Case: Karamshi Jethabhai Somayya Vs. The State Of Bombay

2. The appellant is the owner of Shankar Tukaram Karale Rampur Farm, situated at the tail-outlet of the Godavari Right Bank Canal Distributary No. 17. The lands comprised in the said Farm originally belonged to Shankar Tukaram Karale, hereinafter called Karale. In the year 1935 the said Karale had a farm for raising sugar-cane consisting of 35 acres owned by him and about 65 acres of land taken on lease by him in Ahemdnagar District. He obtained sanction to irrigate his lands on the outlet No- 17 of the Godavari Right Bank Canal. In or about the same year the Government of Bombay proposed to reserve certain area along the said Distributary Canal as "factory area". After some correspondence between the said Karale and the Government of Bombay, it was the appellants case, the Superintending Engineer agreed on July 14, 1939, to exclude Karales lands from the factory area and also to give him water perpetually on condition that he concentrated all his holdings on the tail outlet of Distributary No 17 and to take the supply of water on volumetric basis. Pursuant to that arrangement, Karale by purchase or otherwise. concentrated his holdings and shifted his operations to that area and he was supplied water on the agreed basis. In or about April 1948, the appellant and Karale entered into a partnership for exploiting the said area where under the appellant had three fourths share. Later on disputes arose between the appellant and Karale in respect of the partnership which culminated in a consent decree dated February 7, 1951, whereunder the appellant became the full owner of the partnership business with all its assets and liabilities, including the lands and the compact block and the right to use the canal water. When the appellant applied for the recognition of the transfer, the Canal-Officer refused to do so. On appeal, he was informed that his request for supply of canal water could not be granted. From April 1952 the supply was stopped. After giving the statutory notice under S. 80 of theCode of Civil Procedure, the appellant filed Special Civil Suit No. 6 of 1953 in the Court of the Civil Judge, Senior Division, Ahemdnagar, against the State of Bombay for a declaration that the plaintiff was entitled to the supply and use of the water from the tail outlet of Distributary No. 17 of the Canal to irrigate 100 acres of basic cane land in the concentrated area described in Schedule II at the rates prescribed by the Government under the Irrigation Act on a volumetric basis, for specific performance of the aforesaid agreement between Karale and the Government, for recovery of damages, and for other incidental reliefs. The State of Bombay filed a written statement contending, inter alia, that there was no concluded agreement between the Government and Karale embodying the alleged terms stated in the plaint, that even if there was such an agreement, it was void inasmuch as it did not comply with the provisions of S. 175(3) ofthe Government of India Act, 1935, and that, in any view, the appellant could not legally get the benefit of the agreement under S. 30 of the Bombay Irrigation Act, 1879. On the pleadings as many as seven issues were framed reflecting the contention of the parties. The learned Civil Judge held that there was a concluded agreement between the Government and Karale on the terms alleged by the appellant, but the transfer by Karale of the said right in favour of the appellant was in violation of the provisions ofthe Bombay Tenancy and Agricultural Lands Act, 1948, and, therefore, there was no legal transfer of Karales right of water in favour of the appellant. In that view, he dismissed the suit. On appeal the High Court held that there was neither a concluded agreement between Karale and the Government nor did it comply with the requirements of law. In the result the appeal was dismissed. Hence the present appeal.

