Case: Chief Conservator Of Forests And Ors Vs. Rattan Singh

1. Under a contract, dated October 14, 1956, the respondent was granted a right to the forest produce from Coupe No 9, Lendara in the Sainmura Borgaon Reserved Forest in the Kanker Forest Division of Bastar District of Madhya Pradesh, for the period October 14, 1956 to March 31, 1958. The Divisional Forest Officer held an enquiry in respect of certain breaches committed by the respondent of the terms of the contract, and by order, dated January 30, 1958, directed the respondent in exercise of the authority under R. 15 (1) of the Forest Contract Rules framed by the Government of Central Provinces and Berar, to pay Rs. 8,500 as compensation assessed by him for damage done in the reserved forest and Rs. 500 as penalty under R. 30 (1) of the Forest Contract Rules. An appeal against the order to the Conservator of Forests, and a revision petition to the Chief Conservator of Forests, Madhya Pradesh, were unsuccessful. The respondent then moved the High Court of Madhya Pradesh by a petition under Art. 226 of the Constitution for a Writ quashing the order, dated January 30, 1958, directing payment of compensation and penalty and restraining enforcement of the order. The High Court granted the petition and restrained the State and the forest authorities from recovering Rs 9,000 ordered on January 30, 1958, from the respondent.

Court's reasoning:
3. We agree with the appellants that the High Court his without any plea or evidence assumed that compensation under R. 15 (1) could not be directed to be paid by the contractor for damage done in the coupe, for which he was given a contract, because the coupe was not included in a reserved forest. The plea which appealed to the High Court was not raised in the petition, nor in the objections to the Divisional Forest Officer in reply to the notice to show cause, nor in the memorandum of appeal before the Conservator of Forests, nor in the petition invoking the revisional jurisdiction of the Chief Conservator of Forests. The High Court assumed that because the forest authorities charged the contractor with "illegal fallings in the coupe" wanted to him, the "fillings could not he in a reserved forest." For this assumption there is no warrant. The High Court was, therefore, in error in setting up the ground that the impugned order was not authorised by the terms of R. 15 (1)In dealing with the validity of the order imposing penalty upon the contractor, the High Court upheld that argument. Rule 15 in the first instance declares that the forest contractor shall be responsible for any damage done either by himself, or his servants or agents: it then proceeds to state that compensation shall be assessed by the Divisional Forest Officer whose decision shall be deemed to be that of an arbitrator, subject to an appeal to the Conservator of Forests. The rule does not confer upon the Divisional Forest Officer authority to determine, when a dispute is raised, whether damage has been caused in a reserved forest by the contractor, his agents or his servants The rule only declares that for damage that may be done, by the contractor, his servants or agents, in the forest, the contractor shall be liable: the rule also invests the Divisional Forest Officer with authority to determine the amount of compensation payable by the contractor, but not to determine whether the contractor, his servants or his agents have committed breach of the contract. Clause 9 of the contract confers authority upon the Chief Conservator of Forests to adjudicate upon disputes, inter alia, as to the performance or breach of the contract. By Cl. 1 read with the Schedule to the contract "the contractor had to fell or uproot trees marked with a geru band or to fell trees on coupes and section lines which bear a marking hammer impression on the stump buttends and all Karra over 9 at B. H. whether marked or not?. It was the case of the Divisional Forest Officer that the contractor had, contrary to the terms of the contract, cut trees not marked with the geru band. Plainly, the Divisional Forest Officer claimed that the contractor had committed a breach of the terms of the contract, and when the contractor denied the breach, a dispute arose between the parties as to the performance or breach of the terms of the contract, and it had to be referred to the Chief Conservator of Forests. It is conceded, and in our judgment counsel is right in so conceding, that the expression "shall be referred to" means "shall be referred to the Officer denominated as an arbitrator to decide the dispute."8. There is no inconsistency between Cl. 9 of the contract and R. 15. It is unnecessary, therefore, to consider whether in case of inconsistency, the terms of the contract expressly setting out a certain covenant may supersede the terms of the rule. Under R. 15 the liability for damage done in a reserved forest is declared against the contractor. He is also declared liable to pay compensation as may be assessed by the Divisional Forest Officer. But the Divisional Forest Officer is not invested with authority to determine whether the damage was done by the contractor, his agents or servants. That is a matter which must be determined in a reference under Cl. 9 of the contractBut as already stated, the Divisional Forest Officer passed an order holding the respondent liable to pay compensation for damage done in a reserved forest and assessing the compensation at Rs. 8,500 and penalty at Rs. 500. That order was confirmed in appeal by the Conservator of Forests, and in exercise of his revisional jurisdiction the Chief Conservator of Forests upheld the order of the Conservator of Forests. The Chief Conservator of Forests did not even purport to act as an arbitrator; he recorded no evidence, and expressly held that the Divisional Forest Officer was not obliged to refer the case for arbitration under Cl. 9 of the contract. The trial was not of a proceeding in arbitration, but of a proceeding in exercise of supervisory or revisional jurisdiction. If in truth the dispute had to be referred for adjudication to the Chief Conservator of Forests, his decision that he found no reason to interfere with the "finding of the Divisional Forest Officer who was one of the parties to the dispute, cannot conceivably be regarded as an award between two contesting parties. It must therefore be held that the order passed by the Divisional Forest Officer imposing liability for compensating for damage done by illegal fellings cannot be sustained11. The second part of the order imposing penalty under R. 30 (1) also suffers from the same infirmity. It is true that under the rule the Divisional Forest Officer had power to impose penalty in a sum not exceeding Rs. 500. But exercise of that power is conditioned by the existence of a breach by the forest contractor of any of the terms of the contract. Where a dispute arises whether there has been a breach of any of the terms of the contract, it is, for reasons already stated, to be determined by the Chief Conservator of Forests. That has admittedly not been done4. But the appeal filed by the appellants must still fail on the grounds to be presently set out.