the date of such reference." (Underlined for emphasis) 7. In Excel Wear v. Union of India and Ors. (1978 (4) SCC 224 ) this Court considered the legality of Section 25-O and 25-R as it stood then. It was held that those provisions were violative of Section 19(1)(g) of the Constitution of India, 1950 (in short the ‘Constitution). It was held that steps under Section 25-N as it stood then cannot be read into Section 25-O. 8. In Workmen of Meenakshi Mills Ltd. And Ors. v. Meenakshi Mills Ltd. And Anr. (1992 (3) SCC 336 ) the scope and ambit of Section 25-N as it stood then prior to its substitution by Industrial Disputes (Amendment) Act, 1984 was considered. Section 25-O was recast with effect from 21.8.1984 by Act 46 of 1982. Similarly, changes were brought in Section 25-N by Act 49 of 1984 w.e.f. 18.8.1984. Under Section 25-N(5) finality is given subject to sub-section (6). A plain reading of the provision shows that two options are available i.e. to decide itself or refer to the Tribunal. It cannot be said that the Tribunal is an additional forum for fresh look at the matter. 9. In Orissa Textile and Steel case (supra) the constitutional validity of Section 25-O of the Act was under consideration. 10. Learned counsel for the respondents has placed great reliance on paragraphs 16, 17 and 18 of the judgment to contend that this Court had accepted the interpretation given by the High Court. 11. On a close reading of the judgment it is clear that in the said case the issues presently under consideration did not fall for consideration. What was stated in essence was that the provisions for amended Section 25-O relates to review and reference would be in addition to judicial review under Article 226 or Article 32 of the Constitution. The Court was really considering the question as to whether provisions for review and reference were in addition to judicial review. It never said that they are cumulative and not alternative.12. The word ‘or is normally disjunctive and ‘and is normally conjunctive. But at times they are read as vice versa to give effect to the manifest intention of the Legislature as disclosed from the context. As stated by Scrutton, L.J.: "You do sometimes read ‘or as ‘and in a statute. But you do not do it unless you are obliged because ‘or does not generally mean ‘and and ‘and does not generally mean ‘or. And as pointed out by Lord Halsbury the reading of ‘or as ‘and is not to be resorted to, "unless some other part of the same statute or the clear intention of it required that to be done". But if the literal reading of the words produces an unintelligible or absurd result ‘and may be read for ‘or and ‘or for ‘and even though the result of so modifying the words is less favourable to the subject provided that the intention of the Legislature is otherwise quite clear. Conversely if reading of ‘and as ‘or produces grammatical distortion and makes no sense of the portion following ‘and, ‘or cannot be read in placed ‘and. The alternatives joined by ‘or need not always be mutually exclusive. 13. In Fakir Mohd. (dead) by Lrs. V Sita Ram (2002 (1) SCC 741 ) it was held that the word ‘or is normally disjunctive. The use of the word ‘or in a statute manifests the legislative intent of the alternatives prescribed under law. 14. Had the Legislature intended that the reference could be made after the Government or the Specified Authority deals with the review power, it would have said so specifically by specific words. It could have provided for a direct reference. The parameters of review are different from a reference.15. A plain reading of the provision makes the position clear that two courses are open. Power is conferred on the appropriate Government to either on its own motion or on an application made, review its order or refer the matter to the Tribunal. Whether one or the other of the courses could be adopted depends on the fact of each case, the surrounding circumstances and several other relevant factors.16. Under sub-section (6) of Section 25-N it is open to the appropriate Government or the Specified Authority to review its order granting or refusing to grant permission under sub-section (3).17. When the words of a statute are clear, plain or unambiguous, i.e. they are reasonably susceptible to only one meaning, Courts are bound to give effect to that meaning irrespective of consequences. [See: State of Jharkhand v. Govind Singh (AIR 2005 SC 294 ), Nathi Devi v. Radha Devi Gupta (2005 (2) SCC 271 )]. 18. In Sussex Peerage case (1844) 11 CI&F 85, at page 143 Tindal C.J. observed as follows: "If the words of the statute are in themselves precise and unambiguous, then no more can be necessary than to expound those words in their natural and ordinary sense. The words themselves do alone in such cases best declare the intent of the lawgiver." 19. When a language is plain and unambiguous and admits of only one meaning no question of construction of a statute arises, for the Act speaks for itself.20. As observed in Nathi Devis case (supra) if the words used are capable of one construction, then it would not be open to the Courts to adopt any other hypothetical construction on the ground that such construction is more consistent with the alleged object and policy of the Act. The spirit of the law may well be an elusive and unsafe guide and the supposed spirit can certainly be not given effect to in opposition to the plain language of the sections of the Act.

1[ds]11. On a close reading of the judgment it is clear that in the said case the issues presently under consideration did not fall for consideration. What was stated in essence was that the provisions for amended Section 25-O relates to review and reference would be in addition to judicial review under Article 226 or Article 32 of the Constitution. The Court was really considering the question as to whether provisions for review and reference were in addition to judicial review. It never said that they are cumulative and not alternative.12. The word ‘or is normally disjunctive and ‘and is normally conjunctive. But at times they are read as vice versa to give effect to the manifest intention of the Legislature as disclosed from the context. As stated by Scrutton, L.J.: "You do sometimes read ‘or as ‘and in a statute. But you do not do it unless you are obliged because ‘or does not generally mean ‘and and ‘and does not generally mean ‘or. And as pointed out by Lord Halsbury the reading of ‘or as ‘and is not to be resorted to, "unless some other part of the same statute or the clear intention of it required that to be done". But if the literal reading of the words produces an unintelligible or absurd result ‘and may be read for ‘or and ‘or for ‘and even though the result of so modifying the words is less favourable to the subject provided that the intention of the Legislature is otherwise quite clear. Conversely if reading of ‘and as ‘or produces grammatical distortion and makes no sense of the portion following ‘and, ‘or cannot be read in placed ‘and. The alternatives joined by ‘or need not always be mutually exclusive.Had the Legislature intended that the reference could be made after the Government or the Specified Authority deals with the review power, it would have said so specifically by specific words. It could have provided for a direct reference. The parameters of review are different from a reference.15. A plain reading of the provision makes the position clear that two courses are open. Power is conferred on the appropriate Government to either on its own motion or on an application made, review its order or refer the matter to the Tribunal. Whether one or the other of the courses could be adopted depends on the fact of each case, the surrounding circumstances and several other relevant factors.16. Under sub-section (6) of Section 25-N it is open to the appropriate Government or the Specified Authority to review its order granting or refusing to grant permission under sub-section (3).17. When the words of a statute are clear, plain or unambiguous, i.e. they are reasonably susceptible to only one meaning, Courts are bound to give effect to that meaning irrespective of consequences.When a language is plain and unambiguous and admits of only one meaning no question of construction of a statute arises, for the Act speaks for itself.20. As observed in Nathi Devis case (supra) if the words used are capable of one construction, then it would not be open to the Courts to adopt any other hypothetical construction on the ground that such construction is more consistent with the alleged object and policy of the Act. The spirit of the law may well be an elusive and unsafe guide and the supposed spirit can certainly be not given effect to in opposition to the plain language of the sections of the Act.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: matter or, as the case may be, cause it to be referred, to a Tribunal for adjudication.Provided that where a reference has been made to a Tribunal under this sub-section, it shall pass an award within a period of thirty days from the date of such reference." (Underlined for emphasis) 7. In Excel Wear v. Union of India and Ors. (1978 (4) SCC 224 ) this Court considered the legality of Section 25-O and 25-R as it stood then. It was held that those provisions were violative of Section 19(1)(g) of the Constitution of India, 1950 (in short the ‘Constitution). It was held that steps under Section 25-N as it stood then cannot be read into Section 25-O. 8. In Workmen of Meenakshi Mills Ltd. And Ors. v. Meenakshi Mills Ltd. And Anr. (1992 (3) SCC 336 ) the scope and ambit of Section 25-N as it stood then prior to its substitution by Industrial Disputes (Amendment) Act, 1984 was considered. Section 25-O was recast with effect from 21.8.1984 by Act 46 of 1982. Similarly, changes were brought in Section 25-N by Act 49 of 1984 w.e.f. 18.8.1984. Under Section 25-N(5) finality is given subject to sub-section (6). A plain reading of the provision shows that two options are available i.e. to decide itself or refer to the Tribunal. It cannot be said that the Tribunal is an additional forum for fresh look at the matter. 9. In Orissa Textile and Steel case (supra) the constitutional validity of Section 25-O of the Act was under consideration. 10. Learned counsel for the respondents has placed great reliance on paragraphs 16, 17 and 18 of the judgment to contend that this Court had accepted the interpretation given by the High Court. 11. On a close reading of the judgment it is clear that in the said case the issues presently under consideration did not fall for consideration. What was stated in essence was that the provisions for amended Section 25-O relates to review and reference would be in addition to judicial review under Article 226 or Article 32 of the Constitution. The Court was really considering the question as to whether provisions for review and reference were in addition to judicial review. It never said that they are cumulative and not alternative.12. The word ‘or is normally disjunctive and ‘and is normally conjunctive. But at times they are read as vice versa to give effect to the manifest intention of the Legislature as disclosed from the context. As stated by Scrutton, L.J.: "You do sometimes read ‘or as ‘and in a statute. But you do not do it unless you are obliged because ‘or does not generally mean ‘and and ‘and does not generally mean ‘or. And as pointed out by Lord Halsbury the reading of ‘or as ‘and is not to be resorted to, "unless some other part of the same statute or the clear intention of it required that to be done". But if the literal reading of the words produces an unintelligible or absurd result ‘and may be read for ‘or and ‘or for ‘and even though the result of so modifying the words is less favourable to the subject provided that the intention of the Legislature is otherwise quite clear. Conversely if reading of ‘and as ‘or produces grammatical distortion and makes no sense of the portion following ‘and, ‘or cannot be read in placed ‘and. The alternatives joined by ‘or need not always be mutually exclusive. 13. In Fakir Mohd. (dead) by Lrs. V Sita Ram (2002 (1) SCC 741 ) it was held that the word ‘or is normally disjunctive. The use of the word ‘or in a statute manifests the legislative intent of the alternatives prescribed under law. 14. Had the Legislature intended that the reference could be made after the Government or the Specified Authority deals with the review power, it would have said so specifically by specific words. It could have provided for a direct reference. The parameters of review are different from a reference.15. A plain reading of the provision makes the position clear that two courses are open. Power is conferred on the appropriate Government to either on its own motion or on an application made, review its order or refer the matter to the Tribunal. Whether one or the other of the courses could be adopted depends on the fact of each case, the surrounding circumstances and several other relevant factors.16. Under sub-section (6) of Section 25-N it is open to the appropriate Government or the Specified Authority to review its order granting or refusing to grant permission under sub-section (3).17. When the words of a statute are clear, plain or unambiguous, i.e. they are reasonably susceptible to only one meaning, Courts are bound to give effect to that meaning irrespective of consequences. [See: State of Jharkhand v. Govind Singh (AIR 2005 SC 294 ), Nathi Devi v. Radha Devi Gupta (2005 (2) SCC 271 )]. 18. In Sussex Peerage case (1844) 11 CI&F 85, at page 143 Tindal C.J. observed as follows: "If the words of the statute are in themselves precise and unambiguous, then no more can be necessary than to expound those words in their natural and ordinary sense. The words themselves do alone in such cases best declare the intent of the lawgiver." 19. When a language is plain and unambiguous and admits of only one meaning no question of construction of a statute arises, for the Act speaks for itself.20. As observed in Nathi Devis case (supra) if the words used are capable of one construction, then it would not be open to the Courts to adopt any other hypothetical construction on the ground that such construction is more consistent with the alleged object and policy of the Act. The spirit of the law may well be an elusive and unsafe guide and the supposed spirit can certainly be not given effect to in opposition to the plain language of the sections of the Act. ### Response: 1

The State Of Tripura Vs. The Province Of East Bengalunion Of India--Intervener

1. The challenge in this appeal is to the impugned order of the High Court, dated 15th March, 2002, whereby Civil Misc. Writ Petition No. 26446/2001, filed by the appellants, was dismissed. In the said writ petition, the appellants had challenged the order of the Labour Court dated 25th May, 2001 whereby the application filed for restoration had been dismissed. The appellants had the grievance against the ex-parte award of the Labour Court, dated 10th March, 1999, which had been made in favour of the workman-respondent No.4 herein. By the said award, the Labour Court, noticing that several opportunities were given to the employer to submit the written statement but the same was not filed, directed reinstatement of the workman in continuation of his services since 14th March, 1997 with full pay during the period of unemployment with all benefits. A reference under Section 4K of the U.P. Industrial Disputes Act, 1947 to the Labour Court was made by the State Government to decide whether the termination of services of the workman in the post of plumber since 14th March, 1997 was illegal and/ or unjustified and, if so, to what relief was he entitled to and what directions were necessary in this respect. In the writ petition, another relief claimed was to set aside the order of the Deputy Labour Commissioner, dated 27th June, 2001, whereby the said officer had cancelled an earlier order dated 17th May, 2001. In the order of reference above referred the name of the employer shown was M/s. Santosh Medical College. According to the appellants the said college was run by the Managing Trustee, Maharaji Educational Trust, i.e. the appellant before us, and it was necessary to make the Chairman of the Trust as employer. On an application filed by the appellants, by order dated 17th May, 2001 passed by the Deputy Labour Commissioner, the Chairman and Managing Trustee, Maharaj Educational Trust was also added as a second employer to the reference. The order dated 17th May, 2001 was, however, cancelled, on the application of the workman, in terms of the aforenoted order dated 27th June, 2001. 2. According to the appellants, the second order dated 27th June, 2001 which had the effect of deleting the appellants from the order of reference was without jurisdiction and the High Court, without going into this question, disposed of the writ petition by holding that the application for setting aside the ex-parte order was rightly dismissed in terms of the order dated 25th May, 2001. The appellants further claimed that after the order dated 17th May, 2001, they had also filed written statement before the Labour Court. There is also some controversy about the date of the publication of the award dated 10th March, 1999. 3. After hearing learned counsel for the appellants and the workman-respondent No.4, we are of the view that ends of justice would be met if the dispute about the termination of services of workman-respondent No.4 is decided afresh by the Labour Court on merits, after giving opportunity to the appellants and the aforesaid college, i.e. M/s. Santosh Medical College, to contest the claim of the workman on merits. It would be open to the appellants to take such pleas as may be available to them in law. We may only indicate that according to the appellants, respondent No.4 was never their employee. It is strenuously disputed by the workman-respondent No.4. While permitting the appellants to contest on merits the dispute before Labour Court, it is also necessary to impose heavy costs on them so as to compensate the workman for the delay that has occurred in the last about five years.

