Case: Vidya Sagar Joshi Vs. Surinder Nath Gautam

2. By a notification dated January 13, 1967 the electors of this constituency were invited to elect a member to the Assembly. The last date for filing of nomination papers was January 20, 1967. Scrutiny of the nomination papers was held the following day and the last date of withdrawal was January 23, 1967. Three candidates contested the election. The appellant was an independent candidate opposed by the respondent who was a Congress nominee and one Shanti Swarup, Jansangh candidate. The poll took place throughout the constituency on February 18, 1967. Votes were counted four days later at Una and the result was declared asSagar Joshi (Appellant)8437 votes Surinder Nath Gautam (Election Petitioner) 7695 votes Shanti Swarup 2067 votes 1267 ballots were rejected as invalid. Thus the present appellant was returned with a margin of 742 votes. The returned candidate filed his return of election expenses showing an expenditure of Rs. 1862.05 P. The limit of expenditure in this constituency was Rs. 2000. One of the contentions of the election petitioner was that he had filed a false return of his election expenses, that he had spent and amount exceeding Rs. 2000 in the aggregate and therefore contravened the provisions of Sec. 77 (3) of the Representation of the People Act 1951 and therefore committed corrupt practice under Section 123 (6) of the Act. The election petitioner therefore asked that his election be declared void. There were other grounds also on which the election was challenged, but we need not refer to them since no point has been made before us.The main item on which the expenses were said to be false was a deposit of Rs. 500 as security and Rs. 200 as application fee which the returned candidate had made with the Congress party on or before January 2, 1967. The fee was not returnable, but as this payment was made before the notification calling upon the voters to elect a member to the Assembly nothing turns upon it. The returned candidate was denied the Congress ticket on or about January 10, 1967. This was also before the said notification. According to the rules of the Congress Party the security deposit was refundable to a candidate if he or she was not selected. It was however provided in the same rules that if the candidate contested the election against the official Congress candidate, the security deposit would be forfeited. The returned candidate chose to stand as an independent candidate against the official Congress nominee and incurred the penalty of forfeiture. This was after the date or the filing of the nomination paper (January 20, 1967). He had time till January 23, 1967 to withdraw from the contest. If he had done so the deposit would have presumably been returned to him. As he became a contesting candidate the forfeiture of the deposit became a fact.4. The case of the election petitioner was that if this deposit were added to the election expenses, the limit of Rs. 2000 was exceeded dud therefore this amounted to a corrupt practice under S. 123 (6) read with Sec. 77 (3) of the Representation of the People Act. The High Court held in favour of the election petitioner and hence the appeal.

Court's reasoning:
9. The candidate here put out this money for his election since he was trying to obtain a Congress ticket. If he had got the ticket and the money was refunded to him, this would not have counted as an expenditure since the expense would not have been incurred. When the candidate knowing that the money would be lost went on to stand as an independent candidate, he was willing to let the money go and take a chance independently.The case of the appellant is that this money was not used in furthering the prospect of his election. On the other hand, it was in fact used against him by the Congress Party as he was opposed to that partys candidate. He contends that such an expense cannot be regarded as expense in connection with the election. According to him the connection must be a connection of utility and not something which is of no use but rather against the chances ofCounsel for the appellant relied on this case and claimed that the same principle applies and this penalty cannot be said to be an expenditure in connection with the election. The analogy is not apt because not only the prescriptions of the two laws are different but the underlying principle is different also. In Income-tax laws the expenditure must be laid out wholly or exclusively for the purpose of the business etc. Breaking laws and incurring penalty is not carrying on business and therefore, the loss is not for the purposes of business.Here the expenditure is to be included if it is incurred in connection with the election and the payment to secure the seat is an expenditure in connection with the election. The ruling, therefore, does not apply.13. In the second case a Congress candidate had paid a sum of Rs. 500 of which Rs. 100 were subscription for membership and Rs. 400 were a deposit. Later he paid Rs. 500 as donation to the Congress. He failed to include the two sums of Rs. 500 each in his return of expenses. The Tribunal found that both the sums were spent in connection with the election and by including them the limit was exceeded. This Court affirmed the decision of the Tribunal. The case was decided under R. 117. The two sums were considered separately. The contention was that under S. 123 (7) and R. l17 the candidate was nominated only on November 16, 1951 and the first sum was paid on September 12, 1951. The question then arose when the candidate became a candidate for the application of the Rule and S. 123 (7). It was held that the candidate became a candidate when he unequivocally expressed his intention by making the payment.14. The question of commencement of the candidature is now obviated by prescribing the two terminii between which the expense it to be counted. In so far as the case goes it supports our view. It is risky to quote the decision because the terms of the law on which it was declared were entirely different. We can only say that there is nothing in it which militates against the view taken by us here.