Court's reasoning:
4. This appeal raises a question ofimportance as regards the scope of the executive authority exercised by the Governor underthe Government of India Act, 1935; but, we are relieved of the duty to express our opinion on that question in this appeal in view of our finding that the agreement in question was arrived at outside the provisions of the Act and, therefore, it squarely falls within the scope of S. 175(3) ofthe Government of India Act,the High Court threw the blame for this lapse on the appellant, we do not think there was any justification for it. Apart from the fact that the appellant asked for the production of all the relevant documents, the Government, being the defendant in this case, should have produced the documents relevant to the question raised. While it is the duty of a private party to a litigation to place all the relevant matters before the Court, a higher responsibility rests upon the Government not to withhold such documents from the court. Be that as it may, the documents were finally produced before the court, and the High Court considered the same in the arriving at its conclusion. Though Mr. Nambiar suggested that the said documents related to some other party, as we will indicate in the course of the judgment, the said file dealt also with the agreement alleged to have been entered into between Karale and thefair reading of these two documents leaves no room for doubt that a firm agreement was entered into between the Government and Karale in respect of the supply of water to his land to the extent of 100 acres on the tail outlet of Distributry No. 17 of the Godavari Right Bank Canal. These two letters show that there was previous correspondence between the Engineering Department and Karale and that the Minister of Public Works Department intervened and settled the terms of the agreement, and that the terms were communicated to Karale, who accepted the same.Revenue Minister accepted the endorsement. This is only an office note and the suggestion that the irrigators should be allowed to continue on the yearly basis was only to prevent further applications after the factory area was declared. This endorsement had nothing to do with the exclusion of any particular area from the sugar factory area. The endorsement "should see" below the endorsement made by the Revenue Minister perhaps meant that the papers should be submitted to the Minister concerned. Exhibitis a letter written by the Deputy Secretary to the Government of Bombay to Changdeo Sugar Mills. This letter also refers to the office endorsement No. 3033/Though we are not directly concerned with this letter, it may be mentioned that the application of Karale is connected with the proposal to declare certain area as factory area and to give water to Changdeo Sugar Factory in respect of the lands in that area, for his application was to exclude his area from the factory area. Both the matters obviously were dealt together. Exhibitis again part of the file relevant to the factory area. But a reference is made again to the office No.and in the same file Karales letter is also noticed. Exhibitis an endorsement at page 133 of the same file, which also deals with the subject "sugar factories". It contains a copy of letter written to the Superintending Engineer requesting him to submit at a very early date a draft agreement for the supply of water to the companys area on the Godavari Right Bank Canal on the terms embodied in the margin thereof. Exhibitis also another endorsement on the same file.endorsement notices the contents of Ex.and therefore it must have been made only after April 28, 1939. The said documents do not carry the matter further. They only show what we have already noticed, namely, the Government wanted to create a factory area and that Karale filed an application to have his area excluded therefrom. The notings of the department are not in any way inconsistent either with Ex.or with Ex.67 andrefer to Office No. 3686 dated June 23, 1939, and that letter must have been in some other file and that file was not produced and, if produced, it might have thrown some more light. In the circumstances we must proceed on the basis that Exs.68 embodied the terms of the agreement entered into between the Government and Karale pursuant to the application, Ex.made by him to the Chief Engineer, P.W.D. We have already held that the said documents record the completed agreement between the Government and Karale in respect of supply of water to hisit was not made under the provisions of the Act, but outside the Act, the foundation for this argument would disappear.We would, therefore, proceed to consider now whether the said agreement was under the provisions of thecombined reading of these provisions establishes that every person desiring to have supply of water from a canal shall apply in the prescribed manner to theand that the person to whom water is supplied cannot transfer his right to another without the permission of theBut if the land in respect whereof the water is supplied is transferred, the agreement for the supply of water also shall be presumed to have been transferred along with it. The expression "agreement" in S. 30 of the Act, it is contended, does not connote a contract as understood in law, but only a convenient mode of expression to indicate the sanction or permission given by theThis meaning of the expression "agreement" is sought to be supported by a reference to the Bombay Canal Rules, 1934, made in exercise of the powers conferred on the State Government under Section 70(e) of the Act. Part II of the Rules deals with supply of water. It provides for the filing of applications, the manner of their disposal and the persons entitled to dispose of the same, and also the mode of supply of water for cultivation of different crops. The forms prescribed columns under different heads for giving the necessary particulars. The forms contain the instructions as well as conditions on which permission will be granted. Rule 7 says that an application for supply of water for the irrigation of land for any period may be sanctioned, indicating thereby that there is no maximum period fixed for which application for supply of water can be made. Assuming without deciding that "agreement" under S. 30 of the Act means only sanction, the Act and the Rules provide for an application to be made to the Executive Engineer, who, subject to the Rules, can give the sanction. Rule 36 provides for an appeal from the order of the Executive Engineer to the Superintending Engineer, and from that of the Executive Engineers order under R. 18 or R. 19 to the