1[ds]3. After hearing learned counsel for the appellants and the workman-respondent No.4, we are of the view that ends of justice would be met if the dispute about the termination of services of workman-respondent No.4 is decided afresh by the Labour Court on merits, after giving opportunity to the appellants and the aforesaid college, i.e. M/s. Santosh Medical College, to contest the claim of the workman on merits. It would be open to the appellants to take such pleas as may be available to them in law. We may only indicate that according to the appellants, respondent No.4 was never their employee. It is strenuously disputed by the workman-respondent No.4. While permitting the appellants to contest on merits the dispute before Labour Court, it is also necessary to impose heavy costs on them so as to compensate the workman for the delay that has occurred in the last about five years.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: 1. The challenge in this appeal is to the impugned order of the High Court, dated 15th March, 2002, whereby Civil Misc. Writ Petition No. 26446/2001, filed by the appellants, was dismissed. In the said writ petition, the appellants had challenged the order of the Labour Court dated 25th May, 2001 whereby the application filed for restoration had been dismissed. The appellants had the grievance against the ex-parte award of the Labour Court, dated 10th March, 1999, which had been made in favour of the workman-respondent No.4 herein. By the said award, the Labour Court, noticing that several opportunities were given to the employer to submit the written statement but the same was not filed, directed reinstatement of the workman in continuation of his services since 14th March, 1997 with full pay during the period of unemployment with all benefits. A reference under Section 4K of the U.P. Industrial Disputes Act, 1947 to the Labour Court was made by the State Government to decide whether the termination of services of the workman in the post of plumber since 14th March, 1997 was illegal and/ or unjustified and, if so, to what relief was he entitled to and what directions were necessary in this respect. In the writ petition, another relief claimed was to set aside the order of the Deputy Labour Commissioner, dated 27th June, 2001, whereby the said officer had cancelled an earlier order dated 17th May, 2001. In the order of reference above referred the name of the employer shown was M/s. Santosh Medical College. According to the appellants the said college was run by the Managing Trustee, Maharaji Educational Trust, i.e. the appellant before us, and it was necessary to make the Chairman of the Trust as employer. On an application filed by the appellants, by order dated 17th May, 2001 passed by the Deputy Labour Commissioner, the Chairman and Managing Trustee, Maharaj Educational Trust was also added as a second employer to the reference. The order dated 17th May, 2001 was, however, cancelled, on the application of the workman, in terms of the aforenoted order dated 27th June, 2001. 2. According to the appellants, the second order dated 27th June, 2001 which had the effect of deleting the appellants from the order of reference was without jurisdiction and the High Court, without going into this question, disposed of the writ petition by holding that the application for setting aside the ex-parte order was rightly dismissed in terms of the order dated 25th May, 2001. The appellants further claimed that after the order dated 17th May, 2001, they had also filed written statement before the Labour Court. There is also some controversy about the date of the publication of the award dated 10th March, 1999. 3. After hearing learned counsel for the appellants and the workman-respondent No.4, we are of the view that ends of justice would be met if the dispute about the termination of services of workman-respondent No.4 is decided afresh by the Labour Court on merits, after giving opportunity to the appellants and the aforesaid college, i.e. M/s. Santosh Medical College, to contest the claim of the workman on merits. It would be open to the appellants to take such pleas as may be available to them in law. We may only indicate that according to the appellants, respondent No.4 was never their employee. It is strenuously disputed by the workman-respondent No.4. While permitting the appellants to contest on merits the dispute before Labour Court, it is also necessary to impose heavy costs on them so as to compensate the workman for the delay that has occurred in the last about five years. ### Response: 1

In Re Bhavani River Vs. Sakthi Sugars Ltd

A.S. Anand, J. 1. An additional affidavit of Undertaking has been filed in Court today by Mr. P. Natarajan on behalf of the Industry, respondent No. 6.2. We have heard learned counsel for respondent No. 6, the learned Amicus Curiae as also the learned counsel appearing for Tamil Nadu Pollution Control Board.3. From a perusal of the affidavit filed by the Member Secretary, Tamil Nadu Pollution Control Board on 12.1.1998, it transpires that certain directions were issued by the Board in exercise of the powers conferred under Section 33A of the Water (Prevention and Control of Pollution) Act, 1974, as amended in 1988 to respondent No. 6. These directions were inter alia aimed at ensuring proper storage of effluent in lagoons and for proper treatment and disposal of the treated effluent. As many as 11 directions, as detailed in the affidavit, were given. Para 5 of the said affidavit discloses that the Industry (respondent No. 6) has not complied with direction Nos. 6, 7, 8 and 9. It is also stated that during the inspection of the Industry on 23rd of November, 1997, it was noticed that the seepage of effluent from lagoon `C joined the drain and ultimately reached river Bhavani thereby contravening the conditions imposed in the directions by the Board. The affidavit goes on to say that show cause notice was also issued by the Board to the Industry calling upon it to state why penal action for offences punishable under Section 44 read with Section 45(a) of the Act should not be initiated for violating the conditions imposed by the Board.4. Respondent No. 6 in its affidavit filed on 27th of January, 1998 has not denied that 11 directions had been issued to it by the Board and that some of those directions have not been complied with. It is stated in para (d) as follows : "In respect of the direction of the Tamil Nadu Pollution Control Board at Para (viii) that the Company shall give progress report on disposal of accumulated effluent in lagoons every fortnight and also fortnightly progress report on the actions taken to comply with the conditions stipulated in the Consent Order issued by the Tamil Nadu Pollution Control Board, it is submitted that the Company has furnished daily statements giving complete particulars of the effluent generated, effluent utilised for composting and for concentration, inflow into lagoons, outflow from the lagoons and other detailed particulars. The receipt of these daily statements by the Tamil Nadu Pollution Control Board is acknowledged in their Affidavit filed before this Honourable Court. Apart from the daily statements, the Company has also furnished consolidated and fortnightly reports to the Joint Chief Environmental Engineer of the Tamil Nadu Pollution Control Board." 5. In the affidavit of Undertaking filed on behalf of respondent No. 6 today it is stated that since 16th of January, 1998, the production capacity of the Industry has been reduced and ferti-irrigation has been completely stopped. It is also stated that the entire effluent is being utilised within the premises for bio-composting and that there is no discharge of water or effluent on land or in the water.6. With regard to the two unlined lagoons, it is stated in para 7(a) of the affidavit of undertaking filed today that effluent has been stored in the two unlined lagoons and it is reiterated that no further discharge of effluent is being made into the unlined lagoons.

0[ds]9. From the affidavit of Undertaking of respondent No. 6 filed today, we also find on admission that there are eleven small intermediary transit tanks used for transferring the effluent from the concentration plant to the lagoons, which are also unlined at the bottom. Respondent No. 6 shall not put to use those transit tanks unless the lining is complete in all respects.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: A.S. Anand, J. 1. An additional affidavit of Undertaking has been filed in Court today by Mr. P. Natarajan on behalf of the Industry, respondent No. 6.2. We have heard learned counsel for respondent No. 6, the learned Amicus Curiae as also the learned counsel appearing for Tamil Nadu Pollution Control Board.3. From a perusal of the affidavit filed by the Member Secretary, Tamil Nadu Pollution Control Board on 12.1.1998, it transpires that certain directions were issued by the Board in exercise of the powers conferred under Section 33A of the Water (Prevention and Control of Pollution) Act, 1974, as amended in 1988 to respondent No. 6. These directions were inter alia aimed at ensuring proper storage of effluent in lagoons and for proper treatment and disposal of the treated effluent. As many as 11 directions, as detailed in the affidavit, were given. Para 5 of the said affidavit discloses that the Industry (respondent No. 6) has not complied with direction Nos. 6, 7, 8 and 9. It is also stated that during the inspection of the Industry on 23rd of November, 1997, it was noticed that the seepage of effluent from lagoon `C joined the drain and ultimately reached river Bhavani thereby contravening the conditions imposed in the directions by the Board. The affidavit goes on to say that show cause notice was also issued by the Board to the Industry calling upon it to state why penal action for offences punishable under Section 44 read with Section 45(a) of the Act should not be initiated for violating the conditions imposed by the Board.4. Respondent No. 6 in its affidavit filed on 27th of January, 1998 has not denied that 11 directions had been issued to it by the Board and that some of those directions have not been complied with. It is stated in para (d) as follows : "In respect of the direction of the Tamil Nadu Pollution Control Board at Para (viii) that the Company shall give progress report on disposal of accumulated effluent in lagoons every fortnight and also fortnightly progress report on the actions taken to comply with the conditions stipulated in the Consent Order issued by the Tamil Nadu Pollution Control Board, it is submitted that the Company has furnished daily statements giving complete particulars of the effluent generated, effluent utilised for composting and for concentration, inflow into lagoons, outflow from the lagoons and other detailed particulars. The receipt of these daily statements by the Tamil Nadu Pollution Control Board is acknowledged in their Affidavit filed before this Honourable Court. Apart from the daily statements, the Company has also furnished consolidated and fortnightly reports to the Joint Chief Environmental Engineer of the Tamil Nadu Pollution Control Board." 5. In the affidavit of Undertaking filed on behalf of respondent No. 6 today it is stated that since 16th of January, 1998, the production capacity of the Industry has been reduced and ferti-irrigation has been completely stopped. It is also stated that the entire effluent is being utilised within the premises for bio-composting and that there is no discharge of water or effluent on land or in the water.6. With regard to the two unlined lagoons, it is stated in para 7(a) of the affidavit of undertaking filed today that effluent has been stored in the two unlined lagoons and it is reiterated that no further discharge of effluent is being made into the unlined lagoons. ### Response: 0

Union Of India Vs. Onkar S. Kanwar

(Removal of Difficulties) Order was not to be given where the proceedings were pending adjudication but only where the show cause notices were pending adjudication. 11. Mr. Vellapally, on the other hand, submitted that only one show cause notice had been issued. He submitted that in the same show cause notice the Company was called upon to show cause whey excise duty and penalty be not levied and the Directors/Officers were also called upon to show cause whey penalty be not levied on them. He submitted that Section 91 of the Kar Vivad Samadhan Scheme makes it clear that on payment being made and a certificate being granted, immunity is granted against prosecution for any offence and from imposition of penalty. He submitted that once the Company settled under the said Scheme, there was immunity in respect of the matter for which the show cause notice was issued. He submitted that penalty was sought to be imposed on the Directors/Officers for the same matter in respect of which the Show Cause Notice had been issued on the Company. He submitted that once the Company got immunity in respect of the matter, nothing survived even against the Directors/Officers. 12. We are unable to accept this submission. Under the Kar Vivad Samadhan Scheme there is no adjudication on the subject matter of the demand notice or show cause notice. There s a settlement of the "tax arrears". Even though the same show cause notice may call upon the Company and its Directors/Officers to show cause, there is a separate demand for "tax arrears" against the Company and a separate demand for "tax arrears" against the Directors/Officers. Thus each entity/person would have to file a declaration separately. The settlement is in respect of each declaration. Section 91 only gives immunity in respect of matters covered in the declaration. The matter covered in the declaration by the Company in the "tax arrears" of the Company. The declaration by the Company admittedly does not cover the tax arrears of the Directors/Officers. Thus they get no immunity under Section 91 on a settlement by the Company. 13. Mr. Vellapally next submitted that the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order, if read as a whole, makes it clear that the benefit of the declaration made by the Company was to accrue even to the Officers of the Company so long as the adjudication proceedings were pending. He submitted that the interpretation sought to be given by the Department would render nugatory the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order. He submitted that such an interpretation would lead to uncertainty. He submitted that the applicability of the Order could not depend upon whether or not an Officer has been proceeded with adjudication expeditiously or not. He submitted that the object was to give benefit to all Directors/Officers of the Company. He submitted that the restricted interpretation would defeat the object. 14. We have heard the parties. In our view, a reading of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order shows that where a declaration had been made in respect of a tax arrear and where in respect of the same matter a show cause notice had also been issued to any other person, then the settlement in favour of the declarant has to be deemed to be full and final in respect of other persons on whom show cause notices had been issued. It is settled law that when an Appeal is pending there is no finality to the proceedings. The proceedings are then deemed to be continuing. Undoubtedly, at one place the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order seems does state that the show cause notice should be pending adjudication. However, the same order also talks of the show cause notice being in respect of same matter on which the show cause notice has been issued to the main declarant. Then the Order provides that a settlement in favour of the declarant will be deemed to be full and final in respect of other persons also. This Order has tobe read as a whole. If read as a whole, it s clear that a settlement by the main declarant is to operate as full and final settlement in respect of all other persons on whom show cause notice was issued in respect of the same matter. Thus read as a whole the words "pending adjudication" cannot be read to exclude cases where the proceedings are still pending in Appeal. Even otherwise the order has to be read along with the Kar Vivad Samadhan Scheme. Under the Kar Vivad Samadhan Scheme a party can file a declaration so long as the proceedings are pending. Thus, even though the show cause notice may have been adjudicated upon and an Appeal is pending a party could still take the benefit of the Kar Vivad Samadhan Scheme and file a declaration. The object of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order is to give benefit of a settlement by the main party (i.e. the company in this case) to all other co-noticees. This being the object a classification, restricting the benefit only to cases where the show cause notice is pending adjudication, would be unreasonable. If read in this manner the Order would be discriminatory. An interpretation which leads to discrimination must be avoided. An interpretation, as suggested by Mr. Ganesh, would also be against the object of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order. It is therefore not possible to accept the submissions of Mr. Ganesh. In our view the reasoning given by the High Court of Kerala is correct and needs to be upheld. 15. In any event this would clearly be a case where two views are possible. It is settled law that if two views are possible then the one which is in favour of the assessee must be adopted. On this ground also the interpretation sought to be given by Mr. Ganesh cannot be accepted.

0[ds]It is settled law that when an Appeal is pending there is no finality to the proceedings. The proceedings are then deemed to be continuing. Undoubtedly, at one place the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order seems does state that the show cause notice should be pending adjudication. However, the same order also talks of the show cause notice being in respect of same matter on which the show cause notice has been issued to the main declarant. Then the Order provides that a settlement in favour of the declarant will be deemed to be full and final in respect of other persons also. This Order has tobe read as a whole. If read as a whole, it s clear that a settlement by the main declarant is to operate as full and final settlement in respect of all other persons on whom show cause notice was issued in respect of the same matter. Thus read as a whole the words "pending adjudication" cannot be read to exclude cases where the proceedings are still pending in Appeal. Even otherwise the order has to be read along with the Kar Vivad Samadhan Scheme. Under the Kar Vivad Samadhan Scheme a party can file a declaration so long as the proceedings are pending. Thus, even though the show cause notice may have been adjudicated upon and an Appeal is pending a party could still take the benefit of the Kar Vivad Samadhan Scheme and file a declaration. The object of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order is to give benefit of a settlement by the main party (i.e. the company in this case) to all other co-noticees. This being the object a classification, restricting the benefit only to cases where the show cause notice is pending adjudication, would be unreasonable. If read in this manner the Order would be discriminatory. An interpretation which leads to discrimination must be avoided. An interpretation, as suggested by Mr. Ganesh, would also be against the object of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order. It is therefore not possible to accept the submissions of Mr. Ganesh. In our view the reasoning given by the High Court of Kerala is correct and needs to be upheld.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: (Removal of Difficulties) Order was not to be given where the proceedings were pending adjudication but only where the show cause notices were pending adjudication. 11. Mr. Vellapally, on the other hand, submitted that only one show cause notice had been issued. He submitted that in the same show cause notice the Company was called upon to show cause whey excise duty and penalty be not levied and the Directors/Officers were also called upon to show cause whey penalty be not levied on them. He submitted that Section 91 of the Kar Vivad Samadhan Scheme makes it clear that on payment being made and a certificate being granted, immunity is granted against prosecution for any offence and from imposition of penalty. He submitted that once the Company settled under the said Scheme, there was immunity in respect of the matter for which the show cause notice was issued. He submitted that penalty was sought to be imposed on the Directors/Officers for the same matter in respect of which the Show Cause Notice had been issued on the Company. He submitted that once the Company got immunity in respect of the matter, nothing survived even against the Directors/Officers. 12. We are unable to accept this submission. Under the Kar Vivad Samadhan Scheme there is no adjudication on the subject matter of the demand notice or show cause notice. There s a settlement of the "tax arrears". Even though the same show cause notice may call upon the Company and its Directors/Officers to show cause, there is a separate demand for "tax arrears" against the Company and a separate demand for "tax arrears" against the Directors/Officers. Thus each entity/person would have to file a declaration separately. The settlement is in respect of each declaration. Section 91 only gives immunity in respect of matters covered in the declaration. The matter covered in the declaration by the Company in the "tax arrears" of the Company. The declaration by the Company admittedly does not cover the tax arrears of the Directors/Officers. Thus they get no immunity under Section 91 on a settlement by the Company. 13. Mr. Vellapally next submitted that the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order, if read as a whole, makes it clear that the benefit of the declaration made by the Company was to accrue even to the Officers of the Company so long as the adjudication proceedings were pending. He submitted that the interpretation sought to be given by the Department would render nugatory the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order. He submitted that such an interpretation would lead to uncertainty. He submitted that the applicability of the Order could not depend upon whether or not an Officer has been proceeded with adjudication expeditiously or not. He submitted that the object was to give benefit to all Directors/Officers of the Company. He submitted that the restricted interpretation would defeat the object. 14. We have heard the parties. In our view, a reading of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order shows that where a declaration had been made in respect of a tax arrear and where in respect of the same matter a show cause notice had also been issued to any other person, then the settlement in favour of the declarant has to be deemed to be full and final in respect of other persons on whom show cause notices had been issued. It is settled law that when an Appeal is pending there is no finality to the proceedings. The proceedings are then deemed to be continuing. Undoubtedly, at one place the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order seems does state that the show cause notice should be pending adjudication. However, the same order also talks of the show cause notice being in respect of same matter on which the show cause notice has been issued to the main declarant. Then the Order provides that a settlement in favour of the declarant will be deemed to be full and final in respect of other persons also. This Order has tobe read as a whole. If read as a whole, it s clear that a settlement by the main declarant is to operate as full and final settlement in respect of all other persons on whom show cause notice was issued in respect of the same matter. Thus read as a whole the words "pending adjudication" cannot be read to exclude cases where the proceedings are still pending in Appeal. Even otherwise the order has to be read along with the Kar Vivad Samadhan Scheme. Under the Kar Vivad Samadhan Scheme a party can file a declaration so long as the proceedings are pending. Thus, even though the show cause notice may have been adjudicated upon and an Appeal is pending a party could still take the benefit of the Kar Vivad Samadhan Scheme and file a declaration. The object of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order is to give benefit of a settlement by the main party (i.e. the company in this case) to all other co-noticees. This being the object a classification, restricting the benefit only to cases where the show cause notice is pending adjudication, would be unreasonable. If read in this manner the Order would be discriminatory. An interpretation which leads to discrimination must be avoided. An interpretation, as suggested by Mr. Ganesh, would also be against the object of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order. It is therefore not possible to accept the submissions of Mr. Ganesh. In our view the reasoning given by the High Court of Kerala is correct and needs to be upheld. 15. In any event this would clearly be a case where two views are possible. It is settled law that if two views are possible then the one which is in favour of the assessee must be adopted. On this ground also the interpretation sought to be given by Mr. Ganesh cannot be accepted. ### Response: 0

