Case: Laliteshwar Prasad Sahi Vs. Bateshwar Prasad And Others

1. This is an appeal by certificate granted by the High Court of Patna, directed against the judgment of the said High Court reversing the decision of the Election Tribunal, Muzaffarpur. This appeal arises out of the election of the respondent, Shri Bateshwar Prasad, to the Bihar Legislative Assembly from Lal Ganj North Constituency. The appellant was one of the candidates. He filed an election petition No. 133 of 1962, alleging inter alia that the election of respondent No. 1, Shri Bateshwar Prasad, was void as he was disqualified under S. 7 (d) of the Representation of the People Act, 1951, hereinafter referred to as the Act. His complaint was that respondent No. 1 had entered into various contracts with the Government and that these contracts were subsisting on January 14 1962, the date fixed for filing nomination papers. The Election Tribunal, after reviewing both oral and documentary evidence, held that the respondent had entered into contracts to do Mosaic flooring work in the Rajendra Surgical Block of Patna Medical Hospital and that these were subsisting on the date of the nomination, viz., January 14, 1962. The Election Tribunal further held that by virtue of Cl. 3 (c) of the conditions embodied in the agreement, Ex. D, it was not at all necessary for the Public Works Department to have entered into a contract with the respondents company, called the Patna Flooring company. In the result, the Election Tribunal declared the election of Respondent No. 1 to the Bihar Legislative Assembly from the Lal Ganj North Constituency as void, but refused the prayer of the petitioner before it to be declared elected.2. Both sides appealed to the High Court but we are only concerned with the election appeal No. 11 of 1963, filed by Bateshwar Prasad, the returned candidate. Before the High Court three points wereThe appellant was not a contractor under the State Government for the mosaic work to be done in the Rajendra Surgical Block, but that at all relevant times, he was a sub-contractor under one G. P. Saxena, who was a contractor under the State Government for the purpose:(2) Assuming that there was contract within the meaning of Section 7 (d) of the Representation of the People Act, 1951 (Act 43 of 1951), sometime, there was no subsisting contract when the appellant had filed his nomination paper in 1962 and thereafter.(3) Assuming again that there was a contract between the appellant and the State Government sometime, the contract alleged was void, in view of Article 299 (1) of the Constitution of India, so that the Tribunal could not have held that the appellant was disqualified to be chosen as a candidate.The High Court reviewed the entire evidence and came to the conclusion on point No. 1 above that the appellant was not a contractor under the State Government but continued to be a sub-contractor under Saxena for mosaic work. It also differed from the Election Tribunal on the interpretation of Cl. 3 (c) of Ex. D. On the second point, the High Court felt that in view of its decision of the first point, the question was of mere academic interest and there might be substance in the argument of the learned counsel for the respondent that this question ought not to be allowed to be raised at this stage. Regarding the third point, the High Court held that Chaturbhujs case (Chatturbhuj Vithaldas Jasani v. Moreshwar Parashram; 1954 SCR 817  : (AIR 1954 SC 236  )) was distinguishable because in the instant case the State Government has not accepted the performance of the contract by the appellant. It further held that since the decision in Chatturbhujs case, 1954 SCR 817   : (AIR 1954 SC 236  ), the law had been amended by the amendment of S. 7 and the effect of the amendmentthe candidate shall be disqualified for being chosen as a member only if there still exists, in substance, at the relevant time, a valid and binding contract between him and the appropriateHigh Court further observedis difficult to accept the contention of the learned counsel for the respondent that a transaction may be void under the Contract Act, but its actual existence may still be a disqualification under present Sectionconclusion, the High Court held that Bateshwar Prasad had not incurred a disqualification under S. 7 (d) of the Act, and accordingly set aside the judgment and order of the Election Tribunal.

Reasoning:
In our opinion, the Legislature has made no change in this respect for under the old provision it was also necessary for a contract to have subsisted at the relevant time. This Court had in Chatturbhujs case, 1954 SCR 817  : (AIR 1954 SC 236  ), included both executed and executory contracts within the provision of S. 7 (d) and had refused to follow the English rulings to the contrary. We cannot go into the question whether this was rightly done or not for we are bound by that decision Accordingly, following Chatturbhujs case. 1954 SCR 817  : (AIR 1954 SC 236  ), we hold that a contract for the supply of goods or for the execution of any works or the performance of any services undertaken does not cease to subsist only because the goods had been supplied or work had been executed or services performed. It continues to subsist till payment is made and the contract is fully discharged by performance on bothare inclined to agree with Mr. Purshottam that the correspondence in this group clearly discloses an agreement for the execution of work between the Executive Engineer and the Patna Flooring Company, and the Election Tribunal was quite right in coming to this conclusion. But we may say that the Election Tribunal was not right in holding that Cl. 3 (c) got rid of Art. 299 of the Constitution. Any work which is given in exercise of the powers under Cl. 3 (c) has also to comply with the provisions of Art. 299 of the Constitution.It seems to us that the decision in. Chatturbhujs case, 1954 SCR 817  : (AIR 1954 SC 236  ), cannot be extended to cover a case where the Government has in fact not ratified the contract. If we were to hold that this type of transaction is covered then we would be giving no effect to the word "contract" in S. 7(d) and we would be substituting the word "agreement" for it. The Legislature has not chosen to use the word "agreement" but has used the word "contract" Therefore, a mere agreement entered into in contravention of Art. 299 and in fact not ratified cannot be called a "contract" within S. 7 (d) of the Representation of the Peopleis not doubt that the plaint in the money suit filed by the Patna Flooring Company shows that Bateshwar Prasad, plaintiff, was trying to make out that there was a direct contract entered into between the P. W. D. and plaintiff, but even so, the plaint does not make them solely responsible. We have also come to a finding that there was admittedly a contract in the beginning. The fact that the plaint does not allege any subsequent non-acceptance or refusal to ratify by the Government would not estop the respondent from proving in this case that on the material on record it is clear that the Government had not ratified the contract with the respondent, but confirmed the original contract with Saxena. The written statement filed by the Government in the money suit cannot be used to destroy the inference which clearly arises from the documents referred to above. It is doubtful whether the written statement can be taken into consideration at all.