Collector. But there is no provision either in the Act or in the Rules made thereunder enabling any party to make an application to the Chief Engineer to exclude his land from factory area, and to give him supply of water for irrigating the said land permanently, or a power to the Government to enter into an agreement or make an order in respect of such an application. Such an order or agreement is entirely outside the scope of the Act or the Rules made thereunder. We are not called upon in this case to decide whether the Government has any such power outside the Act; but we shall assume for the purpose of this case that it has such power and to proceed to consider the legal arguments on that basis.10. The documentary evidence adduced in this case, which we have already considered, discloses that the application was made to the Chief Engineer; that the Government, through the relevant ministry, considered the application and that on the instructions given by the concerned Minister, the Superintending Engineer wrote the letter Ex.to Karale. It was, therefore, in effect and substance, an agreement entered into between the Government and Karale. Such an agreement fell outside the provisions of the Act. The parties to the agreement also understood that it was an agreement made between the Government and Karale.section laid down two conditions for the validity of such a contract, namely (i) it should be expressed to be made by the Governor of the Province, and (ii) it should be executed on behalf of the Governor by such persons and in such manner as he might direct or authorise. We have nothing on the record to disclose whether the Superintending Engineer, though he acted under oral instructions of the Minister was authorized by the Governor or under relevant rules to enter into such a contract. That apart, even if Exs.68 together were treated as forming part of a contract entered into between the Government and Karale, can it be said that the said contract was expressed to be made in the name of the Governor? Ex facie it cannot be said so. But it is contended that on a liberal construction, which we should adopt in a case where the Government is trying to go back on its solemn promise, such a formality can easily be read into the said documents. Before we construe the said two documents in order to ascertain whether such a formality has been complied with or not, it would be convenient to notice some of the decisions of this Court. The question of construction of S. 175 (3) ofthe Government of India Act,1935 directly arose for decision in Bhikraj Jaipuria v. Union of India.SCR 880 : (AIR 1962 SC 113 ). There, the Divisional Superintendent, East Indian Railway, placed certain orders with the appellant for the supply of foodgrains for the employees of the said Railway. The orders were not expressed to be made in the name of the Governor General and was not executed on behalf of theas required by S. 175(3) ofthe Government of India Act,They were signed by the Divisional Superintendent either in his own hand or in the hand of his Personal Assistant. This Court held that the contracts, not having been expressed to be entered into by theand not having been executed on his behalf, were void. This Court held that the provisions of S. 175 (3) ofthe Government of India Act,1935, were mandatory and, therefore, the contracts were void. This decision was followed by this Court in New Maria Coal Co. v. Union of India, AIR 1964 SC 152 .Reliance is placed by the learned counsel for the appellant on the decision of this Court in Union of India v. Rallia Ram, AIR 1963 SC 1685  in support of his contention that though ex facie Exs.68 do not show that the contract was expressed to be made in the name of the Governor, the said fact could be inferred from the recitals. There the goods offered to be sold belonged to the Government of India. A tender notice was issued by the Government of India. Department of Food (Division 111), in the name of the Chief Director of Purchases. The Chief Director of Purchases agreed to sell the goods on certain conditions to the respondent and incorporated them in the acceptance note, which was also headed "Government of India, Department of Food (Division 111), New Delhi." The general conditions of contract, which accompanied the letter of acceptance, defined Government as meaning the GovernorGeneral for India in Council. On the said facts this Court held that correspondence between the parties ultimately resulting in the acceptance note amounted to a contract expressed to be made by the Government and, therefore, by the"because it was thewho invited tenders through the Chief Director of Purchases and it was thewho, through the Chief Director of Purchases, accepted the tender of the respondent subject to the conditions prescribed therein." Though in the acceptance note it was not expressly stated that the contract was executed on behalf of theon a fair reading of the contents of the letter in the light of the obligations undertaken thereunder, it was held that the contract was executed on behalf of theThis decision does not depart from the principle accepted in Bhikhraj Jaipurias case.SCR 880 : (AIR 1962 SC 113 ).On a fair reading of correspondence this Court construed that the contract was entered into on behalf of theand expressed to be made in his name. Can it be said that in the present case Exs.68 disclose that the Superintending Engineer was authorized to enter into a contract of the nature mentioned therein on behalf of the Provincial Government and that the contract was expressed to be made in the name of the Governor? Nothing has been placed before us to establish that the Superintending Engineer was legally authorized to enter into such a contract on behalf of the Government; nor do the documents ex facie show that the agreement was expressed to be made in the name of the Provincial Government. The letters mentioned the name of the Minister of the public Works Department and also the Government, in the context of the rates that might be fixed thereafter, but the said documents did not purport to emanate from the Governor. At best they were issued under the directions of the Minister. We find it difficult to stretch the point further, as such a construction will make the provision of S. 175(3) ofthe Government of India Act,1935, nugatory. We cannot, therefore, hold that either the contract was entered into by the person legally authorized by the Government to do so or expressed to be made in the name of the Governor. The agreement is void, as it has not complied with the provisions of S.175(3) of the Government of India Act. 1935.