Ajanta Pharma Ltd Vs. Commissioner of Income Tax-9, Mumbai

as clause (iv). Section 115JB continues to remain a self-contained Code.9. On the other hand, Section 80HHC(1) inter alia states that where an assessee, who is the Indian resident, is engaged in the business of exports out of India of any goods earns convertible foreign exchange then in computing the total income, a deduction of the profits derived from such exports would be admissible. Thus, Section 80HHC provides for tax incentives. Section 80HHC(1) at one point of time laid down that an amount equal to the amount of deduction claimed should be debited to the P&L Account of the previous year in respect of which deduction is to be allowed and credited to the reserve account to be utilized for the business purpose. Section 80HHC(1) concerns eligibility whereas Section 80HHC(3) concerns computation of the quantum of deduction/tax relief. At one point of time prior to the Finance Act, 2000, exporters were allowed 100% deduction in respect of profits derived from export of goods. However, that has now been reduced in a phase-wise manner under Section 80HHC(1B). It may be noted that all assessable entities are not eligible for deduction under Section 80HHC. Similarly, only eligible goods are entitled to such special deduction under Section 80HHC(1). A bare reading of Section 80AB shows that computation of deduction is geared to the amount of income, but Section 80HHC(3), which refers to quantification of deduction is geared to the exports turnover and not to the income. On the other hand, Section 115JB refers to levy of MAT on the deemed income. The above discussion is only to show that Sections 80HHC and 115JB operate in different spheres. Thus, two essential conditions for invoking Section 80HHC(1) are that assessee must be in the business of export and secondly that sale proceeds of such exports should be receivable in India in convertible foreign exchange. Hence, Section 80HHC(1) refers to "eligibility" whereas Section 80HHC(3) refers to computation of tax incentive. Coming to Section 80HHC(1B) it is clear that after Finance Act, 2000 w.e.f. assessment year 2001-02 exporters would not get 100% deduction in respect of profits derived from exports but that they would get deduction of 80% in the assessment year 2001-02, 70% in the assessment year 2002-03 and so on. Thus, Section 80HHC(1B) deals not with "eligibility" but with the "extent of deduction". As earlier stated, Section 115JB is a self-contained Code. It taxes deemed income. It begins with a non-obstante clause. Section 115JB refers to computation of "book profits" which have to be computed by making Upward and Downward Adjustments. In the Downward Adjustment, vide clause (iv) it seeks to exclude "eligible" profits derived from exports. On the other hand, under Section 80HHC(1B) it is the extent of deduction which matters. The word "thereof" in each of the items under Section 80HHC(1B) is important. Thus, if an assessee earns Rs.100 crores then for the assessment year 2001-02, the extent of deduction is 80% thereof and so on which means that the principle of proportionality is brought in to scale down the tax incentive in a phased manner. However, for the purposes of computation of book profits which computation is different from normal computation under the 1961 Act/computation under Chapter VIA. We need to keep in mind the Upward and Downward Adjustments and if so read it becomes clear that clause (iv) covers full export profits of 100% as "eligible profits" and that the same cannot be reduced to 80% by relying on Section 80HHC(1B). Thus, for computing "book profits" the Downward Adjustment, in the above example, would be Rs.100 crores and not Rs.90 crores. The idea being to exclude "export profits" from computation of book profits under Section 115JB which imposes MAT on deemed income. The above reasoning also gets support from the Memorandum of Explanation to the Finance Bill, 2000. 10. One of the contentions raised on behalf of the Department was that if clause (iv) of Explanation to Section 115JB is read in entirety including the last line thereof (which reads as "subject to the conditions specified in that section"), it becomes clear that the amount of profits eligible for deduction under Section 80HHC, computed under clause (a) or clause (b) or clause (c) of sub-section (3) or sub-section (3A), as the case may be, is subject to the conditions specified in that Section. According to the Department, the assessee herein is trying to read the various provisions of Section 80HHC in isolation whereas as per clause (iv) of Explanation to Section 115JB, it is clear that book profit shall be reduced by the amount of profits eligible for deduction under Section 80HHC as computed under clause(a) or clause(b) or clause(c) of sub- section (3) or sub-section (3A), as the case may be, of that Section and subject to the conditions specified in that Section, thereby meaning that the deduction allowable would be only to the extent of deduction computed in accordance with the provisions of Section 80HHC. Thus, according to the Department, both "eligibility" as well as "deductibility" of the profit have got to be considered together for working out the deduction as mentioned in clause (iv) of Explanation to Section 115JB. We find no merit in this argument. If the dichotomy between "eligibility" of profit and "deductibility" of profit is not kept in mind then Section 115JB will cease to be a self-contained code. In Section 115JB, as in Section 115JA, it has been clearly stated that the relief will be computed under Section 80HHC(3)/(3A), subject to the conditions under sub-clauses (4) and (4A) of that Section. The conditions are only that the relief should be certified by the Chartered Accountant. Such condition is not a qualifying condition but it is a compliance condition. Therefore, one cannot rely upon the last sentence in clause (iv) of Explanation to Section 115JB (subject to the conditions specified in sub-clauses (4) and (4A) of that Section) to obliterate the difference between "eligibility" and "deductibility" of profits as contended on behalf of the Department.

1[ds]7. In recent times, the number ofcompanies and companies paying marginal tax has grown, hence, vide the Finance (No.2) Act, 1996, levy of minimum tax on companies having "book profits" stood introduced. The scheme envisaged payment of minimum tax by deeming 30% of the book profits computed under the Companies Act, as taxable income, in a case where the total income as computed under the provisions of the 1961 Act, is less than 30% of the book profit. The word "book profit" has been defined in Section 115JA(2) read with the Explanation thereto to mean the net profit as shown in the Profit and Loss Account, as increased by the amount(s) mentioned in clauses (a) to (f), and as reduced by amount(s) covered by clauses (i) to (ix) of the Explanation. These may be called for the sake of brevity as "Upward and Downward Adjustments". From the above it is clear that Section 115JA is aCode and will apply notwithstanding any provisions in the 1961 Act. In this case, we are concerned with Downward Adjustment, particularly clause (viii) which refers to the amount(s) of profits eligible for deduction under Section 80HHC, computed under Section 80HHC(3) but subject to conditions specified in Sections 80HHC(4) and 80HHC(4A).8. By the Finance Act, 2000, Section 115JB was inserted w.e.f. 1.4.2001 providing for levy of MAT on certain companies. Section 115JB, though structured differently, stood inserted to provide for payment of advance tax by MAT companies. Section 115JB is the successor section to Section 115JA. In essence, it is the same except that Section 115JA provided for MAT on companies, so far as it does not deem the book profit as total income. Under Section 115JB, however, clause (viii) of Section 115JA isas clause (iv). Section 115JB continues to remain aCode.9. On the other hand, Section 80HHC(1) inter alia states that where an assessee, who is the Indian resident, is engaged in the business of exports out of India of any goods earns convertible foreign exchange then in computing the total income, a deduction of the profits derived from such exports would be admissible. Thus, Section 80HHC provides for tax incentives. Section 80HHC(1) at one point of time laid down that an amount equal to the amount of deduction claimed should be debited to the P&L Account of the previous year in respect of which deduction is to be allowed and credited to the reserve account to be utilized for the business purpose. Section 80HHC(1) concerns eligibility whereas Section 80HHC(3) concerns computation of the quantum of deduction/tax relief. At one point of time prior to the Finance Act, 2000, exporters were allowed 100% deduction in respect of profits derived from export of goods. However, that has now been reduced in amanner under Section 80HHC(1B). It may be noted that all assessable entities are not eligible for deduction under Section 80HHC. Similarly, only eligible goods are entitled to such special deduction under Section 80HHC(1). A bare reading of Section 80AB shows that computation of deduction is geared to the amount of income, but Section 80HHC(3), which refers to quantification of deduction is geared to the exports turnover and not to the income. On the other hand, Section 115JB refers to levy of MAT on the deemed income. The above discussion is only to show that Sections 80HHC and 115JB operate in different spheres. Thus, two essential conditions for invoking Section 80HHC(1) are that assessee must be in the business of export and secondly that sale proceeds of such exports should be receivable in India in convertible foreign exchange. Hence, Section 80HHC(1) refers to "eligibility" whereas Section 80HHC(3) refers to computation of tax incentive. Coming to Section 80HHC(1B) it is clear that after Finance Act, 2000 w.e.f. assessment yearexporters would not get 100% deduction in respect of profits derived from exports but that they would get deduction of 80% in the assessment year70% in the assessment yearand so on. Thus, Section 80HHC(1B) deals not with "eligibility" but with the "extent of deduction". As earlier stated, Section 115JB is aCode. It taxes deemed income. It begins with aclause. Section 115JB refers to computation of "book profits" which have to be computed by making Upward and Downward Adjustments. In the Downward Adjustment, vide clause (iv) it seeks to exclude "eligible" profits derived from exports. On the other hand, under Section 80HHC(1B) it is the extent of deduction which matters. The word "thereof" in each of the items under Section 80HHC(1B) is important. Thus, if an assessee earns Rs.100 crores then for the assessment yearthe extent of deduction is 80% thereof and so on which means that the principle of proportionality is brought in to scale down the tax incentive in a phased manner. However, for the purposes of computation of book profits which computation is different from normal computation under the 1961 Act/computation under Chapter VIA. We need to keep in mind the Upward and Downward Adjustments and if so read it becomes clear that clause (iv) covers full export profits of 100% as "eligible profits" and that the same cannot be reduced to 80% by relying on Section 80HHC(1B). Thus, for computing "book profits" the Downward Adjustment, in the above example, would be Rs.100 crores and not Rs.90 crores. The idea being to exclude "export profits" from computation of book profits under Section 115JB which imposes MAT on deemed income. The above reasoning also gets support from the Memorandum of Explanation to the Finance Bill, 2000.One of the contentions raised on behalf of the Department was that if clause (iv) of Explanation to Section 115JB is read in entirety including the last line thereof (which reads as "subject to the conditions specified in that section"), it becomes clear that the amount of profits eligible for deduction under Section 80HHC, computed under clause (a) or clause (b) or clause (c) ofion (3A), as the case may be, is subject to the conditions specified in that Section.According to the Department, the assessee herein is trying to read the various provisions of Section 80HHC in isolation whereas as per clause (iv) of Explanation to Section 115JB, it is clear that book profit shall be reduced by the amount of profits eligible for deduction under Section 80HHC as computed under clause(a) or clause(b) or clause(c) of subsection (3) or(3A), as the case may be, of that Section and subject to the conditions specified in that Section, thereby meaning that the deduction allowable would be only to the extent of deduction computed in accordance with the provisions of Section 80HHC. Thus, according to the Department, both "eligibility" as well as "deductibility" of the profit have got to be considered together for working out the deduction as mentioned in clause (iv) of Explanation to Section 115JB. We find no merit in this argument. If the dichotomy between "eligibility" of profit and "deductibility" of profit is not kept in mind then Section 115JB will cease to be acode. In Section 115JB, as in Section 115JA, it has been clearly stated that the relief will be computed under Section 80HHC(3)/(3A), subject to the conditions under(4) and (4A) of that Section. The conditions are only that the relief should be certified by the Chartered Accountant. Such condition is not a qualifying condition but it is a compliance condition. Therefore, one cannot rely upon the last sentence in clause (iv) of Explanation to Section 115JB (subject to the conditions specified in(4) and (4A) of that Section) to obliterate the difference between "eligibility" and "deductibility" of profits as contended on behalf of the Department.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: as clause (iv). Section 115JB continues to remain a self-contained Code.9. On the other hand, Section 80HHC(1) inter alia states that where an assessee, who is the Indian resident, is engaged in the business of exports out of India of any goods earns convertible foreign exchange then in computing the total income, a deduction of the profits derived from such exports would be admissible. Thus, Section 80HHC provides for tax incentives. Section 80HHC(1) at one point of time laid down that an amount equal to the amount of deduction claimed should be debited to the P&L Account of the previous year in respect of which deduction is to be allowed and credited to the reserve account to be utilized for the business purpose. Section 80HHC(1) concerns eligibility whereas Section 80HHC(3) concerns computation of the quantum of deduction/tax relief. At one point of time prior to the Finance Act, 2000, exporters were allowed 100% deduction in respect of profits derived from export of goods. However, that has now been reduced in a phase-wise manner under Section 80HHC(1B). It may be noted that all assessable entities are not eligible for deduction under Section 80HHC. Similarly, only eligible goods are entitled to such special deduction under Section 80HHC(1). A bare reading of Section 80AB shows that computation of deduction is geared to the amount of income, but Section 80HHC(3), which refers to quantification of deduction is geared to the exports turnover and not to the income. On the other hand, Section 115JB refers to levy of MAT on the deemed income. The above discussion is only to show that Sections 80HHC and 115JB operate in different spheres. Thus, two essential conditions for invoking Section 80HHC(1) are that assessee must be in the business of export and secondly that sale proceeds of such exports should be receivable in India in convertible foreign exchange. Hence, Section 80HHC(1) refers to "eligibility" whereas Section 80HHC(3) refers to computation of tax incentive. Coming to Section 80HHC(1B) it is clear that after Finance Act, 2000 w.e.f. assessment year 2001-02 exporters would not get 100% deduction in respect of profits derived from exports but that they would get deduction of 80% in the assessment year 2001-02, 70% in the assessment year 2002-03 and so on. Thus, Section 80HHC(1B) deals not with "eligibility" but with the "extent of deduction". As earlier stated, Section 115JB is a self-contained Code. It taxes deemed income. It begins with a non-obstante clause. Section 115JB refers to computation of "book profits" which have to be computed by making Upward and Downward Adjustments. In the Downward Adjustment, vide clause (iv) it seeks to exclude "eligible" profits derived from exports. On the other hand, under Section 80HHC(1B) it is the extent of deduction which matters. The word "thereof" in each of the items under Section 80HHC(1B) is important. Thus, if an assessee earns Rs.100 crores then for the assessment year 2001-02, the extent of deduction is 80% thereof and so on which means that the principle of proportionality is brought in to scale down the tax incentive in a phased manner. However, for the purposes of computation of book profits which computation is different from normal computation under the 1961 Act/computation under Chapter VIA. We need to keep in mind the Upward and Downward Adjustments and if so read it becomes clear that clause (iv) covers full export profits of 100% as "eligible profits" and that the same cannot be reduced to 80% by relying on Section 80HHC(1B). Thus, for computing "book profits" the Downward Adjustment, in the above example, would be Rs.100 crores and not Rs.90 crores. The idea being to exclude "export profits" from computation of book profits under Section 115JB which imposes MAT on deemed income. The above reasoning also gets support from the Memorandum of Explanation to the Finance Bill, 2000. 10. One of the contentions raised on behalf of the Department was that if clause (iv) of Explanation to Section 115JB is read in entirety including the last line thereof (which reads as "subject to the conditions specified in that section"), it becomes clear that the amount of profits eligible for deduction under Section 80HHC, computed under clause (a) or clause (b) or clause (c) of sub-section (3) or sub-section (3A), as the case may be, is subject to the conditions specified in that Section. According to the Department, the assessee herein is trying to read the various provisions of Section 80HHC in isolation whereas as per clause (iv) of Explanation to Section 115JB, it is clear that book profit shall be reduced by the amount of profits eligible for deduction under Section 80HHC as computed under clause(a) or clause(b) or clause(c) of sub- section (3) or sub-section (3A), as the case may be, of that Section and subject to the conditions specified in that Section, thereby meaning that the deduction allowable would be only to the extent of deduction computed in accordance with the provisions of Section 80HHC. Thus, according to the Department, both "eligibility" as well as "deductibility" of the profit have got to be considered together for working out the deduction as mentioned in clause (iv) of Explanation to Section 115JB. We find no merit in this argument. If the dichotomy between "eligibility" of profit and "deductibility" of profit is not kept in mind then Section 115JB will cease to be a self-contained code. In Section 115JB, as in Section 115JA, it has been clearly stated that the relief will be computed under Section 80HHC(3)/(3A), subject to the conditions under sub-clauses (4) and (4A) of that Section. The conditions are only that the relief should be certified by the Chartered Accountant. Such condition is not a qualifying condition but it is a compliance condition. Therefore, one cannot rely upon the last sentence in clause (iv) of Explanation to Section 115JB (subject to the conditions specified in sub-clauses (4) and (4A) of that Section) to obliterate the difference between "eligibility" and "deductibility" of profits as contended on behalf of the Department. ### Response: 1

Ranjit Singh Etc Vs. Union of India

guns per month. Until the year 1963, the licence in favour of Pritam Singh was renewed by the Government of Jammu &Kashmir for the full quota of 30 guns. But with effect from the year 1964 the Government of India began to issue the licences. The quota was reduced from 30 guns to 10 guns per month, and it is alleged that this has resulted in considerable hardship in view of the financial liability and the establishment expenses suffered pursuant to the installation of the machinery. On the death of Pritam Singh in 1969, the business was carried on by the petitioner and his mother, and the licence now stands in their names. Several representations were made to the authorities for the restoration of the original quota but there was no satisfactory response. The petitioner claims that his plea for the restoration of his original quota has been supported by the State Government. The petitioner cites a number of cases where the quota reduced in the case of other manufacturers has been restored and relies on other material to show that the determination of his quota has been arbitrary.3. Writ Petition No. 834 of 1979 has been filed by Bachan Singh. The facts incorporated in the petition run a materially similar course, except that the original quota granted to the petitioner consisted of 50 guns per month and has now been reduced to 5 guns per month.4. The petitioner in the third Writ Petition, No. 835 of 1979, is Uttam Singh. In his case, th e original quota of 50 guns a month has been reduced to 15 guns a month. Here again, the pattern of facts is substantially similar to that traced in the other two writ petitions.5. In opposition to the writ petitions, the Union of India which is t he sole respondent, relies on an Industrial Policy Resolution of 1956 which envisions an exclusive monopoly in the Central Government in the matter of manufacturing arms and ammunition while permitting existing manufacturers in the private sector to continue to carry on their business on a limited scale. It is asserted that in fixing a quota the manufacturing capacity of a concern is not a determining factor, and it is denied that the Government has acted arbitrarily. It is also urged that the petitioners should be denied relief on the ground of laches.6. The Union of India rests its case on the Industrial Policy Resolution of 1956. Under that Resolution, however, it was decided that no objection would be taken to the continuance of the manufacture of arms and ammunition by existing units in the private sector already licensed for such manufacture provided the operation of those units was strictly restricted to the items already manufactured by them and that no expansion of their production or increasing the capacity of the items already produced was undertaken without the prior sanction of the Government of India. Plainly, what was envisaged was a prohibition against an increase in the quota, n ot its curtailment. Purporting to implement the Industrial Policy Resolution, the Government issued instructions that the quota fixed should be such that the market was not flooded with arms and ammunition. No objection can be raised to that. It i s as it should be, but with that primary consideration defining the outer limits, there are other factors which govern the fixation of the actual quota. There is the production capacity of the factory, the quality of guns produced and the economic viability of the unit. The Government is bound to keep these in mind while deciding on the manufacturing quota. There is need to remember that the manufacture of arms has been the business of some of these units for several years and the Industrial Policy Resolution contains a specific commitment to permit the continuance of those factories. On the other side, the Government is entitled to take into consideration the requirements of current administrative policy pertinent to the maintenance of law and order and internal security. Any curtailment of the quota must necessarily proceed on the basis of reason and relevance. If all relevant factors are not considered, or irrelevant considerations allowed to find place, the decision is vitiated by arbitrary judgment. On the material placed before us, we are not satisfied that the Government of India has taken into careful consideration the several elements necessary for forming a decision on the quota permissible to each of these petitioners. We are of opinion that it should do so now. And, for that purpose, the petitioners should be entitled to place before the Government a fresh and complete statement of their case, with supporting written material, to enable the Government to reach a just decision in each case.7. We need not, in the circumstances, consider the other grounds on which the petitioners claim relief.8. On behalf of the Government it is urged that there is no fundamental right under Article 19(1)(g) of the Constitution to carry on the manufacture of arms. That contention is disposed of shortly. The Arms Act, 1959, expressly contemplates the grant of licences for manufacturing arms. An applicant for a licence is entitled to have it considered in accordance with the terms of the statute and to have for its grant on the basis of the criteria set forth in it.9. The other contention on behalf of the Government is that the petitioners are guilty of laches. We are not impressed by the contention for the reason that the licences are granted for specific periods with a right to apply for renewal on the expiry of each period. Each renewal constitutes a further grant of rights and it is open to the applicant to show on each occasion that the quota governing the preceding period should now be revised in the light of present circumstances. Besides, the petitioners have been continuously agitating for the restoration of their quota. Having regard to the peculiar circumstances of these cases, we are not inclined to deny them relief.10.

1[ds]The Union of India rests its case on the Industrial Policy Resolution of 1956. Under that Resolution, however, it was decided that no objection would be taken to the continuance of the manufacture of arms and ammunition by existing units in the private sector already licensed for such manufacture provided the operation of those units was strictly restricted to the items already manufactured by them and that no expansion of their production or increasing the capacity of the items already produced was undertaken without the prior sanction of the Government of India. Plainly, what was envisaged was a prohibition against an increase in the quota, n ot its curtailment. Purporting to implement the Industrial Policy Resolution, the Government issued instructions that the quota fixed should be such that the market was not flooded with arms and ammunition. No objection can be raised to that. It i s as it should be, but with that primary consideration defining the outer limits, there are other factors which govern the fixation of the actual quota. There is the production capacity of the factory, the quality of guns produced and the economic viability of the unit. The Government is bound to keep these in mind while deciding on the manufacturing quota. There is need to remember that the manufacture of arms has been the business of some of these units for several years and the Industrial Policy Resolution contains a specific commitment to permit the continuance of those factories. On the other side, the Government is entitled to take into consideration the requirements of current administrative policy pertinent to the maintenance of law and order and internal security. Any curtailment of the quota must necessarily proceed on the basis of reason and relevance. If all relevant factors are not considered, or irrelevant considerations allowed to find place, the decision is vitiated by arbitrary judgment. On the material placed before us, we are not satisfied that the Government of India has taken into careful consideration the several elements necessary for forming a decision on the quota permissible to each of these petitioners. We are of opinion that it should do so now. And, for that purpose, the petitioners should be entitled to place before the Government a fresh and complete statement of their case, with supporting written material, to enable the Government to reach a just decision in eachneed not, in the circumstances, consider the other grounds on which the petitioners claimare not impressed by the contention for the reason that the licences are granted for specific periods with a right to apply for renewal on the expiry of each period. Each renewal constitutes a further grant of rights and it is open to the applicant to show on each occasion that the quota governing the preceding period should now be revised in the light of present circumstances. Besides, the petitioners have been continuously agitating for the restoration of their quota. Having regard to the peculiar circumstances of these cases, we are not inclined to deny them relief.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: guns per month. Until the year 1963, the licence in favour of Pritam Singh was renewed by the Government of Jammu &Kashmir for the full quota of 30 guns. But with effect from the year 1964 the Government of India began to issue the licences. The quota was reduced from 30 guns to 10 guns per month, and it is alleged that this has resulted in considerable hardship in view of the financial liability and the establishment expenses suffered pursuant to the installation of the machinery. On the death of Pritam Singh in 1969, the business was carried on by the petitioner and his mother, and the licence now stands in their names. Several representations were made to the authorities for the restoration of the original quota but there was no satisfactory response. The petitioner claims that his plea for the restoration of his original quota has been supported by the State Government. The petitioner cites a number of cases where the quota reduced in the case of other manufacturers has been restored and relies on other material to show that the determination of his quota has been arbitrary.3. Writ Petition No. 834 of 1979 has been filed by Bachan Singh. The facts incorporated in the petition run a materially similar course, except that the original quota granted to the petitioner consisted of 50 guns per month and has now been reduced to 5 guns per month.4. The petitioner in the third Writ Petition, No. 835 of 1979, is Uttam Singh. In his case, th e original quota of 50 guns a month has been reduced to 15 guns a month. Here again, the pattern of facts is substantially similar to that traced in the other two writ petitions.5. In opposition to the writ petitions, the Union of India which is t he sole respondent, relies on an Industrial Policy Resolution of 1956 which envisions an exclusive monopoly in the Central Government in the matter of manufacturing arms and ammunition while permitting existing manufacturers in the private sector to continue to carry on their business on a limited scale. It is asserted that in fixing a quota the manufacturing capacity of a concern is not a determining factor, and it is denied that the Government has acted arbitrarily. It is also urged that the petitioners should be denied relief on the ground of laches.6. The Union of India rests its case on the Industrial Policy Resolution of 1956. Under that Resolution, however, it was decided that no objection would be taken to the continuance of the manufacture of arms and ammunition by existing units in the private sector already licensed for such manufacture provided the operation of those units was strictly restricted to the items already manufactured by them and that no expansion of their production or increasing the capacity of the items already produced was undertaken without the prior sanction of the Government of India. Plainly, what was envisaged was a prohibition against an increase in the quota, n ot its curtailment. Purporting to implement the Industrial Policy Resolution, the Government issued instructions that the quota fixed should be such that the market was not flooded with arms and ammunition. No objection can be raised to that. It i s as it should be, but with that primary consideration defining the outer limits, there are other factors which govern the fixation of the actual quota. There is the production capacity of the factory, the quality of guns produced and the economic viability of the unit. The Government is bound to keep these in mind while deciding on the manufacturing quota. There is need to remember that the manufacture of arms has been the business of some of these units for several years and the Industrial Policy Resolution contains a specific commitment to permit the continuance of those factories. On the other side, the Government is entitled to take into consideration the requirements of current administrative policy pertinent to the maintenance of law and order and internal security. Any curtailment of the quota must necessarily proceed on the basis of reason and relevance. If all relevant factors are not considered, or irrelevant considerations allowed to find place, the decision is vitiated by arbitrary judgment. On the material placed before us, we are not satisfied that the Government of India has taken into careful consideration the several elements necessary for forming a decision on the quota permissible to each of these petitioners. We are of opinion that it should do so now. And, for that purpose, the petitioners should be entitled to place before the Government a fresh and complete statement of their case, with supporting written material, to enable the Government to reach a just decision in each case.7. We need not, in the circumstances, consider the other grounds on which the petitioners claim relief.8. On behalf of the Government it is urged that there is no fundamental right under Article 19(1)(g) of the Constitution to carry on the manufacture of arms. That contention is disposed of shortly. The Arms Act, 1959, expressly contemplates the grant of licences for manufacturing arms. An applicant for a licence is entitled to have it considered in accordance with the terms of the statute and to have for its grant on the basis of the criteria set forth in it.9. The other contention on behalf of the Government is that the petitioners are guilty of laches. We are not impressed by the contention for the reason that the licences are granted for specific periods with a right to apply for renewal on the expiry of each period. Each renewal constitutes a further grant of rights and it is open to the applicant to show on each occasion that the quota governing the preceding period should now be revised in the light of present circumstances. Besides, the petitioners have been continuously agitating for the restoration of their quota. Having regard to the peculiar circumstances of these cases, we are not inclined to deny them relief.10. ### Response: 1

Arun Maan and Ors Vs. State of Uttar Pradesh and Ors

Kurian Joseph, J.1. Leave granted.2. In the nature of order we propose to pass, it is not necessary to issue notice to the Respondents, since, in any case, the matter will have to be contested on merits before the High Court.3. We find that in the High Court also, no notice was issued to the parties while dismissing the writ petition. The impugned order reads as follows:Having heard learned Counsel for the Petitioners, we find that the Petitioner had earlier filed writ petition before the Delhi High Court which was dismissed as withdrawn by order dated 21.04.2015 and 07.12.2015. Thereafter the Petitioner has filed writ petition before this Court. In our opinion the Petitioner has approached the Court belatedly. There is a delay of more than five years in approaching this Court. Dismissed on the ground of laches.4. The order, by which the Appellants withdrew their cases before the Delhi High Court dated 21.04.2015 reads as follows:After some arguments, counsel for the Petitioners seek leave to withdraw these writ petitions with liberty to challenge the letter dated 15.11.2010 issued by the Regional Transport Authority, Agra whereby the said Authority has taken a decision that all the 81 licenses were fake licenses.Reserving the said liberty to challenge the legality of the said letter issued by the Assistant Divisional Transport Officer of Regional Transport Office, Agra Region, the present writ petitions are dismissed as withdrawn.5. The order dated 07.12.2015, referred to by the High Court in the impugned order, reads as follows:Petitioner in person. At the first call, counsel for the Petitioner was also present. Petitioner submits that he wishes to withdraw present writ petition in view of the order dated 21.4.2015 passed by this Court in W.P.(C) 6358/2014 and other connected matters.Accordingly, petition stands dismissed as withdrawn in view of above.6. It may be seen that the High Court of Delhi reserved the liberty to the Appellants, while withdrawing the writ petition to challenge the orders, which are now mentioned before the High Court of Allahabad. Therefore, it cannot be said that there is delay of more than five years, while filing the writ petitions. It appears that the Writ Petitions have been filed within five months, apparently after obtaining the orders dated 21.04.2015 and 07.12.2015.

0[ds]6. It may be seen that the High Court of Delhi reserved the liberty to the Appellants, while withdrawing the writ petition to challenge the orders, which are now mentioned before the High Court of Allahabad. Therefore, it cannot be said that there is delay of more than five years, while filing the writ petitions. It appears that the Writ Petitions have been filed within five months, apparently after obtaining the orders dated 21.04.2015 and 07.12.2015.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: Kurian Joseph, J.1. Leave granted.2. In the nature of order we propose to pass, it is not necessary to issue notice to the Respondents, since, in any case, the matter will have to be contested on merits before the High Court.3. We find that in the High Court also, no notice was issued to the parties while dismissing the writ petition. The impugned order reads as follows:Having heard learned Counsel for the Petitioners, we find that the Petitioner had earlier filed writ petition before the Delhi High Court which was dismissed as withdrawn by order dated 21.04.2015 and 07.12.2015. Thereafter the Petitioner has filed writ petition before this Court. In our opinion the Petitioner has approached the Court belatedly. There is a delay of more than five years in approaching this Court. Dismissed on the ground of laches.4. The order, by which the Appellants withdrew their cases before the Delhi High Court dated 21.04.2015 reads as follows:After some arguments, counsel for the Petitioners seek leave to withdraw these writ petitions with liberty to challenge the letter dated 15.11.2010 issued by the Regional Transport Authority, Agra whereby the said Authority has taken a decision that all the 81 licenses were fake licenses.Reserving the said liberty to challenge the legality of the said letter issued by the Assistant Divisional Transport Officer of Regional Transport Office, Agra Region, the present writ petitions are dismissed as withdrawn.5. The order dated 07.12.2015, referred to by the High Court in the impugned order, reads as follows:Petitioner in person. At the first call, counsel for the Petitioner was also present. Petitioner submits that he wishes to withdraw present writ petition in view of the order dated 21.4.2015 passed by this Court in W.P.(C) 6358/2014 and other connected matters.Accordingly, petition stands dismissed as withdrawn in view of above.6. It may be seen that the High Court of Delhi reserved the liberty to the Appellants, while withdrawing the writ petition to challenge the orders, which are now mentioned before the High Court of Allahabad. Therefore, it cannot be said that there is delay of more than five years, while filing the writ petitions. It appears that the Writ Petitions have been filed within five months, apparently after obtaining the orders dated 21.04.2015 and 07.12.2015. ### Response: 0

Vandana Global Limited Vs. Il & Fs Financial Services Limited

the exercise price. To appreciate as to what is the meaning of the term guarantee it would be useful to refer to Blacks Law Dictionary, Eighth Edition which defines guarantee as under:Guarantee (garantee), n. 1. The assurance that a contract or legal act will be duly carried out.2. GUARANTY (1)In practice, guarantee, n., is the usual term, seen often, for example, in the context of consumer warranties or other assurances of quality or performance, Guaranty, in contrast, is now used primarily in financial and banking contexts in the sense a promise to answer for the debt of another.. Guaranty is now rarely seen in nonlegal writing, whether in G.B. Or in the U.S. Brayan A. Garner, A Dictionary of Modern Legal Usage 394(2nd ed. 1995).3. Something given or existing as security, such as to fulfil a future engagement or a condition subsequent. [Cases: Guaranty 29] 4. One to whom a guaranty is made. Also spelled guaranty.Guarantee, vb 1. To assume a suretyship obligation; to agree to answer for a debt or default. 2.To promise that a contract or legal act will be duly carried out. 3. To give security to.(emphasis supplied)17. In the above context from the bare reading of Article II, it is clear that the appellant as also Vandana Ispat Ltd. had irrevocably, absolutely and unconditionally agreed and had undertaken to the respondent that in the event of occurrence of a default under the facility agreement, the respondent may at its discretion issue Put Notice and upon receipt of the Put Notice, the appellant and Vandana Ispat Ltd., shall without demur or protest make payment of Exercise Price to the respondent and accept by way of assignment from the respondent the facility alongwith all rights and liabilities thereunder. The very wording of Article II is suggestive of a guarantee on the part of the appellant to the respondent. The legal position can be clearly noted from Section 126 of the Contract Act which defines a contract of guarantee to mean a contract to perform the promise, or discharge the liability, of a third person in case of his default. It is well settled that a contract of guarantee involves principally three parties namely the creditor, the surety and the principal debtor, where liability may be actual or prospective. Thus necessarily the ingredients of a contract of guarantee are clearly present in the option agreement which are reflected from the unambiguous nature of Article II the Put Option whereby the appellant has irrevocably, absolutely and unconditionally without demur or protest agreed to make payment of the exercise price to the respondent. If this be the case, then considering the provisions of Section 126 of the Contract Act, it is imperative to accept the option agreement as a contract of guarantee. There can be no other interpretation. Thus, we are of the considered opinion, the learned Single Judge is correct in observing that the option agreement is required to be considered as a guarantee.18. Now coming to the contention as urged on behalf of the appellant that the option agreement was terminated on 4 March 2015 and the same could not have been invoked. This contention also cannot be accepted, firstly because the parties have bound themselves by providing Article IV the termination clause, which provides that the option agreement will be terminated only on the happening of two events, firstly on due repayment of all outstanding amounts under the facility by the borrower to the respondent and secondly on receipt of exercise price by the respondent from the appellant and Vandana Ispat Ltd. (VIL) It would be desirable to note that the contents of Article IV which reads thus:This Agreement will terminate on the happening of the following events:a) On the repayment of all outstanding amounts under the Facility by the Borrower to IFIN, orb) on the receipt of the Exercise Price by IFIN from VGL and VIL in terms of Article 2.1.Once having agreed to the above conditions of termination, it was not open to the appellant to contend that the appellants liability had ceased to exist in view of a purported termination of the option agreement and that civil proceedings were required to be filed by the respondent to seek specific performance of the said agreement. In our opinion, by agreeing to Article IV (termination clause) and accepting that the agreement will be terminated only on the happening of said two events, it can certainly be said that the appellant had waived the right if any, to terminate the contract. The submission as urged on behalf of the appellant that by their letter dated 4 March 2015 the option agreement was terminated, if is accepted, then the consequence is that Article IV (Termination Clause) of the option agreement itself would be rendered nugatory and meaningless. The whole intention of the parties to incorporate the termination clause as contained in Article IV is to bind the parties only in the stipulated and agreed mode of termination and in no other form or method. In fact what is pertinent is that the parties had categorically avoided to enter any other form of termination when they agreed to incorporate Article IV. Thus, the appellants contention that in view of termination letter dated 4 March 2015 the Put Option could not have been exercised by the respondent is wholly untenable. The appellants contention of the validity of the option agreement being considered by the learned Single Judge in the summary proceedings of a winding up petition, hence is wholly unfounded.19. Before parting, we may also note that by the impugned order the winding up petition of the respondent has been admitted and was directed to be advertised. It is not in dispute that the winding up petition has already been advertised and to that extent the impugned order is already implemented. As regards the final hearing of winding up petition, as informed to us, the learned Single Judge has placed the winding up petition for final hearing on 16 March, 2018.

0[ds]13. There are three principal submissions as urged on behalf of the appellant in challenging the impugned order passed by the learned Single Judge. The first submission is that the option agreement was not available to be invoked against the appellant as the same was terminated by the appellant on 4 March 2015. The option agreement being terminated was not enforceable in law. As a consequence of termination of the option agreement no dues are payable under the option agreement. Further the adjudication of the validity and purport of the option agreement cannot be a subject matter of summary proceedings of a winding up petition but ought to be agitated in a civil suit. The second submission is that the learned Single Judge has erred in coming to a conclusion that there is no right available under the general law, for the appellant to terminate the option agreement and that the option agreement could not have been terminated only in two circumstances as provided by the termination clauseArticle IV (supra). The third submission is that even assuming that the option agreement was subsisting, the same could not have been construed as an agreement of guarantee by the learned Single Judge. The option agreement had created reciprocal obligations as also there was no amount payable by the appellant per se under the option agreement. The interpretation of option agreement is, therefore, contrary to the express terms of the said agreement.14. We are not persuaded to accept any of the submissions as urged on behalf of the appellant. Taking the third submission first, we may state that it is not in dispute that the principal terms and conditions of the financial assistance as provided by the respondent to theborrowerVandana Udhyog Ltd.stipulates Put Option which provides that on the Put/Call dates, maturity and trigger of any event of default, the respondent shall have an unconditional right to sell the RTL through transfer/assignment, to the appellantVandana Global Ltd. (VGL) and Vandana Ispat Limited (VIL) and realize all the outstanding dues under the loan agreement. It further provides of the unconditional commitment of the appellant and Vandana Ispat Limited (VIL) to buy the RTL on the exercise of the above right by the respondent which will be backed by their respective Board Resolution, in compliance of Section 295 of the Companies Act. Accordingly, the respondent had entered into the Option Agreement dated 6 January 2012 with the appellant and Vandana Ispat Limited and theborrowerVandana Udhyog Ltd.Clause 2 of the said agreement clearly provides that it is a condition for the respondent agreeing to grant financial facility that the appellant and Vandana Ispat Ltd. (VIL), provide the respondent with an unconditional and irrevocable option to sell and assign the facility to the appellant and VIL alongwith associated rights thereunder in the event default occurs under the said facility agreement. Clause 2 reads as under:It is a condition for IFIN agreeing to grant the Facility that VGL and VIL provide IFIN with an unconditional and irrevocable option to sell and assign the Facility to VGL and VIL alongwith the associated rights thereunder in the event in Event of Default occurs under the Facility Agreement.15. Article I being the interpretation clause, the Put Option is defined to mean the right but not the obligation of the respondent to sell and assign the facility to the appellant and VIL on the terms and conditions contained in the said agreement and demand payment of Exercise Price. The Exercise Price is defined to mean the aggregate amount of all debts and monetary liabilities of theborrowerVandana Udhyog Ltd.to the respondentwhich are owed, incurred and outstanding as principal, together with interest, charges, costs, expenses and all other monies payable by the borrower alongwith the penalty, if any, under the facility agreement and any other documents in relation to the facility, upon the occurrence of an event of default, under the facility agreement.In the above context from the bare reading of Article II, it is clear that the appellant as also Vandana Ispat Ltd. had irrevocably, absolutely and unconditionally agreed and had undertakento the respondentthat in the event of occurrence of a default under the facility agreement, the respondent may at its discretion issue Put Notice and upon receipt of the Put Notice, the appellant and Vandana Ispat Ltd., shall without demur or protest make payment of Exercise Priceto the respondentand accept by way of assignment from the respondent the facility alongwith all rights and liabilities thereunder. The very wording of Article II is suggestive of a guarantee on the part of the appellantthe respondent. Thelegal position can be clearly noted from Section 126 of the Contract Act which defines a contract of guarantee to mean a contract to perform the promise, or discharge the liability, of a third person in case of his default. It is well settled that a contract of guarantee involves principally three parties namely the creditor, the surety and the principal debtor, where liability may be actual or prospective. Thus necessarily the ingredients of a contract of guarantee are clearly present in the option agreement which are reflected from the unambiguous nature of Article II the Put Option whereby the appellant has irrevocably, absolutely and unconditionally without demur or protest agreed to make payment of the exercise priceIf this be the case, then considering the provisions of Section 126 of the Contract Act, it is imperative to accept the option agreement as a contract of guarantee. There can be no other interpretation. Thus, we are of the considered opinion, the learned Single Judge is correct in observing that the option agreement is required to be considered as a guarantee.18. Now coming to the contention as urged on behalf of the appellant that the option agreement was terminated on 4 March 2015 and the same could not have been invoked. This contention also cannot be accepted, firstly because the parties have bound themselves by providing Article IV the termination clause, which provides that the option agreement will be terminated only on the happening of two events, firstly on due repayment of all outstanding amounts under the facility by the borrowerto the respondentand secondly on receipt of exercise price by the respondent from the appellant and Vandana Ispat Ltd. (VIL) It would be desirable to note that the contents of Article IV which reads thus:This Agreement will terminate on the happening of the following events:a) On the repayment of all outstanding amounts under the Facility by the Borrower to IFIN, orb) on the receipt of the Exercise Price by IFIN from VGL and VIL in terms of Article 2.1.Once having agreed to the above conditions of termination, it was not open to the appellant to contend that the appellants liability had ceased to exist in view of a purported termination of the option agreement and that civil proceedings were required to be filed by the respondent to seek specific performance of the said agreement. In our opinion, by agreeing to Article IV (termination clause) and accepting that the agreement will be terminated only on the happening of said two events, it can certainly be said that the appellant had waived the right if any, to terminate the contract. The submission as urged on behalf of the appellant that by their letter dated 4 March 2015 the option agreement was terminated, if is accepted, then the consequence is that Article IV (Termination Clause) of the option agreement itself would be rendered nugatory and meaningless. The whole intention of the parties to incorporate the termination clause as contained in Article IV is to bind the parties only in the stipulated and agreed mode of termination and in no other form or method. In fact what is pertinent is that the parties had categorically avoided to enter any other form of termination when they agreed to incorporate Article IV. Thus, the appellants contention that in view of termination letter dated 4 March 2015 the Put Option could not have been exercised by the respondent is wholly untenable. The appellants contention of the validity of the option agreement being considered by the learned Single Judge in the summary proceedings of a winding up petition, hence is wholly unfounded.19. Before parting, we may also note that by the impugned order the winding up petition of the respondent has been admitted and was directed to be advertised. It is not in dispute that the winding up petition has already been advertised and to that extent the impugned order is already implemented. As regards the final hearing of winding up petition, as informed to us, the learned Single Judge has placed the winding up petition for final hearing on 16 March, 2018.

### Instruction: Examine the case narrative and anticipate the court's decision: will it result in an approval (1) or disapproval (0) of the appeal? ### Input: the exercise price. To appreciate as to what is the meaning of the term guarantee it would be useful to refer to Blacks Law Dictionary, Eighth Edition which defines guarantee as under:Guarantee (garantee), n. 1. The assurance that a contract or legal act will be duly carried out.2. GUARANTY (1)In practice, guarantee, n., is the usual term, seen often, for example, in the context of consumer warranties or other assurances of quality or performance, Guaranty, in contrast, is now used primarily in financial and banking contexts in the sense a promise to answer for the debt of another.. Guaranty is now rarely seen in nonlegal writing, whether in G.B. Or in the U.S. Brayan A. Garner, A Dictionary of Modern Legal Usage 394(2nd ed. 1995).3. Something given or existing as security, such as to fulfil a future engagement or a condition subsequent. [Cases: Guaranty 29] 4. One to whom a guaranty is made. Also spelled guaranty.Guarantee, vb 1. To assume a suretyship obligation; to agree to answer for a debt or default. 2.To promise that a contract or legal act will be duly carried out. 3. To give security to.(emphasis supplied)17. In the above context from the bare reading of Article II, it is clear that the appellant as also Vandana Ispat Ltd. had irrevocably, absolutely and unconditionally agreed and had undertaken to the respondent that in the event of occurrence of a default under the facility agreement, the respondent may at its discretion issue Put Notice and upon receipt of the Put Notice, the appellant and Vandana Ispat Ltd., shall without demur or protest make payment of Exercise Price to the respondent and accept by way of assignment from the respondent the facility alongwith all rights and liabilities thereunder. The very wording of Article II is suggestive of a guarantee on the part of the appellant to the respondent. The legal position can be clearly noted from Section 126 of the Contract Act which defines a contract of guarantee to mean a contract to perform the promise, or discharge the liability, of a third person in case of his default. It is well settled that a contract of guarantee involves principally three parties namely the creditor, the surety and the principal debtor, where liability may be actual or prospective. Thus necessarily the ingredients of a contract of guarantee are clearly present in the option agreement which are reflected from the unambiguous nature of Article II the Put Option whereby the appellant has irrevocably, absolutely and unconditionally without demur or protest agreed to make payment of the exercise price to the respondent. If this be the case, then considering the provisions of Section 126 of the Contract Act, it is imperative to accept the option agreement as a contract of guarantee. There can be no other interpretation. Thus, we are of the considered opinion, the learned Single Judge is correct in observing that the option agreement is required to be considered as a guarantee.18. Now coming to the contention as urged on behalf of the appellant that the option agreement was terminated on 4 March 2015 and the same could not have been invoked. This contention also cannot be accepted, firstly because the parties have bound themselves by providing Article IV the termination clause, which provides that the option agreement will be terminated only on the happening of two events, firstly on due repayment of all outstanding amounts under the facility by the borrower to the respondent and secondly on receipt of exercise price by the respondent from the appellant and Vandana Ispat Ltd. (VIL) It would be desirable to note that the contents of Article IV which reads thus:This Agreement will terminate on the happening of the following events:a) On the repayment of all outstanding amounts under the Facility by the Borrower to IFIN, orb) on the receipt of the Exercise Price by IFIN from VGL and VIL in terms of Article 2.1.Once having agreed to the above conditions of termination, it was not open to the appellant to contend that the appellants liability had ceased to exist in view of a purported termination of the option agreement and that civil proceedings were required to be filed by the respondent to seek specific performance of the said agreement. In our opinion, by agreeing to Article IV (termination clause) and accepting that the agreement will be terminated only on the happening of said two events, it can certainly be said that the appellant had waived the right if any, to terminate the contract. The submission as urged on behalf of the appellant that by their letter dated 4 March 2015 the option agreement was terminated, if is accepted, then the consequence is that Article IV (Termination Clause) of the option agreement itself would be rendered nugatory and meaningless. The whole intention of the parties to incorporate the termination clause as contained in Article IV is to bind the parties only in the stipulated and agreed mode of termination and in no other form or method. In fact what is pertinent is that the parties had categorically avoided to enter any other form of termination when they agreed to incorporate Article IV. Thus, the appellants contention that in view of termination letter dated 4 March 2015 the Put Option could not have been exercised by the respondent is wholly untenable. The appellants contention of the validity of the option agreement being considered by the learned Single Judge in the summary proceedings of a winding up petition, hence is wholly unfounded.19. Before parting, we may also note that by the impugned order the winding up petition of the respondent has been admitted and was directed to be advertised. It is not in dispute that the winding up petition has already been advertised and to that extent the impugned order is already implemented. As regards the final hearing of winding up petition, as informed to us, the learned Single Judge has placed the winding up petition for final hearing on 16 March, 2018. ### Response: 0

Jasodabai & Smt. Ramchandrabai Vs. The State Of Maharashtra & Anr

Hidayatullah, C.J.1. This order will govern the disposal of Civil Appeals Nos. 1554 and 1555 of 1966.2. The two appellants, seeking to appeal against the common judgment and order of the Bombay High Court (Nagpur Bench), September 10, 1965, in proceedings under Art. 226 of the Constitution, applied to the Division Bench of the High Court for a certificate under Arts. 132 and 133 (1) (a) or (b) and/or (c) of the Constitution. Their applications were summarily dismissed on December 6, 1965. The present two appeals (consolidated for hearing) by special leave and are against the order refusing certificate. The appellants contend that they were entitled to a certificate as of right as laid down in Ramesh v. Gendalal Motilal, (1966) 3 SCR 198 = (AIR 1966 SC 1445 ). The other side opposes.3. The appellants and 3 others had, by their several petitions under Art. 226 of the Constitution asked that certain notices issued under S.17 (2) of the Act for declaration of lands in excess of the ceilings as surplus and requiring that they be surrendered, by quashed on the ground that the Maharashtra Agricultural Lands (Ceilings on Holdings) Act, 1961 (27 of 1961) offends Arts. 14, 19 and 31 and was therefore void under Art. 13. The Divisional Bench disposed of the five petitions by a common judgment and order on September 10, 1965 dismissing them. It was held that barring S. 28, the Act was already held to be validly enacted in a decision of the High Court in another petition decided on October 25, 1968. The earlier case had laid down that the Act was saved by Art. 31-A. The Divisional Bench also pointed out that the Act was included in the 9th Schedule to the Constitution and enjoyed protection of Art. 31-B. That too was held in yet another petition. The learned counsel attempted to urge some new grounds but was not allowed to do so. The petitions were dismissed by without costs.4. In pressing the application for certificate the petitioners pointed out that 1976 acres of dry crop lands were involved and were likely to be declared surplus and asked to be surrender and that at a valuation of Rs. 1,000 per acre, the value of the subject matter in the High Court and on appeal to this Court was well over the mark. They claimed a certificate as of right. The High Court refused the certificate but gave no reasons for the refusal.5. In these appeals it is submitted that in view of the Decision of this Court (1966) 3 SCR 198 =(AIR 1966 SC 1445 ),the certificate ought to have been granted because the order was made in the exercise of extraordinary original jurisdiction in a civil proceeding and the valuation of the claim was well over Rs. 20,000.It is submitted that the appeals satisfied all the tests laid down by this Court in the earlier case.6. There is considerable force in the submissions. As pointed out in the earlier case Art. 133 is wide enough to take in civil proceedings decided in the High Court in the exercise of the extraordinary jurisdiction provided some civil right of the party is decided. The appellants before the High Court were attempting to save their property by challenging the validity of the Act and the decision of the Court that the Act was valid directly affected the civil rights of the parties in properties well over the mark in value. In these circumstances, the High Court could not refuse the certificate.7. We would have, therefore, seriously considered remanding the case to the High Court for the grant of a certificate but for two things. Special leave was granted on may 5, 1966. Since then on April 10, 1968, in State of Maharashtra v. Madhavrao Damodar, (1968) 3 SCR 712 = (AIR 1968 SC 1395 ) this Court has held the Act to be intra vires and the Act is also included in the 9th Schedule and is protected by Art. 31-B of the Constitution.It will be an exercise in futility to ask the High Court to certify the cases when the appeals that will follow must necessarily and inevitably fail.

0[ds]6. There is considerable force in the submissions. As pointed out in the earlier case Art. 133 is wide enough to take in civil proceedings decided in the High Court in the exercise of the extraordinary jurisdiction provided some civil right of the party is decided. The appellants before the High Court were attempting to save their property by challenging the validity of the Act and the decision of the Court that the Act was valid directly affected the civil rights of the parties in properties well over the mark in value. In these circumstances, the High Court could not refuse thewould have, therefore, seriously considered remanding the case to the High Court for the grant of a certificate but for two things. Special leave was granted on may 5, 1966. Since then on April 10, 1968, in State of Maharashtra v. Madhavrao Damodar, (1968) 3 SCR 712 = (AIR 1968 SC 1395 ) this Court has held the Act to be intra vires and the Act is also included in the 9th Schedule and is protected by Art. 31-B of the Constitution.It will be an exercise in futility to ask the High Court to certify the cases when the appeals that will follow must necessarily and inevitably fail. It is better to save circuity of action and to dismiss the appeals before us. We order accordingly but make no order about costs.

### Instruction: From the information provided in the case proceeding, infer whether the court's decision will be positive (1) or negative (0) for the appellant. ### Input: Hidayatullah, C.J.1. This order will govern the disposal of Civil Appeals Nos. 1554 and 1555 of 1966.2. The two appellants, seeking to appeal against the common judgment and order of the Bombay High Court (Nagpur Bench), September 10, 1965, in proceedings under Art. 226 of the Constitution, applied to the Division Bench of the High Court for a certificate under Arts. 132 and 133 (1) (a) or (b) and/or (c) of the Constitution. Their applications were summarily dismissed on December 6, 1965. The present two appeals (consolidated for hearing) by special leave and are against the order refusing certificate. The appellants contend that they were entitled to a certificate as of right as laid down in Ramesh v. Gendalal Motilal, (1966) 3 SCR 198 = (AIR 1966 SC 1445 ). The other side opposes.3. The appellants and 3 others had, by their several petitions under Art. 226 of the Constitution asked that certain notices issued under S.17 (2) of the Act for declaration of lands in excess of the ceilings as surplus and requiring that they be surrendered, by quashed on the ground that the Maharashtra Agricultural Lands (Ceilings on Holdings) Act, 1961 (27 of 1961) offends Arts. 14, 19 and 31 and was therefore void under Art. 13. The Divisional Bench disposed of the five petitions by a common judgment and order on September 10, 1965 dismissing them. It was held that barring S. 28, the Act was already held to be validly enacted in a decision of the High Court in another petition decided on October 25, 1968. The earlier case had laid down that the Act was saved by Art. 31-A. The Divisional Bench also pointed out that the Act was included in the 9th Schedule to the Constitution and enjoyed protection of Art. 31-B. That too was held in yet another petition. The learned counsel attempted to urge some new grounds but was not allowed to do so. The petitions were dismissed by without costs.4. In pressing the application for certificate the petitioners pointed out that 1976 acres of dry crop lands were involved and were likely to be declared surplus and asked to be surrender and that at a valuation of Rs. 1,000 per acre, the value of the subject matter in the High Court and on appeal to this Court was well over the mark. They claimed a certificate as of right. The High Court refused the certificate but gave no reasons for the refusal.5. In these appeals it is submitted that in view of the Decision of this Court (1966) 3 SCR 198 =(AIR 1966 SC 1445 ),the certificate ought to have been granted because the order was made in the exercise of extraordinary original jurisdiction in a civil proceeding and the valuation of the claim was well over Rs. 20,000.It is submitted that the appeals satisfied all the tests laid down by this Court in the earlier case.6. There is considerable force in the submissions. As pointed out in the earlier case Art. 133 is wide enough to take in civil proceedings decided in the High Court in the exercise of the extraordinary jurisdiction provided some civil right of the party is decided. The appellants before the High Court were attempting to save their property by challenging the validity of the Act and the decision of the Court that the Act was valid directly affected the civil rights of the parties in properties well over the mark in value. In these circumstances, the High Court could not refuse the certificate.7. We would have, therefore, seriously considered remanding the case to the High Court for the grant of a certificate but for two things. Special leave was granted on may 5, 1966. Since then on April 10, 1968, in State of Maharashtra v. Madhavrao Damodar, (1968) 3 SCR 712 = (AIR 1968 SC 1395 ) this Court has held the Act to be intra vires and the Act is also included in the 9th Schedule and is protected by Art. 31-B of the Constitution.It will be an exercise in futility to ask the High Court to certify the cases when the appeals that will follow must necessarily and inevitably fail. ### Response: 0

The State Of Bihar Vs. Shailabala Devi

of this nature. They will necessarily be educated people. Such writings leave their readers cold and nobody takes them seriously. People laugh and scoff at such stuff as they have become too familiar with it and such writings have lost all sting. Any non-descript person who promises to change the order of things by bloody revolution and assumes the role of a new Messiah is merely the laughing-stock of his readers and creates an adverse impression against himself rather than succeed in stirring up any excitement in the minds of the readers. Rhetoric of this kind might in conceivable circumstances inflame passions as, for example, if addressed to an excited mob, but if such exceptional circumstances exist it was for the State Government to establish the fact. In the absence of any such proof we must assume that the pamphlet would be read by educated persons in the quietness of their homes or in other places where the atmosphere is normal. I would therefore hold in the words of my brother Bose in BHAGWATI CHARAN v. GOVERNMENT OF C. P. and BERAR, I.L.R. 1946 Nag 865, that though the pamphlet in question uses extravagant language and there is in it the usual crude emotional appeal which is the stock-in trade of the demagogue as well as a blundering and ineffective attempt to ape the poets but that is all, and there is nothing more in it. The time is long past when writings of this kind can, in normal circumstances, excite people to commit crimes of violence or murder or tend to excite anybody to commit acts of violence. Again, the language employed is full of mysticism and cannot be easily understood and it creates no impression of any kind on any person.11. In order to determine whether a particular document falls within the ambit of any of the clauses of section 4 (1), the writing has to be considered as a whole and in a fair and free and liberal spirit, not dwelling too much upon isolated passages or upon a strong word here and there, and an endeavour should be made to gather the general effect which the whole composition would have on the mind of the public. Expressions which are the stock in-trade of political demagogues have no tendency to excite anybody and exaggerations in language cannot lead to that result. The learned Government Advocate placed reliance on the decision of Harries C. J. in BADRI NARAIN v. CHIEF SECRETARY, BIHAR GOVERNMENT, AIR 1941 Pat 132 SB. The learned Chief Justice therein held that in order to show that certain words fall under section 4 (1) (a), it is not necessary to show that the words tend to incite or to encourage the commission of a particular offence or offences and that it is sufficient if they tend to incite to or to encourage the commission of cognizable offences of violence in general. In that case, a poem entitled "Labourers, the mainstay of the world" began by emphasing that labourers are the mainstay of the present world and then proceeded to describe their unfortunate and pitiful lot. In a subsequent portion, the author stated that though speeches today, when organized the labourers will be as powerful as millions and this portion of the poem ended with these words :"Why are you helplessly tolerating the exploitation of your masters."The remaining lines were as follows :-"Laboureres, raise now the cry of revolution. The heavens will tremble, the Universe will shake and the flames of revolution will burst forth from land and water. You who have been the object of exploitation, now dance the fearful dance of destruction on this earth, truly, labourers. Only total destruction will create a new world order and that will bring happiness to the whole word."12. It is quite clear that here an appeal was made to labourers inciting and encouraging them to commit acts of violence. The words used certainly tended to achieve that result. They were no empty slogans or abstract propositions. It had one consistent and coherent purpose, i.e., to excite labourers and to bring then into action. Any observation made about this writing can have no apt application for the determination of the present case. The learned Chief Justice in the concluding part of the judgment very pertinently pointed out that a commonsense interpretation must be given to the document complained of the question to be answered always being, what impression will the documents or words give to a man of ordinary common sense. My answer to this query in the present case is that the document read at first sight is not intelligible unless it is explained to that man of ordinary common sense by a learned person and hence it can by itself crate no impression of any kind on such a person. After the writing is explained to such a man, he will merely laugh at it and how it in the wastepaper basket without taking it seriously. He will refuse to believe that a person of this kind can create a new world order by appealing to a bloody revolution.13. As I pointed out in my judgment in HARKRISHAN SINGH v. EMPEROR, AIR 1946 Lah 22, the use of such words as appear in this document creates no impression on the mind of any reasonable reader. That case dealt with clause (d) of section 4 (1), but the principle underlying it also applies to the construction of writings which are alleged to fall under section 4 (1) (a). I do not mean to suggest or to lay down as a general proposition that some of the words used in the pamphlet in question in the context of any other writing would not fall within the mischief of section 4 (1) (a). Certain parts of the pamphlet, if read as isolated passages, may have the tendency to excite people to commit crimes of violence but that is not the effect if the pamphlet is read in its entirety.

0[ds]4. In my opinion, Shearer J. was right in the view that there is nothing in the two decisions of this Court which bears directly or indirectly on the point at issue in the present case and that both Sarjoo Prasad and Ramaswami JJ. were in error in holding that these decisions were conclusive on the question of the invalidity of clauses (a) and (b) of section 4 (1) of the Act. Towards the concluding part of his judgment, Sarjoo Prasad J. observed as followsam compelled to observe that from the above discussions of the Supreme Court judgments, it follows logically that if a person were to go on inciting murder or other cognizable offences either through the press or by word of mouth, he would be free to do so with impunity inasmuch as he would claim the privilege of exercising his fundamental right of freedom of speech and expression. Any legislation which seeks or would seek to curb this right of the person concerned would not be saved under Article 19 (2) of the Constitution and would have to be declared void. This would be so, because such speech or expression on the part of the individual would fall neither under libel nor slander nor defamation nor contempt of court nor any matter which offends against decency or morality or which undermines the security of or tends to overthrow the State. I cannot with equanimity contemplate such an anomalous situation but the conclusion appears to be unavoidable on the authority of the Supreme Court judgments with which we are bound. I, therefore, wish that my decision on the point would sooner than ever come to be tested by the Supreme Court itself and the positionin the light of the anomalous situation pointed out above. It seems to me that the words used in the Constitution Act should be assigned a wide and liberal connotation even though they occur in a clause which provides an exception to the fundamental right vouch safed under Article 19 (1) (a) of the ConstitutionI speak with greata complete lack of understanding of the precise scope of the two decisions of this Court referred to(a) of section 4 (1) deals with words or signs or visible representations which incite to or encourage, or tend to incite to encourage the commission of any offence of murder or any cognizable offence involving violence. It is plain that speeches or expressions on the part of an individual which incite to or encourage the commission of violent crimes, such as murder, cannot but be maters which would undermine the security of the State and come within the ambit of a law sanctioned by Article 19 (2) of the Constitution. I cannot help observing that the decisions of this Court in ROMESH THAPARS CASE, 1950 SCR 594 and in BRIJ BHUSHANS CASE, 1950 S. C. R. 605 have been more than once misapplied and misunderstood and have been construed as laying down the wide proposition that restrictions of the nature imposed by section 4 (1) (a) of the Indian Press (Emergency Powers) Act or of similar character are outside the scope of Article 19 (2) of the Constitution inasmuch as they are conceived generally in the interests of public order. Sarjoo Prasad J. also seems to have fallen into the same error.5. The question that arose in ROMESH THAPARS CASE, 1950 S.C.R. 594 was whether the impugned Act (Madras Maintenance of Public Order Act, XXIII of 1949) in so far as it purported by section 9to authorise the Provincialthe purpose of securing the public safety and the maintenance of public order to prohibit or regulate the entry into or the circulation, sale or distribution in the Province of Madras or any part thereof any document or class ofa law relating to any matter which undermined the security of or tended to overthrow the State, and it was observed that whatever ends the impugned Act may have been intended to subserve and whatever aims its framers may have and in view, its application and scope could not, in the absence of delimiting words in the statute itself, be restricted to those aggravated forms of prejudicial activity which are calculated to endanger the security of the State, nor was there any guarantee that those authorized to exercise the powers under the Act would in using them discriminate between those who act prejudicially to the security of the State and those who do not.Section 4 (1) (a) of the impugned Act, however, is restricted to aggravated forms of prejudicial activity. It deals specifically with incitement to violent crimes and does not deal with acts that generally concern themselves with the maintenance of public order. That being so, the decision in ROMESH THAPARS CASE, 1950 S.C.R. 594 given on the constitutionality of section 9of the Madras Maintenance of Public Order Act has no relevancy for deciding the constitutionality of the provisions of section 4 (1) (a) of the Indian Press (Emergency Powers)that as it may, the matter is now concluded by the language of the amended Article 19 (2) made by the Constitution (First Amendment) Act which is retrospective in operation, and the decision of the High Court on this point cannot be sustained.Mr. Basant Chander Ghosh contended that the amendment made in Article 19 (2) of the Constitution with retrospective operation was repugnant to Article 20 of the Constitution inasmuch as it declared a certain act an offence which was not an offence at the time when the act wascommitted. This contention is untenable. The respondent is alleged to have violated the provisions of section 4(1) (a) of the Indian Press (Emergency Powers) Act which was a law in force in the year 1949 when the offending pamphlet was published. She has not been convicted of any offence so far and is not being again convicted for the same by reason of the amendment in Article 19 (2). Article 20 has no application whatever to the present case. Article 19 (2) empowers a legislature to make laws imposing reasonable restrictions on the fundamental rights conferred under Article 19 (1) of the Constitution. It does not declare any acts which were not offences before as offences with retrospective effect. Moreover, in the year 1949, the respondent was not possessed of any fundamental right which could be said to have been contravened by the amendment.7. Though, as I have said above, the High Court is in error in the finding that the provisions of section 4 (1) (a) of the Indian Press (Emergency Powers) Act are repugnant to the Constitution, its judgment has to be maintained as it is also in error in holding that the pamphlet in question fell within the mischief of section 4 (1) (a) of the Indian Press (Emergency Powers) Act.It seems to me that the learned Judges of the High Court took this writing too seriously. It did not deserve that consideration. It is some kind ofwork, with no consistency or cohesion between its different parts. Fortions of it are unmeaning nonsense and in other parts it talks of revolution in the abstract. There is no appeal to anybody in particular or for any known or specific cause. No mention is made of any specific kind of operation or injustice that is intended to be remedied. The desire is to change the face of the earth by ending all oppression, tyranny and injustice. There is no evidence whatsoever for connecting this pamphlet with any agitation or movement at the time it was written in that locality. I have read the writing several times and I think that Mr. Ghosh is right when he says that the pamphlet contains merely empty slogans, carrying no particular meaning except some amount of figurative expression or language borrowed at random from various authors with a touch of poetic flourish about it. Writings of this character at the present moment and in the present background of our country neither excite nor have the tendency to excite any person from among the class which is likely to read a pamphlet of this nature. They will necessarily be educated people. Such writings leave their readers cold and nobody takes them seriously. People laugh and scoff at such stuff as they have become too familiar with it and such writings have lost all sting. Anyperson who promises to change the order of things by bloody revolution and assumes the role of a new Messiah is merely theof his readers and creates an adverse impression against himself rather than succeed in stirring up any excitement in the minds of the readers. Rhetoric of this kind might in conceivable circumstances inflame passions as, for example, if addressed to an excited mob, but if such exceptional circumstances exist it was for the State Government to establish the fact. In the absence of any such proof we must assume that the pamphlet would be read by educated persons in the quietness of their homes or in other places where the atmosphere is normal. I would therefore hold in the words of my brother Bose in BHAGWATI CHARAN v. GOVERNMENT OF C. P. and BERAR, I.L.R. 1946 Nag 865, that though the pamphlet in question uses extravagant language and there is in it the usual crude emotional appeal which is thetrade of the demagogue as well as a blundering and ineffective attempt to ape the poets but that is all, and there is nothing more in it. The time is long past when writings of this kind can, in normal circumstances, excite people to commit crimes of violence or murder or tend to excite anybody to commit acts of violence. Again, the language employed is full of mysticism and cannot be easily understood and it creates no impression of any kind on anylearned Government Advocate placed reliance on the decision of Harries C. J. in BADRI NARAIN v. CHIEF SECRETARY, BIHAR GOVERNMENT, AIR 1941 Pat 132 SB. The learned Chief Justice therein held that in order to show that certain words fall under section 4 (1) (a), it is not necessary to show that the words tend to incite or to encourage the commission of a particular offence or offences and that it is sufficient if they tend to incite to or to encourage the commission of cognizable offences of violence in general. In that case, a poem entitled "Labourers, the mainstay of the world" began by emphasing that labourers are the mainstay of the present world and then proceeded to describe their unfortunate and pitiful lot. In a subsequent portion, the author stated that though speeches today, when organized the labourers will be as powerful as millions and this portion of the poem ended with these wordsare you helplessly tolerating the exploitation of yourremaining lines were as followsraise now the cry of revolution. The heavens will tremble, the Universe will shake and the flames of revolution will burst forth from land and water. You who have been the object of exploitation, now dance the fearful dance of destruction on this earth, truly, labourers. Only total destruction will create a new world order and that will bring happiness to the whole word.It is quite clear that here an appeal was made to labourers inciting and encouraging them to commit acts of violence. The words used certainly tended to achieve that result. They were no empty slogans or abstract propositions. It had one consistent and coherent purpose, i.e., to excite labourers and to bring then into action. Any observation made about this writing can have no apt application for the determination of the present case. The learned Chief Justice in the concluding part of the judgment very pertinently pointed out that a commonsense interpretation must be given to the document complained of the question to be answered always being, what impression will the documents or words give to a man of ordinary common sense. My answer to this query in the present case is that the document read at first sight is not intelligible unless it is explained to that man of ordinary common sense by a learned person and hence it can by itself crate no impression of any kind on such a person. After the writing is explained to such a man, he will merely laugh at it and how it in the wastepaper basket without taking it seriously. He will refuse to believe that a person of this kind can create a new world order by appealing to a bloody revolution.13. As I pointed out in my judgment in HARKRISHAN SINGH v. EMPEROR, AIR 1946 Lah 22, the use of such words as appear in this document creates no impression on the mind of any reasonable reader. That case dealt with clause (d) of section 4 (1), but the principle underlying it also applies to the construction of writings which are alleged to fall under section 4 (1) (a). I do not mean to suggest or to lay down as a general proposition that some of the words used in the pamphlet in question in the context of any other writing would not fall within the mischief of section 4 (1) (a). Certain parts of the pamphlet, if read as isolated passages, may have the tendency to excite people to commit crimes of violence but that is not the effect if the pamphlet is read in its entirety.

### Instruction: Assess the case proceedings and provide a prediction: is the court likely to rule in favor of (1) or against (0) the appellant/petitioner? ### Input: of this nature. They will necessarily be educated people. Such writings leave their readers cold and nobody takes them seriously. People laugh and scoff at such stuff as they have become too familiar with it and such writings have lost all sting. Any non-descript person who promises to change the order of things by bloody revolution and assumes the role of a new Messiah is merely the laughing-stock of his readers and creates an adverse impression against himself rather than succeed in stirring up any excitement in the minds of the readers. Rhetoric of this kind might in conceivable circumstances inflame passions as, for example, if addressed to an excited mob, but if such exceptional circumstances exist it was for the State Government to establish the fact. In the absence of any such proof we must assume that the pamphlet would be read by educated persons in the quietness of their homes or in other places where the atmosphere is normal. I would therefore hold in the words of my brother Bose in BHAGWATI CHARAN v. GOVERNMENT OF C. P. and BERAR, I.L.R. 1946 Nag 865, that though the pamphlet in question uses extravagant language and there is in it the usual crude emotional appeal which is the stock-in trade of the demagogue as well as a blundering and ineffective attempt to ape the poets but that is all, and there is nothing more in it. The time is long past when writings of this kind can, in normal circumstances, excite people to commit crimes of violence or murder or tend to excite anybody to commit acts of violence. Again, the language employed is full of mysticism and cannot be easily understood and it creates no impression of any kind on any person.11. In order to determine whether a particular document falls within the ambit of any of the clauses of section 4 (1), the writing has to be considered as a whole and in a fair and free and liberal spirit, not dwelling too much upon isolated passages or upon a strong word here and there, and an endeavour should be made to gather the general effect which the whole composition would have on the mind of the public. Expressions which are the stock in-trade of political demagogues have no tendency to excite anybody and exaggerations in language cannot lead to that result. The learned Government Advocate placed reliance on the decision of Harries C. J. in BADRI NARAIN v. CHIEF SECRETARY, BIHAR GOVERNMENT, AIR 1941 Pat 132 SB. The learned Chief Justice therein held that in order to show that certain words fall under section 4 (1) (a), it is not necessary to show that the words tend to incite or to encourage the commission of a particular offence or offences and that it is sufficient if they tend to incite to or to encourage the commission of cognizable offences of violence in general. In that case, a poem entitled "Labourers, the mainstay of the world" began by emphasing that labourers are the mainstay of the present world and then proceeded to describe their unfortunate and pitiful lot. In a subsequent portion, the author stated that though speeches today, when organized the labourers will be as powerful as millions and this portion of the poem ended with these words :"Why are you helplessly tolerating the exploitation of your masters."The remaining lines were as follows :-"Laboureres, raise now the cry of revolution. The heavens will tremble, the Universe will shake and the flames of revolution will burst forth from land and water. You who have been the object of exploitation, now dance the fearful dance of destruction on this earth, truly, labourers. Only total destruction will create a new world order and that will bring happiness to the whole word."12. It is quite clear that here an appeal was made to labourers inciting and encouraging them to commit acts of violence. The words used certainly tended to achieve that result. They were no empty slogans or abstract propositions. It had one consistent and coherent purpose, i.e., to excite labourers and to bring then into action. Any observation made about this writing can have no apt application for the determination of the present case. The learned Chief Justice in the concluding part of the judgment very pertinently pointed out that a commonsense interpretation must be given to the document complained of the question to be answered always being, what impression will the documents or words give to a man of ordinary common sense. My answer to this query in the present case is that the document read at first sight is not intelligible unless it is explained to that man of ordinary common sense by a learned person and hence it can by itself crate no impression of any kind on such a person. After the writing is explained to such a man, he will merely laugh at it and how it in the wastepaper basket without taking it seriously. He will refuse to believe that a person of this kind can create a new world order by appealing to a bloody revolution.13. As I pointed out in my judgment in HARKRISHAN SINGH v. EMPEROR, AIR 1946 Lah 22, the use of such words as appear in this document creates no impression on the mind of any reasonable reader. That case dealt with clause (d) of section 4 (1), but the principle underlying it also applies to the construction of writings which are alleged to fall under section 4 (1) (a). I do not mean to suggest or to lay down as a general proposition that some of the words used in the pamphlet in question in the context of any other writing would not fall within the mischief of section 4 (1) (a). Certain parts of the pamphlet, if read as isolated passages, may have the tendency to excite people to commit crimes of violence but that is not the effect if the pamphlet is read in its entirety. ### Response: 0

Jumni & Others Vs. State of Haryana

declaration would put the court on the guard and induce it to apply a rule of caution. There may be cases wherein the part of the dying declaration which is not found to be correct is so indissolubly linked with the other part of the dying declaration that it is not possible to sever the two parts. In such an event the court would well be justified in rejecting the whole of the dying declaration. There may, however, be other cases wherein the two parts of a dying declaration may be severable and the correctness of one part does not depend upon the correctness of the other part. In the last mentioned cases the court would not normally act upon a part of the dying declaration, the other part of which has not been found to be true, unless the part relied upon is corroborated in material particulars by the other evidence on record. If such other evidence shows that part of the dying declaration relied upon is correct and trustworthy the court can act upon that part of the dying declaration despite the fact that another part of the dying declaration has not been proved to be correct.” 40. Although at law there is no difficulty in segregating the role of two sets of accused persons if the dying declaration is severable, the present case indicates that the role of the accused persons cannot be segregated. This is because Asha Devi’s dying declaration mentions all the accused persons as being involved in all the events that had taken place on 4th April 1996 and 5th April 1996. There is no distinction made in the role of any of the accused persons and they have all been clubbed together with regard to the harassment of Asha Devi; making plans to eliminate her; Asha Devi being beaten up on 4th April 1996; all the accused persons preventing her from lodging a complaint with the police; all the accused persons tying up Asha Devi with her chunni and pouring kerosene oil on her and then setting her on fire. Asha Devi has referred to each one of them as being involved in every incident on 4th April 1996 and 5th April 1996. If somewhat different roles were assigned to at least some of the accused persons, segregation or severance could have been possible. But with everybody being roped in for every event, it is not possible in this case to segregate or sever the actions of one from another.41. Notwithstanding this, as we have seen, it is not possible to accept the involvement of Prem Nath and Raj Bala in the events that took place on the two fateful days. Nevertheless, it is quite possible that the other four accused were involved in beating up Asha Devi on 4th April 1996 and setting her on fire on 5th April 1996. But, what is of equal importance is that neither the Trial Court nor the High Court adverted to the crucial evidence of Puran Chand (DW-8) who stated that he saw smoke coming out of Jagdish’s tenement and children were making a noise. When he reached there, he saw flames and smoke coming out from the ventilator of Jagdish’s tenement and along with Gurbachan, he had to break down the door of the tenement which was locked from inside and they found Asha Devi on fire. If this statement of Puran Chand is correct, and there does not seem any reason to doubt it since nothing was put to him in this regard in cross examination, a case of suicide by Asha Devi is a possibility. At this stage, it may be noted that the investigating officer Gurdial Singh (PW-10) could not say if the bolt of the tenement was broken or not.42. On a reading of the dying declaration it is quite clear that Asha Devi was very disturbed on the morning of 5th April 1996 and that is why she broke her bangles in the presence of Jumni. This may be because of the events of the previous day or her being a victim of continuous harassment. This, coupled with a lack of response from Jumni on the morning of 5th April 1996 may have completely frustrated Asha Devi leading her to commit suicide. Whatever be the cause of Asha Devi being upset, the evidence of Puran Chand has not been challenged and so it cannot be glossed over. In the face of this, it is not possible to discount the theory suggested by learned counsel that the case was possibly one of the suicide out of extreme frustration and not of murder.43. It is true that when a person is on his or her death bed, there is no reason to state a falsehood but it is equally true that it is not possible to delve into the mind of a person who is facing death. In the present case the death of Asha Devi and the circumstances in which she died are extremely unfortunate but at the same time it does appear that for some inexplicable reason she put the blame for her death on all her in-laws without exception. Perhaps a more effective investigation or a more effective cross-examination of the witnesses would have brought out the truth but unfortunately on the record as it stands, there is no option but to give the benefit of doubt to Jumni (and Sham Lal) and to hold that they were not proved guilty of the offence of having murdered Asha Devi.44. Insofar as Prem Nath and Raj Bala are concerned there is sufficient material to accept their alibi and they must be acquitted of the charges made against them.45. As mentioned above Rati Ram and Balbir Prasad are already dead and nothing need be said about their involvement in the incident. Were they alive, they too would have been entitled to the benefit of doubt since the facts pertaining to them were similar to those of Jumni and Sham Lal.Conclusion:

1[ds]36. Apart from the conclusions of the Trial Court and the High Court appearing far-fetched, the testimony of Jagan Nath Mishra (DW-2) the tenant of Prem Nath has not been correctly appreciated because of a typing error in transcribing it from the original record. As mentioned above, Jagan Nath Mishra had seen Prem Nath and Raj Bala at 7.45 a.m. on 5th April 1996 (and not at 5.45 a.m. as wrongly transcribed in the impugned judgment). Consequently, Prem Nath and Raj Bala could not have been in village Bhojpur at 7.30 a.m. on 5th April 1996. This evidence has gone unchallenged.37. It seems to us that although the High Court has given due weightage to the dying declaration of Asha Devi but having accepted it, it has tried to pick holes in the defence evidence to justify the contents of the dying declaration. Given the law laid down by this Court, this was not the correct manner of approaching the evidence brought forth by Prem Nath and Raj Bala. In our opinion, the alibi witnesses have made out a strong case of demonstrating the improbability of Prem Nath and Raj Bala being involved in the incident of beating up Asha Devi at about 12.00 noon on 4th April 1996, of stopping her at about 3.00 p.m. from going to the police to lodge a complaint and setting her on fire at about 7.30 a.m. on 5th April 1996.Although at law there is no difficulty in segregating the role of two sets of accused persons if the dying declaration is severable, the present case indicates that the role of the accused persons cannot be segregated. This is because Ashadying declaration mentions all the accused persons as being involved in all the events that had taken place on 4th April 1996 and 5th April 1996. There is no distinction made in the role of any of the accused persons and they have all been clubbed together with regard to the harassment of Asha Devi; making plans to eliminate her; Asha Devi being beaten up on 4th April 1996; all the accused persons preventing her from lodging a complaint with the police; all the accused persons tying up Asha Devi with her chunni and pouring kerosene oil on her and then setting her on fire. Asha Devi has referred to each one of them as being involved in every incident on 4th April 1996 and 5th April 1996. If somewhat different roles were assigned to at least some of the accused persons, segregation or severance could have been possible. But with everybody being roped in for every event, it is not possible in this case to segregate or sever the actions of one from another.41. Notwithstanding this, as we have seen, it is not possible to accept the involvement of Prem Nath and Raj Bala in the events that took place on the two fateful days. Nevertheless, it is quite possible that the other four accused were involved in beating up Asha Devi on 4th April 1996 and setting her on fire on 5th April 1996. But, what is of equal importance is that neither the Trial Court nor the High Court adverted to the crucial evidence of Puran Chand (DW-8) who stated that he saw smoke coming out oftenement and children were making a noise. When he reached there, he saw flames and smoke coming out from the ventilator oftenement and along with Gurbachan, he had to break down the door of the tenement which was locked from inside and they found Asha Devi on fire. If this statement of Puran Chand is correct, and there does not seem any reason to doubt it since nothing was put to him in this regard in cross examination, a case of suicide by Asha Devi is a possibility. At this stage, it may be noted that the investigating officer Gurdial Singh (PW-10) could not say if the bolt of the tenement was broken or not.42. On a reading of the dying declaration it is quite clear that Asha Devi was very disturbed on the morning of 5th April 1996 and that is why she broke her bangles in the presence of Jumni. This may be because of the events of the previous day or her being a victim of continuous harassment. This, coupled with a lack of response from Jumni on the morning of 5th April 1996 may have completely frustrated Asha Devi leading her to commit suicide. Whatever be the cause of Asha Devi being upset, the evidence of Puran Chand has not been challenged and so it cannot be glossed over. In the face of this, it is not possible to discount the theory suggested by learned counsel that the case was possibly one of the suicide out of extreme frustration and not of murder.43. It is true that when a person is on his or her death bed, there is no reason to state a falsehood but it is equally true that it is not possible to delve into the mind of a person who is facing death. In the present case the death of Asha Devi and the circumstances in which she died are extremely unfortunate but at the same time it does appear that for some inexplicable reason she put the blame for her death on all her in-laws without exception. Perhaps a more effective investigation or a more effective cross-examination of the witnesses would have brought out the truth but unfortunately on the record as it stands, there is no option but to give the benefit of doubt to Jumni (and Sham Lal) and to hold that they were not proved guilty of the offence of having murdered Asha Devi.44. Insofar as Prem Nath and Raj Bala are concerned there is sufficient material to accept their alibi and they must be acquitted of the charges made against them.45. As mentioned above Rati Ram and Balbir Prasad are already dead and nothing need be said about their involvement in the incident. Were they alive, they too would have been entitled to the benefit of doubt since the facts pertaining to them were similar to those of Jumni and Sham Lal.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: declaration would put the court on the guard and induce it to apply a rule of caution. There may be cases wherein the part of the dying declaration which is not found to be correct is so indissolubly linked with the other part of the dying declaration that it is not possible to sever the two parts. In such an event the court would well be justified in rejecting the whole of the dying declaration. There may, however, be other cases wherein the two parts of a dying declaration may be severable and the correctness of one part does not depend upon the correctness of the other part. In the last mentioned cases the court would not normally act upon a part of the dying declaration, the other part of which has not been found to be true, unless the part relied upon is corroborated in material particulars by the other evidence on record. If such other evidence shows that part of the dying declaration relied upon is correct and trustworthy the court can act upon that part of the dying declaration despite the fact that another part of the dying declaration has not been proved to be correct.” 40. Although at law there is no difficulty in segregating the role of two sets of accused persons if the dying declaration is severable, the present case indicates that the role of the accused persons cannot be segregated. This is because Asha Devi’s dying declaration mentions all the accused persons as being involved in all the events that had taken place on 4th April 1996 and 5th April 1996. There is no distinction made in the role of any of the accused persons and they have all been clubbed together with regard to the harassment of Asha Devi; making plans to eliminate her; Asha Devi being beaten up on 4th April 1996; all the accused persons preventing her from lodging a complaint with the police; all the accused persons tying up Asha Devi with her chunni and pouring kerosene oil on her and then setting her on fire. Asha Devi has referred to each one of them as being involved in every incident on 4th April 1996 and 5th April 1996. If somewhat different roles were assigned to at least some of the accused persons, segregation or severance could have been possible. But with everybody being roped in for every event, it is not possible in this case to segregate or sever the actions of one from another.41. Notwithstanding this, as we have seen, it is not possible to accept the involvement of Prem Nath and Raj Bala in the events that took place on the two fateful days. Nevertheless, it is quite possible that the other four accused were involved in beating up Asha Devi on 4th April 1996 and setting her on fire on 5th April 1996. But, what is of equal importance is that neither the Trial Court nor the High Court adverted to the crucial evidence of Puran Chand (DW-8) who stated that he saw smoke coming out of Jagdish’s tenement and children were making a noise. When he reached there, he saw flames and smoke coming out from the ventilator of Jagdish’s tenement and along with Gurbachan, he had to break down the door of the tenement which was locked from inside and they found Asha Devi on fire. If this statement of Puran Chand is correct, and there does not seem any reason to doubt it since nothing was put to him in this regard in cross examination, a case of suicide by Asha Devi is a possibility. At this stage, it may be noted that the investigating officer Gurdial Singh (PW-10) could not say if the bolt of the tenement was broken or not.42. On a reading of the dying declaration it is quite clear that Asha Devi was very disturbed on the morning of 5th April 1996 and that is why she broke her bangles in the presence of Jumni. This may be because of the events of the previous day or her being a victim of continuous harassment. This, coupled with a lack of response from Jumni on the morning of 5th April 1996 may have completely frustrated Asha Devi leading her to commit suicide. Whatever be the cause of Asha Devi being upset, the evidence of Puran Chand has not been challenged and so it cannot be glossed over. In the face of this, it is not possible to discount the theory suggested by learned counsel that the case was possibly one of the suicide out of extreme frustration and not of murder.43. It is true that when a person is on his or her death bed, there is no reason to state a falsehood but it is equally true that it is not possible to delve into the mind of a person who is facing death. In the present case the death of Asha Devi and the circumstances in which she died are extremely unfortunate but at the same time it does appear that for some inexplicable reason she put the blame for her death on all her in-laws without exception. Perhaps a more effective investigation or a more effective cross-examination of the witnesses would have brought out the truth but unfortunately on the record as it stands, there is no option but to give the benefit of doubt to Jumni (and Sham Lal) and to hold that they were not proved guilty of the offence of having murdered Asha Devi.44. Insofar as Prem Nath and Raj Bala are concerned there is sufficient material to accept their alibi and they must be acquitted of the charges made against them.45. As mentioned above Rati Ram and Balbir Prasad are already dead and nothing need be said about their involvement in the incident. Were they alive, they too would have been entitled to the benefit of doubt since the facts pertaining to them were similar to those of Jumni and Sham Lal.Conclusion: ### Response: 1

Charanjit Pal Jindal Vs. M/s. L.N. Metalics

It does not lay down any condition that the person-in-charge or an officer of the Company may not be separately prosecuted if the Company itself is not prosecuted. Each or any of them may be separately prosecuted or alongwith the Company. Section 10 lists the person who may be held guilty and punished when it is a Company that contravenes an order made under Section 3 of the Essential Commodities Act. Naturally, before the person in-charge or an officer of the Company is held guilty in that capacity it must be established that there has been a contravention of the order by the Company. That should be axiomatic and that is all that the Court laid down in State of Madras v. C.V. Parekh (supra) as a careful reading of that case will show and not that the person-in-charge or an officer of the Company must be arraigned simultaneously along with the Company if he is to be found guilty and punished. The following observations made by the Court clearly bring out the view of the Court. "It was urged that the two respondents were in charge of, and were responsible to, the company for the conduct of the business of the Company and, consequently, they must be held responsible for the sale and for thus contravening the provisions of clause 5 of the Iron and Steel (Control) order. This argument cannot be accepted, because it ignores the first condition for the applicability of Section 10 to the effect that the person contravening the order must be a company itself. In the present case, there is no finding either by the Magistrate OR by the High Court that the sale in convention of clause 5 of the Iron & Steel (Control) order was made by the Company. In fact, the Company was not charged with the offence at all. The liability of the persons in charge of the Company only arises when the contravention is by the Company itself. Since, in this case, there is no evidence and no finding that the Company contravened clause 5 of the Iron & Steel (Control), order the two respondents could not be held responsible. The actual contravention was by Kamdar and Villabhadas Thacker and any contravention by them would not fasten responsibility on the respondents.The sentences underscored by us clearly show that what sought to be emphasised was that there should be a finding that the contravention was by the Company before the accused could be convicted and not that the Company itself should have been prosecuted along with the accused. We are therefore clearly of the view that the prosecutions are maintainable and that there is nothing in section 10 of the Essential Commodities Act which bars such prosecutions." 8. In Aneeta Hadas case (supra) the question that arose for determination by this Court was whether an authorised signatory of a company would be liable for prosecution u/s 138 of the Act without the company being arraigned as an accused. As there was a difference of opinion between the two learned Judges regarding the interpretation of Sections 138 and 141 of the Act reference was made to the larger Bench of three Judges. In the said case, this Court noticed the ratio laid down in C.V. Parekhs case and the view expressed in Sheoratan Agarwals case while interpreting Section 138 and 141 of the Act, this Court observed as follows: "53. It is to be borne in mind that Section 141 of the Act is concerned with the offences by the company. It makes the other persons vicariously liable for commission of an offence on the part of the company. As has been stated by us earlier, the vicarious liability gets attracted when the condition precedent laid down in Section 141 of the Act stands satisfied. There can be no dispute that as the liability is penal in nature, a strict construction of the provision would be necessitous and, in a way, the warrant.58. Applying the doctrine of strict construction, we are of the considered opinion that commission of offence by the company is an express condition precedent to attract the vicarious liability of others. Thus, the words "as well as the company" appearing in the Section make it absolutely unmistakably clear that when the company can be prosecuted, then only the persons mentioned in the other categories could be vicariously liable for the offence subject to the averments in the petition and proof thereof. One cannot be oblivious of the fact that the company is a juristic person and it has its own respectability. If a finding is recorded against it, it would create a concavity in its reputation. There can be situations when the corporate reputation is affected when a director is indicted.59. In view of our aforesaid analysis, we arrive at the irresistible conclusion that for maintaining the prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative. The other categories of offenders can only be brought in the dragnet on the touchstone of vicarious liability as the same has been stipulated in the provision itself. We say so on the basis of the ratio laid down in C.V. Parekh (supra) which is a three-Judge Bench decision. Thus, the view expressed in Sheoratan Agarwal (supra) does not correctly lay down the law and, accordingly, is hereby overruled. The decision in Anil Hada (supra) is overruled with the qualifier as stated in paragraph 37. The decision in Modi Distilleries (supra) has to be treated to be restricted to its own facts as has been explained by us hereinabove." 9. From the aforesaid finding, we find that after analyzing all the provisions and having noticed the different decisions rendered by this Court, the three Judges Bench arrived at the irresistible conclusion that for maintaining the prosecution u/s 141 of the Act, arraigning a company as an accused is imperative. Hence in this case, we find no reason to refer the matter to the larger Bench.

1[ds]8. In Aneeta Hadas case (supra) the question that arose for determination by this Court was whether an authorised signatory of a company would be liable for prosecution u/s 138 of the Act without the company being arraigned as an accused. As there was a difference of opinion between the two learned Judges regarding the interpretation of Sections 138 and 141 of the Act reference was made to the larger Bench of three Judges. In the said case, this Court noticed the ratio laid down in C.V. Parekhs case and the view expressed in Sheoratan Agarwals case while interpreting Section 138 and 141 of the Act, this Court observed asIt is to be borne in mind that Section 141 of the Act is concerned with the offences by the company. It makes the other persons vicariously liable for commission of an offence on the part of the company. As has been stated by us earlier, the vicarious liability gets attracted when the condition precedent laid down in Section 141 of the Act stands satisfied. There can be no dispute that as the liability is penal in nature, a strict construction of the provision would be necessitous and, in a way, the warrant.58. Applying the doctrine of strict construction, we are of the considered opinion that commission of offence by the company is an express condition precedent to attract the vicarious liability of others. Thus, the words "as well as the company" appearing in the Section make it absolutely unmistakably clear that when the company can be prosecuted, then only the persons mentioned in the other categories could be vicariously liable for the offence subject to the averments in the petition and proof thereof. One cannot be oblivious of the fact that the company is a juristic person and it has its own respectability. If a finding is recorded against it, it would create a concavity in its reputation. There can be situations when the corporate reputation is affected when a director is indicted.59. In view of our aforesaid analysis, we arrive at the irresistible conclusion that for maintaining the prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative. The other categories of offenders can only be brought in the dragnet on the touchstone of vicarious liability as the same has been stipulated in the provision itself. We say so on the basis of the ratio laid down in C.V. Parekh (supra) which is aBench decision. Thus, the view expressed in Sheoratan Agarwal (supra) does not correctly lay down the law and, accordingly, is hereby overruled. The decision in Anil Hada (supra) is overruled with the qualifier as stated in paragraph 37. The decision in Modi Distilleries (supra) has to be treated to be restricted to its own facts as has been explained by us hereinabove.From the aforesaid finding, we find that after analyzing all the provisions and having noticed the different decisions rendered by this Court, the three Judges Bench arrived at the irresistible conclusion that for maintaining the prosecution u/s 141 of the Act, arraigning a company as an accused is imperative. Hence in this case, we find no reason to refer the matter to the larger Bench.m the aforesaid finding, we find that after analyzing all the provisions and having noticed the different decisions rendered by this Court, the three Judges Bench arrived at the irresistible conclusion that for maintaining the prosecution u/s 141 of the Act, arraigning a company as an accused is imperative. Hence in this case, we find no reason to refer the matter to the larger Bench.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: It does not lay down any condition that the person-in-charge or an officer of the Company may not be separately prosecuted if the Company itself is not prosecuted. Each or any of them may be separately prosecuted or alongwith the Company. Section 10 lists the person who may be held guilty and punished when it is a Company that contravenes an order made under Section 3 of the Essential Commodities Act. Naturally, before the person in-charge or an officer of the Company is held guilty in that capacity it must be established that there has been a contravention of the order by the Company. That should be axiomatic and that is all that the Court laid down in State of Madras v. C.V. Parekh (supra) as a careful reading of that case will show and not that the person-in-charge or an officer of the Company must be arraigned simultaneously along with the Company if he is to be found guilty and punished. The following observations made by the Court clearly bring out the view of the Court. "It was urged that the two respondents were in charge of, and were responsible to, the company for the conduct of the business of the Company and, consequently, they must be held responsible for the sale and for thus contravening the provisions of clause 5 of the Iron and Steel (Control) order. This argument cannot be accepted, because it ignores the first condition for the applicability of Section 10 to the effect that the person contravening the order must be a company itself. In the present case, there is no finding either by the Magistrate OR by the High Court that the sale in convention of clause 5 of the Iron & Steel (Control) order was made by the Company. In fact, the Company was not charged with the offence at all. The liability of the persons in charge of the Company only arises when the contravention is by the Company itself. Since, in this case, there is no evidence and no finding that the Company contravened clause 5 of the Iron & Steel (Control), order the two respondents could not be held responsible. The actual contravention was by Kamdar and Villabhadas Thacker and any contravention by them would not fasten responsibility on the respondents.The sentences underscored by us clearly show that what sought to be emphasised was that there should be a finding that the contravention was by the Company before the accused could be convicted and not that the Company itself should have been prosecuted along with the accused. We are therefore clearly of the view that the prosecutions are maintainable and that there is nothing in section 10 of the Essential Commodities Act which bars such prosecutions." 8. In Aneeta Hadas case (supra) the question that arose for determination by this Court was whether an authorised signatory of a company would be liable for prosecution u/s 138 of the Act without the company being arraigned as an accused. As there was a difference of opinion between the two learned Judges regarding the interpretation of Sections 138 and 141 of the Act reference was made to the larger Bench of three Judges. In the said case, this Court noticed the ratio laid down in C.V. Parekhs case and the view expressed in Sheoratan Agarwals case while interpreting Section 138 and 141 of the Act, this Court observed as follows: "53. It is to be borne in mind that Section 141 of the Act is concerned with the offences by the company. It makes the other persons vicariously liable for commission of an offence on the part of the company. As has been stated by us earlier, the vicarious liability gets attracted when the condition precedent laid down in Section 141 of the Act stands satisfied. There can be no dispute that as the liability is penal in nature, a strict construction of the provision would be necessitous and, in a way, the warrant.58. Applying the doctrine of strict construction, we are of the considered opinion that commission of offence by the company is an express condition precedent to attract the vicarious liability of others. Thus, the words "as well as the company" appearing in the Section make it absolutely unmistakably clear that when the company can be prosecuted, then only the persons mentioned in the other categories could be vicariously liable for the offence subject to the averments in the petition and proof thereof. One cannot be oblivious of the fact that the company is a juristic person and it has its own respectability. If a finding is recorded against it, it would create a concavity in its reputation. There can be situations when the corporate reputation is affected when a director is indicted.59. In view of our aforesaid analysis, we arrive at the irresistible conclusion that for maintaining the prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative. The other categories of offenders can only be brought in the dragnet on the touchstone of vicarious liability as the same has been stipulated in the provision itself. We say so on the basis of the ratio laid down in C.V. Parekh (supra) which is a three-Judge Bench decision. Thus, the view expressed in Sheoratan Agarwal (supra) does not correctly lay down the law and, accordingly, is hereby overruled. The decision in Anil Hada (supra) is overruled with the qualifier as stated in paragraph 37. The decision in Modi Distilleries (supra) has to be treated to be restricted to its own facts as has been explained by us hereinabove." 9. From the aforesaid finding, we find that after analyzing all the provisions and having noticed the different decisions rendered by this Court, the three Judges Bench arrived at the irresistible conclusion that for maintaining the prosecution u/s 141 of the Act, arraigning a company as an accused is imperative. Hence in this case, we find no reason to refer the matter to the larger Bench. ### Response: 1